Crown Resorts see profits tumble on China’s corruption crackdown

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Australia’s biggest casino company, Crown Resorts, has reported a slump in half-year profits, which were dented by a sharp slowdown at its Chinese operations.

The firm’s net profits fell 22% to $205m Australian dollars ($146.9m; £105.5m) in the six months to December.

Crown said its overall gaming revenue in Macau, the only place in China where casinos are allowed, fell 30%.

But it said gaming revenue at Crown’s Australian resorts had increased 9.8%.

The firm’s Sydney-listed shares lost more than 9% on the profit report, but were down just over 5% later.

The Macau factor

Crown holds a big interest in Melco Crown Entertainment (MCE), which operates casino and hotel properties in Macau.

A special administrative region of China, Macau is the world’s largest gaming centre, ahead of Las Vegas. Its economy relies heavily on gambling and shopping – especially by big spending tourists from the mainland.

But Chinese President Xi Jinping’s campaign against corruption and luxury spending, which began in December 2012, has seen officials and others more wary of gaming and spending in the city.

“The decline in MCE’s result was attributable to weak market conditions in Macau,” Crown’s chief executive Rowen Craigie said.

“Overall gross gaming revenue across the Macau market in the half year to 31 December 2015 declined by more than 30%,” he added.

Crown Resorts was started in Melbourne and has since expanded to Sydney, Perth, London, Macau, Manila and Las Vegas.

 

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