Crown Resorts Limited ABN 39 125 709 953
Level 3, Crown Towers, 8 Whiteman Street, Southbank VIC 3006
ASX/MEDIA RELEASE
FOR IMMEDIATE RELEASE
9 September 2021
2021 ANNUAL REPORT
MELBOURNE: Crown Resorts Limited (ASX:CWN) (Crown) attaches the 2021 Annual Report.
ENDS
This announcement was authorised for release by the Crown Board.
Investor and Analyst Enquiries – Matthew Young, Investor Relations, 03 9292 8848.
Media Enquiries – Natasha Stipanov, Corporate Affairs, 03 9292 8671.
COPIES OF RELEASES
Copies of previous media and ASX announcements issued by Crown are available on Crown's website
at www.crownresorts.com.au
ANNUAL REPORT 2021
b
CROWN RESORTS LIMITED
ABN 39 125 709 953
1
Crown Resorts Limited Annual Report 2021
1
Contents
Letter from the Board
2
About Crown
6
Crown’s Resort Portfolio
7
International Interests
10
Crown Digital
11
Financial Summary
12
Regulatory Update and Remediation Plan
14
Australian Resorts Business Update
16
Corporate Responsibility
22
Corporate Governance Statement
33
Directors’ Statutory Report
49
Remuneration Report
73
Auditor’s Independence Declaration
96
Independent Auditor’s Report
97
Financial Report
104
Directors’ Declaration
160
Shareholder Information
161
Additional Information
163
Corporate Information
164
Crown acknowledges the Traditional Custodians of the land
on which its Australian Resorts are located; where we gather
as employees, as friends and as the Crown family. Crown
acknowledges and thanks all of the Aboriginal and Torres
Strait Islander people and communities who have contributed
and continue to contribute to enrich our workplace. Crown
acknowledges the Traditional Custodians’ kinship lines, their
ongoing cultures and connection to the land and waters and we
pay respects to Elders past and present, the Wurundjeri and
Bunurong of the Kulin Nation (Melbourne), Noongar on Whadjuk
Country (Perth), and Gadigal of the Eora Nation (Sydney).
Acknowledgment of Country
Letter from the Board
The 2021 financial year stands out as one of the most
challenging in our history with unprecedented impacts on
business operations from the COVID-19 pandemic and
intense public and regulatory scrutiny.
With COVID-19 restrictions continuing, the past 12 months
have been extremely testing for our employees, customers,
suppliers, and society more generally, and have forced
changes to most aspects of our work and lives.
Extended lockdowns to reduce community transmission
of COVID-19 have curtailed activity in many parts of the
economy, with the hospitality sector among those
industries most heavily affected. Restrictions on travel
between states and territories – and the continuing
closure of the Australian border to international visitors
– have also had a devastating impact on the tourism
industry.
Our priority is the health, safety and wellbeing of our
employees, customers and the community, so Crown is
supportive of the measures taken by the State and
Federal Governments.
Recognising the impact COVID-19 has had not only on
Crown’s business operations, but directly on Crown’s
employees, we have been proactive in seeking ways to
support our people through these challenging times. This
has included financial support to employees who have been
stood down and those suffering serious financial hardship, as
well as other forms of support, such as ongoing access to
Crown’s assistance and wellness programs.
Crown has also supported the communities in which we
operate through this challenging period, including
through the ongoing work of the Crown Resorts
Foundation and its program partners.
Against the backdrop of a global pandemic, Crown
continues to face additional uncertainty from ongoing
regulatory investigations.
Crown has apologised for the failings identified through
these various regulatory processes and we are committed
to doing everything in our power to redress them and
earn back confidence and trust.
We have, and will continue, to fully cooperate with each of
these regulatory processes and we recognise the need to
demonstrate that we can deliver and sustain market
leading responsible gaming, governance, risk management
and compliance, and a strong values based culture.
Renewed Leadership
With significant change at both the Board and senior
executive level over the last 12 months, there is now an
almost entirely new leadership team in place at Crown.
We have undertaken significant Board renewal. Of those
directors present at the 2020 Annual General Meeting,
only two remain on the Board today. We would like to
thank all outgoing directors for their contribution to
Crown and wish them well for the future.
In particular, we would like to recognise outgoing
Chairman Helen Coonan for her leadership and stability
during an extremely challenging period for the company.
Helen played an important role at Crown over a long
period of time, particularly since stepping up as Executive
Chairman where she has made a major contribution to
Crown’s reform program and navigated the company
during a time of significant change and disruption.
Dr Ziggy Switkowski will join the Board as Chairman
following receipt of all necessary regulatory approvals as
part of the planned succession process. The Board
welcomes Dr Switkowski to Crown and has confidence in
his experience and capabilities to lead the Board during
what is a critical time for the organisation.
We also welcomed Nigel Morrison and Bruce Carter to
the Board this year as independent non-executive
directors, who both bring extensive experience and
expertise, particularly in relation to the casino industry.
There has also been considerable change at the senior
management level, with a number of departures.
We are pleased to have Steve McCann on board as CEO
pending regulatory approval. He has the experience,
capacity and integrity to lead Crown through the
extensive reformation already underway.
Jane Halton AO PSM
Interim Chairman
Toni Korsanos
Non-executive Director
Nigel Morrison
Non-executive Director
Bruce Carter
Non-executive Director
2
Crown Resorts Limited Annual Report 2021
3
Recognising the importance of Crown Melbourne to
Crown, Steve McCann will move to Melbourne as soon as
practicable following his recent additional appointment to
the role of Chief Executive Officer of Crown Melbourne.
Steve McCann is supported by new senior executive
appointments, including the addition of Betty Ivanoff as
Group General Counsel, Tony Weston as Chief People and
Culture Officer, Nick Weeks as Executive General
Manager - Transformation & Regulatory Response, and
Steven Blackburn as Chief Compliance and Financial
Crime Officer.
