The Star Entertainment Group has reported another quarter of mounting losses, while warning that its proposed exit from Brisbane’s Queen’s Wharf project is unlikely to proceed as planned, further clouding the company’s financial outlook.
In a quarterly update released Wednesday to the Australian Securities Exchange, the embattled casino operator posted revenue of AU$270 million ($182 million) for the three months ended June 30th, broadly unchanged from the previous quarter. The group recorded an EBITDA loss of AU$27 million ($18.2 million), deepening from the AU$24 million ($16.2 million) loss reported in the March quarter and reversing a profit of AU$23 million ($15.5 million) in the same period last year.
The Star attributed the losses to a persistently difficult operating environment, including the full implementation of mandatory carded play and cash transaction limits in New South Wales, as well as increased regulatory scrutiny across all its casino properties.
The group’s flagship Sydney property remains under a suspended license, with a suitability submission due to the New South Wales regulator by August 31st. In Queensland, both The Star Gold Coast and The Star Brisbane remain under special oversight arrangements until at least the end of September.
Meanwhile, efforts to exit its 50 percent stake in the Destination Brisbane Consortium (DBC)—the entity developing Queen’s Wharf Brisbane—have hit a setback. While The Star signed a heads of agreement in March with joint venture partners Chow Tai Fook Enterprises and Far East Consortium, it now warns that final agreements are unlikely to be reached by the July 31st deadline.
If the deal falls through, The Star will be required to repay AU$10 million ($6.7 million) by August 6th and reimburse an estimated AU$26.5 million ($17.8 million) to its partners by September 5th, representing its share of capital contributions made since March.
Despite holding AU$234 million ($158 million) in available cash as of June 30th, The Star’s liquidity position remains constrained. The group is relying on a AU$300 million ($202 million) strategic investment package from Bally’s Corporation and its largest shareholder, Investment Holdings. Some AU$233 million ($157 million) of the total has been received, with the remaining AU$67 million ($45 million) contingent on receiving regulatory approvals.
Revenue performance across The Star’s core properties weakened further. The Star Sydney recorded flat revenue at AU$162 million ($109 million) but saw its EBITDA loss widen to AU$14 million ($9.4 million). The Star Gold Coast posted revenue of AU$96 million ($64.4 million) and a modest EBITDA of AU$2 million ($1.3 million). The Star Brisbane, which is still in its ramp-up phase, brought in AU$8 million ($5.4 million) in operator fees, but recorded an EBITDA loss of AU$15 million ($10.1 million).
Operating expenses rose slightly to AU$232 million ($156 million), despite The Star having achieved AU$100 million ($67.1 million) in annualized corporate cost reductions over the financial year.
