Star Entertainment’s Financial Challenges and Bally’s Strategic Investment

Star Entertainment Unveils Financial Report

• Star Entertainment has released its postponed semi-annual financial report, illuminating its financial status for the period concluding on December 31, 2024.
• The company experienced a downturn in revenue, alongside a decline in EBITDA and a statutory net profit after tax loss.
• Earlier this month, Star Entertainment agreed to a AU$300 million offer from Bally’s Corporation for a controlling interest.

Financial Outcomes for H1 FY25

Following a delay tied to debt financing and various hurdles, Star Entertainment Group Limited, the renowned Australian gambling and entertainment entity, has disclosed its financial outcomes for the half-year period ending on December 31, 2024.

The company reported a revenue decline coupled with a substantial financial loss. This financial update coincided with the company’s decision to accept a financial lifeline from Bally’s Corporation, which involved an AU$300 million offer for a controlling stake.

Revenue Declines, EBITDA and NPAT Reflect Losses

According to the company’s latest financial disclosure, revenue for the half-year period ending December 31, 2024, identified as H1 FY25, amounted to AU$650 million.

When compared year-over-year to the AU$866 million recorded in H1 FY24, this represents a significant 25% decrease.

Not surprisingly, EBITDA also diminished, resulting in a loss for H1 FY25.

The freshly released financial update indicates an EBITDA loss of AU$26 million for the six months ending December 31, 2024, in stark contrast to the AU$114 million reported in the corresponding H1 FY24 period.

Additionally, the statutory net profit after tax (NPAT) for the half-year period ending December 31, 2024, marked a loss of AU$302 million, compared to a statutory NPAT gain of AU$9 million for H1 FY24.

Star Entertainment’s financial update clarified that the revenue downturn is attributed to “challenging trading conditions resulting from the enactment of casino operating reforms, including mandatory carded play and cash limits at The Star Sydney, and further market share erosion.”

In its update, the company emphasized achieving a previously announced AU$100 million reduction in annualized cost savings.

Furthermore, Star Entertainment confirmed its ongoing efforts to integrate these cost savings and identify additional areas for potential incremental cost reductions.

The H1 FY25 results reflect a partial contribution from Treasury Brisbane, which ceased operations on August 25, 2024, and a partial contribution from The Star Brisbane, which initiated its phased opening on August 29, 2024, according to the company.

Bally’s Secures Controlling Interest in Star

Recently, Star Entertainment engaged in refinancing proposal discussions with Salter Brothers Capital, a private equity firm.

Initially, the company aimed to secure up to AU$940 million, but as discussions faltered, it considered an offer from Bally’s Corporation.

Earlier this year, Bally’s proposed an AU$250 million offer in exchange for a controlling interest in Star Entertainment.

After refinancing negotiations with Salter Brothers Capital stalled, Star Entertainment accepted an improved AU$300 million offer from Bally’s, securing a controlling stake of 56.7%.

Star Entertainment has already received AU$100 million on April 9, 2025, with an additional AU$200 million anticipated upon shareholder approval.