Crown Resorts, one of Australia’s premier casino giants, has announced significant job cuts, affecting up to 1000 employees. The move comes amidst a backdrop of economic downturn and increased regulatory scrutiny impacting the company’s operations across its key national venues.
Chief Executive Officer Ciaran Carruthers disclosed the restructuring plans to staff members on Monday, signaling a need to streamline operations in response to ongoing challenges in Sydney, Melbourne, and Perth. While the Perth site is expected to be less affected, the overall restructuring aims to reduce the corporate and precinct roles by 4 per cent.
In a statement to the Australian Financial Review, Carruthers cited various challenges facing Crown Resorts, including a decline in tourism, reduced local foot traffic in city centers, and stricter gaming regulations in Sydney and Melbourne. These factors have collectively contributed to a challenging operating environment for the company.
“The challenges at Crown reflect greatly reduced foreign tourism, a sharp decline in local workers in the city centers, and restrictions on gaming play in Sydney and Melbourne,” said Carruthers. He further emphasized the company’s commitment to regulatory compliance and ongoing transformation initiatives, such as the Crown PlaySafe program and redevelopment plans for its Melbourne and Sydney properties.
Crown Resorts, which employs over 20,000 people and is a significant contributor to employment in the states where it operates, has faced mounting pressures in recent years. Stagnation in international travel, coupled with a decrease in high roller patronage, has impacted the company’s revenue streams. Moreover, tightening regulatory controls on the casino industry have added further strain, prompting Crown to shift focus away from gaming and towards promoting its non-gaming offerings, such as dining and entertainment experiences.
Sources familiar with the restructuring decision revealed that it was initiated by Carruthers himself, rather than the parent company Blackstone, which acquired Crown Resorts in June 2022 for nearly $9 billion. This move underscores Crown’s efforts to adapt to evolving market dynamics and regulatory requirements independently.
The announcement of job cuts follows a significant regulatory setback for Crown Resorts in July 2023 when it was ordered to pay $450 million after an investigation by the financial crime watchdog AUSTRAC found breaches related to anti-money laundering and counter-terrorism financing obligations.
As Crown Resorts navigates through these challenges, the company remains focused on implementing measures to ensure compliance, enhance operational efficiency, and sustain its position as a leading player in Australia’s entertainment and hospitality industry. However, the road ahead appears fraught with uncertainties, requiring strategic decisions and adaptability to overcome the obstacles confronting the organization.
