The Star responds to NICC show cause notice
There is no timetable for a decision.
Australia.- The New South Wales Independent Casino Commission (NICC) has received The Star Entertainment Group’s response to a show cause notice that demanded it provide reasons why it should not face disciplinary action for breaches mentioned in the second Bell Report. The regulator said it does not have a timetable for making its decision, and added the timeline might be impacted by other factors relating to the Star.
“The NICC will make an announcement sometime in October to address Mr Bell’s findings and any subsequent disciplinary outcomes,” it said.
The Star said it has made submissions to the NICC in respect of matters including its suitability to hold the Sydney casino licence, progress in respect of its remediation plan, its current financial position and its proposed plans to address financial issues on an ongoing basis. In addition, the Star has confirmed that it sold its leasehold interest in the Treasury Brisbane Casino building to Griffith University for AU$67.5m (US$45.5m). The sale generated net proceeds of AU$60.5m (US$41.7m.
“Bell Two” probed the casino’s adherence to regulatory standards, financial obligations and the efficacy of its reform agenda since the original inquiry. It found The Star to be “falling short of what is required from a suitable casino operator.”
The Star Entertainment Group closed the Treasury Brisbane Casino on August 25 as part of preparations for the staged opening of The Star Brisbane at Queen’s Wharf. The venue soft-opened on August 29.
The Star results: revenue down 10%
The Star shared financial results for its fiscal year 2024. Revenue declined 10 per cent in year-on-year terms from AU$1.86bn (US$1.26bn) to AU$1.67bn (US$1.13bn). The company attributed this to cost of living pressures, casino operating reforms and loss of market share.
The company posted a net loss of AU$1.68m (US$1.14m). EBITDA (before significant items) declined 45 per cent to AU$175m (US$119m).
The Star Sydney revenue was AU$878m (US$597m), down 11 per cent year-on-year. EBITDA was AU$52m (US$35.3m), down 59 per cent. The Star Gold Coast revenue was AU$456m (US$309.1m), down 10 per cent, while EBITDA was AU$71m (US$48.2m), down 33 per cent. Treasury Brisbane revenue was down 8 per cent to AU$344m (US$233.9m), with EBITDA of AU$52m (US$35.3m), down 38 per cent.
Steve McCann, The Star Group CEO (subject to regulatory approvals), stated: “There are a number of significant challenges currently facing the business from an earnings, liquidity and balance sheet perspective. We recognise and appreciate the support provided to date by our stakeholders as The Star puts in place a new management team and strategy to implement a remediation and transformation program, and return the company to a more sustainable footing.
“We have identified a range of initiatives to improve business performance and cashflow, as well as providing the organisation with additional liquidity. However, time and flexibility is required to implement these initiatives.
“As we work through these initiatives, the Board and management team remain focused on demonstrating suitability to hold our casino licenses and regaining the trust and support of our regulators and the broader community while seeking to enhance shareholder value .”
