Star Entertainment Group Limited · ASX:SGR
Star Entertainment — FY2021 Earnings Presentation
33 slides from Star Entertainment's earnings presentation, Aug 19, 2021
Slide 1: ASX Announcement: Full Year Results Presentation
ASX Announcement 19 August 2021 FULL YEAR RESULTS PRESENTATION Attached is the presentation regarding the financial results of The Star Entertainment Group Limited (The Star Entertainment Group) for the year ended 30 June 2021, to be presented by Matt Bekier (Managing Director and Chief Executive Of
Slide 2: FY2021 Results Presentation
THE STAR ENTERTAINMENT GROUP FY2021 RESULTS PRESENTATION THURSDAY 19 AUGUST 2021
Slide 3: Basis of Preparation and Non-IFRS Information
THE STAR ENTERTAINMENT GROUP THE STAR ENTERTAINMENT GROUP LIMITED (ASX: SGR) BASIS OF PREPARATION AND NON-IFRS INFORMATION ♦ Information in this presentation is provided as at the date of the presentation unless specified otherwise. It should be read in conjunction with The Star Entertainment Group
Slide 4: Agenda
THE STAR ENTERTAINMENT GROUP AGENDA 1. OVERVIEW 2. FINANCIALS 3. PRIORITIES 4. Q&A 3
Slide 5: FY2021 Highlights
OVERVIEW FY2021 HIGHLIGHTS PERFORMANCE ♦ Normalised Group revenue of $1.56bn, EBITDA of $430m and NPAT of $116m* IMPACTED BY COVID-19 ♦ Statutory EBITDA of $427m (before significant items) and statutory NPAT of $58m (after RELATED RESTRICTIONS significant items) ♦ COVID-19 related property shutdowns
Slide 6: Trading Update
OVERVIEW TRADING UPDATE EARLY 1H FY2022 ♦ Early 1H FY2022 trading has been negatively impacted by property shutdowns and operating TRADING IMPACTED BY restrictions upon re-opening of the Queensland properties COVID ♦ When open in Queensland, the revenue trends were broadly consistent with 1H FY2021
Slide 7: Improving Revenue Trends as Restrictions Ease
OVERVIEW IMPROVING REVENUE TRENDS AS RESTRICTIONS EASE POSITIVE REVENUE ♦ EGM revenue returned to growth on pre-COVID levels during 2H FY2021 1 TRENDS ♦ Table games revenue improved but was still below pre-COVID levels QUEENSLAND STRONG ♦ Gold Coast domestic gaming revenue up 18% in 2H FY2021 vs 2H
Slide 8: Sydney
OVERVIEW SYDNEY IMPACTED BY ♦ Earnings significantly impacted by the more onerous COVID-19 related operating restrictions OPERATING (300 patron cap per area, no co-mingling, caps on table and machine utilisation, masks) and RESTRICTIONS the property shutdown at the end of the period ♦ Domestic EBITD
Slide 9: Sydney Operating Conditions
OVERVIEW SYDNEY OPERATING CONDITIONS 12-Feb-2021 29-Mar-2021 18-Jun-2021 ♦ Capacity ♦ Restrictions ♦ Masks strongly encouraged in 03-Jan-2021 increased to lifted at all public indoor venues ♦ Masks mandatory 01-Jul-2020 10,000 patrons entertainment 20-Jun-2021 in gaming areas ♦ Capacity increased to
Slide 10: Gold Coast
OVERVIEW GOLD COAST ♦ Gold Coast normalised EBITDA up 17% to $112m, margins improved from 18.0% to 29.2% RECORD DOMESTIC ♦ Domestic EBITDA up 86% on pcp to $115m, margins improved from 20.4% to 30.2% EARNINGS ♦ Very strong performance in the second half upon re-opening of domestic borders ♦ Domestic
Slide 11: Brisbane
OVERVIEW BRISBANE ♦ Brisbane normalised EBITDA up 100% on pcp to $114m, revenue up 34% RECORD PERFORMANCE ♦ EBITDA margin improved from 22.1% to 32.9% DESPITE SHUTDOWNS ♦ Domestic gaming revenue in the second half up 3% on 2H FY2019 despite shutdowns in SLOTS UP 4% ON 2H January (3 days), March (3 d
