Star Entertainment Sees Improvement in Q2 Despite Ongoing Challenges
Cost-Cutting Efforts Pay Off
Australian casino operator Star Entertainment has reported a smaller loss for the second quarter, thanks to its successful cost-out program and a strong December performance. The company’s efforts to reduce expenses have helped mitigate the impact of ongoing regulatory inquiries and prolonged casino closures.
Revenue Takes a Hit
Despite the improvement, Star Entertainment’s revenue fell 15% to A$299 million compared to the previous quarter. The company attributed this decline to the continued weakness in the operating performance of the group, as well as costs associated with ongoing remediation activities.
Cash Flow Remains a Concern
Star Entertainment, which is struggling with a cash crunch, reported an 18% decline in operating expenses to A$52 million. This reduction was driven by lower corporate costs, among other factors. The company’s available cash stood at A$78 million at the end of December.
Market Reaction
Investors reacted negatively to the news, with shares falling 3.6% to A$0.135 by 2355 GMT. This decline came despite the benchmark stock index rising 0.4%.
A Challenging Environment
The company’s statement acknowledged the ongoing challenges it faces, citing a difficult consumer environment. Despite these hurdles, Star Entertainment remains committed to its cost-cutting program and remediation efforts.
Key Figures
- Loss before interest, tax, depreciation, and amortization (EBITDA): A$8 million (excluding significant items)
- Operating expenses: A$52 million (down 18%)
- Available cash: A$78 million
- Revenue: A$299 million (down 15%)
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