- The Star Sydney facility continues to run its operations following the amended COVID-19 guidelines from the NSW Government.
- While talks with the Australian Government failed regarding absolute monopoly in Gold Coast, The Star still believes in investing $2bn in Gold Coast master plan to increase tourism footfall.
- While other entertainment players have resumed their operations, adopting COVID-safe practices is key to ensure business continuity amidst looming threat of second infection wave.
In the beginning of July, The Star Entertainment Group Ltd (ASX: SGR), an Australian gambling and entertainment company, announced next stage of the lifting of restrictions at The Star Sydney casinos and reopening of The Star Queensland’s properties. The Star Sydney property reopened on a restricted basis from 1 June 2020, with the entry restricted to loyalty club members and their guests by invitation only.
As per the latest update, The Star Sydney facility will continue to run its operations following guidelines from NSW Government Public Health (COVID-19 restrictions on gathering and movement) order, that amends the restrictions applicable to hospitality businesses.
The Aussie group owns and operates The Star Sydney, Gold Coast, Treasury Casino and Hotel Brisbane.
As per new restrictions, The Star Sydney will apply to the minimum four sq mt per patron rule, with a maximum capacity of 300 customers per area. The customers will not be allowed to mingle with each other. The Star is implementing the new restrictions on its day to day procedures.The Star Sydney casino area is about 20,000 sq mt.
As per latest restrictions, the casino will be prioritising its visitation by its highest-value customers. From 19 to 30 June, it saw a comparable number of visitors to 1H FY2010. They have also made adjustments in the staff available to the new environment.
A few days back, The Star was informed by NSW officials, of one of the visitors testing positive for coronavirus. After the news broke in, the company took utmost caution and worked with NSW officials to comply with all safety measures like spatial distancing, hygiene and cleaning measures.
Plan for Second Casino on Gold Coast Shelved
The Australian Government was also in talks with The Star for developing a second casino on the Gold Coast. However, the Government decided to end this process pertaining to disastrous coronavirus impact on the country. This announcement came as a surprise when Innovation and Tourism Development Minister Kate Jones revealed that the Government is no longer negotiating with The Star over Gold Coast monopoly.
With the global market conditions impacting investment decisions, the Government stated they are no longer following the dream of creating a Global Tourism Hub, along with a second casino in the Gold Coast.
Star Entertainment Group had offered the Government to give them an absolute monopoly over the casino in Gold Coast, and the company would invest $2bn. The company planned to help the Government create a Global Tourism Hub.
Despite the failure in agreement, the Star believes in investing $2bn in its Gold Coast master plan which not only helps increase the tourist footfall but improve tourism industry across the state to recover from COVID-19 impact.
SGR stock last traded at $2.770, down 2.12% on 24 July with a market capitalisation of $2.68bn, and annual dividend yield of 7.24%.
Crown Resorts Limited (ASX:CWN)
Crown is one of the largest entertainment groups in Australia, making a significant contribution to the Australian economy through its role in tourism by attracting millions of visitors to its resorts.
Its economic contribution to Australian GDP through its resorts is up to $4.4bn, with Crown Melbourne resort contributing up to $3.2bn and Crown Perth contributing up to $1.2bn. Around 16,500 people are employed at Crown Melbourne resort, and up to 8,500 are employed at Crown Perth resort through direct and indirect full-time employment.
Crown is one of the significant taxpayers in the country. In the 2019 financial year, Crown paid over $650m in taxes to all levels of government in Australia. It represents approximately two-thirds of Crown’s pre-tax profits.
From 27th June, Crown reopened its casino, gaming floor and food & beverages outlets in agreement in Western Australia Government’s restrictions.
- Patrons capacity limit at each venue of one person per sq mt.
- Physical distancing is a must at electronic gaming machines and electronic table games.
- There are restrictions on the number of players at each table as well.
- Crown also follows hygiene protocol at the venues.
CWN stock last traded at $9.070, down 2.4% on 24 July with a market capitalisation of $6.29 bn, and annual dividend yield of 6.62%.
Tabcorp Holdings Limited (ASX:TAH)
Tabcorp is a diversified gambling entertainment company based out of Australia. The company is one of the largest providers of lotteries, Keno, wagering and gaming products and services in Australia. Tabcorp is the market leader in Australian wagering with 3m plus registered customers. They have more than nine thousand venues with the most considerable retail footfall in the country.
On 23rd July, Tabcorp announced the retirement of its Chairman Paula Dwyer effective 31 December 2020. Steven Gregg is selected to take Paula’s place and lead the company. Gregg has been Tabcorp’s director since 2012.
The leadership at Tabcorp is committed to steering the company through COVID-19 pandemic crisis.
TAH stock last traded at $3.640, up 0.55% on 24 July with a market capitalisation of $7.36 bn, and annual dividend yield of 6.04%.