- »Canberra Clubs Reports Big Losses
Canberra Clubs Reports Big Losses
The coronavirus pandemic has had a big impact on one of Canberra’s biggest clubs.
The Canberra Times reports that the Canberra Labor Club posted a loss of more than $10 million in the past financial year, with a significant fall in pokies revenue posted.
The number of staff working at its venues was also cut by 10 per cent, the club’s annual report showed.
The Labor Party-owned club’s directors said the impact of the coronavirus pandemic was ongoing and it was impractical to estimate the potential impact going forward.
“The situation is rapidly developing and is dependent on measures imposed by the Australian government and other countries, such as maintaining social distancing requirements, quarantine, travel restrictions and any economic stimulus that may be provided,” the report said.
In the 2019-20 financial year, the club recorded an after-tax loss of $10.7 million, up from an after-tax loss of $192,394 the previous year.
Club chief executive Arthur Roufogalis said in his report the operation of the club’s new Mercure Hotel in January 2020 led to an impairment of $11.7 million.
“The hotel opened for trade on January 22, 2020, with promising early results before the impact of the pandemic and travel restrictions,” he said.
“We were required to have it valued as of June 30, 2020. The valuation reflected the extremely poor trading results during the pandemic, which substantially impacted its value.”
Poker machine revenue falls away
Poker machine revenue fell by more than 28 per cent, from $24.3 million in 2018-19 to $17.4 million in 2019-20.
The club has voluntarily surrendered gaming machine licences valued at $1.5 million and can use the value of the licences as a discount on future development charges until March 2026 as part of an ACT government scheme to reduce the number of gaming machines in the territory.
The club claimed $1.1 million in community purpose contributions, including more than $400,000 of in-kind support.
Those contributions included more than $200,000 in support for club staff during the COVID-19 pandemic.
The contributions amounted to about 10 per cent of the club’s total net gaming machine revenue.
Clubs are required to spend at least eight per cent of that revenue on community contributions.
But club president Brian Weir warned the impact of COVID-19 on the club’s finances would affect its ability to provide community support in the coming year.
Other club and hotel revenue dropped from $8.7 million to $6.8 million in the last financial year.
The number of club members also fell by three per cent to 40,565.
Other community clubs have also incurred multimillion-dollar losses during the pandemic.
Vikings Group, which has four venues in Tuggeranong, reported a $5.4 million loss in 2019-20, the largest in its 40-year history.
Southern Cross Club, which has venues in Woden, Greenway and Jamison, suffered a $2.14 million loss in 2019-20, having projected a surplus of more than $1 million earlier in the year.
The club also experienced a more than 20 per cent drop in revenue from pokies.
Casino Canberra rebounds and exits from government wage scheme
The Australian government’s JobKeeper wage subsidy payments are no longer available to Canberra’s Aquis Entertainment, following its strong fourth quarter of 2020.
Asgam reported in January that the owner and operator of Casino Canberra said in a recent filing that it had been eligible for phase two of the scheme, which ran from September 28 to January 3, which was aimed to help businesses impacted by the coronavirus pandemic.
However, “Casino Canberra’s trading performance over the December quarter was strong and returned to approximately pre-COVID levels,” it said.
As a result, Aquis is not eligible for the third phase of the program.
Aquis said all employees were recalled to full capacity in the fourth quarter, despite the property still operating under some restrictions.
As per local COVID guidelines, Casino Canberra is currently capped at one person per four quarter metres of usable space, giving it a capacity of 505 patrons.
“The business continues to operate according to its COVID Safety Plan, as required by the ACT Government, which is reviewed daily and updated based on the latest advice issued by the ACT Government,” it said.
Casinos in Australian states and territories have all reopened to varying extents, based on local coronavirus restrictions and government guidance.