Australian casino and hotel operator Star Entertainment Group has revealed it will be challenging to meet the conditions needed to draw down additional funds as its cash levels run down.
Star Entertainment said it had A$79 million of cash at 31 December, including $100 million drawn from the first tranche of its new debt facility, which was a reduction from $149 million at 30 September 2024.
Star said available cash had fallen by about $107 million in the three months ended 31 December 2024, reflecting:
- continued difficult trading conditions
- essential capital expenditure
- significant items including fees relating to the new debt facility
- the first $5 million of the $15 million NSW Independent Casino Commission fine
- significant legal and consulting fees
- ongoing transformation and remediation activities, and
- joint venture contributions.
Star said it continued to work towards fulfilling conditions that must be met to draw down an additional $100 million under the second tranche of the new facility.
“A number of these conditions remain challenging to meet given the Group’s current circumstances,” Star said in an ASX announcement.
“In addition to seeking to fulfil the conditions precedent for Tranche 2 of the New Facility, the Group continues to explore other liquidity solutions.”
Star (ASX: SGR) shares closed on Wednesday at $0.20, up $0.01 (5.41%) on the day, capitalising the company at $553.4 million.
The shares have fallen more than 94% in the last four years and remain just above the record low of 18 cents reached last week.
Star Entertainment, which owns the Star casinos and resorts in Sydney, Brisbane and Gold Coast, has faced official inquiries over alleged money laundering and failure to prevent criminal activities in its casinos, and has struggled operationally and financially with factors such as a fall in business, high debt and management changes.