Star Entertainment Group keeps making headlines. One of Australia’s largest casino groups is now reportedly running low on cash, caused partially by an investigation into criminal activity of its gambling operations. The Group’s latest problems are further exacerbated by a slowdown in demand from gamblers who are facing a raging cost-of-living crisis.
Star was once one of the most lucrative brick-and-mortar casinos Down Under, with establishments in Sydney, Brisbane, and the Gold Coast. However, the latest reports released on Thursday show that the Group lost a quarter of its value, and was left with only A$79 million for funding all of their casino operations.
Australia’s strictest pokie machine regulations to date, set by Victoria, aren’t helping the matter, either. The new rules aim to protect the players, and they reflect on everything from money limits to a mandatory swipe card system. The amount of money players could put into a machine at a time went from $1000 to $100, significantly reducing casinos’ profits. And if you want to play at online casinos in Australia, the situation is a bit grey. There are no domestically registered iGaming platforms here, but Aussies can still test their skills at internationally licensed casinos not on BetStop. These sites are usually licneced in places like Malta and Curacao, and according to Alex Hoffmann, offer access to bigger bonuses, a wider variety of games, and fewer restrictions.
In light of the new gambling policies, pubs and clubs in New South Wales have recently undergone a massive overhaul, all in the attempt to protect patrons and motivate them to gamble responsibly. The initiative introduced a responsible gambling officer on duty tasked with monitoring the players as long as poker machines are in operation.
The number of pubs and clubs in Australia that offer gambling machines and sports betting has risen, and so has the public’s interest in them, partially due to strict regulations that surround them. As the number of gamblers that visit these venues rises, the number of people gambling in Star’s grand casinos plummets.
Star Entertainment Group isn’t the only one facing these problems, as the entire industry has been hit by new, tougher rules by regulators that focus on monitoring high-risk individuals. Crown Resorts—one of Star’s rival casinos—is going through a crisis of its own. This casino operator, which was acquired by Blackstone in 2022, has lost significant profit, leading it to cut jobs within the establishment.
While every casino is dealing with its own consequences, Star seems to be left with the biggest ones. Their shares are now valued at $415 million, in comparison to more than $3 billion, which is how much they were worth in 2022.
The casino group might have raised serious concerns over its viability, but the officials aren’t ready to throw in the towel just yet. The coming months will see them struggling with fines and refinancing costs, all the while they continue to search for ways to improve their financial situation.
Even though the group got a loan extension with the creditors six months ago, they are working their way to another $100 million loan. Before they are able to get it, the group’s casinos would have to fulfill a number of conditions, which, given their current situation, will be extremely difficult. While hope might spring eternal, it’s difficult to find room for improvement in Star’s earnings in the short term.