Slide 12: Queensland Operating Conditions
OVERVIEW QUEENSLAND OPERATING CONDITIONS 17-Nov-2020 11-Jan-2021 22-Jan-2021 29-Mar-2021 29-Jun-2021 02-Jul-2021 08-Aug-2021 ♦ Capacity increased ♦ Treasury Brisbane re- ♦ Revert to 1 ♦ Treasury Brisbane ♦ Brisbane-1 ♦ Gold Coast-1 person per 4m2, ♦ Brisbane and to ~5,000 patrons (1 opened to ~2,500
Slide 13: Agenda
THE STAR ENTERTAINMENT GROUP AGENDA 1. OVERVIEW 2. FINANCIALS 3. PRIORITIES 4. Q&A 12
Slide 14: Group Overview
FINANCIALS GROUP OVERVIEW ♦ Operating expenses down 11% on pcp to $740m OPERATING COSTS ♦ JobKeeper wage subsidy of $58m booked in 1H FY2021* WELL-MANAGED ♦ $50m fixed cost reduction program progressed with the full run-rate to be realised in FY2022, assuming more normal operating conditions ♦ $51.5
Slide 15: EBITDA Bridge
FINANCIALS EBITDA BRIDGE $m FY2020 International FY2020 Sydney Queensland Sydney Queensland FY2021 International FY2021 Statutory VIP Rebate Normalised Domestic Domestic International International Normalised VIP Rebate Statutory EBITDA* Business EBITDA* EBITDA EBITDA VIP Rebate VIP Rebate EBITDA* B
Slide 16: Capex
FINANCIALS CAPEX GROUP CAPEX IS DOWN ♦ The Group is coming off a period of heavy investment, delivered on time and on budget MATERIALLY FROM ♦ FY2021 group capex down 63% to $89m*, below guidance and well below D&A of $211m PRIOR YEARS ♦ FY2022 expected capex remains $125-150m, FY2023 guidance is ~$
Slide 17: Asset Sales
FINANCIALS ASSET SALES ♦ The Group has been pursuing a strategy of releasing capital from non-core or low-yielding RATIONALE assets and to re-invest the proceeds in higher growth and more productive areas ♦ Assets that meet this criteria include VIP related assets, car parks, hotels, retail and prop
Slide 18: Profit and Loss – FY2021
FINANCIALS PROFIT AND LOSS – FY2021 FY2021 FY2020* FY2021 FY2020* $M fav/(unfav) 2 2 2 2 2 fav/(unfav) STATUTORY STATUTORY NORMALISED NORMALISED Domestic Gaming revenue 1,363.8 1,243.9 9.6% 1,363.8 1,243.9 9.6% International VIP Rebate 9.5 285.2 (96.7%) 13.5 509.2 (97.3%) Non-gaming and other revenu
Slide 19: Balance Sheet
FINANCIALS BALANCE SHEET $M JUN 2021 JUN 2020 ♦ Capital programs progressed RESTATED* ASSETS • Property, plant and equipment declined, reflecting capex Current Assets Cash and cash equivalents 67.9 66.1 below depreciation Trade and other receivables 23.3 99.5 • Investment in associates and joint ven
Slide 20: Agenda
THE STAR ENTERTAINMENT GROUP AGENDA 1. OVERVIEW 2. FINANCIALS 3. PRIORITIES 4. Q&A 19
Slide 21: Our Priorities for the Year Ahead
PRIORITIES OUR PRIORITIES FOR THE YEAR AHEAD ♦ Post COVID-19 earnings recovery 1 OPERATIONS ♦ Operating expenses – maintain cost benefits from recently executed programs LEGAL, REGULATORY ♦ AUSTRAC – enforcement investigation – notified in June 2021 2 AND COMPLIANCE • The Star will co-operate fully
Slide 22: Strategy Remains Unchanged
PRIORITIES STRATEGY REMAINS UNCHANGED OUR STRATEGY OUR DELIVERY ♦ Privileged assets and partnerships 1 Deliver on the operating model ♦ Signature gaming ♦ Leverage improved capabilities – loyalty, gaming, ♦ Premium hotel rooms, risk, RG, AML/CTF Food and Beverage, ♦ Retain the efficiencies from cost
