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Crown Casino faces up to competition for VIP customers

Despite a challenging market, and especially in the face of competition from Singapore’s new casinos, Crown Casino has reported a final dividend of 19c, for a full-year total dividend of 37c. Shares in the company closed at $7.87, a drop of nearly 3%.

The Crown Casino group includes some of Australia’s most successful international attractions, chief amongst them the Crown Casino Melbourne Australia complex, which was the largest contributor to the group’s earnings – close to $340million in profit (an increase of 15%).

Casinos in the Yarra and in Macau performed well, but the Burswood Casino in Perth saw a 32% drop in VIP gaming revenue, and Melbourne’s main floor gaming revenue showed slowed growth in the first weeks of the financial year.

The loss of VIP revenue will be a worrying trend for Crown Casino, hinting as it does that Asia’s high rollers are being lured away from Australia’s venues to Singapore’s newly-developed casinos.

But there is confidence at Crown Casino – the group has invested $1.5billion since 2007, and will spend a further $540million this year. Even more telling is the group’s planned buy-back of some 30 million shares that total around 4% of Crown Casino’s capital.

Crown’s CEO Rowen Craigie is realistic: ‘if you’re in the high roller business you can’t see a slow down.’ He said that Crown had strategies to bring high-worth individuals to Australia, pointing to a 15% increase in VIP gaming revenue in Melbourne, alongside strong contributions from the complex’s restaurants and hotels.

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