Transformation and Remediation
As part of Crown’s response to matters raised throughout
various regulatory processes, Crown has taken action and
has focussed on driving transformation and remediation
to ensure Crown is a more transparent and respected
public company. As part of this process, Crown has
developed a comprehensive Remediation Plan which is
the cornerstone of many of the significant changes to the
way Crown conducts business.
Successful implementation of these reforms is intended
to position Crown as a leader in the industry in its
approach to governance, compliance, responsible gaming
and the management of financial crime risk, supported by
an organisational culture reflecting the importance and
significance of these areas.
We have already made significant progress in
implementing reforms.
We have revised organisational structures, enhanced
capability and increased resourcing across a number of
key areas, including Crown’s Financial Crime, Compliance
and Responsible Gaming functions. In addition, we have
implemented other changes to Crown’s business
practices, such as the introduction of the Significant
Player Review process, which has resulted in the exit of a
number of customer relationships, ceased dealing with all
junket operations, restructured the VIP international
business (including closing all offshore offices) and
terminated the information sharing agreements that were
in place with CPH. There is also a substantial culture
reform program underway.
The significantly renewed Board and leadership team are
committed to setting the standard expected across the
organisation, and Crown’s employees have embraced the
change with engagement, energy and commitment.
We will continue to work hard to implement these
reforms as we seek to repair Crown’s reputation and build
the trust of our communities, regulators and
governments, and investors as a responsible operator of
outstanding quality integrated resorts.
2021 Performance
Our financial results for the year ended 30 June 2021
reflect the severe impact on operations from the
COVID-19 pandemic.
Revenue of approximately $1.5 billion was down over
30%, whilst Crown recorded a consolidated net loss after
tax of over $260 million. No dividends were declared or
paid in respect of the 2021 financial year.
The protracted lockdown in Victoria meant that Crown
Melbourne was closed for much of the first half, with
gaming operations closed for a total of 160 days during
the financial year. When open, gaming facilities were
subject to ongoing restrictions, including overall capacity
and density limits, restrictions on available product and
physical distancing requirements, which adversely
impacted performance.
Crown Perth delivered strong performance during the
financial year. Crown Perth re-opened with restrictions
towards the end of June 2020 and remained open for
the entirety of the first half, exceeding expectations.
Several short-term closures occurred during the second
half, with Crown Perth’s gaming operations closed for a
total of 27 days. Whilst trading performance rebounded
quickly following each shutdown, overall performance
moderated throughout the course of the year.
4
After four years of construction, select non-gaming
operations at Crown Sydney opened to the public for the
first time in a restricted capacity in late December 2020.
Non-gaming operations commenced progressively
throughout the year, with all areas of the hotel resort now
complete. Crown Sydney experienced encouraging
property visitation, with the food and beverage offering
extremely well received, despite gaming operations yet to
commence as Crown continues its consultation process
with the NSW Independent Liquor & Gaming Authority on
suitability.
The residential component of the project, “Crown
Residences”, is also complete with residents commencing
move-ins from April 2021. Apartment sales are
progressing well with approximately $650 million of sale
proceeds received during the year.
Financial Position and Dividends
Crown has maintained a sound financial position with a
well-invested asset base, significant tangible asset
backing and a low level of gearing.
However, with the ongoing impacts of the COVID-19
pandemic on Crown’s operations and the uncertainty
associated with various regulatory processes, Crown has
taken the prudent step of engaging with its lenders to
ensure we have the necessary financial flexibility to
manage through this period. We were pleased to receive
the support of our lenders for a package of amendments
to Crown’s financing arrangements following year-end.
As part of these arrangements, Crown has agreed not to
declare or pay dividends in respect of the half year ending
31 December 2021 or where certain triggers occur as a
consequence of various casino licence events.
With further deleveraging expected from the remaining
Crown Sydney apartment sales, we are as confident as we
can be that we are well placed to navigate through this
challenging period.
Looking Ahead
COVID-19 continues to create uncertainty, with ongoing
operating restrictions likely to continue to materially
influence business performance over the near term.
We also await the outcomes of various regulatory
processes, with final reports expected from the Victorian
Royal Commission by 15 October 2021 and the Perth
Casino Royal Commission by 4 March 2022.
Despite the current uncertainty facing the business, we
remain focussed on transformation and remediation
efforts to address the shortcomings of the past. We
believe that Crown has a truly special portfolio of
premium integrated resorts which are well positioned to
make a strong recovery once Australia emerges from the
current challenges of the pandemic. Crown Melbourne
and Crown Perth are world-class entertainment precincts
and we are excited about the prospects of Crown’s new
6-star resort, Crown Sydney.
There is still much work to do. While we continue to
re-focus our organisation structure and strengthen our
Board and management team, we have made real
progress in reforming the company, and believe we are on
the right path to address our challenges, leading to longer-
term sustainable shareholder value.
Finally, we would like to thank all of our employees for
their dedication, resilience and patience throughout an
extremely challenging year. We look forward to
welcoming all employees back to our world-class
properties soon so that they can continue to deliver
exceptional experiences to our many thousands of
customers.
Jane Halton AO PSM
Interim Chairman
Toni Korsanos
Non-executive Director
Nigel Morrison
Non-executive Director
Bruce Carter
Non-executive Director
Crown Resorts Limited
Letter from the Board continued
5
6
About Crown
Crown Resorts (Crown) is one of Australia’s largest entertainment groups and makes a major contribution to the Australian
economy through its role in tourism, employment and training, and its corporate responsibility programs.
In Australia, Crown owns and operates two of Australia’s leading integrated resorts, Crown Melbourne and Crown Perth, as
well as Sydney’s latest premium hotel resort and dining precinct at Crown Sydney.
