Star Entertainment shakes off VIP blues to post profit
One of the Australian gaming giants, The Star Entertainment Group, witnessed a rise in revenue in the fiscal year despite VIP gamblers cleaning up.
A preliminary report, released by the company last week, shows its revenue for the 12 months ending June increased by 6% to a record AU$ 2.6 billion (US $1.9b), compared to last year. Its earnings fell 19.2% to AU$ 484.4 million while net profit after tax also dropped by 44% to AUD $148.1 million.
Using the metric known as ‘normalised’ results, adopted by Aussie gaming firms, considered to provide a more definite look at the VIP gambling win rate, revenue went up 15.3%, earnings increased 14.3% while net profit after tax went up by 20.3%.
The company also indicated that AU$ 37 million of its statutory net profit after tax went into significant items including debt restricting and other expenses associated with the launch of its renovated Gold Coast edifice.
The Asian VIP gamblers of The Star, under the name ‘international VIP rebate’ business, as shown in May witnessed a long hot streak in the 2018 fiscal year. The year saw the VIP win rate at 1.16% compared to the 1.59% last year, with an average 1.35% under the ‘normalized’ heading.
However, the VIP turnover increased by 54.3% to AU$ 61.2 billion, while statutory revenue also increased by 11.2% to AU$ 711.5 million.
With these figures, The Star claims its VIP business is the largest in Australia and New Zealand and has credited the gains to “sales-driven diversification strategy” and “market normalization.”