Crown Resorts woes deepen as VIP business shrinks

Crown Resorts Ltd.’s high-roller gambling business continued to shrink, cementing the company’s woes amid allegations that criminal gangs laundered money at its casinos.

Turnover from the VIP program tumbled 26% to AUD38 billion ($26 billion) in the year ended June, Melbourne-based Crown said yesterday. The stock rose 0.1% in Sydney as earnings broadly matched estimates.

Weakness in Crown’s VIP business was enough to drag down total group revenue, indicating the company’s reliance on big-gambling overseas visitors in a sluggish Australian market.

The regulatory investigations into the media reports – that Crown used junket operators linked to drug traffickers to attract wealthy Chinese gamblers – risk compounding the current weakness in Crown’s VIP business, reported Bloomberg.

That also bodes badly for Crown’s planned luxury casino in Sydney, which is due to be completed in 2021 and will rely in large part on VIP gamblers.

Crown reiterated yesterday the media reports “unfairly sought to tarnish Crown’s reputation.” Bloomberg