Star FY26 Statutory Loss $307m; Going Concern Doubt Flagged

The Star (ASX:SGR) Entertainment Group reported FY26 normalised revenue of $1,101.0 million and a normalised EBITDA loss before significant items of $16.1 million, against a normalised EBITDA loss of $76.2 million in the prior comparable period. Normalised revenue excludes $205.2 million of contracted revenue from Destination Brisbane Consortium and revenue from discontinued operations. The statutory net loss was $307.3 million, compared with $427.9 million in FY25, and the normalised loss after tax of $158.9 million is before significant items of $144.3 million and discontinued operations of $4.1 million. Following the exit of the group's equity interest in the Destination Brisbane Consortium integrated resort joint venture, Treasury Brisbane operations have been classified and disclosed separately as a discontinued operation and FY25 comparative information has been restated. The result includes operator fee revenue of $59.7 million from operating The Star Brisbane, which the group said comprised $45.0 million recognised for the nine months to 31 March 2026 under the previous fee arrangement of $5.0 million a month, $4.5 million recognised in the June 2026 quarter under the revised Casino Management Agreement, and $10.2 million relating to FY25 operator fees held in escrow pending completion of the first stage of the joint venture partner transaction. With effect from 1 April 2026 the casino operator fee payable under the amended agreement is a fixed annual fee of $18 million payable monthly, plus performance-based incentive fees comprising two components, each based on EBITDAM before operator fee for the gaming and resort operations at The Star Brisbane.

The group said the $300 million strategic investment by Bally's Corporation and Investment Holdings completed during the period, and that Bruce Mathieson Jnr was appointed Group Chief Executive Officer effective 16 December 2025. Annualised 4Q FY26 group corporate costs of $178 million represent a reduction of $111 million, or 38 per cent, against FY25 group corporate costs of $289 million; on the group's own chart, corporate costs fell $75 million in FY26 itself, to $214 million. The Star held cash and cash equivalents of $267 million at 30 June 2026, part of total cash and cash deposits of $368 million that also include $101 million of restricted deposits. On 7 May 2026 it announced it had completed a US$390 million secured term loan due May 2029 from WhiteHawk Capital Partners, following which, and net of the interest reserve account required to be funded under the facility, the group had additional liquidity of approximately A$130 million. On 31 March 2026 it completed the first stage of the joint venture partner transaction, fully releasing the $700 million parent company guarantee previously provided in respect of the group's 50 per cent share of Destination Brisbane Consortium's $1.4 billion debt facilities; the second stage remains subject to a separate set of conditions precedent, which the parties currently expect to satisfy during 2H CY2026 and by no later than 31 March 2027. Combined July 2026 revenue at The Star Sydney and The Star Gold Coast was $92.4 million, 6 per cent above the July 2025 comparative and 8 per cent above the Q4 FY26 monthly average. The company said material uncertainties continue to exist that can cast significant doubt as to the group's ability to remain a going concern, citing the quantum and timing of the AUSTRAC penalty and other provisions and contingencies, its ability to implement FY27 revenue growth and cost-out initiatives that return the group to a level of profitability sufficient to satisfy its external debt covenants, its ability to return to suitability through restoration of The Star Sydney's casino licence and withdrawal by the Queensland Government of the suspension of The Star Gold Coast's casino licence, and its ability to maintain its transactional banking services, adding that there is no certainty each of those matters can be resolved satisfactorily and in a sufficiently timely manner.