Australia’s Echo Entertainment Group said cost-cutting and 5.7% bump in gaming revenue at its Sydney and Queensland casinos combined to boost earnings in the third quarter.
It signaled a strong start for new CEO Matt Bekier as the company’s shares (ASX: EGP) jumped more than 12% on the news to trade near their 52-week high of $3.72
That contrasts with the record low hit in February when Mr Bekier’s predecessor, Las Vegas industry veteran John Redmond, resigned after just over a year in the position amid a frontal assault from James Packer’s Crown Resorts on Echo’s key urban markets of Sydney and Brisbane.
EGP shed 34% of its value during Mr Redmond’s watch as the company lost a battle with Crown to retain its Sydney monopoly at The Star casino on Darling Harbour and faces a similar prospect in Queensland, where Mr Packer is lobbying heavily for a new license to be awarded in Brisbane and a number of deep-pocketed foreign investors vie for two more licenses the state is going to award.
All the more reason why analysts welcomed the positive third-quarter preview.
“They’ve given the market an indication of where profit will come in, and I think that’s really what the market was looking for, some sort of reassurance around earnings,” Peter Esho, chief market analyst at Invast Securities, told Reuters.
Mr Bekier was Echo’s chief financial officer and an executive director and has been with the company since it was spun off from betting giant Tabcorp Holdings in 2011.