rown Resorts Limited announced on Thursday its results for the half-year ended 31 December 2020. The company reported statutory revenue of $581.0 million, down 62.1%; and reported NPAT attributable to the parent a loss of $120.9 million, down 155.4%.
According to Crown’s Chief Financial Officer, Alan McGregor, Crown’s first-half results reflect the severe impact on operations from the COVID-19 pandemic. Crown Melbourne was closed for most of the half.
"Crown Perth re-opened with restrictions towards the end of June 2020 and has traded above expectations despite ongoing COVID-19 restrictions, and limited marketing and promotional activity. The main gaming floor started strongly, with performance moderating across the half. Non-gaming revenues were adversely impacted by capacity constraints and reduced foot traffic to the property, but have shown improvement through the half, particularly over the summer holiday season, despite the restrictions which remain in place. Unfortunately, the Perth metropolitan area was recently placed into lockdown following the detection of a new community case of COVID-19. In line with Western Australian Government directions, Crown Perth suspended gaming operations for a period of 14 days and the majority of non-gaming operations for a period of five days. On 14 February 2021, Crown Perth recommenced trading of all gaming and non-gaming operations under the same restrictions that were in place immediately prior to the introduction of the lockdown," he explained.
"Crown Melbourne has progressively recommenced operations from November, albeit with only limited initial access to the property. Since the easing of restrictions on 9 December, results had shown improvement but continued to be impacted by ongoing limitations on capacity. Following the introduction of a five-day lockdown in Victoria on 12 February 2021, Crown Melbourne similarly suspended gaming operations and the majority of non-gaming operations in line with Victorian Government directions. Crown Melbourne has recommenced operations today under restriction. Crown is supportive of the measures taken by the Victorian and Western Australian Governments through the lockdown period, with our priority remaining the health and safety of our employees, customers and the community," McGregor added.
"Crown Sydney opened in a restricted capacity in late December and, while gaming operations are yet to commence, the non-gaming elements have seen encouraging property visitation. The overall contribution from the property continues to be impacted by the limited scale of operations. Good progress has been made in Crown Sydney apartment sales, with over $870 million in gross sales and pre-sale commitments achieved to date. We expect settlement of the apartment sales to occur progressively from March through the balance of the calendar year, which will help to substantially de lever Crown’s balance sheet," he went on.
"During the half, Crown Melbourne continued to qualify for the Commonwealth Government’s JobKeeper scheme, with all proceeds either paid in full to Crown’s employees that were stood down or subsidizing wages of employees that worked in either a full or partial capacity. The scheme helped to support thousands of our employees during the extended Melbourne lockdown. Given the performance upon re-opening, Crown Perth ceased to qualify for the JobKeeper scheme in September at the conclusion of the initial program.
Furthermore, Crown’s Executive Chairman, Helen Coonan dealt with the NSW Independent Liquor and Gaming Authority Inquiry:
"Despite the uncomfortable reading at times, Crown has welcomed the Commissioner’s report," she said. "We see it as an opportunity for a complete and comprehensive corporate re-set."
"We recognize the need for immediate and swift action and I would like to reiterate my commitment to driving the necessary ‘root and branch’ change that is required. Crown has committed to working constructively with ILGA to advance reforms necessary to allow it to give effect to the Restricted Gaming Licence in Sydney," Coonan continued. "Crown also continues to work cooperatively with the Victorian and WA regulators as it works to restore public and regulatory confidence in its operations."
Crown also reported closure costs of $58.1 million (net of tax), which includes costs incurred during the mandated closure of Crown Melbourne and Crown Aspinalls, and Significant Items of $42.0 million (net of tax) relating to Crown Sydney pre-opening costs, one-off allowance for expected credit losses and a reassessment of DGN contingent consideration, were recorded during the period.
"With Ken Barton stepping down from his role of CEO and Managing Director earlier this week, I assumed the role of Executive Chairman on an interim basis to provide leadership stability as we undertake a search for a new CEO and implement Crown’s ambitious reform program. I want to be clear I do not see myself as Executive Chairman for an extended tenure. We have already commenced a global search for a new CEO," Coonan explained
"The resignations of Guy Jalland and Michael Johnston as Directors of Crown and the termination of the consultancy arrangement between CPH and John Poynton mean CPH is no longer separately represented on the Crown Board. Further, Andrew Demetriou has resigned as a Director of Crown. Their decisions have helped to accelerate our plans for Board renewal, which had already commenced with the appointment of Nigel Morrison subject to the receipt of regulatory approvals. Nigel will bring to the Board gaming industry experience throughout Australasia and Asia. Nigel’s appointment will also enhance our Board representation in Melbourne where he is based. I would like to thank Ken, Guy, Michael and Andrew for their contributions to Crown over a number of years. On behalf of the Board, I wish all of them well in their next endeavours," she added.
"As interim Executive Chairman, I am determined to provide the leadership required to drive change. My job is to lead Crown to become a stronger company, a more transparent company and a more respected company. A better company," Coonan concluded.