Crown’s full-year results hit by Macau’s losing streak

17 August 2016

Crown Resorts registered a 23% fall in full-year net profits as its small gains in Australia were overshadowed by substantial losses in Macau.

The casino operator posted normalised net profit of Aus$406.2 million (€277.2 million / $312.57 million) for the 12 months to June 30, which was slightly below analysts’ forecasts and well down on the Aus$525.5 million achieved last year.

Actual net profit was up 146.4% to Aus$948.9 million, although this was assisted by net gains of more than Aus$600 million from the sale of shares in Macau venture Melco Crown.

Full-year revenue from operations was up 3.8% to Aus$3.62 billion, with normalised EBITDA up 4% year-on-year to Aus$855.8 million and reported EBITDA rising 11% to Aus$861.3 million.

Crown brought in Aus$3.23 billion, up 0.8%, from its Australian properties – Crown Melbourne and Crown Perth. The majority of that was from gambling, with non-gaming revenue of Aus$674.6 million.

Normalised EBITDA in Australia was up 2% to Aus$933.2 million, while reported EBITDA was almost flat at Aus$949.2 million.

Citing “weak market conditions” in Macau, Crown said that its share of Melco Crown Entertainment (MCE) experienced a 64% drop in net profits to Aus$58.1 million and a 65% fall in reported net profit to Aus$42.7 million.

Chief executive Rowen Craigie said: “The 2016 full-year result reflects a solid performance from our Australian operations and continued subdued trading in Macau.

“At Crown’s Australian resorts, main floor gaming revenue increased by 5.8%, which was a solid performance. VIP programme play turnover in Australia of Aus$65.1 billion (down 8%) was a reasonable outcome given the strong growth in the prior comparable period of 41.8% and the depressed nature of VIP gaming activity across Asia.

“The decline in MCE’s result was attributable to weak market conditions in Macau. Overall gross gaming revenue across the Macau market in the full year to 30 June 2016 declined by more than 20%.”

Related article: Crown suffers Macau decline