Crown Limited Executive Chairman James Packer and CEO Rowen Craigie addressed the annual meeting of the international casino operator last month. The good news was that not all the news was awful. However, most of the good news predated the recent worldwide financial crisis.
Harkening back to better times, Packer recalled some of the highlights of the 2007/2008 fiscal year, which ended June 30. Crown posted a net profit after tax of A$370.1 million, about $330 million. Australian properties Crown Melbourne and Burswood had EBITDA growth of 8.2 percent.
In fact, the news at the Australian properties was not too bad. From July 1 to September 30, Craigie said, Crown Melbourne and Burswood saw combined revenue from tables and slots, excluding VIP commission program play, up 4 percent on the same quarter in 2007. He added that “year-on-year growth in international VIP commission program play has been very strong over the same period.”
Craigie announced that phases one and two of the Macau City of Dreams project are fully funded and on track for completion in the first half of 2009. The project will add 550 gaming tables, 1,500 slots and 1,400 hotel rooms to the Melco Crown Entertainment entity, of which Crown owns 37.9 percent.
In the U.S., where last year Crown purchased Cannery Casino Resorts, Craigie cited the Meadows racino outside of Pittsburgh, whose revenue was up 14 percent year-on-year in the quarter ended September 30. Though in an “immature” market, Craigie said the Meadows contributed 50 percent to CanneryÆs EBITDA.
Craigie pointed out that Crown has “high-quality casino properties, performing well relative to their peers,” and that some of the inherent risk was lessened by the fact they operate in diverse markets and regions.
Near the end of his remarks, he said: “While some of the markets in which those businesses are located may see some dislocation in the next 12 to 18 months, taking a two- to three-year view we believe they are likely to return to steady growth trends.”