Star Casino to cut 500 employees and freeze salaries as gambling empire warns of ‘rapid decline’
- The Star Casinos are cutting 500 of the 8,000 jobs
- It will also freeze workers’ wages and bonuses
- Moves come after $80 million drop in revenue
Star Casino plans to cut 500 jobs and freeze salaries after a dip in its earnings.
In a trading update provided to the exchange, the gambling giant, which owns casinos in Sydney, Brisbane and the Gold Coast, revealed that its pre-tax revenue would fall by $80 million to $280 million.
The group is experiencing a significant and rapid deterioration in operating conditions, particularly in The Star Sydney and Star Gold Coast.
The Star Casino group has announced they will cut 500 jobs and freeze wages (pictured The Star Casino on the Gold Coast)
“This is largely driven by the growing impact of regulatory operational restrictions and exclusions, as well as emerging weaknesses in consumer discretionary spending.”
Star said the loss of 500 jobs out of 8,000 employees, added to a freeze on wages and bonuses, along with other cost-cutting measures, would lead to a $100 million savings in spending for the next financial year.
The group is proceeding with the planned sale of the Sheraton Grand Mirage on the Gold Coast and has hired a consultancy to assess operations at Sydney’s casino.
The Star said the job cuts, wage freezes and other planned measures would save $100 million from the operating budget for the next financial year (pictured The Star Casino in Sydney)
In February, The Star revealed an after-tax net loss of $1.3 billion for the December half of last year.
That included fines of more than $200 million following investigations in Queensland and NSW last year where the casino group found Star both unfit to be licensed.
The casino giant was also factored in another $150 million hit, expected to be levied by financial watchdog AUSTRAC.
In response to questions, the casino group said it was willing to “do whatever it takes” to restore legitimacy and appointed a law firm as an independent observer as it promised a cultural review.
The investigations came in the wake of media investigations that revealed Star casinos concealing illegal Chinese gambling payments, organized crime ties through paid gambling junkies and luring problem gamblers off the highway.
NSW watchdog, the Independent Casino Commission, has appointed former NRL boss Nicholas Weeks as an independent special manager to oversee Star’s operations both in that state and Queensland.
The Queensland government has threatened to suspend Star’s gaming license if the operator can’t prove it has cleaned up its business by the end of this year.