Star Entertainment shares hit record low as Queensland introduces new casino controls

The chips are down for Star Entertainment after the introduction of tough new casino laws in Queensland sent its shares tumbling to a record low.

Shares in Star Entertainment slumped to a record low in the wake of the Queensland government introducing tough new casino controls.

The stock tumbled 2.5 per cent to close at 59.5c after earlier in the day hitting an all-time low of 57.75c, valuing Star at just $1.7bn. Star shares have plunged 60 per cent this year.

Star told the market it is currently considering the Casino Control and Other Legislation Amendment Bill 2023 and its potential application to its Queensland operations.

Star noted the bill remains subject to the usual consultation and parliamentary processes.

“The proposed reforms include the introduction of mandatory carded play, cash and time play limits, restrictions on the use of cash, mandatory player pre-commitment restrictions on expenditure by customers for certain games and activities and a supervisory levy payable by casino licence holders,” Star said.

The Queensland government issued a blockbuster $100m fine to Star last December, following a damning inquiry headed by former Court of Appeal judge Robert Gotterson.

The inquiry found Star disguised millions of Chinese gambling transactions as hotel charges, allowed gamblers banned in NSW to come to its Queensland casinos, and “lied” to state regulators – flouting anti-money laundering and counter-terrorism financing laws.

Queensland Attorney-General Yvette D’Ath said the latest reforms will increase regulatory scrutiny and require casinos to introduce specific measures to reduce gambling harm and combat money-laundering.

“This bill will enable us to continue our work in implementing all 12 recommendations outlined in Mr Gotterson’s review,” Ms D’Ath said.

“The new laws will ensure organisations associated with Queensland casinos are subject to inquiries every five years.

“This will assist in determining the ongoing suitability of those organisations.”

The government said the new legislation means casinos will have to adopt new technologies and face higher penalties for specific breaches.

Queensland deputy premier Stephen Miles (right) with Star Entertainment CEO Robbie Cooke. Picture: Lyndon Mechielsen/Courier Mail

Ms D’Ath said casino executives would be required to undertake particular duties in relation to the operation of a casino and would face significant personal penalties for non-compliance.

“There will also be a supervision levy imposed on casino licensees so that the costs of regulating casinos will not be passed onto taxpayers,” she said.

“These reforms will continue to modernise Queensland’s gambling and casino laws to ensure they remain effective now and into the future.”

Last year, the government gave Star until the end of 2023 to prove it was a suitable casino licence holder or face a 90-day suspension.

The state government appointed Nick Weeks as Star interim manager – the same man the NSW government hired to oversee its operations at its flagship casino in Pyrmont in Sydney.

Robbie Cooke, who started at Star in mid-October last year – following an exodus of most of its senior management and directors – has previously expressed confidence he would meet the Queensland government’s deadline to transform the company.

The Queensland penalty follows the NSW government issuing Star a $100m fine in October last year and suspending the licence for its Pyrmont casino.

It also financial a hefty penalty after financial crimes regulator Austrac launched civil proceedings against the group last November. Star is also dealing with a number of class actions from disgruntled shareholders.

Star, which is building the $3.6bn Queen’s Wharf project in Brisbane, posted a full-year statutory loss of $2.4bn in August, largely due to writedowns of its existing properties in Sydney and the Gold Coast.

“To say it has been a challenging year completely understates the lived experience at The Star over the last 12 months,” Mr Cooke said at the time.