Southeast Asia News Desk

(AsiaGameHub) –   Australia’s leading casino brand The Star Entertainment Group has recorded a major year-on-year improvement, reporting an AU$1m (£530,000) loss for Q3 2026, down from a $24m loss in the same quarter of 2025.

That said, the quarter was slightly weaker than Q2, with revenue falling and profitability slipping back into negative territory, as regulatory pressures and lower visitor numbers continued to weigh on performance.

Group revenue landed at $266m, down 12% quarter-on-quarter and slightly lower than the $268m recorded in the prior corresponding period.

The company posted an EBITDA loss of $1m, reversing the $6m profit it gained in Q2, though the result is still a marked improvement on 2025 figures driven by cost-cutting efforts.

Declines were largely fueled by ongoing soft performance in Sydney, where revenue dropped 10% versus the previous quarter and 9% year-on-year. Table games were a particular weak point, and the impact of mandatory carded play and cash limits continues to be felt – average daily revenue at the Sydney property is still roughly 20% below pre-reform levels.

Examples of these regulatory reforms include a $100 cash load-up limit for Victorian poker machines and a delayed rollout of $1,000 daily cash limits at New South Wales casinos, where the limit will remain at $5,000 until August 2027.

Across other locations, performance was mixed. The Gold Coast delivered modest year-on-year growth, supported by stronger electronic gaming and hospitality results, while Brisbane’s numbers were impacted by the transition out of the Destination Brisbane Consortium (DBC) joint venture and changes to the operator fee structure.

Cost reductions were a clear positive highlight, with operating expenses falling 11% quarter-on-quarter and 10% year-on-year. This reflects the early impact of “cost out” initiatives launched by the company’s new leadership team, including corporate streamlining and reviews of supplier costs.

Latest updates on The Star’s turnaround plan

Even so, The Star’s broader overall financial position remains fragile. Available cash dropped to $90m at the end of March, and the company is working against a tight deadline to complete refinancing by 15 May to avoid breaching its existing debt agreement.

A binding refinancing commitment with WhiteHawk Capital Partners, announced at the end of last month, is already in place, and all required regulatory approvals have been secured.

The refinancing package consists of a three-year facility totaling around $550m, which will be used to fully refinance the group’s existing debt while also providing extra liquidity.

A minimum liquidity requirement of $50m has been set for the first 12 months after financial close, which the company is on track to meet. The requirement rises to $75m between 12 and 18 months post-close, and $100m after that period.

Additional covenants include a minimum asset coverage ratio starting December 2026 and a minimum EBITDA threshold starting March 2027, alongside standard reporting obligations and default provisions.

An interest reserve account that will cover the first 12 months of interest payments will also be set up as part of the new financing structure.

“The Star is working to complete the refinancing as soon as possible, but no later than 15 May 2026, to meet the conditions of the waiver granted by existing SFA lenders,” a company statement read.

The Star has also made progress on its strategic reset, completing the first stage of its exit from the Brisbane joint venture with DBC. This step included the release of a large parent company guarantee tied to $1.4bn in debt facilities.

Financial challenges will not be resolved immediately

Despite these recent steps, The Star has reiterated that material uncertainty remains over its ability to continue as a going concern, with multiple interconnected factors including refinancing, regulatory outcomes and operational recovery still unresolved.

Bruce Mathieson Jnr, the company’s current Chief Executive Officer, has continued advancing the turnaround strategy, which included appointing two new Non-Executive Directors – Brooke Lindsay and Grant Bowie – this month.

The business remains in a transitional period following a $300m strategic investment from Bally’s Corporation and Investment Holdings late last year, a deal that will eventually give Bally’s a 56.7% stake in The Star.

The company is also navigating ongoing regulatory change across Australia, where a key recent policy focus has been cracking down on gambling advertising. The Murphy report, written by late MP Peta Murphy and holding 31 recommendations for Australian regulatory reform, has still not seen most of its suggestions implemented across the country.

For The Star, an immediate return to profitability was always highly unlikely. Despite the unavoidable pressures it faces from both internal and external sources, the company is in a much healthier position today than it was at the start of 2025, when it was grappling with losses of more than $300m.