(Diwida >) — Australia’s struggling casino company, The Star Entertainment, announced on Tuesday a larger than anticipated half-year loss. This comes as cleanup expenses remain significant despite having a recovery plan already in place.
The company released its findings six weeks past the late February deadline due to uncertainties regarding its ongoing viability, given that it has AU$98 million in accessible funds as of April 11.
Stricter regulations and reduced consumer spending led to significant remediation expenses, causing Star Entertainment to incur a loss of A$136 million ($86.2 million) on an underlying basis for the half-year period ending December 31.
The Visible Alpha forecast indicated a loss of A$93.9 million.
Star Entertainment previously announced an underlying profit of AU$25 million during the corresponding period the previous year.
The casino conglomerate accepted a $300 million bailout last week from American firm Bally's. This refinancing plan emerged as a crucial support following the failure of a loan from investment entity Salter Brothers Capital earlier this month.
Star mentioned in its statement that they aim to release "detailed documentation" regarding Bally's investment within the upcoming week, and a shareholders' meeting has been scheduled for late June.
Stars experienced a decline in income during the third quarter of the financial year due to fewer gambling trips and unfavorable weather conditions. The revenue at their Sydney casino dropped by 8% between the second and third quarters.
(1 US dollar equals 1.5780 Australian dollars)
(Reported by Shivangi Lahiri and Adwitiya Srivastava from Bengaluru; Edited by Alan Barona, Rashmi Aich, and Mrigank Dhaniwala)