Tsogo Sun (TSG) investor relations material

Executive summary

• Headline earnings per share increased by 8% to 153 cents year-over-year, with headline earnings up 7% to R1.57 billion.

• Total income was R11.13 billion, flat compared to the prior year, and adjusted EBITDA was R3.46 billion at a 31.1% margin.

• Net interest-bearing debt reduced by R701 million to R6.49 billion, with further reduction to R6.3 billion post year-end.

• R904 million was returned to shareholders via dividends and share buy-backs, with 62 million shares repurchased and cancelled.

• Asset realisation included the sale of City Lodge shares (R215 million realised) and non-core assets, with proceeds used to reduce debt or fund buy-backs.

Financial highlights

• Adjusted EBITDA margin remained stable at 31.1% year-over-year.

• Net finance costs (excluding leases) decreased by 20% to R550 million.

• Capex cash outflow was R723 million, mainly for IT and property upgrades.

• Cash generated from operations was R3.42 billion, with net cash from operating activities at R1.79 billion.

• Basic and diluted EPS rose to 126 cents from 120 cents year-over-year.

Outlook and guidance

• Focus on further debt reduction to achieve a net debt/EBITDA ratio below 1.8x.

• Continued investment in IT, property upgrades, and expansion, with R1.2 billion capex planned for the next year.

• Positive outlook for online betting, with new management and system upgrades targeting long-term growth.

• Regulatory changes and legal proceedings may impact casino operations and expansion plans.