Star Entertainment Group was again suspended from trading on the ASX on March 3 after failing to lodge its half year financial returns.
The Star Group, which operates casinos in Sydney, Brisbane and the Gold Coast, that its half year financial report to December 31 was not lodged on February 28, as required by ASX rules. Its shares were automatically suspended from trading.
Further, it said it would be “unlikely” to lodge these reports “unless, and until, it has secured a refinancing commitment”, including for its existing corporate debt.
The Star also noted: “There remains material uncertainty as to the Group’s ability to continue as a going concern.”
The Sydney Morning Herald reported on March 3 that a financing deal, which had been expected on February 28, did not happen, and unless one is found, the operation is expected to run out of cash this week.
Shares took a 15% hit and closed at 11 cents. Once worth $5 billion, Star is now valued at $315 million, with collective debts of $430 million.
ٱ辱ٱunprecedented latitude from regulators, Star has been unable and, it would seem, unwilling to successfully rebuild its shattered reputation after multiple scandals involving criminal infiltration and money laundering in its Queensland and New South Wales casinos.
Now, facing administration and the sell-off of its $800 million in assets, Star Group seems unlikely to be able to stave off final collapse and the loss of thousands of jobs.
Star Group employs almost 9000 people: 3000 in Brisbane; 2000 on the Gold Coast and 3500 in Sydney. It also employs about 400 corporate employees.
United Workers Union spokesperson Andrew Jones told that staff were frustrated at Star’s “business as usual” attitude, saying staff deserved certainty. “They want to know their job is going to be there tomorrow.”
“It’s not fair that hard-working Star employees could be left carrying the can for a series of regulatory and operational failures they have had nothing to do with,” .
“If Star’s current management fails to come to terms, workers need to be given assurances in any administration or sale scenario that their jobs will be maintained.
“The casino’s recovery must prioritise the workforce, as casino workers are integral to the success of the operations.”
But with Star’s collapse seemingly imminent and the future of its Brisbane Queens Wharf project also now in doubt, it looks like thousands of people will lose their jobs.
When Star does implode, employees will be hoping regulators and administrators prioritise staff entitlements and re-employment over that of the board and executive.
[Suzanne James is a policy, governance, risk management and compliance consultant.]