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Crown Resorts backed in despite profit tumble on failed SL gambit

19 February 2015 11:16 am - 6     - {{hitsCtrl.values.hits}}

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Shares in James Packer’s Crown casino group have soared by more than 7 per cent despite a slump in first-half net profit.

Crown suffered a 47 per cent fall in profit for the six months to December after being hit by asset impairment charges and hefty costs from its abandoned Sri Lanka resort.

The gaming group’s net profit fell to $201.75 million in the period, down from $382.45 million a year earlier.

The result was weighed down by $61.3 million in significant items linked to a write down in Crown’s investment in the US-based Cannery and costs from its now abandoned plan for a $US350 million casino resort in Sri Lanka.

Crown’s earnings were also hit by a sharp fall in earnings from its Melco Crown Entertainment business in Macau, where weak market conditions adversely affected all casino operators.

The group’s normalised net profit — which strips out VIP win rates, significant items and opening costs from Melco Crown in Macau — climbed 2.3 per cent to $322.4 million.

Statutory revenues rose 9.2 per cent to $1.7 billion while its normalised result was up 17.2 per cent at $1.72 billion.

Chief Rowen Craigie said gross gaming revenues across the Macau market fell 30.4 per cent in the six-month period.

“The deterioration in the Macau market has continued into the second half,” he said in a statement.

However, he described as satisfactory the performance of Crown’s Australian gaming businesses given the subdued level of consumer sentiment.

Normalised earnings at Crown Melbourne rose by 26.1 per cent and by 7.7 per cent at Crown Perth. Main floor gaming revenue rose 3.5 per cent at both casinos.

Mr Craigie said there had been strong growth in the VIP program play turnover towards the end of the first half, with record monthly turnover in November and December in Melbourne.

Crown’s shares were up by $1.02, or 7.1 per cent, at $15.48 in morning trade.

OptionsXpress market analyst Ben Le Brun said investors had expected a disappointing result from Crown’s Macau business.

“It looks as if a number of other parts of businesses have picked up the slack and it’s come in better than expected,” he said.(AAP)

  Comments - 6

  • Sana Thursday, 19 February 2015 06:04 PM

    Oh who cares. We got rid of a massive investment opportunity...so we are happy.

    chux Friday, 20 February 2015 04:04 PM

    Government should have one policy towards the gaming such casinos it should not only permit Sri Lankan business guys who does not run a professional operation.If at all pls banned everyone.

    shyapat Thursday, 19 February 2015 06:24 PM

    probably, at the cost of your mothers and sisters...

    Jokster Friday, 20 February 2015 09:40 AM

    "At the cost of your mothers and sisters"What a joke. No one forcefully gets into that kind of business, they are either persuaded to do so and if so, they do it willingly.This is the kind of idiotic, old generation thinking that Sri Lanka no longer needs. You either get liberal or you get going.

    kesi Saturday, 21 February 2015 01:16 AM

    What a loss of investment, such a negative impact on our countries economy and after our own citizens whines about how our economy is terrible, turn back and remember what you did to this project.

    ranja Friday, 20 February 2015 03:05 PM

    If the Govt does not want Casinos just because it is detrimental to our culture then they should banned it.By imposing high taxes they are getting a share of that money too.So the Casinos will raise their gaming monies so they could pay the extra taxes and then what about the culture? When Casinos play high taxes will it be good for the culture?


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