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Crown Resort reveals earnings collapse

Gambling giant Crown Resorts revealed on Wednesday that its full-year net profit tumbled 80% to $79.5 million due to widespread COVID-19 shutdowns, with ASX figures showing a decrease in revenue of 26% across all Crown Australia operations, with main floor gaming revenue down 27% and a collapse of 47% in VIP play turnover.

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Crown Resorts operates casinos in Melbourne, Perth and London, with Sydney's much touted casino set to open in December.

While Crown suspended its shareholder payment policy following its earnings drop, the company controversially awarded the first-half payment in April, which delivered major shareholder James Packer a $73 million pay-out, even though the group was already using the JobKeeper wage subsidiary for staff members.

Crown shareholders typically receive a 30¢ dividend per share every six months, but no pay-out has been announced for the June half. According to Crown CEO Ken Barton, this year’s figures came after an unprecedented operational slump.

“From late January 2020, Crown began to experience softer trading conditions as a result of travel restrictions and general community uncertainty in response to COVID-19, particularly impacting visitation to Crown Melbourne," he said. "In March, Crown was directed to close its gaming activities and a significant part of its non-gaming operations at Crown Melbourne and Crown Perth for an extended period, with our financial results reflecting the impact of these closures. These closures have also had a substantial impact on our people."

Crown managed to secure $111 million in JobKeeper subsidies through to June 30, of which $43.4 million covered the wages of staff who continued to work at Crown, maintaining operational readiness for reopening as soon as restrictions eased.

Barton added: "Additionally, Crown has established a Hardship Fund to provide targeted financial assistance to employees experiencing serious financial hardship as a result of COVID-19. This programme is in addition to the many other programmes Crown has established to support employees during this unprecedented time."

Crown expects to qualify for round two of the JobKeeper programme in September for Melbourne staff, but not Perth staff, as they have already recommenced operations.


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