Hundreds of workers at Star casinos in Sydney and the Gold Coast will lose their jobs after the Star Entertainment Group announced it is seeking to cut costs by $100 million amid "rapidly deteriorating" operating conditions.
In a statement to the ASX the troubled gambling giant said it would cut 500 jobs, freeze salaries and cancel executive bonuses to try to improve its financial outlook.
The Star Casino in Sydney has been consumed by controversy in recent years, and was hit with a $100 million fine and licence suspension last year over its failure to prevent criminal activity.
Star's Queensland casinos were plagued by similar issues and also faced fines and licence suspensions in 2022.
Star Entertainment Group blamed the job cuts on the "compounding impact of regulatory operating restrictions", many of which were introduced in both New South Wales and Queensland in the wake of damaging inquiries into the casino's activities.
It also said that its earnings had been hit by changes in the way people were spending their discretionary income.
"The group is experiencing a significant and rapid deterioration in operating conditions, particularly at the Star Sydney and the Star Gold Coast," the statement to the ASX read.
"To put the operating environment into perspective, the Group's current earnings performance is at unprecedented low levels (excluding the COVID-19 period)."
Review to 'maximise value for shareholders' announced
The group trimmed its annual earnings forecast by another $80 million and said it would be seeking to cut expenditure by $100 million.
It has also commissioned Barrenjoey Capital Partners to complete a strategic review of The Star Sydney "and consider any structural alternatives available to maximise value for the Group's shareholders".
The ABC understands the majority of the job cuts will be in Sydney.
The casino group had been warning of job cuts if the New South Wales government goes ahead with a proposed casino poker machine tax hike.
But it said the job cuts and other measures announced on Wednesday "are being undertaken independent of any potential impact from the proposed casino duty rate increases in NSW".
United Workers Union national secretary Tim Kennedy said the union had been told around half of the cuts would be at the corporate level.
"I know The Star is anticipating its earnings will be further impacted by fines and other regulatory issues but like we've said all along this is not the fault of casino workers, some of whom will be facing a job loss during a cost-of-living crisis," he said.
"We also reiterate our calls to the NSW government to revise its proposed tax to prevent further jobs being cut at The Star Sydney."
A spokesperson for the New South Wales government said "we will be working closely with the relevant unions, workers and The Star on next steps, but ultimately this is a commercial decision by The Star".
