Star Entertainment Group has halted trading ahead of its half-year results as the casino giant mulls renegotiating its debt.
The star issued a gloomy market outlook last week ahead of Thursday’s results, which saw the stock price fall more than 30 percent to $1.28. In it, the group said it faces a write-down of between $400 million and $1.6 billion plus millions of dollars in cleanup and transformation costs and is therefore considering an “urgent review” of its Sydney operations and assets.
The final figure is expected to be just $1.6 billion if the NSW government goes ahead with a proposed tax hike on casino table games and poker machine revenue.
In the past six months, The Star’s share price has plummeted more than 65 percent to $1.47, and its market cap has plummeted to $1.4 billion from $4 billion in 2021.
Cooper Investors – which previously held an 8% stake in the company – sold nearly 20 million shares following the announcement and is no longer a significant shareholder in Star Entertainment.
Under the proposed increase, casino poker machines would receive a top tax rate of 60.67 percent. It is expected to come into effect in July.
A spokesman for NSW Treasurer Matt Kean told this legal notice on Friday the extent of The Star’s financial burden was not clear when the proposal was tabled in December and his department began talks with the group.
Whether that means the government will revise the proposal is unclear.
“The Star is facing financial difficulties due to the fines and lost revenue caused by its historical, systemic, serious regulatory failures and illegal activities that have not been visible to the market,” the spokesman said.
https://www.smh.com.au/business/companies/star-in-trading-halt-as-pokies-pain-looms-20230220-p5clt0.html?ref=rss&utm_medium=rss&utm_source=rss_business Star in the trade stops as the Pokies pain pops up