The Star Entertainment Group’s first-half profit dipped 2.4 per cent to $123.8 million after more of its high-stakes gamblers tapped out early.
Australia’s second-largest casino operator says normalised profit, which strips out win rate volatility and one-off items, slipped because a high win rate resulted in a lower number of turns from international VIPs.
“VIPs make up about 15 per cent of our business,” chief executive Matt Bekier told AAP.
“Because we won so quickly, people just didn’t stick around for as long as they normally would have.”
The company raised its interim dividend from 7.5 to 10.5 cents after statutory profit – which incorporates the substantial win rate and the sale of land around the Star Gold Coast – rose from $32.9 million a year ago to $148.5 million.
Total normalised revenue rose 0.9 per cent to $1.11 billion.
Domestic business drivers included slot machine revenue, up 6.3 per cent from the prior corresponding period, with Sydney up 9.9 per cent.
Mr Bekier said the company – which operates casinos in Sydney, the Gold Coast and Brisbane – would continue to expand all three precincts.
Mr Bekier said Chinese tourism remained key to the business.
“I’ve noted over the last couple of months it’s been a little bit of a slowdown, but 25 per cent of all Chinese tourists who come to Australia come and visit one of our properties,” Mr Bekier said.
“We will continue to pursue this market space even more aggressively.”
At 1310 AEDT Star shares were up 5.80 per cent to $4.65.
VIPS SPEND BIG BUT TAP OUT EARLY ON STAR:
* Normalised net profit down 2.4pct to $123.8m
* Normalised revenue up 0.9pct to $1.11b
* Statutory net profit $148.5m, from $32.9m in pcp
* Statutory revenue down 3.2 pct to $1.15b
* Final dividend of 10.5 cents fully franked, up 3.0 cents from a year ago
Originally published as International VIPs tap out early on Star