This article is from the Australian Property Journal archive
DAYS after flagging the sale of more assets and a profit downgrade, struggling ASX-listed gambling company Star Entertainment Group announced it has enlisted former Lendlease and Crown chief Steve McCann to guide it through troubled waters.
McCann will join The Star in a fortnight’s time.
The company this week revealed it is forecasting FY24 revenue to be between $1.675 billion and $1.685 billion, while due to challenging trading conditions and elevated operating expenses as a result of ongoing remediation and $100 million penalties from the Queensland and NSW governments for operational and cultural issues, EBITDA will slump to between $165 million to $180 million – substantially down on FY23’s $317 million.
The Star has been on the brink of losing its licence to operate its Sydney casino, with the NSW regulator having launched a surprise inquiry into the company’s progress in remedying cultural issues that saw it heavily punished following the initial inquiry in 2022.
McCann, after retiring from the top post as major property player Lendlease in 2021, oversaw a similar period of turbulence and change at The Star’s rival Crown following the group’s own breaches, and the mega-deal that saw its $8.9 billion sale to US giant Blackstone.
“Following a comprehensive search process, the board is very pleased to have secured a CEO of Steve’s calibre, experience and respect in the market. Given his time with Crown, and previous long-standing leadership at Lendlease, he has the right credentials to lead The Star’s remediation program,” said chairman of The Star, Anne Ward.
“His track record reflects his capability to work collaboratively with multiple stakeholders and lead meaningful transformational change and cultural renewal. This experience will be invaluable as we work towards rebuilding trust and expediting the sustainable transformation of The Star.”
McCann is replacing Robbie Cooke, who left in March.
The company this week flagged the potential sale of other non-core assets in the coming months, and said it would provide a further update with its full-year results.
It said negotiations continue for the $200 million sale of the Treasury Brisbane casino, hotel and car park after a sale to Charter Hall fell through. Charter Hall had entered into due diligence in October 2021 to buy the Treasury casino and hotel buildings as well as the Queen’s Gardens car park for $248 million, but a year ago walked away from the deal after the parties could not reach an agreement.
The Star has also commenced a process to sell the Festival Car Park in Brisbane.
The Star, through its 50% owned subsidiary, sold the Sheraton Grand Mirage Resort on the Gold Coast for $192 million in June last year, of which it pocketed $60 million in net proceeds.
