Predictions of a quick rebound in the VIP segment for Australian casino operator Crown Resorts have come to fruition with VIP turnover in FY18 climbing 54.5% to AU$51.5 billion.
The results still lag some way behind the AU$65.1 billion in turnover Crown booked for FY16 but represent a considerable improvement over its AU$33.3 billion last year following the arrests of 19 staff in mainland China in October 2016 for promoting gambling.
Crown’s group revenue for the 12 months grew 5.4% to AU$3.5 billion, including a 9.5% increase in revenue at flagship property Crown Melbourne to AU$2.3 billion.
On a normalized basis, VIP revenue at Crown Melbourne jumped 73.9% to AU$591.8 million, with turnover of AU$43.8 billion. Main floor gaming revenue grew 4.6% to AU$767.1 million with slot machine revenue basically flat at AU$449.9 million.
Normalized VIP revenue at Crown Perth fell 5.8% to AU$103 million while mass gaming revenue declined 4.1% to AU$198.8 million.
Group-wide EBITDA grew 0.3% to AU$792.4 million while normalized EBITDA climbed 6.1% to AU$878.3 million.
“Crown’s full year result reflects a solid performance from our Melbourne operation and continued subdued trading in Perth,” said Executive Chairman John Alexander.
“Total normalized revenue across Crown’s Australian resorts increased by 10.6% on the prior comparable period. Main floor gaming revenue increased by 1.5%, with modest growth in Melbourne offset by softness in Perth. VIP program play turnover in Australia of $51.5 billion was a pleasing outcome, particularly at Crown Melbourne given the difficult trading conditions in the (previous year).”
Crown Resorts also announced on Thursday that it has commenced legal proceedings against the Barangaroo Delivery Authority (BDA) in the Commercial List of the Supreme Court of New South Wales in relation to the development of its Crown Sydney casino, hotel and residences.
According to a Crown announcement, the proceedings seek injunctive relief and declarations against the BDA that require the BDA to comply with a number of its contractual obligations under the Crown Development Agreement (CDA).
These obligations include consulting with Crown about any application for the proposed development of Central Barangaroo that differs from that provided for in the relevant Concept Plan for Central Barangaroo in existence at the time the CDA was entered into, and negotiating in good faith and agreeing with Crown and Lendlease any required changes to that application to ensure that sight lines from the Harbour Bridge to the Sydney Opera House are retained for the Crown Sydney Hotel Resort.
Crown Sydney is due for completion in 1H21.
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