Craigie Seeks More Investment in Tourism

Crown Casino chief Rowen Craigie is looking to boost Australia’s tourism sector with a call to invest more money into airports, hotels and speeding up the visa application process. It all falls into his plans to capitalise on the lucrative Asian gambling demographic by competing with such leaders as Singapore and Macau for its attention.

Craigie recently revealed that Crown has experienced a 22.9% drop in full-year profit, sending it down to just $395.8 million. Crown’s current projects are no secret and the headlines have been dominated by the Barangaroo development in Sydney. Crown has plans to sink billions of dollars into a monolithic casino and hotel resort and is also looking to expand into Brisbane and dominate the market there, but just how successful these ventures are will hinge largely on how much of China’s middle-class holiday market will be tempted by these new facilities. For this reason, Craigie wants to revamp Australia’s tourism and entertainment infrastructure in order to bring this crowd in.

Craigie places particular importance on visas, direct flights, airports themselves and accommodation. Every country in the world is allegedly reaching out to the Chinese middle-class market and so Australia should strive to accommodate them and become their most attractive holiday destination. Of course, Crown is heavily invested in this market already and is prepared to fight both sides of this tourism war. After all, the company does have a 34% investment in Melco Crown Entertainment, which operates a casino resort in tourism rival Macau, while its own Australian casinos already draw in plenty of Asian high-rollers.

However 2013 has seen significant changes take place in Chinese leadership, which in turn has had an effect on the VIP high-rollers and, consequently, Crown’s revenue. At the end of the financial year, Crown has had mixed fiscal results, following the effect of various factors.

The Crown Casino in Melbourne has experienced a boost in earnings from the mass market, while normalised group profit has risen 14% up to $473.2 million. However, the rise in revenue on the main gambling floor has been minimal at just 0.9%, as a result of refurbishments causing disruptions to gamblers. Less successful were the basic games and pokies, which were actually down since last year, due to the popularity of the private rooms within the casino. VIP gaming yielded much more positive results with a 9.2% boost, while the Perth Casino main floor also enjoyed a 9.7% rise. Overall, shares in Crown closed at an all-time high and were up 76¢ at $14.34.

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