Macau gaming slump weighs on Australia's Crown

Australia's Crown Resorts Wednesday posted strong full-year net profits boosted by the part sale of its stake in a Macau-focused group, but saw underlying earnings fall as the gaming slump in the Chinese territory ate into revenue.

Casino mogul James Packer's Crown Resorts, like other operators, has been hurt by softening demand in Macau following a Chinese corruption crackdown, with the Australian company moving to sell some of its Melco Crown Entertainment stake back to the subsidiary in May.

The sale lowered Crown's slice of Melco to 27.4 percent and saw the operator pocket Aus$602 million (US$463.6 million) to boost net profit for the year to June 30 by 146.4 percent to Aus$948.8 million, compared to the previous corresponding period.

But underlying earnings -- which exclude one-off items -- declined 22.7 percent to Aus$406.2 million despite solid gaming revenue in the Australian casino resorts. Weak market conditions in Macau "adversely impacted" Melco's performance, the firm said.

"The 2016 full year result reflects a solid performance from our Australian operations and continued subdued trading in Macau," Crown Resorts' chief executive Rowen Craigie said in a statement.

"Overall gross gaming revenue across the Macau market in the full year to 30 June 2016 declined by more than 20 percent."

Crown declared a final dividend of 39.5 Aus cents for a full-year payout, compared to 19 cents in the prior period.

Shares in Crown rose 3.16 percent to Aus$13.71 in early trade on Wednesday.

Crown in June said it would separate its "high-performing" local assets from its international businesses, particularly the casinos in under-performing Macau.

Main floor gaming revenue in the Australian resorts, which includes casinos in Melbourne and Perth, rose 5.8 percent to Aus$1.68 billion, while non-gaming revenue edged up 1.5 percent to Aus$674.6 million.

But Crown's share of underlying earnings for Melco slumped 64.0 percent to Aus$58.1 million, while its share of net profit also plunged 65.0 percent to Aus$42.7 million.

Crown added that it would "vigorously" fight a legal case challenging plans to build a Aus$1.5 billion towering six-star hotel and casino complex on Sydney harbour aimed at Asian high-rollers, for which it won government approval in June.

Billionaire Packer, who is engaged to pop diva Mariah Carey, owns 53 percent of Crown Resorts but resigned as chairman in 2015.