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Australian Casino Industry Down

9 June 2003

AUSTRALIA – As reported by the Financial Times: “Clustered along the seemingly endless rows of flashing machines in Melbourne's Crown casino, the jewel of Kerry Packer's gambling empire, poker-faced punters feed coin after coin into Scorchin' Fortune and Jackpot Carnival games.

“There are relatively few customers and the rattle of coins coming out of the machines is even more scarce. Certainly, no one seems to be having much fun.

“It's not just the players who are glum.

“Although Australians love trying their luck - 80 per cent gamble at least once a year, with half of that number doing so on a regular basis - the chips also seem to be down for the A$ 16bn-a-year (US$10.5bn-a-year) industry due to a combination of government restrictions and uncertain growth prospects.

“…A smoking ban instituted at all gaming venues in Victoria, which will spread to New South Wales and probably Queensland, has hit revenues. Lower tourist numbers linked to the Sars out break aren't helping either.

“…The federal government's decision to make it illegal to provide online gambling to Australians, except for some sports and racing, has further crimped growth opportunities.

“…Matthew Slatter, chief executive of Tabcorp, Australia's biggest gaming company, concedes the industry is facing challenges and says there are unlikely to be any new casinos built for some time.

“…Tabcorp, whose shares have fallen by 15 per cent over the past year, has responded by creating smoking rooms and allowing customers to reserve machines during breaks.

“…Aristocrat Leisure, the world's second-biggest poker machine maker, lost 40 per cent in market capitalisation in one day last week after warning global revenues would be 15 to 20 per cent lower in the first half, leading to a net loss of A$32m (US$21 million)-A$37m (US$24.2 million)…”

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