Gold Coast bucking trend as Star shines
THE Star Gold Coast has bucked a downward trend with a surge in revenue from international high rollers at its Broadbeach venue.
Listed owner The Star Entertainment Group, which yesterday reported a 36 per cent increase to its full-year net profit helped by a high VIP win rate, said its international gambling business had dropped 20 per cent to $554.7 million.
That was because of disruption to the North Asia market following the detention of rival Crown Resorts staff in China.
It said Queensland operations, which included The Star Gold Coast, saw gross revenue grow in the VIP international rebate business by 213.3 per cent and turnover soar by 199 per cent to $6.2 billion.
The VIP business refers to foreign punters who receive incentives like luxury hospitality and cash rebates in return for committing to gamble certain amounts.
Chief executive Matt Bekier said the Gold Coast was able to attract strong revenue following extensive renovations, which included refurbished hotel rooms and new food and beverage offerings.
Mr Bekier said Gold Coast was the third most popular destination for VIP high rollers in Australia based on turnover.
“The performance of the Gold Coast was particularly pleasing,” he said.
“We had a fair bit of disruption in the first half with hoardings everywhere. Most of that has gone. With the new facilities we have been able to bring many high-end customers to the property.”
Mr Bekier said Star had been working for the past two years to draw in a more diverse overseas customer base outside of China, and now could
count clients from 13 countries.
Domestic revenue rebounded in the second half, fuelled by revenue growth of 39.1 per cent for hotel rooms and 6.2 per cent for food and beverage.
“What really stood out was the non-gaming side including the new food and beverage offerings and refurbished hotel rooms,” Mr Bekier said.
Overall domestic revenue rose 9.9 per cent in FY17.
Mr Bekier said the main gaming floor would be expanded by 40 per cent once connected to Star’s new 17-storey sixstar hotel due for completion before next year’s Commonwealth Games.
He said it meant more table games, space for customers, but no additional slot machines.
Mr Bekier said Star had not completed plans for the Sheraton Grand Mirage Resort at Main Beach, which it acquired last year in a joint venture with Far East Consortium and retailers Chow Tai Fook.
“That is fully-booked until the Commonwealth Games, so we cannot do anything until that is over. We are talking to the Gold Coast City Council about what we can do there.”
Mr Bekier previously flagged plans to turn the resort into a “European beach club”.
Star is due to start presales marketing next month for units in a 700-room hotel and apartment tower, with construction due to start next year.
Shares closed up 26¢ or 5 per cent at $5.36.