Australia’s Crown Resorts Ltd has secured more than AU$1 billion in additional debt facilities as it looks to navigate the closure of its casinos in Melbourne and Perth due to COVID-19.
The additional funding includes AU$560 million in new bilateral facilities with relationship banks and another AU$450 million project finance facility to support the ongoing construction of its AU$2.2 billion Crown Sydney development, due to open in 2021, Crown said in a market update on Thursday.
The company added it already has cash reserves of around AU$500 million on hand.
“We came in with a very clean balance sheet but we obviously need to get through some period of time where we’ll have almost no revenue,” Crown CEO Ken Barton said in an interview published by The Australian Financial Review.
“It means we can sustain ourselves for a quite a while irrespective of what goes on. I really think that any of the scenarios that people can throw at us we will be able to get through.”
Crown also revealed on Thursday that it has stood down more than 11,500 employees, representing 95% of its workforce, since the Australia-wide shutdown of non-essential services began in late March. The company has agreed to pay all full-time and part-time employees who have been stood down, other than senior management, an ex gratia payment of two weeks’ pay while casual workers will receive an AU$1,000 lump sum payment.
Barton himself, alongside other senior management, have agreed to a 20% reduction in fixed remuneration and directors a 20% reduction in fees.
As a result, Crown said underlying operating cash costs have been reduced to between AU$20 million and AU$30 million per month.
Discussing the AU$450 million project finance facility for its Sydney development, Crown said it “intends to continue construction of the Crown Sydney project as planned and, absent any further delays arising from the impact of COVID-19, remains on track for completion of the Crown Sydney Hotel Resort by the end of the year.
“The project cost remains unchanged, with the gross project cost expected to be approximately $2.2 billion and the net project cost expected to be approximately $1.4 billion.”
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