Home' Forge : Vol 1 No 4 Contents 69
we attract international visitors and
encourage them to extend their stay and
see more of Australia,' says Bekier.
Right people to deliver the strategy
All multi-billion-dollar investment
programs have execution risk. For
The Star Entertainment Group, those
risks fall into three categories: having
suffcient executive depth to implement
a transformative strategy; ensuring that
there are enough highly trained staff
members to deliver the experience;
and managing a massive capital works
program that delivers growth without
disrupting operations, or denting
Bekier has strengthened the Group's
executive team since his appointment as
Chief Executive Offcer in February 2014.
Greg Hawkins, a former CEO of Crown
Melbourne, joined as Managing Director
of The Star, Sydney, in September 2014.
Hawkins has 20 years of Australian and
international gaming experience, and is
driving stronger operational performance --
a feature of The Star Entertainment
Group’s 2014–15 earnings result.
Geoff Hogg, previously Managing
Director of the Group's Treasury Hotel
& Casino (to be renamed The Star,
Brisbane, when the new integrated
resort development becomes operational
in 2022), was appointed to lead its
Queensland operations. Chad Barton
joined as Chief Financial Offcer in April
2014, and Geoff Parmenter joined as
Executive General Manager, Marketing
and Corporate Affairs, in March 2013.
'We have the right leadership team for
our strategy,' says Bekier. 'It has deep
experience in gaming, tourism and Asia --
and the stability to oversee a capital
investment program over this decade
and next. Our goal is to deliver more
consistent, ongoing capital expenditure
to continually improve our properties
and minimise disruption.'
Bekier adds, 'Greater management
depth will also ensure that the Group
manages what we expect will be rapid
growth over the coming decade. For
example, we had 51,000 people visit
The Star in Sydney on the day of the
Rugby World Cup fnal. We know
we need more hotel rooms, and food
and beverage facilities, to cater for
higher demand. Our challenge is to
manage that short-term demand while
positioning for long-term growth.'
To this end, the Group has established
a tourism and hospitality school on
the Gold Coast in partnership with
Queensland TAFE, which will train an
expected 10,000 extra staff members
between now and 2022, as well as staff of
other companies. 'We wanted to invest
more in frontline staff and create a strong
internal training facility to ensure that our
people consistently deliver a world-class
experience to customers,' says Bekier.
On projects, the group is managing its
capital works program to ensure that its
three east-coast casinos are not affected
by refurbishments or new projects.
Much of the Gold Coast property's
refurbishment is outside its existing
footprint; Queen's Wharf is adjacent to
the current Brisbane casino; and ongoing
refurbishment at The Star, Sydney, is
being managed smoothly, judging by its
strong recent operating results.
Right strategy to drive earnings growth
The Star Entertainment Group’s 2014–15
result beat market expectations.
Normalised earnings before interest, tax,
depreciation and amortisation (EBITDA)
of $521 million were 24.1 per cent higher
than the previous corresponding period.
Each business segment contributed to
growth, and The Star, with 25.5 per cent
EBITDA growth, headlined the result.
A total dividend of 11 cents per share,
fully franked, was 38 per cent up on
FY14. The Group’s total return (including
dividends) is 38 per cent over one year to
5 October 2015, Morningstar data shows.
Over three years to October 2015, the
annualised return is 14 per cent, making
it the best-performed ASX200 casino
stock in that period.
A November trading update confrmed
that the momentum has continued so
far this fnancial year. Domestic gaming
revenue rose 10 per cent on the same
period last year, and the Group said it
had 'experienced good demand in all its
properties in the FY16 year to date’.
A promising future
The 12-month priorities are driving
continued earnings growth across
the Group; delivering on the capital
investment program at the Gold Coast;
and commencing and delivering on the
frst stage of The Star, Sydney, master
plan. Other goals include evolving the
brand and loyalty program; implementing
a guest service program; and working
with the Queensland Government and the
Group's consortium partners to progress
Queen's Wharf Brisbane.
Longer-term, Bekier wants The Star
properties to be prime destinations for
Asian tourists. 'Inbound tourism from
China to Australia is up 40 per cent over
one year, but we are only scratching
the surface. Australia rates very highly
in terms of appeal and desirability
for Chinese tourists, but much lower
in terms of actual travel. Tourism
stakeholders and governments can
work together to convert more of those
intentions into visitations to Australia,
and develop a product that better caters
to Asian tourists.'
Bekier says that the Queen's Wharf
Brisbane project has incredible potential.
'We intend to take the marketing of
Queensland tourism to a new level in
Asia. We are very conscious that Asian
tourists do not want to visit something
that looks like any other integrated
resort; they want a strong Queensland
experience, and hope to see more of the
state on their visit.'
Bekier says that The Star 's three east-
coast resorts, working together under
one brand, are ideally positioned
for Asian tourism. 'We will have
the properties to absorb the Asian
inbound tourism boom. The challenge
is to keep building up our properties,
running them as effciently as possible,
and making them successful for
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