BUSINESS & FINANCE
Darryl Watt, Ord Minnett Buderim
CROWN RESORTS – ROYAL IN WAITING
C
rown Resorts is one of Australia’s largest entertainment groups with its core business in integrated resorts. The company appears to be emerging from a troubled 12 months. Nonetheless, we believe the company is undertaking significant changes to its strategy. Our increased confidence in management to focus on shareholder returns drives us to upgrade our earnings estimates. In our view, the downside risks are well incorporated into the share price and can be mitigated by a number of factors: • Crown has undertaken significant costcutting. We forecast a decrease in operating expenditures at the Melbourne and Perth operations. We believe the expected weak VIP performance and Perth softness can be mitigated by cost-savings potential.
• The prospect of partnerships will reduce capital intensity in Crown’s domestic operations, while recent de-leveraging provides potential upside. Our forecast FY17 net debt to operating profit (EBITDA) ratio of 0.4 times suggests significant opportunity, with possible activity ranging from privatisation to further share buybacks and global partnerships. • We believe CrownBet’s margin improvement and the recent ACCC appeal of the Tabcorp/ Tatts Group merger increase the potential for a joint bid for Tatts’ wagering and lotteries business. Crown’s interest in retail, with a $300 million investment in Clubs NSW, underpins the retail wagering strategy. • Crown faces challenges, such as VIP business declines and recent softness in Perth. However, the prospect of cost savings and reduced gearing, along with indications of a recovering industry (with increased electronic game machine expenditure) provides valuation support as casinos may provide pockets of outperformance in a struggling discretionary space. Steady inbound tourism is also expected to drive growth in casino visitations and domestic revenue at attractive rates for Melbourne, as Perth appears to be recovering. Darryl Watt is a Representative of Ord Minnett Limited, AFS Licence 237121 and Ord Minnett Financial Planning Pty Ltd, AFS Licence 237122. This article contains general financial advice only and does not consider your personal circumstances.
Do you find yourself tired throughout the day, struggling to concentrate or falling asleep at work? Does your mind race when your head hits the pillow or do you stir all night, waking groggy despite taking sleeping tablets? Don’t accept these feelings as “normal”. One simple infection can cause all of these symptoms plus irritable bowel syndrome, anxiety, anger outbursts, poor concentration, sugar cravings, reduced ability to cope with stress and depression. These symptoms can have a sudden onset or gradually worsen over years or decades, and you may not have realised they are linked. A simple reduction in specific gut bacteria or an overgrowth of bacterial infection can stop you absorbing the nutrients you require to make the brain chemicals needed for sustained, restorative sleep.
The infection can be picked up from travelling overseas, working with children, regular contact with the sick or elderly and is more prevalent in FIFO workers. Easily transmittable, common infections contracted from overseas travel to popular island holiday destinations, or contact with someone recently overseas, has been detected in the gut through specialised testing. This infection has been shown to release a neuronal toxin, affecting the nervous system physically and mentally. Studies now available link the impact of gut infection on the brain. Being easily passed on, others in your home may also be affected. Often the first symptoms correlate with a stomach bug causing diarrhoea or vomiting. The countries it may be transmitted from, often have untreated water, with many people returning, infected and passing it on easily through schools, day care centres, hospitals or places of work. Thankfully these infections are easy to test for and respond well to treatments allowing your sleep, mood, health and happiness to get back on track. Don’t put up with the cycle of low energy, high stress and poor sleep any longer. Contact Advanced Wellness & Behavioural Centre for a free half hour consultation on 1800 699 355.
38 Maud St, Maroochydore advancedwellness.com.au
1800 MY WELLNESS (1800 699 355)
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*Comparison Rate for finance of $30,000 on secured Consumer Loan for 60 months. WARNING: This comparison rate is true only for the examples given and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate. Available at Pacific Ford for private buyers only on qualifying new and demo Ford Escape vehicles, with finance approved by 30/9/17 and delivered by 3/10/17. Minimum deposit 10% of driveaway price and 48-month maximum term. Finance provided by Macquarie Leasing Pty Limited ABN 38 002 674 982 (Australian Credit License 394925) t/as myFord FINANCE subject to credit criteria. Fees, charges and conditions apply. Full conditions available on application. 1. Not all SYNC® features are supported on all phones. Some features may require active data service, and connection cable (sold separately). 2. Ford Applink® is available on selected SYNC® models and is compatible with select smartphone platforms and relevant apps. Voice Control SatNav requires phone to be connected to SYNC® 3 with a genuine USB cable (Apple devices) or Bluetooth® (Android devices).SYNC® does not control Apple CarPlay or Android Auto while in use. Apple CarPlay is a trademark of Apple Inc. Android™ is a trademark of Google Inc. Warning: Local laws prohibit some or all of the text messaging functions while driving. Message and data rates may apply. Please refer to ford.com.au for compatibility and full details. **Private and small business buyers only. Extended warranty covers 5 years or 200,000km from date of delivery, whichever occurs first. 3. Braked towing capacity when fitted with a genuine Ford towpack and towball. Subject to State and Territory regulations.
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