PUNTERS BIG AND SMALL BOOST ECHO

Written on the 13 August 2014

PUNTERS BIG AND SMALL BOOST ECHO

REVENUE gains from both small punters and high rollers helped Echo Entertainment Group (ASX: EGP) boost its bottom line by 27.3 per cent to $106.3 million for the 2014 financial year.

The owner of Sydney’s The Star, Brisbane’s Treasury and Gold Coast’s Jupiters casinos has enjoyed unexpected growth over the second half at a time when the south-east Queensland casino market is poised to become even more competitive.

Echo posted a 3.9 per cent increase in full-year revenue to $1.8 billion, buoyed by The Star which the company says is “gaining traction” with customers following its $1 billion redevelopment.

The Star accounted for $1.2 billion of the revenue figure, with Echo reporting that most of that growth came from electronic gaming machines.

Queensland operations remain flat, with revenue down 3.7 per cent to $620 million.

However, EBITDA (earnings before interest, tax, depreciation and amortisation) for Queensland is up 3.9 per cent to $127.1 million.

Echo says the non-gaming sector in Queensland has been impacted by the lack of new attractions and a “difficult consumer environment”.

The VIP business, which involves luring big punters from interstate and overseas, has given Echo a lift, even though win rates are down on FY13.

VIP revenue rose 2.5 per cent to $396.5 million.

Operating expenses of $866.9 million are fractionally lower than FY13, and comfortably under guidance of $870 million. Expenses in Queensland are down due to lighter volumes.

Echo expects the momentum achieved in the second half of 2014 to continue into the current half-year.

“We have started FY15 the same way we finished FY14, with good momentum in our major properties,” says CEO Matt Bekier.

“We have three priorities this financial year – firstly, to continue growing earnings across the group through greater focus on our customers and prudent expense management.

“Secondly, we will deliver on the initial stage of the capital program to substantially redevelop and expand the Gold Coast property, and, thirdly, we are working hard to develop a compelling proposal for the Queen’s Wharf Brisbane development.”

Echo faces competition from the likes of James Packer’s Crown Group for a new Brisbane casino, while on the Gold Coast the ASF Consortium has been granted preferred status for a second casino licence for a new development to include a cruise-ship terminal in the Southport Broadwater.

Echo announced plans for a second hotel to be developed at Jupiters in time for the 2018 Commonwealth Games. Construction is due to start next year.

Echo is paying a final dividend of 4c a share, bringing the full-year payout to 8c.


Latest News

INTEREST IN RETAIL PROPERTY SPIKES AS INTERNATIONAL BRANDS LOOK TO ROLL OUT IN AUSTRALIA

AN influx of international retail brands into Australia over the next five years are expected to push up demand for f...

MANTRA BOASTS OF SUCCESSFUL HOTEL INTEGRATION AS NET PROFIT GROWS 15 PER CENT

MANTRA Group (ASX:MTR) CEO Bob East has praised the performance of the company's new Honolulu Hotel as it posted ...

WHITEHAVEN TRIPLES EARNINGS, PAYS DOWN DEBT AFTER COAL PRICE TURNAROUND

THE HIGH coal price has allowed Whitehaven Coal to triple earnings and pay down a large portion of its debt in the fi...

BABY BUNTING BUOYED BY CLICKS AND BRICKS PERFORMANCE

BABY Bunting has grown sales 18.1 per cent to $135.1 million in the first half of FY17, sweetened by the opening o...

Related News

WHY EMPLOYEE-OWNED COMPANIES ARE BEATING ASX200 SHARE PRICES

EMPLOYEE-owned companies command a higher share price than their publicly listed peers, reaping a 17 per cent prem...

RISE OF THE MACHINES HAS WORKERS SWEATING

UP TO 3.8 million Australian workers are fearful their job may soon be terminated by a robot, a new survey has shown....

LESS TALK, MORE SMALL BUSINESS ACTION IN 2017

THE future growth and prosperity of Australian SMEs could be undermined if governments lose sight of the sector...

TEST DRIVE A POST GRAD AT BOND

THERE'S only one way to really move your career into the fast lane, says Bond University, and 'test driving...

Contact us

Email News Update Sign Up Contact Details
Subscriptions

PO Box 2087
Brisbane QLD 4001

LoginTell a FriendSign Up to Newsletter