Australian casino operator, The Star Entertainment Group Limited, has reportedly unveiled a three-tier ‘master plan’ that it hopes will help to convince the government of Queensland not to license a second gambling resort for the area around the city of Gold Coast.
According to a report from The Sydney Morning Herald newspaper, the Sydney-listed firm is responsible for region’s The Star Gold Coast resort casino and has been upset by the Queensland government’s continued warmth towards calls to authorize a second such facility for the state’s second largest city.
The newspaper reported that the envisioned scheme from The Star Entertainment Group Limited was revealed earlier today at the firm’s annual general meeting in Brisbane and includes an almost $68.5 million revamp of the Gold Coast Convention and Exhibition Centre. The proposal purportedly also encompasses the completion of the $1.4 billion arrangement that would add five additional hotel towers to The Star Gold Coast alongside a significant overhaul of the nearby five-star Sheraton Grand Mirage Resort oceanfront facility.
In exchange for this investment, the casino operator reportedly wants an assurance from the government of Queensland that it will not license a second Gold Coast resort casino and allow it to continue managing the Gold Coast Convention and Exhibition Centre, which is built on state-owned land.
John O’Neill, Chairman for The Star, reportedly described the seven-year debate over whether to license a second resort casino for the area around Gold Coast as a distraction that has ‘yielded nothing but considerable cost’ to local governments while moreover negatively impacting his firm’s business and ‘share price.’
O’Neill reportedly told The Sydney Morning Herald…
“Our position has always been [that] we support investment in tourism assets on the Gold Coast but that the Gold Coast market is too small for two casinos. We are not alone in this assessment of the market. The introduction of another local casino competitor would force us to defend our local market share at the expense of driving incremental growth in interstate and international tourism.”
The Star moreover used the shareholders meeting to detail that aggregated third-quarter revenues had risen by 1.5% year-on-year while predicting that earnings before interest, tax, depreciation and amortization for the final six months of 2019 could reach as high as $211.6 million. However, the firm purportedly proclaimed that it was planning to cut costs by as much as $30.7 million as a consequence of its results being negatively hit by an ongoing ‘low actual win rate.’
Matt Bekier, Chief Executive Officer for The Star Entertainment Group, told The Sydney Morning Herald that the previous twelve months had been a ‘mixed year’ for his firm owing to the dual impacts of a softening global market and reduced domestic consumer sentiment.
Bekier reportedly told the newspaper…
“The international VIP business produced mixed results. While we delivered 10% growth in unique visitation on the 2018 year, normalized revenues were down 30.7% on the previous corresponding period due to substantially lower spend per customer.”