A $4 million loss on international commission business in the first three months of the 2003 financial year has cast a cloud over Perth casino group Burswood’s continued involvement in the high-roller market without tax concessions from the West Australian Government.
Burswood’s announcement of the surprise ICB loss came as the board confirmed it was considering raising fresh equity as the September 30 deadline approaches for the $67 million settlement of a 1997 agreement to buy the five-star Burswood Hotel from Japanese businessman Tiebu Ogino.
Burswood reported a 6.9 per cent slide in earnings to $20.6 million for the 2002 financial year, a result chairman David Young said was affected by construction disruptions at the casino and resort complex, the impact of September 11 and the collapse of Ansett.
Mr Young said the 56.2 per cent rise in turnover to $85.2 million in ICB, along with an improved win percentage of 1.42 per cent, was a positive feature of the 2002 result. He said that represented the first ICB increase since the 1996 financial year, boosted by Burswood’s penetration into new international markets.
However, Mr Young said that since the June 30 balance date, a deteriorating win rate of just 0.5 per cent had flowed through to produce a $4 million loss on ICB.
Burswood wants a reduction in its 15 per cent high-roller tax rate as part of a suite of concessions sought from the State Government, which remain the subject of sensitive negotiations.
“It [the $4 million ICB loss] underscores certain points we’ve made about our tax regime,” Mr Young said.
“The casino tax that applies to our ICB business is a cost that we have to bear in mind when we carry out a strategic review as to whether you’re …