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Australia – Star shines again with revenues up across all its casinos

By - 30 August 2023

Australian operator Star Entertainment achieved normalised FY23 EBITDA slightly above previously announced guidance saying that ‘underlying performance has stabilised’ and that ‘early H1 FY24 trading is broadly in line with Q4 FY23.’

Sydney revenue was up 26.5 per cent on pcp with EGMs up 30 per cent, tables up 19 per cent and non-gaming revenue up 49 per cent. Gold Coast revenue was up 20 per cent on pcp with EGMs up nine per cent, tables up seven per cent and non-gaming revenue up 52 per cent. Brisbane revenue was up 15 per cent on pcp with EGMs up 17 per cent, tables up eight per cent and non-gaming revenue up 34 per cent.

Regarding its casino in Sydney, The Star said: “Trading and financial performance has been adversely impacted by several factors, including uplifted controls from mid-September 2022 increasing the number of excluded guests; certain operating restrictions impacting guest experiences (such as a reduced level of complimentary services and benefits in private gaming areas) impacting the performance of both EGMs and table games.”

It added there had been ‘weaker consumer discretionary spending,’ ‘increased competition from Crown and less regulated NSW clubs’ and a necessary step-up in risk and compliance resourcing and remediation costs.’

“The Star Gold Coast started the year strongly benefiting from a surge in domestic tourism and consumer spending post Covid along with a return in convention business, however this performance softened in H2 FY23 impacted by a rebound in outbound travel competing with domestic tourism and uplifted controls resulting in an increased number of excluded guests; and weaker consumer discretionary spending.”

The Star added that its Brisbane casino had a ‘strong start to FY23 with a slight slowdown in the second half.’

Group CEO and Managing Director, Robbie Cooke stated: “To say it has been a challenging year completely understates the lived experience at The Star over the last 12 months. The consequences flowing from the damage to our social licence are felt daily by team members on multiple levels, reinforcing the critical need to understand the privilege and responsibility that comes with holding a casino licence. The ancillary challenges that have arisen in the year, and there are many, all follow from the breaches of trust identified in the Bell and Gotterson reports.

As a team we are determined to earn back the trust and confidence of our community including our regulators, governments, shareholders, employees and guests. We fully understand the responsibility
involved in holding our licences and are committed to transforming our leadership and culture. This journey has started and we know there is still a lot to be done.

Remediation is our number one priority. We have commenced the uplift in our risk management, safer gambling and AML capability and are starting to embed greater accountability and more robust governance. We have invested in enhancing our control environments and are operationalising and embedding these controls. We are improving our financial crime management and our overall approach to harm minimisation. Our remediation program will track and hold us accountable to the multi-year program we are committed to delivering.

In terms of trading performance our statutory EBITDA for FY23 was $317 million, up 34% on the prior year, and slightly above the top end of the previously announced guidance range. Our statutory net
loss was $2.4 billion. The resolution of the NSW casino duty proposed increase has removed significant uncertainty in relation to FY24 and beyond for our Sydney operation and has protected the jobs of thousands of NSW team members.”

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