Crown Perth Cuts 200 Jobs as Share Prices Leap 10 Percent
Crown Resorts has been suffering from multiple problems these fast few months. It seems that the staff that works at the Crown Perth Casino are the ones who will feel the first sting of the changes and the problems that the gambling operator has been suffering from. This is because almost 200 jobs are being shed at the casino.
The Toughest Six Months on Crown Resorts
Crown Resorts had to go through tough 6 months. Its ½ year results that were released lately showed a 9.6 percent drop in the net profit, as well as a 45.3 percent decrease in the turnover from the VIP section. In addition, Crown Resorts also stated that the Chairman of the group, John Alexander, is going to take over as the Chief Executive following the sudden exit of the ex CEO, Rowan Craigie.
The new Chief Executive has given his promises of a more effective and an efficient operation. This was a clear indication that jobs might be shed as a result of the current fortunes of Crown Resorts. It was then confirmed by Crown Perth that up to 200 jobs will be lost and will not be a part of their operation. The spokesperson of Crown Perth stated that the casinos priority is to support the people who are going to be affected by the changes. Almost 5500 people are still going to keep their jobs at the casino. He also added that the casino has a pretty solid commitment to their welfare and development.
The Reason behind the VIP Market Turnover Slide
The negative changes that occurred in the VIP market turnover was a result of the arrest of the Crown Staff on the Chinese mainland. They were arrested by the Chinese authorities as it was alleged that they were promoting gambling services and products to Chinese players. Therefore, this ended the marketing activities of the company in China, which is where the major VIP market comes from.
This resulted in worries among the investors, who were quite concerned regarding the company’s plans in Australia when it comes to attracting the high roller VIP players from China. In specific, the concern was regarding the fact that Crown Resorts was working on a $1.2 billion casino that is going to be located in Sydney. This casino was said to be focused on the VIP gamblers. Responding to these worries, Alexander stated that describing the Barangaroo casino as an exclusive VIP casino is not accurate. Although it is not going to offer the basic gambling products like pokies, it is still going to target the local market.
Last Tuesday, the company closed at the highest point since the arrest news broke out, as it reached $12.66, which is a 10% increase in the span of one week.