Crown Resorts records $125 million loss in 2023 financial year, investigation costs to blame.
Crown Resorts suffered a loss of AU$199 million (US$125 million) during the fiscal year ending June 30, 2023. This loss was attributed to financial penalties imposed on the company due to regulatory violations at its three casinos in Australia.
Crown Resorts owns multiple establishments, including Crown Melbourne, Crown Sydney, Crown Perth, Crown London, and a 20% ownership of the Nobu restaurant and hotel group. They also hold a 50% stake in the Aspers Group, which operates four casinos in the UK, and have a digital gaming unit.
The company experienced a 44% year-over-year increase in revenue, totaling $1.7 billion. Crown Melbourne significantly contributed to this increase, generating $882 million in revenue.
Revenue for Crown Melbourne climbed by 49% from the previous fiscal year. Crown Perth reported a 16% rise to $538 million, while Crown Sydney, which opened in December 2020, yielded $171 million. The remaining revenue, roughly $590 million, came from other business segments.
Crown Resorts reported a rebound in casino resort revenue across all segments during the 12-month period ending June 30. However, this improvement was eclipsed by expenses related to state inquiries into its casino operations in Victoria, Western Australia, and New South Wales.
The investigations found that Crown had failed to prevent money laundering at its casinos and had not worked to prevent illicit criminal groups from entering its properties. Responsible gambling promotion was also inadequate. Nevertheless, each inquiry permitted Crown to keep its gaming license, albeit under the close watch of independent monitors and auditors.
Crown incurred AUSTRAC fines for its regulatory issues, amounting to AU$450 million (US$286 million), as well as legal fees and remedial costs, totaling $1.9 billion.
Investing in the revitalization of Crown Resorts is New York-based private equity giant Blackstone Group, which acquired the casino operator in June 2022 for $6.5 billion. Blackstone has expressed enthusiasm for casino properties since the pandemic and has purchased resorts such as the Bellagio on the Las Vegas Strip.
Blackstone is dedicated to investing substantially in Crown Resorts' resurgence. The firm stated it will earmark "hundreds of millions of dollars" for upgrades to the Melbourne and Perth venues.
Following Blackstone's backing, Crown officials are confident of overcoming the issues associated with the inquiries and entering a more prosperous period.
Crown's FY23 loss of $125 million was a marked improvement from the $596 million loss in the previous fiscal year.
The biggest gaming operator in Australia, Crown Resorts, currently stands in comparison to Star Entertainment Group, a rival with licensed casinos in the country. Star reported $1.18 billion in revenue for its FY23 fiscal year, overseeing The Star Sydney, Star Gold Coast, and Treasury Casino in Brisbane.
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Source: www.casino.org
