Star Entertainment cuts losses, but concerns remain

The Australian casino group pursues refinancing as revenue falls.

Australia.- Star Entertainment Group has reported a narrower first-half loss but warned that material uncertainty remains over its ability to continue as a going concern. For the six months ended December 31, the company posted a statutory loss of AU$109.7m (US$78m) and a normalised loss of AU$75.7m (US$53.8m), an improvement on the AU$136m (US$96m) loss recorded a year earlier.

Operating earnings were negative AU$7.6m (US$5.4m), while revenue fell 10 per cent year-on-year to AU$585m (US$415m) on an 18 per cent drop in gaming revenue. The decline was attributed to ongoing regulatory reforms, softer trading conditions and the closure of the Treasury Brisbane casino in 2024.

At The Star Sydney, domestic gaming revenue fell 10.6 per cent to AU$257m (US$182m) following the introduction of mandatory carded play and a daily cash limit of AU$5,000 (US$3,550). January revenue at the Sydney property was down 6 per cent compared with the prior year.

Star ended December with AU$130m (US$92m) in available cash, down from AU$234m (US$166) six months earlier. During the half, it recorded a AU$53m (US$37m) net operating cash outflow, spent AU$22m on capital expenditure and paid AU$49m in finance costs. The group has AU$341m in bank loans outstanding.

Management is focused on cost reductions and operational restructuring. Chief executive Bruce Mathieson Jr said the company is streamlining corporate functions and shifting support services to the property level across Sydney, the Gold Coast and Brisbane, while pursuing initiatives to attract customers and stabilise performance.

Star has signed a non-binding term sheet with US-based WhiteHawk Capital Partners for a potential refinancing that would provide additional liquidity. To avoid default, Star must secure a refinancing commitment letter by the end of March and complete the transaction by mid-May.

A key near-term variable remains the pending Federal Court penalty sought by AUSTRAC over historical anti-money laundering breaches. The regulator has requested an AU$400m (US$284m) fine, while Star has said it would not manage without entering administration.

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See also: The Star secures refinancing term sheet with WhiteHawk Capital Partners

The Australian casino group pursues refinancing as revenue falls. Australia.- Star Entertainment Group has reported a narrower first-half loss but warned that material uncertainty remains over its ability to continue as a going concern. For the six months ended December 31, the company posted a statutory loss of AU$109.7m (US$78m) and a normalised loss of…