Casino Industry Analysis

2292 Words Oct 7th, 2012 10 Pages
Recently, Crown casino declared that it decided to spend nearly $568 million to invest a new 500-room luxury hotel in Perth. WA government agreed not to be against a request for 500 extra gaming machines and 130 extra tables which would enable the capacity of Perth nearly as same as Crown Melbourne. The Executive Chairman, James Packer, was quoted as saying “This is not a great deal for me; this is a deal where I expect my share price to go down” (Australian Financial Review). In this essay, I will list all different types of business that run by Crown and describe them. Furthermore, this essay will conduct an industry analysis of gaming sector in Australia and present performance of Crown as well as its competitors Wynn. Also, Crown and …show more content…
Competition (VERY HIGH)
Due to the large growth within the gaming industry, a great number of gambling locations have been opened all around the world. The main goal of every company in gaming industry is to make money and attract many a customer. As a result, it will lead to increase the competition. Crown Casino stays to be the major players in terms of hotel services, resorts and entertainment facilities. Crown Limited’s competitors could be Echo Entertainment Group, Tabcorp Holdings Limited and Centrebet International Limitedcould.

Substitutes (Low)
There have been many forms of gambling evolved over the years including casino games, horseracing bets, boxing, fighting games, sports betting etc. consumers gamble for seeking the pleasure, fun or making money for luck. Due to great number of gambling games, it may hard to find substitutes. As a consequence, this force can have a low power.

Between 2007 and 2011, Crown Casino had a better performance in reducing financial risk and payout dividend. On the contrary, it faced difficulties to return net income as shareholders equity and repay short-term liability corresponding to short-term assets. The performance of Crown Casino can be analysis into different components. Considering about the profitability of Crown, the return on equity declined slowly from 2007 at 0.063, which means 6.3 per cent of profit a company
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