Crown has interests in various digital businesses, including
Betfair Australasia (100%), DGN Games (100%) and Chill
Gaming (50%).
AUSTRALIAN RESORTS
CROWN DIGITAL
INTERNATIONAL INTERESTS
Overseas, Crown owns and operates Crown Aspinalls in
London. Crown also holds a 50% equity interest in the UK-based
Aspers Group and a 20% interest in Nobu.
Crown Resorts Limited Annual Report 2021
7
Crown’s Resort Portfolio
Crown Melbourne is Australia’s leading integrated resort
and one of the most visited tourist destinations in Australia
with its dynamic and diverse facilities.
Crown Melbourne is licensed to operate 2,628 gaming
machines and 540 gaming tables.
The resort currently features three hotels:
• Crown Towers Melbourne (481 guest rooms);
• Crown Metropol Melbourne (658 guest rooms); and
• Crown Promenade Melbourne (465 guest rooms).
Crown also wholly owns the One Queensbridge
development site which could accommodate a fourth
Crown hotel.
The Crown Conference Centre has 7,350 square metres of
conference and meeting facilities across three floors.
Banqueting facilities include the Palladium’s 1,500-seat
ballroom and The Palms’ 900-seat cabaret venue.
A broad selection of restaurants and bars are located in the
resort, including many of Melbourne’s finest.
Crown Melbourne’s retail precinct features prestigious
designer brands and luxury retail outlets.
Crown Melbourne
8
Crown’s Resort Portfolio continued
Crown Perth is one of Western Australia’s largest tourist
destinations, with an exceptional range of entertainment and
tourism experiences.
Crown Perth has approval to operate 2,500 gaming machines
and 350 gaming tables.
The resort features three hotels:
• Crown Towers Perth (500 guest rooms);
• Crown Metropol Perth (397 guest rooms); and
• Crown Promenade Perth (291 guest rooms).
Large-scale entertainment facilities include the 1,500-seat
Crown Ballroom and 2,300-seat Crown Theatre Perth,
along with world-class convention facilities.
A premium selection of restaurants and bars are located across
the resort in addition to casual dining options.
Crown Perth
Crown Resorts Limited Annual Report 2021
9
Crown Sydney is located at One Barangaroo Avenue on the
foreshore of Sydney Harbour and is Sydney’s first six-star
hotel and a landmark building with views of some of
Australia’s most celebrated icons, the Sydney Harbour
Bridge and Sydney Opera House.
The Crown Towers Sydney hotel contains 349 guest rooms.
Crown Sydney also features the “Crown Residences” luxury
apartments, luxury retail outlets, pool and spa facilities,
conference rooms and VIP gaming facilities (commence-
ment of which is subject to receipt of necessary approvals).
A premium selection of restaurants and bars are located
across the resort in addition to casual dining options.
Crown Sydney
10
International Interests
Crown Aspinalls
Crown Aspinalls is a high-end casino in London’s prime
West End entertainment district. Nestled in the heart of
Mayfair, Crown Aspinalls offers members and guests an
exciting and opulent world of international VIP gaming,
in an environment that only London can provide.
Aspers Group
Crown holds a 50% interest in the Aspers Group, which
operates four regional casinos in the United Kingdom –
Newcastle, Stratford (London), Milton Keynes and
Northampton.
Crown equity accounts its investment in Aspers Group.
Nobu
Crown holds a 20% interest in Nobu, one of the world’s
most recognised lifestyle hotel and restaurant brands.
The other investors in Nobu are Nobu Matsuhisa, Robert
De Niro and Meir Teper.
Crown equity accounts its investment in Nobu.
Crown Resorts Limited Annual Report 2021
11
Crown Digital
Crown Digital includes Crown’s wagering and online social gaming operations comprising Betfair Australasia and DGN
Games and Crown’s investment in Chill Gaming.
Betfair Australasia
Betfair Australasia is 100% owned by Crown and provides
access for Australian and New Zealand customers to the
world’s leading betting exchange.
DGN Games
DGN Games is 100% owned by Crown and is a developer of
online social and casual games. DGN’s game titles include
“Old Vegas Slots”, a classic 3-reel game, and “Lucky Time
Slots”, a 5-reel game, with two new casual game titles in
development.
Chill Gaming
Chill Gaming is a 50/50 joint venture between Crown and
New Gaming Pty Ltd, which is owned by the founders of
Wymac Gaming Solutions. Chill Gaming is focussed on
innovation and developing new entertaining products.
Crown equity accounts its investment in Chill Gaming.
12
Financial Summary
• Crown’s results reflect the severe impact on operations from the COVID-19 pandemic, with
a net loss after tax of $261.6 million for the year ended 30 June 2021
• Given the challenging operating performance, no dividends were declared for the 2021 financial year
Summary of performance for the year ended 30 June 2021
F21
$m
F20
$m
%
change
Theoretical1 revenue
Crown Melbourne
582.5
1,477.8
(60.6%)
Crown Perth
742.8
613.3
21.1%
Crown Sydney
68.6
-
N/A
Crown Aspinalls
2.3
33.1
(93.1%)
Crown Digital
147.0
135.5
8.5%
Intersegment & unallocated
(1.2)
(1.1)
Theoretical1 operating revenue
1,542.0
2,258.6
(31.7%)
Win rate variance1
(3.4)
133.4
Commission adjustment
(2.8)
(165.0)
Interest revenue
1.0
10.2
Statutory revenue
1,536.8
2,237.2
(31.3%)
Theoretical1 EBITDA before Closure Costs2 and Significant Items3
Crown Melbourne
94.1
354.3
(73.4%)
Crown Perth
254.2
161.8
57.1%
Crown Sydney
(22.8)
-
N/A
Crown Aspinalls
(6.3)
(2.7)
(133.1%)
Crown Digital
34.1
34.7
(2.0%)
Corporate Costs
(111.6)
(44.3)
(151.7%)
Theoretical1 EBITDA before Closure Costs2 and Significant Items3
241.7
503.8
(52.0%)
Win rate variance1
(3.2)
111.6
Closure Costs2
(171.4)
(107.3)
Significant Items3, 4
47.0
(3.5)
Reported EBITDA
114.1
504.6
(77.4%)
Theoretical1 NPAT attributable to the parent before Closure Costs2
and Significant Items3
(84.2)
161.0
(152.3%)
Win rate variance (net of tax)1
(2.2)
78.8
Closure Costs2 (net of tax)
(120.6)
(81.6)
Significant Items3 (net of tax)
(54.6)
(78.7)
NPAT attributable to the parent
(261.6)
79.5
(429.1%)
1. Theoretical results have been adjusted to exclude the impact of any variance from theoretical win rate on VIP program play (at Crown Melbourne,
Crown Perth (until 24 February 2021) and Crown Aspinalls). The theoretical win rate is the expected hold percentage on VIP program play over time.
