Australia’s Star Entertainment Group has reported an AU$18 million (US$12 million) EBITDA loss for the three months to 30 September 2024, impacted by high regulatory costs, lower business volumes and the limited operations of newly opened integrated resort The Star Brisbane.
The AU$3.6 billion (US$2.4 billion) Brisbane property opened on 29 August and generated AU$45.9 million (US$30 million) in revenues in 33 days of operation during the quarter, of which Star’s revenue share was AU$4 million – listed as “Operator Fee Revenue”. Star owns 50% of the Brisbane joint venture, with Hong Kong’s Chow Tai Fook and Far East Consortium each holding 25%.
Group-wide, it was more of the same for Star, with revenue for the September quarter down 18% year-on-year to AU$351 million (US$230 million).
“There continues to be a deterioration in operating performance from a challenging operating environment and the continued implementation of mandatory carded play and cash limits,” the company explained in an ASX filing.
The results included a 16% year-on-year decline in revenue at The Star Sydney to AU$186 million (US$122 million), which also reported an EBITDA loss of AU$21 million (US$14 million). The Star Gold Coast generated revenue of AU$108 million (US$71 million), down 9% year-on-year, with an EBITDA gain of AU$7 million (US$4.6 million), while revenue at Treasury Brisbane prior to its closure during the quarter totaled AU$53 million (US$35 million).
Star noted that The Star Sydney, which was again deemed unsuitable to hold a casino license in August, continues to be most problematic.
“Revenue [in Sydney] continues to trend downward, with an AU$4.4 million (US$2.9 million) impact from system outages in July 2024,” Star said. “The challenging consumer environment and changes in business practices have weighed heavily on gaming, particularly in the premium segment.
“In the 50 days prior to the introduction of mandatory carded play and cash limits on 19 August 2024, revenue was down 11% compared to the FY24 average, and 6% below the 4Q24 average. Since 19 August 2024, revenue declined a further 12%. Electronic gaming machines have also faced significant pressure from competitive venues, evidenced through revenue losses and limiting market share recovery.”
The Star Gold Coast remained more stable during the quarter, it added, because fully carded play and cash limits have not yet been introduced. As such “revenue has stabilized and an anticipated seasonal uplift materialized in the quarter, albeit from a lower base.”
Star, which is still working on finalizing a vital AU$200 million (US$131 million) debt facility, said it had AU$149 million (US$98 million) in available cash as of 30 September 2024, including AU$60.5 million (US$40 million) received from the sale of the Treasury Brisbane casino building in late September.
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