Falling Star Entertainment looking for ‘liquidity solutions’ amid cash crunch and tough trading conditions

Shares in Star Entertainment plunged on Thursday after the already embattled casino operator laid liquidity woes bare.

Late on Wednesday, the Star told the market it had about $79 million in available cash at the end of December after burning through $70m since September. This included cash from a drawdown of a new, much-needed loan in December.

Star is battling with tough trading conditions across its Sydney and Gold Coast operations, $15m worth of fines imposed by the New South Wales Independent Casino Commission, legal and debt fees, as well as day-to-day expenditure.

These circumstances were making it “challenging” to meet the conditions in order to draw a further $100m in cash from lenders, the company told the market.

“The group’s available cash at 31 December 2024 was $79 million, a reduction of $70 million from the previously reported 30 September 2024 balance of $149 million. The available cash at 31 December 2024 includes the impact of the draw down of Tranche 1 of the group’s new debt facility which occurred on 3 December 2024,” a statement read.

“The reduction in available cash reflects the continued difficult trading conditions highlighted at the Group’s Annual General Meeting on 28 November 2024.”

Star said it was exploring “other liquidity solutions” as well as trying to meet conditions to draw down on the second tranche of its loan.

It comes after the casino operator flagged it was facing a “critical” liquidity challenge at its annual meeting in November.

A clearer look into the group’s financial position is expected when it releases half-year results at the end of February.

Star’s share price fell 23 per cent at market open on Thursday to 15.1¢, and later closed lower by 32 per cent to 13.2¢.

It comes following a tumultuous 12 months for the company marred by regulatory and governance issues, as well as operational challenges.