The theoretical result gives rise to adjustments to VIP program play revenue, operating expenses and income tax expense. Crown believes that theoretical
results are the relevant measure of viewing performance of the business as it removes the inherent volatility in VIP gaming revenue. Theoretical results are
a non-IFRS measure.
2. Costs incurred by Crown’s properties whilst gaming activities were closed due to government orders, excluding net contribution in relation to hotel
quarantine services (Closure Costs). Closure Costs are a non-IFRS measure.
3. Significant items are transactions that are not in the ordinary course of business or are material and unexpected due to their size and nature. Refer note
3(e) of the Financial Statements for further details. Significant Items are a non-IFRS measure.
4. Includes EBITDA related Significant Items only.
Crown Resorts Limited Annual Report 2021
13
1. Excluding working capital cash of $86 million. Working capital cash refers to cash held on the Company’s
premises and cash held in bank accounts for day-to-day operations of the businesses.
Crown Melbourne
• Crown Melbourne faced significant disruption during the year as a result of the
COVID-19 pandemic, with gaming operations closed for 160 days of the financial year
• When the property could open and operate, various operating restrictions were
imposed such as capacity limits and physical distancing protocols
Crown Perth
• Crown Perth re-opened with restrictions towards the end of June 2020 and delivered
strong performance during the first half of the 2021 financial year
• Crown Perth faced several short-term closures throughout the second half, and whilst
trading performance rebounded quickly following each shutdown, overall
performance moderated throughout the course of the year
Crown Sydney
• Crown Sydney opened non-gaming operations progressively from late December
2020
• Despite the encouraging property visitation, Crown Sydney delivered an operating
loss given the impact of COVID-19 related restrictions including border closures, and
the limited scale of operations
• Settlement of apartment sales commenced in April 2021, with approximately
$650 million in proceeds received during the period
Other Businesses
• Crown Aspinalls was closed for the majority of the financial year. While trading,
performance was subdued given the constraints on international travel, social
distancing restrictions and reduced operating hours
• Crown’s wagering and online social gaming operations delivered mixed performance.
Improved revenue from Betfair was offset by increased expenses, particularly in the
second half. Conversely, lower revenues from DGN were offset by lower marketing
costs
Corporate
• Corporate costs were higher during the year driven by legal, consulting and
other costs associated with various regulatory inquiries, and higher insurance costs
• At 30 June 2021, Crown’s net debt was $893 million1, consisting of total debt of
$1,283 million and cash of $390 million1
14
Regulatory Update and Remediation Plan
Regulatory Update
During the year, Crown was the subject of a number of
inquiries, Royal Commissions and regulatory
investigations.
Bergin Inquiry
Hearings of the inquiry established under section 143 of
the Casino Control Act 1992 (NSW) (Bergin Inquiry)
concluded in November 2020, with the Commissioner’s
report publicly released on 9 February 2021 (Bergin
Report). Having regard to the contents of the Bergin
Report, the gaming regulator in New South Wales, ILGA,
wrote to Crown stating, amongst other matters, that it
presently considered that Crown Sydney Gaming was no
longer a suitable person to give effect to the Restricted
Gaming Licence in New South Wales.
Crown is continuing to work with ILGA on a path to
suitability to give effect to the Crown Sydney Restricted
Gaming Licence as part of the consultation process
contemplated within Crown’s regulatory agreements in
New South Wales.
Victorian Royal Commission
In February 2021, a Royal Commission was established
into the suitability of Crown Melbourne to hold a casino
licence, as well as the suitability of its associates, including
Crown Resorts Limited (Victorian Royal Commission).
Hearings commenced in March 2021 and concluded with
closing submissions from parties with leave to appear in
August 2021.
The Victorian Royal Commission is expected to deliver its
final report by 15 October 2021.
Perth Casino Royal Commission
In March 2021, a Royal Commission was established to
inquire into the suitability of Crown Perth to continue
holding a casino gaming licence in Western Australia, and
related casino regulation (Perth Casino Royal
Commission). Hearings commenced in April 2021 and are
continuing.
The final report of the Perth Casino Royal Commission is
expected to be delivered by 4 March 2022.
AUSTRAC Enforcement Investigation
Crown Melbourne and Crown Perth are currently the
subject of formal enforcement investigations by AUSTRAC’s
Enforcement Team into potential non-compliance with the
Anti-Money Laundering and Counter-Terrorism Financing
Act 2006 (Cth) and Anti-Money Laundering and Counter-
Terrorism Financing Rules 2007 (Cth).
Other regulatory matters
Crown has also been subject to a number of other
regulatory investigations during the period.
Crown is fully cooperating in relation to the above matters.
Remediation Plan
As part of Crown’s response to matters raised throughout
various regulatory processes and through its engagement with
regulators, Crown has developed a comprehensive
Remediation Plan.
