Crown Resorts chief executive Rowen Craigie is stepping down following a decade in charge after the casino operator comprehensively overhauled its strategy in response to the challenges facing its high-roller business.
Executive chairman John Alexander will assume Mr Craigie’s duties next week and will lead a company that on Thursday cancelled plans for a partial float of its Australian hotels and retail property, launched a $500 million share buyback, flagged a buyback of up to $530 million in subordinated notes and declared an 83 cent special dividend.
With a new dividend policy also in place, Crown’s strategy has transformed in the four months since 15 employees were detained in China amid a crackdown on gambling marketing and outflows of money from the mainland.
Mr Alexander said a simpler executive structure means Crown will focus on its casinos and hotels in Melbourne and Perth, the luxury hotel-VIP casino development at Sydney’s Barangaroo, the development of the Queensbridge hotel tower in Melbourne, and its digital business.
“Our focus is very much on driving the profitability of our Australian resorts,” Mr Alexander said.
“There’s work to be done to bring Sydney into fruition, and we’re very confident that it’s going to be a very successful property.”
The Crown arrests triggered caution in the VIP gambling market in China, hurting the flow of rich high-rollers to Crown’s integrated resorts in Australia.
Since October, Crown has dumped plans to de-merge its international assets, reduced its joint-venture casino and hotel interests in Macau, dropped plans to build a casino in Las Vegas, replaced Robert Rankin as chairman, and reappointed billionaire James Packer – who holds a 48.2 per cent stake – to its board.
One of the Crown employees has been bailed, but 14 are still in detention and Crown is still waiting to find out what they are accused of doing.
Crown said on Thursday its first-half profit rose 75.2 per cent to $359.1 million due to a $176.3 million gain from one-off items, most of which came from the sale of shares in Macau’s Melco Crown Entertainment.
Normalised profit, which strips out one-off items and variations in the theoretical win rate against high-rolling gamblers, was down 9.1 per cent at $191.3 million.
Normalised revenue from Crown’s casinos in Melbourne and Perth fell 12.5 per cent to $1.48 billion as turnover from VIP high-rolling gamblers plunged 45.3 per cent to $19.6 billion.
“Crown’s Australian operations’ first-half result reflected difficult trading conditions,” said Mr Alexander said, who became executive chairman three weeks ago.
Mr Craigie has spent 24 years at Crown, 10 of them as chief executive.
Crown shares gained 90 cents, or 7.9 per cent, at $12.29.
CROWN’S TOUGH FIRST HALF
* Net profit up 75pct to $359.1m
* Normalised net profit down 9.1pct to $191.3m
* Interim dividend down 3 cents to 30 cents, 60pct franked
* Special dividend of 83 cents, 60pct franked