The decline occurred despite the company drawing down the full AU$100m from Tranche 1 of its new debt facility in December 2024.
Key points:
- The Star's available cash decreased by AU$70m to AU$79m in the quarter ending December 2024
- The company utilised AU$100m from Tranche 1 of its new debt facility, offsetting a greater cash reduction
- The Star continues to face financial challenges and is seeking to fulfil conditions for additional funding from Tranche 2
The Star Entertainment Group has reported a substantial reduction in its available cash position, falling from AU$149m (US$92m) to AU$79m in the quarter ending 31 December 2024.
The company disclosed this information in an ASX announcement ahead of its anticipated half-year results release scheduled for 28 February.
The decline occurred despite the company drawing down the full AU$100m from Tranche 1 of its new debt facility in December 2024, which provided a net increase of AU$37.1m.
Adjusting for this draw down, the actual reduction in available cash over the quarter amounts to approximately AU$107m.
This cash position deterioration has been attributed to several factors, including challenging trading conditions, essential capital expenditure and significant costs related to regulatory compliance.
These expenses include the first AU$5m instalment of an AU$15m fine imposed by the NSW Independent Casino Commission in October 2024, as well as substantial legal and consulting fees associated with ongoing transformation efforts.
The announcement follows the company's securing of an AU$200m debt facility in November 2024, structured in two AU$100m tranches.
While the first tranche has been accessed, The Star reports that meeting the conditions precedent for accessing Tranche 2 remains challenging under current circumstances.
The company continues to explore additional liquidity solutions while working to fulfil these conditions.
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