Successful implementation of the Remediation Plan is
intended to position Crown as a leader in the industry in its
approach to governance, compliance, responsible gaming and
the management of financial crime risk, underpinned by an
uplifted organisational culture.
With significant change at both the Board and senior executive
level over the last 12 months, there is now an almost entirely
new leadership team in place leading this reform process:
• Board renewal:
• Departure of nine directors since October 2020, including
all nominees of the major shareholder
• Dr Ziggy Switkowski AO appointed as Chairman (subject
to regulatory approvals)
• Nigel Morrison and Bruce Carter appointed as new
Non-executive Directors
• Senior management change:
• A number of senior executives have departed
• Steve McCann appointed as Chief Executive Officer and
Managing Director (subject to regulatory approvals)
• New senior executives who have commenced at Crown
(subject to necessary regulatory approvals, to the extent
outstanding) include:
• Group General Counsel;
• Chief Compliance and Financial Crime Officer;
• Executive General Manager – Transformation &
Regulatory Response; and
• Chief People and Culture Officer
Crown has already made significant progress in implementing the
changes outlined in the Remediation Plan.
Detail on the key achievements to date is outlined on the
following page.
Crown Resorts Limited Annual Report 2021
15
Corporate governance
and organisation
structure
• Board renewal
• Of the 11 directors listed in the 2020 Annual Report, only two remain
• Implementation of a revised organisational structure
• Wholesale senior management changes
• Of the four Senior Executives listed as Key Management Personnel in the 2020
Annual Report, none remain
Anti-money laundering /
Counter-terrorism
financing (AML / CTF)
Change Program
• Comprehensive Financial Crime & Compliance Change Program developed by the
newly appointed Chief Compliance and Financial Crime Officer
• Enhanced controls to manage the risk of financial crime have been implemented,
including a revised Joint AML/CTF Program, improved controls to prevent and
detect money laundering through Crown’s bank accounts and enhanced controls
and reduced limits relating to cash deposits at the casino
• Increased resourcing & capability, with an additional 55 roles approved under the
new Financial Crime and Compliance operating model and additional training for
Crown employees, Board members and senior management
• Investment in automation, with a new automated transaction monitoring system
(Sentinel) and digitised tool to allow electronic submission and investigation of
Unusual Activity Reports
• Forensic audit and controls assessment of Crown’s patron bank accounts by an
independent expert consultant
Culture review and
transformation program
• Completion of a comprehensive organisational culture review undertaken with the
support of an independent expert
• Development of a comprehensive culture transformation program which is intended to
uplift Crown’s organisational culture
• New organisational purpose and values ready to be implemented through the
organisation
Enhanced responsible
gaming program
• Majority of the recommendations by the VCGLR in its Sixth Review that related to
responsible gaming and the recommendations received from the independent
Responsible Gaming Advisory Panel in August 2020 have been implemented
• Approval by the Board of further enhancements to Crown’s responsible gaming
program, including an additional 14 FTEs, a reduction in time limits, the cessation of
certain marketing programs and support for a move to cashless gaming
Risk management
• Separation of Risk and Internal Audit teams, with elevation of reporting lines and
increased resourcing
• Adoption of a formal risk appetite statement and revised Risk Management Strategy
• Development of a new Risk and Compliance Culture Framework
Changes to Crown’s
approach to junkets, VIPs
and significant players
• Ceased dealing with all junket operators
• VIP business restructured, with all remaining offshore offices closed, the departure
of senior executives and remaining functions integrated into the broader business
• Implementation of a new process to assist with customer due diligence involving a
review of customers once certain actual or prospective gaming activity thresholds
are triggered (Significant Player Review)
Relationship with major
shareholder
• All CPH nominee directors have resigned from the Board
• Information sharing arrangements that were previously in place have been terminated
Remediation Plan - Key achievements to date
16
Australian Resorts Business Update
Crown Melbourne
Overview
Crown Melbourne is one of Australia’s leading
integrated resorts and tourist destinations.
During the 2021 financial year, Crown Melbourne faced
significant disruption as a result of the COVID-19
pandemic and was required to close for a large part of
the financial year.
Property Update
Crown Melbourne used the closure periods to deliver a
program of refurbishment, repair and improvements
across the property.
These improvements included the introduction of a
Changing Places facility at Crown Metropol, in support
of the CROWNability action plan and providing more
inclusive and accessible facilities.
Refurbishment and expansion of a premium gaming
machine area was completed in October 2020 and
included the introduction of the uniquely luxurious
private salon for patrons.
Concept design works have commenced in support of
Crown’s commitment to phase out indoor smoking at all
Crown-owned Australian properties by December
2022. The first of these projects, located in the Teak
Room, was completed in June 2021.
The upgrade of Crown Towers hotel rooms continued
with the soft refurbishment of the Deluxe and Executive
Suites, along with the Lift Lobby decor. A program of
refurbishment and repair works has also been
undertaken across the Melbourne complex, including
enclosure of the Crystal Club external terrace to allow
guests to enjoy the area all year round.
The ground floor Food Court offerings were enhanced
by the refurbishment and introduction of six new
separate outlets, richly detailed to recall a typical Hong
Kong streetscape and featuring a wide selection of
popular Chinese street foods.
Gradi expanded their Crown offering into the Food
Court with Zero Gradi Gelateria and Dessert Bar
focussing on house-made Italian coffee, desserts,
patisserie, crepes and hand-churned gelato.
Further retail updates included the establishment of Mr &
Mrs by Dr Tass in the former Isika Spa at Crown Metropol.
Gaming
During the year, Crown Melbourne’s gaming operations
were closed for 160 days as a result of COVID-19
restrictions.
