Star Entertainment delays H1 results, faces 26% share plunge amid second Sydney inquiry

Australian casino operator Star Entertainment has decided to delay the release of its H1 results for the 2024 financial year. Originally scheduled for February 21, the company will announce a revised release date in the coming days.

This decision follows the announcement by the New South Wales Independent Casino Commission (NICC) of a second investigation into the operations of Star's Sydney casino. The inquiry, led by Adam Bell SC, will span 15 weeks, with the final report expected by May 31. It will focus on assessing how Star has implemented recommendations from the initial inquiry.

In response to the NICC's decision, Star requested a trading halt on the Australian Securities Exchange (ASX). The company expressed a positive stance on the inquiry, viewing it as an "objective forum" to demonstrate its suitability for holding a casino license in NSW. Star had been deemed unsuitable for a casino license in the state in September 2022.

However, the market reacted strongly to the news, with shares in the casino operator plunging by 25.9% to A$0.415 in early trade. This marks the most significant intraday drop ever when trading resumed after a halt on Monday. As of 0002 GMT, the stock was down 23.2% at A$0.430, jeopardizing a three-day winning streak in heavy trade. Tuesday's trading saw nearly 60 million shares change hands, surpassing the 30-day average of approximately 15.7 million shares by 3.8 times.

The new inquiry aims to assess the suitability of Star Entertainment Group's association with the management or operations of its Star Sydney casino. The NICC expressed dissatisfaction with Star's progress on remedial measures, leading to the extension of regulator-appointed management for the second time in December of the previous year.