Crown profit hit by VIP plunge, digital jumps

Crown Entertainment’s full year profit fell more than 15 percent in the year to end June, hurt by a plunge of nearly 50 percent in VIP program play following the arrest of 18 of its employees last year in China.

Normalized profit was $343.1 million ($272 million), though reported profit almost doubled to $1.86 billion due to a gain of about $1.7 billion from the sale of its stake in the Melco Crown Entertainment venture, which it pulled out of earlier this year.

Normalized revenue from Australian operations was down 12.7 percent to $2.82 billion.

Main floor gaming fell 1.4 percent to $1.65 billion, while VIP play dropped 48.9 percent to $33.3 billion. Non gaming revenue rose 6.5 percent to $71.8.5 million.

“Crown’s Australian operations’ full-year result reflected difficult trading conditions,” Executive Chairman John Alexander said.

Despite the drop in VIP revenue, the company’s planned project for a six-star hotel is proceeding on schedule and is expected to be completed in 2021, the company said.

Total revenue from the company’s Melbourne property was down 13.7 percent to $1.99 billion. VIP revenue was down by a half, but mass market revenue was roughly flat with the prior year.

In Perth, total revenue was down 10 percent to $830 million, with main floor down 4.7 percent and VIP off by 46 percent.

Revenue from Crown’s digital division, which includes Crownbet and Betfair Australasia, was strong, posting a gain of almost 32 percent to $303 million.

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