When the property could open and operate, various
operating restrictions were imposed such as capacity
limits for the overall gaming floor or each indoor
space, density limits, restrictions on available gaming
product and physical distancing protocols, including the
deactivation of every second electronic gaming machine
and electronic table game, limits on the number of
players at a traditional table game and minimum
separation between tables.
VIP program play activity was severely impacted by
ongoing international and interstate travel restrictions.
Hotels
Crown Melbourne features more than 1,600 guest
rooms across three luxury hotel brands: Crown Towers,
Crown Metropol and Crown Promenade.
Following the easing of restrictions in place at the start
of the financial year, Crown Towers opened more
broadly on 9 November 2020, followed by Crown
Metropol on 1 December 2020, and finally Crown
Promenade on 11 January 2021. Unfortunately further
closures occurred in February 2021 and May-June 2021
in accordance with Government directions in response
to COVID-19 outbreaks.
Crown Resorts Limited Annual Report 2021
17
Overall hotel occupancy across the three hotels was
approximately 39%, with Crown Towers hotel occupancy
39%, Crown Metropol hotel occupancy 42% and Crown
Promenade hotel occupancy 33%. While leisure market
demand was strong, particularly on weekends
(restrictions permitting), interstate and international
border closures have severely impacted corporate and
group bookings.
During the year, Crown continued to provide safe
accommodation, at no cost, to those experiencing family
violence. The program included the provision of hotel
rooms, food and other amenities such as meeting
facilities for the provision of counselling services in a
safe environment. In total, Crown provided over 1,230
nights under this program.
Hotel rooms were also made available to the Victorian
Government for the purpose of quarantining returned
travellers early in the financial year.
Crown Towers was again awarded with a Forbes
Five-Star rating, and Crown Spa was awarded with a
Forbes Four-Star rating. This year saw both Crown
Towers and Crown Spa receive these prestigious awards
for the fifth consecutive year.
Food and Beverage
Once re-opened, Crown Melbourne’s premium
restaurant offerings continue to lead the way in
Melbourne, with a wide range of new experiences for
guests.
The reputation of Crown’s premium restaurants and
culinary credentials has been renewed by media
coverage from food, travel and lifestyle media globally,
who have celebrated Crown Melbourne’s venues,
world-renowned chefs and vast menu offerings.
Crown Riverside hosted additional outdoor dining spaces
for venues including Nobu, Bistro Guillaume, Rockpool and
Gradi. A reopening highlight was the launch of Petanque
Social, an open-air Riverside lounge bar.
Launched in December 2020, Crown Cellar & Co is a
wine store that has a retail shop front and an online
platform, offering customers premium and bespoke
wines from Australia and around the world.
Events, Conferencing and Entertainment
Crown’s Las Vegas style showroom The Palms at Crown
concentrated on some of Australia’s most iconic
entertainers including James Reyne, Anthony Callea,
illusionist Cosentino, plus a successful season with
Australian comedian Jimeoin during the Melbourne
International Comedy Festival. Crown also played host
to the first Australian tour of Dracula’s theatre
restaurant.
Crown hosted a series of events and conferences during
the year, led by key industry events from corporates,
charities and various associations. Major events included
the AHA State Awards for Excellence, Ritchies 150th
Gala Ball and a number of events for major sporting
clubs.
Evergreen opened its doors in November 2020 and has
hosted a number of weddings and bespoke private
events, as well as the International Women’s Day events
in March 2021 celebrating the role of female chefs in the
industry, headed by Sarah Briegel (Culinary Director
Crown Sydney) and On Saengyojanr (Ging Thai).
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Crown Perth
Overview
Crown Perth is the only fully-integrated entertainment
resort in Western Australia and continues to set the
highest standard of experience with its vast range of
high-quality assets. It remains Western Australia’s
leading tourist destination by volume, and the largest
single-site private sector employer in the State.
Property Update
Crown Perth has progressed improvements to the
property’s existing facilities and employee amenities
over the 2021 financial year. The main gaming floor has
been enhanced with additional seamless LED screens to
provide a more interactive digital media experience for
guests. Concept design works are progressing for the
Pearl Room refurbishment in support of Crown’s
commitment to phase out indoor smoking at all
Australian resorts by the end of December 2022.
These improvements also included the introduction of
the first Adult Accessible Change facility, commonly
known as Changing Places, on the property. Crown
Perth has also installed an accessible toilet within the
Atrium restaurant. In support of the CROWNability
Action Plan these facilities were introduced to provide
an accessible and inclusive environment for patrons and
staff.
Gaming
Crown Perth delivered a strong performance during the
financial year, despite 27 days of mandated closure of
gaming operations related to COVID-19.
Crown Perth’s Main Gaming Floor re-opened with
restrictions towards the end of June 2020 and
remained open for the entirety of the first half of the
financial year. COVID-19 related operating restrictions
which applied throughout the first half included
prescribed maximum density limit of one person per
two square metres, the deactivation of every second
electronic gaming machine and electronic table game
terminal and restricting the number of players at table
games.
Unfortunately, Crown Perth was disrupted at various
times throughout the second half and was required to
close gaming operations in line with government
restrictions imposed in response to COVID-19. Whilst
trading performance rebounded quickly following each
shutdown, overall performance moderated throughout
the course of the financial year.
Hotels
Crown Perth features approximately 1,200 guest rooms
across three luxury hotel brands – Crown Towers,
Crown Metropol and Crown Promenade.
Combined, the three hotels accommodated over
573,000 guests during the 2021 financial year and
achieved occupancy of approximately 67% despite a
number of COVID-19 state-wide and property
lockdowns, together with interstate and international
border restrictions. Crown Promenade remained closed
to the public until September 2020, initially being used
to exclusively house AFL players and staff as part of the
AFL’s quarantine hub.
However, during the year the hotels benefited from
significant demand from leisure travellers within
Western Australia seeking resort style, local based
“staycations”.
