Crown Resorts rolls out skill-based electronic games

The James Packer-backed Crown Resorts is planning to roll out a new suite of “skill-based’’ electronic games.

Crown Casino at Southbank in Melbourne

The James Packer-backed Crown Resorts is planning to roll out a new suite of “skill-based’’ electronic games with a Melbourne-based joint venture partner as it ramps up the growth of its fast-growing digital businesses.

The gaming group said on Friday that its Chill Gaming joint venture was developing “new entertainment product options’’ that would be showcased at future gaming technology expos.

Chill Gaming, a 50/50 joint venture between Crown and New Gaming Pty Ltd — which is owned by the founders of Wymac Gaming Solutions, a manufacturer and developer of electronic gaming machines — is developing a new generation of arcade-style gambling machines that determine payouts on player ability as well as chance.

The new games are being installed on gaming floors at some of the biggest casinos in the world.

“Skill-based gaming is an interesting concept that is getting traction in a number of markets. It is a reaction to the emergence of games that are different to traditional games,’’ Crown chief financial officer Ken Barton said.

“We have got prototypes developed, and at gaming shows that are coming up over the next few months, we should have some demonstrations that we will be able to show.’’

Crown’s digital business was the standout performer in an otherwise soft annual profit result.

Crown shares closed 4.3 per cent lower yesterday, adding to Friday’s 3 per cent fall in the wake of the weaker than expected result, which was weighed down by a near halving of revenues in the high roller business following the arrest of Crown staff in China last October.

EBITDA from Crown’s wagering and online social gaming operations was $14.8 million last year, compared to a loss of $5.4m in 2016.

Crown’s revenue increased by 31.9 per cent to $303.3m, while total expenses increased by 22.6 per cent — less than analysts’ expectations.

Crown’s wagering and online social gaming operations include CrownBet (a 62 per cent-owned online wagering business), Betfair Australasia (a wholly owned online betting exchange) and DGN Games (a 70 per cent-owned online social gaming business based in Austin, Texas).

Crown equity accounts its investment in Chill Gaming.

“That (digital) market is growing strongly,’’ Mr Barton said.

“If you looked at 32 per cent revenue growth overall, you would see a disproportionate amount of that (in Crownbet) given the scale and the high growth rates contributed by that business.”

He also told analysts that Betfair had been consistently profitable for several years and that DGN had been restructured over the past year and would be a greater contributor to profits in future.

JPMorgan recently upgraded Crown Resorts from neutral to overweight, citing in part the potential of the wagering and online businesses.