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Crown

By Dan Stratful (AFA)

Friday 13th July 2012

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Crown's (ASX: CWN) recent acquisition of a 10% stake in Echo Entertainment the owner of The Star in Sydney and Jupiters Hotel & Casino on the Gold Coast was on top of a good first half result for the 6 months ending 31 December 2011 (1H).

CWN reported that Melco Crown Entertainment - its Macau joint venture - was the major contributor to growth in 1H normalised net profit which increased 28% to $212 million. Reported net profit of $274 million was up 79% and the 1H dividend was maintained at 18c per share.

Its 2 core properties, Crown Melbourne and Burswood turned in a reasonable 1H performance given the challenging operating environment and the state of the Australian economy, and significant progress was made on the capital expenditure (CAPEX) program at both properties.

The CAPEX program has seen CWN spend $1.8 billion in total on Crown Melbourne and Burswood from 2007 to 2011 and Crown Melbourne is already benefiting from its refurbishment while upgrades to Burswood continue to be well-received.

Looking forward, CWN will continue to maximise the performance of its Crown Melbourne and Burswood properties and manage the remaining capital expenditure projects underway within the group. Despite a softening in consumer sentiment, CWN's premium markets continue to show strength.

CWN provides growth via its Macau investments and the revamp of Crown Melbourne and Burswood.

About Crown:
CWN resulted from the demerger of the late Kerry Packer's Publishing and Broadcasting Ltd (PBL) in 2007, when PBL demerged its entrainment assets (Crown) and Media assets (Consolidated Media Holdings) into two separate listed companies. Today, CWN is one of Australia's leading entertainment groups which owns and operates 2 of Australia's leading resorts - The Crown Entertainment Complex in Melbourne (100% owned) and The Burswood Entertainment Complex in Perth (100% owned). CWN also has international investments which include the Aspinalls Club in London (100% owned) and a stake in Melco Crown Entertainment (33.6% owned) which operates casino and hotel properties in Macau. Other investments include stakes in Betfair Australasia and a recently acquired stake in Echo Entertainment.

Status: GROWTH BUY

CWN's shares today traded at $8.52

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