Employees at Star Entertainment are bearing the consequences of the casino operator’s deceitful and illegal actions in Australia. As the firm continues to face heavy financial penalties and greater scrutiny, it has declared that it will have to terminate more than 6% of its personnel.
In an update for the Australian Securities Exchange (ASX), Star revealed that its pre-tax profits are likely to decrease by AUD80-280 million (US$53.78-$188.24 million). The casino operator, which owns gambling venues in Sydney, Brisbane, and the Gold Coast, said that it is “suffering significant and rapid deterioration in operating conditions” that are hitting The Star Sydney and Star Gold Coast especially hard.
Star recognized that the plunge is due to its past transgressions, such as money laundering and document forgery, as well as changes in consumer spending. As a result, it will lay off 500 of its 8,000-strong workforce, with the exception being unionized employees. Furthermore, the company will implement a salary and bonus freeze, in addition to other measures, to prevent further losses.
Star’s current earnings performance is on an unprecedented low level (excluding the COVID-19 period), the group stated in an ASX filing. The operator, which several Australian states deemed “unsuitable” to hold a casino license, also plans to sell its Sheraton Grand Mirage on the Gold Coast, with this move estimated to save AUD100 million (US$67.23 million) in the next financial year.
The casino is trying to gain support from state governments. New South Wales (NSW) and Queensland both penalized Star for its violations, but it is now hoping to persuade them to grant it extra time to make payments for its fines. The Australian Transaction Reporting and Analysis Centre (AUSTRAC) is also conducting its own investigation into the company, as well as Crown Resorts, which has had to pay regulators and AUSTRAC for similar offenses.
Star has had to lower its expectations for financial success. It previously anticipated EBITDA (earnings before interest, taxes, depreciation and amortization) of AUD330-AUD360 million (US$221.73-$241.88 million) for 2023, but if market conditions remain as they are it will drop to AUD280-AUD310 million (US$188.13-$208.3 million), a difference of up to 22%.
Shareholders are already taking a step back. Star was trading at around AUD1.35 (US$0.91) for the past week, but it has decreased to AUD1.21 (US$0.81) today, before recovering slightly to AUD1.26 (US$0.85).
The staff at Star Entertainment are feeling the ramifications of the casino operator’s unethical and unlawful activities in Australia. As the business continues to struggle with hefty financial sanctions and heightened supervision, it has declared that it will have to terminate over 6% of its personnel.
In a filing with the Australian Securities Exchange (ASX), Star disclosed that its pre-tax profits are anticipated to fall by AUD80-280 million (US$53.78-$188.24 million). The casino operator, with venues in Sydney, Brisbane, and the Gold Coast, said that it is “experiencing significant and rapid deterioration in operating conditions” that are taking a toll on The Star Sydney and Star Gold Coast.
Star admitted that the drop is the result of its past wrongdoings, such as money laundering and document forgery, as well as alterations in consumer spending. As a result, 500 of its 8,000-strong workforce will be laid off, with unionized positions being the only exception. Additionally, the company will implement a salary and bonus freeze, in addition to other measures, to prevent further losses.
Star’s current earnings performance is at unparalleled low levels (excluding the COVID-19 period), the group clarified in an ASX filing. The operator, which several Australian states deemed “inadequate” to hold a casino license, also plans to sell its Sheraton Grand Mirage on the Gold Coast, which is expected to save AUD100 million (US$67.23 million) in the next fiscal year.
The casino is attempting to find sympathy with state governments. New South Wales (NSW) and Queensland both reprimanded Star for its violations, but it is now hoping to convince them to grant it more time to make payments for its licenses and fines. The Australian Transaction Reporting and Analysis Centre (AUSTRAC) is also targeting the company in its own investigation, as well as Crown Resorts, which has also had to pay regulators and AUSTRAC.
Star has had to reduce its expectations for financial success. It formerly projected EBITDA (earnings before interest, taxes, depreciation
