Packer tells Crown shareholders at AGM confident of Sri Lanka venture

Thursday, 31 October 2013 01:26 - - {{hitsCtrl.values.hits}}

The Australian: Crown Resorts Executive Chairman James Packer has revealed the casino group does not plan to increase its dividends for the next “four or five years” as it rolls out another capital expenditure program, and remains confident its new Crown Sri Lanka project will receive

regulatory approval. Packer told yesterday’s Crown annual meeting in Melbourne, where shareholders approved a change of the company’s name to Crown Resorts, that the company would cap payouts to shareholders to allow it to complete projects in Sydney, Perth and refurbishments in Melbourne. “If you think about capex in Australia, our net debt will rise and that is the reason we haven’t increased our dividends for the next four or five years,” he told the meeting. “It is worth retaining more of our earnings so we can build those facilities out.” Crown is going through the approval process for its $1 billion Crown Sydney casino resort development, building a $500 million hotel in Perth, and is planning a $420m project in Sri Lanka in a joint venture. The Sri Lanka development, in partnership with Rank Holdings, includes a 400-room Crown hotel with gaming facilities. Packer noted yesterday that “Sri Lanka is not going to be an earth-moving cheque”. The Sri Lankan Government last week postponed a Parliamentary debate on the project following opposition criticism of proposed tax breaks given to the proponents, which it claims will cost Sri Lanka $1b over 10 years. Crown’s Executive Vice-President, Strategy and Development Todd Nisbet is in Colombo this week for further meetings on the project. Packer said he was hopeful the Sri Lankan Parliament would pass legislation allowing the casino to proceed. “I am confident. These things are complicated and these guys have CHOGM (the Commonwealth Heads of Government Meeting) on in two weeks. I am a believer in the Sri Lankan Government and I am hopeful we will get there… I am a believer Australia should get closer to Sri Lanka,” Packer said after the meeting. He said Crown’s capex program would also be partly funded by the anticipated start of dividends being paid by its booming Hong Kong-listed subsidiary, Melco Crown Entertainment. Melco Crown, in which Crown has a 34% stake, said earlier this year that it planned to begin paying dividends next year. The Group, which has grown to represent half of Crown’s total value, is now almost debt free at the holding-company level and it has independent financing in place for new developments in Macau and The Philippines. Packer said Crown’s investment in Melco Crown cost $US600 m ($631m) and was now worth $US6.2 b. (http://www.theaustralian.com.au/business/companies/crown-plans-to-build-on-successes/story-fn91v9q3-1226750014998#sthash.ro4hMv5U.dpuf)