Slide 23: Gold Coast
PRIORITIES GOLD COAST CONSTRUCTION ON TIME AND BUDGET ♦ Construction of the Dorsett Hotel and Residences (Tower 1) • Remains on time and budget for completion in FY2022 • Equity contributions have been completed and $260m in project level debt facilities are in place • Sold 93% of the apartments ♦ C
Slide 24: Queen’s Wharf Brisbane
PRIORITIES QUEEN’S WHARF BRISBANE WORKS ON BUDGET ♦ 60% of gross floor area (GFA) has been built ♦ Fit-out of the gaming floor has commenced ♦ In excess of 90% of project costs are now under lump sum terms ♦ Signed a lease agreement with DFS, part of the LVMH Group, for ~6,000 sqm of luxury retail f
Slide 25: Agenda
THE STAR ENTERTAINMENT GROUP AGENDA 1. OVERVIEW 2. FINANCIALS 3. PRIORITIES 4. Q&A 24
Slide 26: Key Sustainability Metrics
APPENDIX KEY SUSTAINABILITY METRICS SUSTAINABILITY A GLOBAL SUSTAINABILITY LEADER AND ENVIRONMENTAL Casino and Gaming Category 2016 – 2021 Winner International Gaming >80% portfolio with environmental ‘Sustainable Business – Operator’ ratings, 90% by 2022 Award Green Star Performance Rating Aligning
Slide 27: Statutory Results – FY2021
APPENDIX STATUTORY RESULTS – FY2021 SYDNEY GOLD COAST BRISBANE TOTAL $M FY2021 FY2020* fav/(unfav) FY2021 FY2020* fav/(unfav) FY2021 FY2020* fav/(unfav) FY2021 FY2020* fav/(unfav) Slots 277.7 258.7 7.3% 203.9 132.6 53.8% 173.8 118.0 47.3% 655.4 509.3 28.7% Domestic Tables 458.1 526.3 (13.0%) 100.8 9
Slide 28: Normalised Results – FY2021
APPENDIX NORMALISED RESULTS – FY2021 SYDNEY GOLD COAST BRISBANE TOTAL $M FY2021 FY2020* fav/(unfav) FY2021 FY2020* fav/(unfav) FY2021 FY2020* fav/(unfav) FY2021 FY2020* fav/(unfav) Slots 277.7 258.7 7.3% 203.9 132.6 53.8% 173.8 118.0 47.3% 655.4 509.3 28.7% Domestic Tables 458.1 526.3 (13.0%) 100.8
Slide 29: Operational Metrics
APPENDIX OPERATIONAL METRICS SYDNEY GOLD COAST BRISBANE OPERATIONAL METRICS FY2021 FY2020 fav/(unfav) FY2021 FY2020 fav/(unfav) FY2021 FY2020 fav/(unfav) Slots Revenue ($m) 278 259 7.3% 204 133 53.8% 174 118 47.3% NMR/machine/day 539 477 13.1% 373 245 52.3% 322 206 56.3% MTGMs Revenue ($m) 76 73 3.6
Slide 30: Cash Conversion and Funding
APPENDIX CASH CONVERSION AND FUNDING CATEGORY Jun-20 Jun-21 $M RESTATED* CASH CONVERSION Cash flows from operating activities before interest and income tax Net cash receipts from customers (inclusive of GST) 1,689.7 1,640.1 Payments to suppliers and employees (inclusive of GST) (995.9) (1,106.9) Pa
Slide 31: International VIP Rebate Receivables
APPENDIX INTERNATIONAL VIP REBATE RECEIVABLES* INTERNATIONAL VIP REBATE BUSINESS 30 DAYS - ♦ 30 June 2021 past due not 0 - 30 DAYS 1 - 3 YEARS 3 YEARS + TOTAL RECEIVABLES (BEFORE PROVISIONS) 1 YEAR impaired receivables down on 30 June 2020 reflecting significantly June 2021 ($m) reduced VIP business
Slide 32: Glossary
APPENDIX GLOSSARY TERM DEFINITION AML/CTF Anti-Money Laundering and Counter-Terrorism Financing AUSTRAC Australian Transaction Reports and Analysis Centre CAGR Compound Annual Growth Rate Capital expenditure Unless otherwise stated, capital expenditure is presented on an accruals basis and excludes
Slide 33: The Star Entertainment Group
THE STAR ENTERTAINMENT GROUP
Star Entertainment Group — FY2021 Earnings Presentation on 6ix