Key points:
- The $200m facility consists of two $100m tranches, available for drawdown until 20 December 2024
- Lenders waived the December 31 2024, covenant testing requirement
- The Star continues to address financial and regulatory challenges, including a recent AU$15m fine and licence suspensions
The Star Entertainment Group has executed agreements for a AU$200m ($129m) debt facility, confirmed in an update to the Australian Securities Exchange (ASX).
The arrangement comprises two tranches of AU$100m each, with availability until 20 December 2024. Alongside this, the company’s lenders have granted a waiver for the upcoming 31 December covenant testing, alleviating immediate financial pressure.
This move comes as The Star continues to face financial difficulties and operational scrutiny. In its Q1 FY25 financial report, the company disclosed an 18% year-on-year revenue decline to AU$351m, accompanied by a 130% drop in EBITDA, resulting in a loss of AU$18m.
These results followed a difficult fiscal year, marked by a 45% drop in statutory EBITDA for 2024 and ongoing challenges, including cost-of-living pressures and new regulatory requirements.
The financial strain has been compounded by regulatory penalties. In October, The Star Sydney received an AU$15m fine from the New South Wales Independent Casino Commission (NICC) for compliance failings.
Good to know: The casino remains under the supervision of an NICC-appointed manager, with its licence suspended until at least March 2025
The debt facility will be integral to The Star’s efforts to stabilise its operations while addressing regulatory mandates and sustaining its phased opening of The Star Brisbane.
Treasury Brisbane was permanently closed earlier this year as part of the company’s operational restructuring.
In its 2024 Annual Report, Chair Anne Ward highlighted the importance of rebuilding trust with stakeholders and regulators. The debt facility, alongside ongoing remediation plans, is expected to support these objectives while addressing immediate financial needs.
