WE ARE SET FOR A JACKPOT

Written on the 14 April 2015 by Laura Daquino

WE ARE SET FOR A JACKPOT WHAT is a vice of some is incredibly virtuous to the Australian economy.

Casino giants are gearing up for the opening of at least three new mega-casinos in the next five years, raising our nation's casino stakes by 23 per cent.

The Acquis Great Barrier Reef, a Chinese consortium developed Gold Coast resort, Crown's Barangaroo development and a potential either-or Crown-Echo Queen's Wharf development are all in the running to become the first new Australian casino since Accor Casino Investments opened the Reef Hotel Casino Cairns in January 1996.

Asian wealth and a boom in high-rollers are driving development in this industry, and carrying a projected revenue growth of 10.3 per cent between 2014-15 and 2019-20 according to IBISWorld.

IBISWorld senior industry analyst Spencer Little says new casinos will present free-flowing benefits to industry, and the arguments for them are well-founded considering Australian gamblers were found to spend more money on gambling services than any other country by a 2013 study in The Economist.

"The effects on the mid to high end of the gambling market will be significant, and will include increased competition and improved revenue flows, not to mention resulting benefits for local tourism and hospitality," says Little.

The Australian casino industry is dominated by three major players - Crown Resorts (ASX: CWN), Echo Entertainment Group (EGP) and SKYCITY Entertainment Group (SKC).

Brisbane-based EGP experienced the most growth in the five years to 2015, enjoying an annualised growth of 5.3 per cent, surpassing CWN's 5 per cent growth.

EGP still holds a smaller market share than CWN, at 31.7 per cent compared to 52.5 per cent, but with only one casino less the odds could eventually be in its favour.

"The industry's two largest players have asserted their dominance and increased their control over the market over the past five years, in large part due to increased expenditure on marketing," says Little.

"Crown Resorts benefited from the rebranding of the Perth casino in 2012 and has also sought to develop new hotels and expand its accommodation facilities to attract more wealthy international visitors. Echo Entertainment Group has employed a similar strategy."

While EGP and CWN seem the fiercest contenders, time will tell if new players shake up the mix even more.

Alternatively, the Australian market could be derailed by Asian destinations, which have recently taken out much bigger beasts.

"Macau, with its 33 casinos, is a particularly high-growth market, and has attracted an increasing number of international high rollers and tourists to its luxury casinos," says Little.

"Macau has surpassed Las Vegas in revenue over the past five years, which is a colossal achievement."



Author: Laura Daquino Connect via: Twitter LinkedIn

Latest News

THE STAR'S STUNNING ANSWER TO CROWN'S BARANGAROO

THE Star Entertainment Group (ASX:SGR), not to be outdone by James Packer's Barangaroo development across the ...

BRISBANE COAL TERMINAL REOPENS AFTER SHIPLOADER REPAIR

COAL loading has recommenced at New Hope's (ASX: NHC) Brisbane terminal today after repairs to its ship loader, w...

SUPERYACHTS OFFER UNTAPPED POTENTIAL AT COMMONWEALTH GAMES

SUPERYACHT Australia has devised a strategy to attract more superyachts to Queensland and capitalise on revenue op...

GDP FIGURES A 'WAKEUP CALL' FOR PARLIAMENT

THE GDP figures are an end-of-year wakeup call for Parliament about what lies ahead for the country, according to ...

Related News

HOW MCDONALD'S AUSTRALIA REDISCOVERED ITS INNOVATIVE SPIRIT

MCDONALD'S is such a ubiquitous part of the Australian landscape today that it is easy to forget how it change...

JB HI-FI IS THE GOOD GUY IN $870 MILLION ACQUISITION

ELECTRONICS giant JB Hi-Fi has formally completed its $870 million acquisition of home appliance chain The Good Gu...

ACCC ACTS AGAINST MERITON'S RIGGED REVIEWS

MERITON Property Services is under fire from Australia's main consumer watchdog, after it allegedly engaged in mi...

ACCC FIRES WARNING SHOT TO IVF PROVIDERS

IVF clinics have been put on notice by consumer watchdog, the Australian Competition and Consumer Commission (ACCC...

Contact us

Email News Update Sign Up Contact Details

Subscribe to our mailing list

* indicates required
Email Format

PO Box 2087
Brisbane QLD 4001

LoginTell a FriendSign Up to Newsletter