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Crown Resorts on the rise as VIP play returns

Thursday, 22 February 2018 19:16
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Australian casino operator Crown Resorts has seen its VIP segment rebound quickly following the release from a Shanghai jail of 16 employees last August.

Releasing its financial results on Thursday for the six months to 31 December 2017, Crown revealed a 15.9% increase in VIP turnover Australia-wide to AU$22.6 billion year-on-year, with flagship property Crown Melbourne’s VIP turnover up 37.5% to AU$19.5 billion.

It was only a few months ago that the company had announced a 48.9% fall in VIP turnover for the 12 months to 30 June 2017 to AU$33.3 billion – stating at the time that it was temporarily “stepping back from an aggressive position in the VIP market” following the arrests of its mainland China staff in October 2016 for promoting gambling. Among them was Crown Resorts’ international VIP operations, Jason O’Connor, who was later jailed for 10 months before being released on 12 August 2017.

Discussing Crown’s latest results, Chairman John Alexander said, “Crown’s Australian operations’ first half result reflected mixed trading conditions.

“Total normalized revenue across Crown’s Australian resorts increased by 4.8% on the prior comparable period (to AU$1.56 billion). Main floor gaming revenue increased by 0.7%, with modest revenue growth in Melbourne offset by softness in Perth.

“VIP program play turnover in Australia of AU$22.6 billion was a pleasing outcome, particularly at Crown Melbourne given the difficult trading conditions in the prior comparable period.”

Crown Resorts’ 1H18 results include the sale of 4.2 million shares in Caesars Entertainment Corporation for US$53.3 million but not the sale of 34.6 hectares of land on the Las Vegas Strip for US$300 million nor the sale of its Ellerston property in NSW for AU$62.5 million, both of which were completed in early 2018.

Net profit for the six months fell 33.6% to AU$238.6 million.

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