Casino shut but Packer’s ante up

Illustration: Rod Clement

Assuming all goes to plan, Australian billionaire James Packer will see about $70m drop into his bank account on Friday.

Packer is the major shareholder in Crown Resorts and the $70m is his claim to the $205m worth of interim dividends that the now effectively closed casino operations will payout at the end of the week.

Not a bad payday for the 52-year-old businessman as Crown’s 18,500 staff and contractors contemplate unemployment amid a national recession driven by the unfolding COVID-19 health crisis.

Margin Call checked in with Crown Resorts new boss Ken Barton, who in January was ­elevated from his role as long-serving chief financial officer to the top job, to see whether there was any plan to postpone payment of the dividend given the unfolding circumstances.

Plenty going on at Crown, so perfectly understandable that a query might fall through the cracks, so we checked in again on the dividend policy, but again, radio silence.

Postponing the interim dividend is not without precedent amid these rapidly changing, crazy times, with a range of corporates cancelling or suspending dividend to protect balance sheets. Ownership Matters says “these withheld payments will become a key source of funding for many companies due to the impact of the COVID-19 pandemic”.

By the end of last week Ownership Matters had calculated that almost $800m worth of interim dividends had either been cancelled or suspended by companies including the Alan Joyce-led Qantas, the Brett Blundy-controlled Lovisa and the Reg Rowe’s Super Retail Group.

Other companies to also have acted include furniture retailer Nick Scali, industrial company Downer EDI and Corporate Travel Management.

Crown’s declared interim dividend is 30c a share, which is the amount that the entertainment company has consistently paid out to investors each half over recent years.

For Packer, who divides his time between Aspen, Colorado, Los Angeles where his children live, Mexico and his $200m-plus gigayacht IJE, the Crown income from his 35 per cent shareholding provides critical cashflow to fund his billionaire lifestyle and the operations of his private company Consolidated Press Holdings, whose ultimate parent is domiciled in the tax haven that is the Bahamas.

Packer’s good friend, Hong Kong casino tycoon Lawrence Ho, has 10 per cent of Crown and on Friday is set to receive about $20m from the dividend payment.

Ignoring the message

Seems there’s little shame on show down Melbourne’s Mornington Peninsula way, where coronavirus remains the hot topic of conversation among locals and weekenders alike.

We all know now how the wealthy peninsula municipality is a COVID-19 hotspot after Australian skiers returning from Aspen, Colorado, were accused of spreading the killer virus.

One fashion industry businesswoman (not all of her ventures have been successful) and her finance sector partner, who divide their time between Melbourne’s eastern suburbs and the seaside playground, have been at the centre of controversy over how they handled their isolation and positive virus diagnosis after their ski trip to Canada.

But even though some time has passed and tests are coming back negative, there is still much animosity towards the spreaders, in particular given that some of the couple’s Geelong Grammar school parent associates have been hospitalised with the virus.

Despite the recent publicity and open hostility, locals were gobsmacked to see one recovered skier unashamedly back out and about over the weekend in defiance of Premier Dan Andrews’ and Prime Minister Scott Morrison’s unequivocal directives to stay home in favour of a spot of horseriding at the picturesque Red Hill Equestrian at Main Ridge. We think that’s what you call tone deaf.

Board keeps distance

New NAB boss Ross McEwan today draws a line under the suddenly smaller $50bn bank’s interim results, amid financial markets the banker could never have foreseen when he started in the top office last December.

In line with the last day of the first half, the NAB board, led by chair Phil Chronican, and its various committees will over the course of this week gather via the internet for their March meetings, which thanks to COVID-19 and the need for strict social distancing are being held via Zoom.

A boardroom Brady Bunch if you will.

Along with its monthly meetings, the NAB board, which also includes coronavirus incubator Carnival Australia chair Ann Sherry, has been exposed to weekly virus briefings, also held online now that no directors are permitted to travel.

Two of the bank’s directors, Kathryn Fagg and former Macquarie banker Simon McKeon, are based in Melbourne, while the rest, including former PwC partners Ann Loveridge and David Armstrong are in Sydney, and Doug McKay dials in from New Zealand.

NAB reports its first-half results in about five weeks on May 7, with a hot topic of boardroom discussion between now and then expected to be the declaration of its interim dividend.

At the start of May last year NAB, then still chaired by Ken Henry, cut the interim dividend by 16 per cent to 83c a share in part thanks to the costs of Ken Hayne’s banking royal commission.

Hanging on to reins

Victoria Racing Club’s Amanda Elliott just can’t let go of her chairmanship.

It’s been common knowledge in the racing world that chief executive Neil Wilson was set to take the post, as the 68-year-old Elliott hit the constitution’s limit late last year.

But she’s still not ready to relinquish just yet. Something about stability and continuity being crucial during the challenging COVID-19 situation, and that the “effective date of that baton change needs to be flexible”.

VRC chair Amanda Elliott in full bloom. Picture: Getty

However Margin Call gleans it is not just the coronavirus keeping things as is.

The issue is that VRC’s mooted successor for Wilson as chief executive is said to be having second thoughts. Margin Call tipped late last year that Crown Hotel’s chief operating officer Peter Crinis was top of the VRC’s wish list, but he may not now be interested in the job.

Wilson, who has been the chief executive since 2018 after an earlier stint as the interim boss, has extended his contract in the role as he “leads the VRC team through this precarious [coronavirus] period”.

The VRC’s FY19 revenue jumped over $27m from FY18 to $204m, but its expenditure was up, resulting in a $617,000 profit for the year, down on the $5.3m the year prior.

Jamie’s kitchens sink

The new owners of celebrity chef Jamie Oliver’s failed Italian restaurant chain could not turn it around, albeit in these turbulent times.

Restaurant group Hallmark Group acquired the chef’s restaurants two years ago, and now they’re shutting them down. The closures affect their Jamie’s Italian restaurants in Perth, Adelaide, Brisbane and Sydney.

Anne Meagher of SV Partners has been appointed, after the voluntary creditors decided, as the liquidator.

“Due to the COVID-19 outbreak and the devastating financial impact on the Australian restaurant industry, we have made the difficult decision to permanently close our Jamie’s Italian restaurants,” a Hallmark Group spokesperson said.

“We will continue to explore new opportunities when the market recovers.”

Late last year Hallmark launched Australia’s first Jamie Oliver’s Pizzeria on the Gold Coast, and that and all other Hallmark venues will reopen as soon as it’s safe to do so.