The coronavirus pandemic has forced the shutdown of Australian's brick and mortar casinos in Spring 2020 for a couple of months. While there are requests by some casino owners to open their gates within the next few weeks, those plans may not work as the Australian higher authorities would want to impose the lockdown for a longer time to keep their citizens safe.
As coronavirus continues to threaten the nation while crashing the economy for almost all businesses, land-based casinos face the brunt as casino players have turned to online casinos for the time being. No wonder, online casinos are gaining new players and seeing a remarkable increase in profits.
The last few weeks were terrible for land-based casinos as they saw a significant drop in profits. Unfortunately, the trend may continue as the effect of COVID-19 exacerbates.
Crown Resorts Unplugged its Slot Machines
Crown Resorts is a popular gaming industry in Australia that operates several gambling venues in various parts of Australia such as in Western Australia, Perth, Melbourne, and Victoria.
The Australian authorities have ordered to temporarily shut down all the businesses that require the gathering of people in a bid to slow down the spread of coronavirus. This includes the shutting down of pubs, bars, casinos, cinema halls, and other such entertainment venues.
Crown Resorts in Australia has already unplugged its slot machines and table games during the mid-March in an effort to contain the coronavirus.
Crown Resorts Limited and The Star Entertainment Group Limited Announce Pay Cuts
Presently, two major casino operators in Australia have started to cut the salary of their employees including those of senior executives in the wake of Covid-19. Moreover, the operators are standing down the majority of their staff because of the ongoing losses.
A few weeks back, ‘Crown Resorts Limited’ and ‘The Star Entertainment Group Limited’ updated the Australian Securities Exchange market about their approaches to survive the closures of their businesses owing to Covid-19.
Crown Resorts authorities stated they are forced to stand down more than 11,000 staff, which represents 95% of their total workforce, on a full or partial basis. The employees that have been stood down have received an ex gratia payment of two weeks. Also, the senior executives have agreed to receive a 20 percent decrease in their salary until June 2020. The employees working in critical business areas are still working with them.
Another huge Casino operator in Australia, The Star, said that the shutting down of land-based casinos will continue to have a financial impact on their business. Star Entertainment operates The Star Gold Coast and Treasury Brisbane in Queensland, and The Star Sydney in New South Wales.
Because of the monetary losses, the operator has stood down more than 8,000 staff, which is around 90% of their total employees. They have further cut the salary of the CEOs by 40%. Other senior executives have also agreed to a reduction in their salaries. Star Entertainment Limited may decide to continue with pay reductions for a few more months, depending upon the incurred losses and the extended lockdown.
The Upcoming ‘Crown Sydney’ Project At Barangaroo
Crown Resorts is building a new gaming complex "Crown Sydney" at Barangaroo in Sydney, New South Wales. The management plans to hire more than 2000 people when the complex opens its door for the public by December 2020.
Although Crown Resorts is facing a financial crisis due to the shutdown of their businesses, they intend to continue the building of the ‘Crown Sydney’ project as scheduled. This is why they have managed AU$1 billion debt facilities and funds. According to Fitch Ratings Inc, Crown Resorts have sufficient funds and resources to cope with the impact of the closure of its casinos.
The Giant Aristocrat Gaming Company Facing Monetary Losses
The slot and casino game supplier of the Australian gaming industry, Aristocrat is dealing with financial losses. Initially, they were confident of sailing through the pandemic safely because of their strong monetary situation and fiscal methods created to lessen expenditures. They, therefore, didn’t find any need for the implementation of extreme steps to fight COVID-19’s spell.
Nevertheless, as the world’s brick and mortar casinos continue to remain closed with the least possibilities to open any time soon, Aristocrat has decided to re-calculate their monetary situation. They updated the Australia Securities Exchange and stated to suspend its scheduled short-term bonus for the corresponding 2020 financial year.
The company further adds that they won’t be able to support 80% of its employees who were previously working with them remotely. Aristocrat has plans to stand down about 1,000 employees, working in sales, service, and manufacturing departments, by the end of June 2020. Besides, the company will be taking strict steps to manage its funds, and for that reason, they are planning to remove about 200 employees from their business ‘permanently.’
Aristocrat has further clarified its monetary condition and indicated that the implementation of all these severe steps does not confirm that they are financially weak as they still hold more than $1 billion worth of available liquidity. They are forced to make harsh decisions, regarding standing down their employees and pay cuts, to endure the long-term effects of Covid-19 and to re-building their business once life gets back to normal. The company has assessed that it might take at least a year or two for the gaming industry to completely rejuvenate.
The Fate of Land-based Casinos Post Coronavirus Pandemic
The coronavirus pandemic may have a huge impact on the Australian land-based casinos, but we are sure that people will begin to flock to the casino floors again soon to enjoy spinning the reels of their favourite slot machines or playing the table games of their choice. Until then, stay safe for yourself and your family and don't miss playing your favourite real money casino games at online casinos.
