Australia: Crown Resorts high-roller sales tank on global challenges

The logo of Australian casino giant Crown Resorts Ltd adorns the hotel and casino complex in Melbourne, Australia

Crown Resorts Ltd (CWN.AX) on Thursday said “VIP” sales at its Australian resorts sank 46% during the July-Oct. 20 period as the international tourist market for the casino operator remained under pressure. 

VIP sales are largely made up of visitors on package deals from China, which is the world’s biggest source of tourists. Slowing growth in the world’s second-largest economy due to a bruising trade war with Washington has pressured spending by Chinese high-rollers, hurting Australian casino operators such as Crown and smaller peer Star Entertainment (SGR.AX). 

Excluding VIP sales, however, revenue from main floor gaming rose 2% during the period, despite sluggish consumer spending in Australia. 

Crown shares climbed as much as 1%, hitting their highest in more than three weeks, while the broader Australian benchmark was 0.6% higher. 

The company, founded and part-owned by billionaire James Packer, has been caught in the cross-hairs of three regulatory probes triggered by media reports alleging the company flouted visa rules. 

“Let me be clear – Crown does not tolerate any illegal activity by its employees or its patrons,” executive Chairman John Alexander said in a statement. 

“The Victorian and New South Wales regulators have taken a decision to examine issues raised in recent media reports and, out of respect for those inquiries, I won’t, and can’t, go into any detail,” Alexander added. 

Australia’s law enforcement anti-corruption watchdog is also investigating the allegations. 

The company also said it is focused on the completion of Crown Sydney, a new complex on the waterfront of Australia’s biggest city, on time and on budget.

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