Crown Resorts (CWLDY, CWN.ASX)

[winston]

vested

China Releases One Detained Employee of Australian Casino Operator Crown

Worker is one of 18 Crown employees China detained in October

A person familiar with the matter said Saturday that one of Crown’s “junior employees,” a Chinese national, was released on bail.

Australian government officials have said they understand that under local law, China has 37 days from the time of the detentions to charge the employees. The employees were first detained around Oct. 14.

Source: WSJ

http://www.wsj.com/articles/china-relea ... yptr=yahoo

[winston]

vested

Our CWN DCF-based target price is A$13.00 and does not change with this research note.

It incorporates an US$15.00 valuation for MPEL. Our OUTPERFORM rating is predicated on the view that CWN’s share price fall after the China VIP incident was an overreaction and now the stock shows good value.

Our target price implies investors would pay 10.5x FY18 EBITDA for the domestic casinos.

The current share prices of CWN and MPEL imply investors are paying 8.1x FY18 EBITDA for the domestic casinos today.

Source: CS

[winston]

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China says three Australian Crown Resorts casino staffers will be prosecuted

China is confirming plans to prosecute three Australians working for James Packer's Crown Resorts. They were detained last month and include vice president of Crown Resorts’ international VIP operations, Jason O'Connor.

Chinese foreign ministry spokesman Geng Shuang said the three employees of Crown Resorts would have their cases handled "in accordance with law.'' Geng did not offer details on the allegations they face.

The three are among 18 detained in mid-October following raids.

Australia's foreign ministry said Tuesday that it had received formal arrest notices from the Chinese side.

Casino gambling is illegal in mainland China and agents are banned from organizing groups of more than 10 Chinese citizens to gamble abroad. According to Chinese law, anyone who "runs a gambling house or makes gambling his profession'' can face up to three years in prison.

Crown Resorts did not return messages seeking comment.

Source: AP

[winston]

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Crown Falls in Sydney After Report Proposed Spinoff Is on Hold

by Angus Whitley

November 28, 2016

Australian Financial Review reports advisors have stopped work
Report follows detention in China last month of 18 Crown staff

Crown Resorts Ltd. shares fell in Sydney after a newspaper report that the Australian casino company has put on hold a proposed multibillion-dollar spinoff of international assets.

Melbourne-based Crown said in June it planned to hive off overseas investments, including a stake in Macau casino operator Melco Crown Entertainment Ltd. and Crown’s development site in Las Vegas.

The proposal aimed to allow Crown’s billionaire controlling shareholder, James Packer, to shield the group’s Australian assets from a prolonged downturn in Macau.

Crown dropped 2.3 percent, the most in more than two weeks, to A$11.58 at 10:11 a.m. local time. That trimmed the company’s market value to A$8.4 billion ($6.3 billion).

According to the report Tuesday in the Australian Financial Review, bankers and lawyers have stopped working on the proposed spinoff for the time being. That’s partly because Chinese authorities detained 18 Crown staff last month in a crackdown on overseas casino operators, the newspaper said.

The detentions mean fewer big-spending gamblers are traveling to Crown’s casinos in Melbourne and Perth, according to the report. Ken Barton, Crown’s chief financial officer, didn’t return a message left at his office seeking comment and a spokeswoman for Crown didn’t reply to an e-mail.

At the time the spinoff was proposed, Macau was in the midst of a more than two-year downturn after Chinese government curbs on illicit money flows and a campaign against corruption. Crown owned 27 percent of U.S.-listed Melco Crown as of June 30.

Now, gambling revenue in Macau has just started to rebound, a factor that will influence the timing of any spinoff, the Australian Financial Review said.

Source: Bloomberg

https://www.bloomberg.com/news/articles ... yptr=yahoo

[winston]

vested

Crown Resorts Ltd. – Value Analysis (ASX:CWN)

Company Overview

Considering peers, relative outperformance over the last year and the last month suggest a leading position.

Crown Resorts Limited trades at a lower Price/Book multiple (1.61) than its peer median (2.06).

We classify CWN-AU as Harvesting because of the market’s relatively low growth expectations despite its relatively high returns.

CWN-AU has relatively high profit margins while operating with median asset turns.

Compared with its chosen peers, changes in the company’s annual earnings are better than the changes in its revenue, implying better than median cost control and/or some economies of scale.

CWN-AU‘s return on assets currently and over the past five years suggest that its relatively high operating returns are sustainable.

The company’s median gross margin and relatively high pre-tax margins suggest non-differentiated product portfolio but with tight cost control relative to peers.

While CWN-AU‘s revenues growth in recent years has been around the peer median, the stock’s below peer median P/E ratio suggests that the market likely sees the company’s long-term growth prospects to be fading.

