The New Zealand Racing Board's turnover rose 2 percent in the six months ended January, but its effective profit fell 1.5 percent to 72.6 million.
The Racing Board, which owns the TAB network, pays out more than 80 cents in every dollar spent at a TAB in prizes and all the board's profit is distributed to the racing industry.
The chief executive, Chris Bayliss, says even though TAB customer numbers have been declining for a decade, the board still accounts for nearly 1 percent of the economy.
He says that the most important thing is that turnover from New Zealand-based clients has lifted 4.3 percent - the highest rate of growth seen in that market segment for six years.
Challenges which have lowered the overall interim turnover to 2 percent include that fact that though Australians bet as much as New Zealanders on races on this side of the Tasman, the Kiwi has risen 17 percent against the Australian dollar in the past 12 months, reducing the revenue received in NZ dollar terms.
A drop of 3.7 percent in gaming receipts was largely due to the closure of a key operation in Wellington's Courtney Place, due to seismic risk to the building.
Mr Bayliss says a Courtney Place venue will re-open later this year, though it is not certain yet whether that will be in the same building - after strengthening - or in alternative premises.
And he says the TAB contribution to earnings is slipping because it has not kept up to date with its digital strategy and New Zealanders have been turning to overseas bookmakers.
The Racing Board hopes to see this turn around with the release of an app for mobile phones and tablets later this year.