Crown Resorts posted a lower than expected profit after tax for the 2017 financial year hit by a huge drop in VIP gaming revenues.
Casino Operator, Crown Resorts (CWN), posted a lower than expected profit after tax for the 2017 financial year. The headline profit result rose 97%, boosted by the sale of the company’s stake in the Melco casino operator, Melco Resorts & Entertainment Ltd worth approximately $1.7 billion during the year.
Crowns total revenue fell 9.9%, impacted by the lower returns from its VIP program. Turnover from larger clients was down 48.9%% to $33.3 billion. Over the last year, Chinese authority crackdowns on the removal of funds outside China as well as the promotion of gambling and foreign casinos, hit the VIP play division.
Crown digital, CWN’s online gaming arm, saw a lift in wagering and social gaming revenues of 26% to $303 million. Earnings increased to $14.8 million, boosted by strong pick up in Betfair Australasia.
Crown's Executive Chairman John Alexander said its “Australian operations result reflected difficult trading conditions.” CWN has been focusing on its Australian business in the last half and will continue to do so over this year. Crown intends to build its investments in Australia over the next two years, with total spend increasing just shy of $800 million in 2019. The Crown Sydney Project is proceeding on schedule and is expected to be completed in 2021
Today Crown said it would extend its on-market buyback to 29.3 million shares representing nearly 10% of all shares. Crown announced it will pay a final dividend of $0.30 a share payable on 6 October 2017.
Normalised results* have been adjusted to exclude the impact of any variance from theoretical win rate on VIP program play (at Crown Melbourne, Crown Perth, Crown Aspinalls and MRE) and significant items.
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