The company’s level of capital investment seems appropriate to support the company’s growth.

CWN-AU does not seem to have the flexibility to raise more debt.

Source: CapitalCube

http://www.capitalcube.com/blog/index.p ... r-13-2016/

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Australian casino giant Crown Resorts downgrades revenue, quits demerger

SYDNEY, Dec 15 (Reuters) - Australia's biggest casino company Crown Resorts Ltd said first half revenue fell 12 percent due to a reduction in VIP gamblers as it announced plans to raise A$1.6 billion by selling shares in Macau-based company Melco Crown Entertainment Ltd.

Sydney-listed Crown also said in a regulatory filing on Thursday that it was cancelling a planned demerger of its international assets, although it would still spin off some Australian hotel properties.

Source: Reuters

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Crown halts Vegas plans, cuts Macau stake

Crown Resorts has dumped plans to spin off its international assets and further reduced its stake in its Macau joint venture, Melco Crown Entertainment amid a suite of strategic changes.

Crown, controlled by billionaire James Packer, has agreed to sell half its stake in Melco Crown Entertainment for $1.6 billion, to its Hong Kong-based partner, Melco International Development, headed by Lawrence Ho.

Mr Packer will also resign as deputy chair and non-executive director of Melco Crown Entertainment.

Crown, which is still dealing with the arrests of 18 of its employees held in China since October, also revealed it will not proceed "at this time" with its Alon casino development project in Las Vegas.

It also abandoned a plan - announced in June - to separate its international assets from its Australian casinos.

"The board's decison represents a prudent alternative to the proposed demerger," Crown CEO Rowen Craigie said in a statement.

Crown shares went into a trading halt ahead of the announcement, which also included a first-half trading update showing a 45 per cent drop in turnover from high-roller gambling at its Australian casinos over the 23-week period, compared to a year earlier.

But VIP gambling activity in the first three months of the prior corresponding period had been extremely strong, the company said.
Revenue from the main gaming floors in its casinos in Melbourne and Perth was flat, reflecting modest revenue growth in Melbourne and softness in Perth.

Total revenue from the Australian casinos and hotels was down by about 12 per cent.

Crown said it was continuing to prepare for a proposed share market float of a 49 per cent stake in some of its Australian hotels and associated retail property.

"These business decisions are strategic and for the long-term and will underpin the company's future over the next decade," Crown Resorts chairman Robert Rankin said.

Under the Melco share sale, Crown will be left with a 14 per cent stake in Melco Crown, with the Australian company saying it is now exploring options to "monetise" part of the shareholding but stating there was no offer of any sale of shares.

Crown said proceeds from the Melco share sale will be used to reduce debt, fund a special distribution and enable a share buyback.

Crown shares last traded at $11.37.

Source: AAP

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Crown further reduces stake in Macau JV

Casino giant Crown Resorts is increasing the scale of the special distribution and buyback that will follow the reduction of its stake in its Macau joint venture after agreeing to further cut its interest.

The James Packer-controlled gaming company had previously planned to reduce its stake in Melco Crown Entertainment to 14 per cent, but now says it will be left with an 11.5 per cent stake after entering into a series of equity swaps,

Crown will now raise $1.9 billion from the deal instead of the previously announced $1.6 billion, allowing it the to lift the amount of its special distribution from $500 million to $600 million and its share buyback from $300 million to $500 million.

Source: AAP

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Crown Casino needs more oversight: report

Melbourne's Crown Casino - the eleventh largest in the world - needs more supervision, the Victoria's auditor general says.

The Victorian Auditor General says in a report that the Victorian Commission for Gambling and Liquor Regulation needs to step up its oversight of the casino.

The report found the VCGLR didn't check the casino's internal auditing enough and has not paid sufficient attention to responsible gambling, money laundering and detecting people excluded by Victoria Police.

" The VCGLR has recognised these issues and has taken action to address this loss of expertise," the auditor general's report says.
"It is now moving to establish a dedicated casino team.

Source: AAP

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Crown HY profit up amid tough conditions

Gambling giant Crown Resorts has lifted headline first-half profit 75 per cent to $359.1 million, boosted by $167m in gains from its Melco selldown but Australian revenue has fallen amid tough trading conditions.

Normalised net profit for Crown - which excludes volatility in gaming revenue - was down 9.1 per cent to $191.3 million and revenue for the James Packer-controlled group's Austrlaian resorts was down 12.5 per cent to $1.48 billion.

Crown declared an interim dividend of 30 cents a share and a special dividend of 83 cents a share, both 60 per cent franked.

Source: AAP