Star Entertainment’s Financial Struggles Continued in FY 2024

The Star Entertainment Group published its financials for the fiscal year, reporting a continued decline amid business and regulatory headwinds. However, the company management remains focused on demonstrating its compliance and generating shareholder value.

The Star’s Financials Were Suboptimal

Star Entertainment reported FY 2024 revenue of almost AUD 1.7 billion ($1.17 billion). This figure represented a decline of 10% year-on-year, from AUD 1.87 billion in FY 2023. In the meantime, the Australian operator also reported an EBITDA of AUD 175 million ($120.5 million), down 45% year-on-year. EBITDA margin, for context, stood at 10%, down from 17% in the prior year period.

While these figures represented significant drops, the results were expected and were in line with the company’s guidance for the period.

The company, meanwhile, reported significant items of AUD 1.7 billion ($1.17 billion), which reflected a non-cash impairment charge of AUD 1.44 billion ($990 million). This impairment was attributed to challenging trading conditions and regulatory changes.

Star’s trading continued to deteriorate in FY 2024 and at the beginning of FY 2025, incurring significant EBITDA loss.

The operator ended the fiscal year with AUD 130 million ($89.5 million) in cash as it faces “significant near-term liquidity requirements.” On September 25, the company executed a commitment letter for a new debt facility of up to AUD 200 million ($137.7 million) in two tranches.

The Company Faces Regulatory and Financial Pressure

The Star also commented on the second Bell Report, which still found the company unsuitable to hold a license in NSW. The operator announced that the NICC is presently considering the next steps in relation to the report’s recommendations.

The NICC also handed a Show Cause Notice to the Star, which it expects to respond to tomorrow.  

In the meantime, the company officially closed The Treasury Brisbane property ahead of the opening of its new casino in the city. On September 6, the company sold the leasehold interest in the Treasury Brisbane Casino building to Griffith University for AUD 67.5 million ($46.5 million), with net proceeds of AUD 60.7 million after settlement adjustments. The sale is expected to close on September 27.

Star’s CEO Is Bullish on Regaining Compliance

Steve McCann, The Star Group CEO, commented on the results, highlighting the significant challenges faced by the company. He thanked the company’s shareholders for their unwavering support during these hard times.

McCann reiterated the company’s commitment to implementing a remediation and transformation program and regaining its compliance.

In the meantime, the Star has identified a number of initiatives to improve its overall business and bolster its liquidity.

As we work through these initiatives, the Board and management team remain focused on demonstrating suitability to hold our casino licenses and regaining the trust and support of our regulators and the broader community while seeking to enhance shareholder value.

SteveMcCann, CEO, The Star Entertainment Group

In other news, the group recently had to deal with a temporary suspension from the ASX.