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Crown H1 profit down 33pc after Melco exit

Trevor Chappell  |  22 Feb 2018Text size  Decrease  Increase  |  
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SYDNEY - [AAP] Casinos operator Crown Resorts' (ASX: CWN) International VIP gambling business has improved but conditions have been more challenging in the first half for its Australian operations, which include casino resorts in Melbourne and Perth.

Crown's first-half profit has fallen 33.2 per cent to $238.6 million, pulled back by the cut to earnings from the company's exit from the Melco Resorts and Entertainment business in Macau.

But a year after Crown's VIP gambling business took a big hit from the detention in late 2016 of Crown employees in China over alleged gambling offences, Crown executive chairman John Alexander described the 16 per cent improvement in VIP turnover to $22.6 billion as "a pleasing outcome".

Excluding one-off items and variations in the win rate against high-rolling gamblers, Crown's profit was up by 0.6 per cent to $192.4 million and the company has declared an interim dividend of 30 cents per share, franked to 60 per cent.

Total normalised revenue at Crown's Australian resorts rose by 4.8 per cent compared to a year ago.

Main floor gaming revenue rose by 0.7 per cent, reflecting modest growth in Melbourne and softness in Perth.

"Crown's Australian operations' first-half result reflected mixed trading conditions," Mr Alexander said in a statement on Thursday.

The late 2016 detentions deterred big gamblers from mainland China visiting Crown's casinos in Australia and the joint operations that Crown held at the time in Macau.

Crown, whose biggest shareholder is billionaire James Packer, subsequently exited its Macau business, with the resulting lack of earnings contribution, and a $167 million benefit from the sale of its Melco stake in the previous period, weighing down the current first-half result.

Crown's normalised net profit, which excludes one-off items and variations in the theoretical win rate against high-rollers, rose 0.6 per cent to $192.4 million.

VIP GAMBLERS RETURN FOR CROWN HY18

* Net profit down 33.6pc to $238.6m

* Revenue up 1.4pc to $1.8bn

* Interim dividend 30 cents, 60pc franked, down from $1.13 previously

 

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is an AAP journalist.

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© 2020 Australian Associated Press Pty Limited (AAP) or its Licensors. This is the Morningstar service with content provided by AAP where indicated. AAP reserves all rights, including copyright, in services provided by it. The information in the service is for personal use only, does not constitute financial product advice (whether general or personal) and may not be re-written, copied, re-sold or re-distributed, framed, linked or otherwise used whether for compensation of any kind or not, without the prior written permission of AAP. You should seek advice from a professional financial adviser before making decision to acquire or dispose of a financial product.

This service is published for general information purposes only without assuming a duty of care. AAP is not in the business of providing financial product advice (whether personal or general advice), and gives no warranty, guarantee or other representation about the accuracy of the information or images contained in this service. AAP is not liable for errors, omissions in, delays or interruptions to or cessation of the services through negligence or otherwise. The globe symbol and "AAP" are registered trademarks.

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