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Jerome García February 13, 2023 3 min read
Preliminary Results Predict 1% Revenue Drop for The Star in H1 FY23
A new earnings update reveals that The Star anticipates a 1% drop in revenue for H1 FY23 when compared to pre-COVID levels
The operator released its unaudited results for H1 FY23, revealing strong performance but an overall drop in revenue. The Star explained that for H1 FY23, the domestic revenue of The Star Gold Coast increased by 30% when compared to the corresponding period pre-COVID or H1, FY19. This result marked an achievement for the company as it set an all-time high record.
Moreover, The Star’s latest trading update provided details regarding the performance of its Treasury Brisbane location. The revenue from this segment in H1 FY23 increased by 9% when compared to pre-COVID levels. According to the company, the revenue was favorably impacted by strong performance within its hospitality segment, as well as record results for slots and table games.
In contrast to the aforementioned increases, The Star Sydney saw a drop in revenue. The Star acknowledged that NSW Casino Control Act changes in combination with the Bell probe and operating restrictions ultimately impacted the result of the location.
The hospitality and entertainment operator said that the factors that impacted The Star Sydney’s performance also led to a decrease in the number of complimentary services for private gaming areas and an increase in the number of excluded visitors. As a result, judging by the latest report, the revenue of the property decreased by 13.5% when compared to pre-COVID results.
The Company Remains Committed to Ensuring License Suitability
Given the expected performance for H1 FY23, The Star provided an update for H2 FY23. The trading update revealed that the entertainment giant anticipates underlying EBITDA between AU$ 330 million ($229.5 million) and AU$ 360 million ($250.4 million) for the year ending on June 30, 2023.
“We have been pleased with the ongoing strength of trading across our Queensland based properties, while trading at The Star Sydney has been impacted by operational changes associated with the outcome of the Bell Review as well as competition from Crown Sydney.“Robbie Cooke, CEO and managing director of The Star Entertainment
Robbie Cooke, The Star Entertainment’s CEO and managing director, acknowledged that The Star Sydney’s operations are still impacted by different operational changes. At the same time, he pointed out that the company is pleased with the performance of its Queensland venues.
“Our key priority is to regain the trust of our community and demonstrate to our regulators that we are suitable to hold our casino licenses,“added Cooke
Cooke pointed out that in light of the uncertain legislative developments and regulatory changes, the company has taken “a prudent approach to assessing the carrying value of our assets, which has resulted in a non-cash impairment charge which will be recognized in our H1 FY23 results.” In conclusion, he confirmed that The Star remains committed to collaborating with the Queensland Special Manager and NSW Manager to ensure the suitability of its businesses.