Would it be a gamble to invest in Crown Resorts Ltd (ASX: CWN) shares after its half-year report?
Crown Resorts is one of Australia’s largest gaming and entertainment groups. It operates two integrated resorts in Melbourne and Perth. Crown also fully owns and operates Crown Aspinalls in London, one of the high-end licensed casinos in the West End entertainment district. It is currently developing Crown Sydney at Barangaroo.
Here’s what Crown reported today
Crown said that its reported profit was up 9.9% before significant items to $174.9 million, or down 26.7% after significant items. Reported EBITDA was down 2.1% to $291.8 million (click here to learn what EBITDA means).
Crown also reports normalised results, which are adjusted to exclude the impact of any variance from the theoretical win rate on VIP program play and significant items in the prior year. Normalised results remove the volatility of VIP gaming revenue.
Crown reported that normalised net profit was up 0.9% to $194.1 million and normalised EBITDA was down 6.5% to $418.8 million.
At the Australian resorts, normalised revenue was down 1.2% to $1.54 billion, but main floor gaming revenue was up 0.9% to $867.7 million.
Crown Dividend and Buy-Back
Crown has declared another 30 cents per share bi-annual dividend, which is the same as last year.
Six months ago Crown announced a share buy-back of up to $400 million. During the half-year it bought back around $131.4 million of shares.
Crown Management Comments
Crown Executive Chairman John Alexander said: “Crown’s Australian operations’ first half result reflected mixed trading conditions…VIP program play turnover across Crown’s Australian resorts of $19.9 billion was down 12.2% after a soft November and December.”
Is Crown a buy?
Crown has a partially franked dividend yield of 5.2%, which looks attractive in the current environment for income.
Both Crown Sydney and the proposed One Queensbridge could significant boosts to Crown’s earnings over the next few years, which could drive longer term growth.
The current share price weakness could be an opportune time to bet on Crown shares, but the ASX businesses in the free report below could create much better shareholder returns over the next decade.
2 Rapid Growth ASX Shares Rising Much Quicker Than Crown
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