Star Entertainment To Decrease Its Reliance on Asian High Rollers
Following the arrests in China, in which 18 employees of Crown Resorts were arrested on the Chinese mainland, changes are occurring to the strategy of the company. The Aussie operator, the Star Entertainment group, is reported to have announced its intention to decrease its reliance on the high stakes players from the Asian land of China. According to reports coming from the news service of Reuters, the company has made this revelation during its 1st earning update since the detentions of the Aussie employees in China that belonged to the company. In addition to such revelation, the company also stated that the pretty good win rate that occurred during the 6 months that led to December were able to mask the great downturn that the income from the Chinese high stake players has suffered.
Matt Bekier Comments on the Situation
The CEO of the Star Entertainment Group Ltd. has stated that currently, they are not going to take any risks by calling on clients and players that they do not know. He added that they also do not respond to customers that they do not know.
The company has also explained that the net profit of the last 6 month increased by 135 percent year on year, to reach a total of $109.1 million. This increase was a result of a near doubling of the win rate. This increase was despite the fact that the turnover coming from the overseas visitors, which mainly consists of rich high stake Chinese players, decreased by 27 percent in the last 2 months of last year, and is still continuing to slump.
The Brisbane based company runs a lot of casinos in Australia. This includes Jupiter’s Gold Coast, The Star Sydney and Treasury Brisbane. The company also detailed that its ½ year net profit was higher by 20% than the predictions of the analysts. On the other hand, the normalized profit of the firm has witnessed a decrease of 17.7 to reach 82.3 million dollars.
Star Entertainment to Cut Down on the Chinese high Stakes Players
The company has seen the turnover of the international VIP players for the 6 month period decrease by twelve percent to reach $16 billion. This is why the company is planning to cut down on the proportion of the Chinese based players amongst its VIP visitors by 30%, while hoping that other high stake players from other Asian countries will be able to fill in the gap in the revenue.
Bekier added that the company clearly intends to be quite cautious because they do not have the facts at the moment. This was stated by the CEO of the Star Entertainment to the analysts regarding the fallout following the arrests of the employees of the company in China.