Crown Towers successfully maintained the Forbes
Travel Guide Five-Star rating for 2021, remaining the
only hotel in Perth to hold this rating. Crown Spa Perth
was again awarded the Forbes Travel Guide Four-Star
rating for 2021.
Australian Resorts Business Update continued
Crown Resorts Limited Annual Report 2021
19
Food and Beverage
Crown Perth continues to be one of Perth’s leading food
and entertainment destinations for Western Australians
and visitors alike.
Crown Perth’s food and beverage portfolio continued to
evolve and innovate, delivering an array of unique
offerings and customer experiences with our key food
and beverage partners. This included Gordon’s Pink Gin
High Tea, Pink Floss Martini, the Dude Tea at Merrywell,
the World Comes Alive, as well as the Grey Goose High
Tea and Cocktails which featured a grand scale fountain
located in the Metropol Lobby.
With COVID-19 travel restrictions in place, the Crown
Towers portfolio reached new heights of popularity
during the year as customers chose to holiday in their
own state and enjoy Crown’s facilities, food and drink
and the beautiful views of the pool and Perth city
skyline. The casual dining restaurants and bars also
continued to draw strong foot traffic.
Some of our extraordinary Crown employees were
recognised and profiled during the year including newly
appointed head chef of Nobu, Ping Ping Poh, who is the
first female appointed to this role after starting at Crown
as an apprentice chef in 2009. In addition, Nobu Perth
received the highest review score since opening in Western
Australia, from the highly regarded Food Editor for The
West Australian and restaurant critic, Rob Broadfield.
A new point of sale system and a new table
management system were introduced during the year,
providing an enhanced guest experience and improved
customer engagement.
Events, Conferencing and Entertainment
Crown attracted over 670 events with over 150,000
meals served at Crown Perth’s convention facilities this
year. However, due to COVID-19 restrictions, there were
no conventions or events until August 2020.
Crown worked with the AFL as part of the official ‘AFL
Hub’ in Western Australia, with Conventions catering for
all the teams’ 7,902 meals.
Other key events included hosting the Department of
Fire & Emergency Services, Grain Industry Association of
Western Australia, WA Education Corporate Services Staff
Association Inc. and key charitable events such as the
Boobalicious Ball (Breast Cancer Care WA), Heartkids WA,
Path of Hope, and Op Shop Ball (Anglicare).
Crown Perth was excited to host its first Telethon Ball at
the Crown Towers Ballroom during the year. This iconic
event included Telethon weekend in the Crown Theatre,
along with the Telethon call centre in the Conventions
space and was a great success.
Crown Theatre opened in 2020 at 50% capacity for the
highly anticipated and world-renowned production of
‘We Will Rock You’. Restrictions progressively eased,
with 100% capacity returning by March 2021. Other
shows in Crown Theatre included ‘The Boy From Oz’,
‘Legally Blonde’, and ‘Priscilla Queen of the Desert’ with
one-off shows also featuring Human Nature, Urzila
Carlson and multiple performances of the popular
children’s show ‘Bluey’.
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Crown Sydney
Overview
Crown Sydney, located at Barangaroo on the foreshore
of Sydney Harbour, is the city’s first six-star hotel and
features 349 hotel rooms and suites, luxury residences,
signature restaurants, bars, luxury retail outlets, pool
and spa facilities, and conference rooms.
After four years of construction, select non-gaming
operations at Crown Sydney opened to the public for
the first time in a restricted capacity from 28 December
2020, with further non-gaming operations opening
progressively throughout the financial year.
Crown is pleased to have welcomed over 3,000
employees and contractors to Crown Sydney at a time
when the hospitality industry has been severely
impacted by COVID-19.
Property Update
Construction of the Crown Sydney Hotel Resort was
completed on schedule, with an Occupation Certificate
granted for the hotel resort component in December
2020 and the residential component in April 2021.
These milestones were successfully achieved despite
the unprecedented weather conditions and
extraordinary logistical difficulties experienced during
the COVID-19 pandemic. Over 7.8 million construction
hours were worked on the project by more than 9,500
personnel.
Crown Sydney is a remarkable building taking a
sculptural form of three petals that twists as it rises.
Soaring 275 metres above the Sydney skyline, the highly
recognisable building is clad in a light silvery veil of glass
with differing levels of transparency.
All areas of the hotel resort, including the food and
beverage and function areas, are now complete and
operating. The opening of gaming areas remains subject
to the receipt of all regulatory approvals.
Construction of the residential component of the
project, “Crown Residences”, is also complete and
residents have been progressively moving in since April
2021.
Crown Sydney contributes to making Barangaroo South
a vibrant, mixed-use destination which offers round-the-
clock activities and inspiration for tourists, visitors, and
Sydneysiders including workers from the nearby
Barangaroo commercial buildings and Sydney CBD.
Gaming
The opening of Crown Sydney’s gaming operation was
postponed in late 2020, pending a determination of
suitability by the casino’s regulator, the Independent
Liquor and Gaming Authority (ILGA).
Crown has invested significant effort to achieve
suitability to commence gaming at Crown Sydney. In the
interim, Crown is ensuring that the employees recruited
for the gaming areas were prepared for when gaming is
permitted to commence and have provided support to
the non-gaming areas of the operation.
In addition, Crown has also been able to more
comprehensively test and develop a number of systems
that are new to Crown and that will likely have
application across the broader group following a
successful operational deployment in Sydney.
Hotels
Exquisitely appointed and offering stunning views of
Sydney’s harbour and icons, Crown Towers Sydney has
welcomed almost 40,000 guests since opening in late
December 2020.
Whilst COVID-19 restrictions, including interstate and
international border closures, had a devastating impact
on the hospitality industry, the arrival of Crown Towers
into the Sydney market has been warmly received.
