Star Entertainment secures exclusive slots rights in Sydney
The Star Sydney, Star Entertainment Group’s property in Australia's largest city, has reopened for business, with the operator announcing a deal that gives it exclusive rights to offer slots in the market.
Yesterday’s (1 June) opening was announced alongside a new, 20-year flat tax structure that begins from the operators' 2022 fiscal year, which starts on 1 July, 2021. This will see table game revenue taxed at 29% of gross revenue until 2041.
For electronic gaming machines, the venue will pay a 32% tax on revenue until 2024, which then rises to 33% between 2025 and 2027, then to 34% for the following 14 years.
As part of this agreement, it will continue to serve as the sole casino operator permitted to offer slots in the Sydney market. This, the operator said, “provide regulatory certainty” for the business.
Should the NSW government permit the city’s other casino, Crown Resorts’ Crown Sydney, to launch slots at any point, it would be entitled to financial compensation, Star Entertainment noted.
Any other material changes to regulatory controls applicable to the venue before 30 June 2041 would also result the operator being able to claim compensation. This could be trigged by changes in the cap on gaming units – with no limits on tables or multi-terminal machines, and a 1,500 cap on slots currently in place – or changes to operating hours or caps on jackpots or prizes.
News of the agreement comes after Star Sydney reopened to customers from 1 June, having shut its doors as a result of novel coronavirus (Covid-19) on 23 March. This saw its private gaming rooms, plus 12 food and beverage venues within the casino, resume operations.
For the time being up to 500 loyalty club members will be allowed into the casino, on an invite-only basis, with additional visitors allowed into its two hotels, and fine dining restaurants, which will have maximum capacities of 50.
The reopening will see social and spatial distancing measures imposed, as well as additional hygiene and cleaning measures in place. The plan has been developed in consultation with two independent health experts, and complies with the NSW government guidance.
“The health and wellbeing of our customers and staff is paramount,” Star Entertainment managing director and chief executive officer Matt Bekier said. “This first step in the re-opening enables us to welcome back a material number of employees and to re-engage with our guests in a safe environment.
“The restrictions mean that business volumes will be significantly below normal levels,” he said. “We are focused on conservatively managing the business to provide us with the confidence for the next stage of returning our properties to more normal conditions as restrictions unwind.”
In April the operator announced that operating expenses had been reduced to $10m per month while its Sydney casino and two venues in Queensland remained closed. The limited reopening, however, is expected to mean outgoings will increase to $20m in June, mainly as a result of staff costs and costs of goods sold.