Australian Resorts Business Update continued
Crown Resorts Limited Annual Report 2021
21
Occupancy has remained low, consistent with conditions
across the luxury hotel market in Sydney, with overall
occupancy of approximately 31% since opening.
Crown Spa Sydney has also opened successfully having
welcomed over 6,500 guests.
Food and Beverage
Crown Sydney commenced food and beverage offerings
in late December 2020, showcasing a variety of
experiences across a range of restaurants and bars.
Crown Sydney’s premium venues are leading the way in
providing guests with memorable experiences in a truly
unique setting with 7,500 reservations received within
24 hours of release.
Venues are already receiving recognition, with The
Waiting Room awarded 2021 NSW Sommelier’s Wine
List of the Year and 2021 Best NSW Wine List in a
Sydney accommodation venue at the NSW Sommelier’s
Wine List Awards. Woodcut and a’Mare were both
recently reviewed by food critics for the Chef’s Hat
Good Food Guide, with both receiving positive reviews
with 16 out of 20 points, in line with two chef’s hats.
SevenRooms is Crown’s new table management system,
which has been instrumental in providing guests with a
truly crafted and unique experience whilst also assisting
with operational efficiencies.
Unfortunately the opening of the final restaurant to
commence operation, Oncore by Clare Smyth, which
was scheduled to open in July 2021, has been delayed
due to the current COVID-19 restrictions in place across
Sydney.
Events, Conferencing and Entertainment
The Pearl Ballroom and Opal Suite commenced
operation in March 2021 and have attracted many
events and future enquiries. The current challenge for
the venues is being able to confirm events beyond the
expiry of the current interim liquor licences, which are in
place through to the end of October 2021.
Despite COVID-19 restrictions and the uncertainty
caused by a temporary liquor licence, Opal Suite is
already popular for small corporate events, and the Pearl
Ballroom is attracting weddings and celebrations. Over
30 private events have also been hosted within Crown
Sydney’s restaurants and bars and have proven to be
popular for corporates.
Crown partnered with Sydney’s Gold Charity Dinner as
the presenting partner in June 2021 at Sydney
International Airport. The event was an opportunity to
launch the Crown Sydney Events brand and showcase
its capabilities.
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Commitment to Responsible Gaming
Crown is committed to harm minimisation and the
responsible service of gaming.
Crown’s responsible gaming and harm minimisation
strategy incorporates a three pillars approach of:
• Awareness – supporting harm minimisation by building
awareness of responsible gaming programs and services
for staff and customers;
• Assistance – contributing to harm minimisation by
providing assistance to customers in managing their
gaming behaviours; and
• Support – delivering a supportive environment where the
potential for harm is minimised and a culture of responsible
gaming support is embedded in the organisation.
Awareness
Crown continued to raise awareness in relation to
responsible gaming and harm minimisation via customer
communication and collaboration with external
stakeholders including delivering the Responsible
Gambling Awareness Week in Crown Perth and the
Gambling Harm Awareness Week in Crown Melbourne.
The Victorian lockdown and resultant Melbourne casino
closure saw the campaign being delivered to Melbourne
employees in an entirely digital way. These weeks are an
important commitment between government,
community and industry in delivering on harm
minimisation principles, and each resort is represented
on each State’s planning committees.
Raising awareness in relation to Crown and community
responsible gaming services and programs is constant
across each property’s workforce and customers.
Involvement in various State committees is an important
part of sharing knowledge and ideas, and refreshing
awareness opportunities. In Victoria, Crown is a member
of the Responsible Gambling Ministerial Advisory
Council and relevant Working Groups, and the Victorian
Responsible Gambling Foundation (VRGF) Industry
Forum. In Western Australia, Crown is a member of the
Problem Gambling Support Services Committee and the
Gaming Community Trust Committee. The Responsible
Gaming team delivers training and information sessions
on a regular basis, increasing awareness and depth of
knowledge.
Assistance
Responsible Gaming Centres at each property are fully
funded by Crown and are unique in the volume and
breadth of the responsible gaming programs and
services they offer. A wide range of assistance
information materials and contact details for problem
gambling and other support service providers is stocked
at each Responsible Gaming Centre, many of which are
available in languages other than English.
Dedicated Responsible Gaming Advisers at each resort
focus on customer welfare and minimising harm.
Advisors are specially trained to provide assistance,
proactively and reactively, 24 hours a day, seven days a
week. Interactions are provided in a sensitive,
confidential and informed way, assisting with
information about, and referral to, the diverse range of
services and programs available at Crown and in the
community.
Support
In order to deliver support for Crown customers,
employees participate in ongoing training and
information sessions, and support from the 24/7
Responsible Gaming team.
Across the properties, Crown’s dedicated teams of
Responsible Gaming Advisors work with customers,
utilising the facilities and resources of each Responsible
Gaming Centre, to deliver responsible gaming programs
and services for customers to support them in managing
their gaming behaviours.
Corporate Responsibility
Crown Resorts Limited Annual Report 2021
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All three pillars of Awareness / Assistance / Support are
encapsulated at every level within Crown, with the
responsible gaming framework overseen by Crown’s
Responsible Gaming Board Committee.
Crown is committed to ensuring continuous improvement
in the area of harm minimisation. The Crown Board has
recently approved a series of enhancements to Crown’s
Responsible Gaming program, whilst a more detailed
‘transformation program’ is currently in development
under the direction of the new Chief Compliance and
Financial Crime Officer.
Current areas of further development include expanding
Crown’s Responsible Gaming Centres, increasing
staffing levels of Responsible Gaming Advisors and
continuing to invest in technological capability to
provide new and improved harm minimisation measures.
To assist Crown in its efforts of continuous improvement,
Crown is commited to ongoing engagement with relevant
stakeholders including government, regulators, gambling
help service providers and other welfare organisations,
together with Crown’s membership of the National
Association for Gambling Studies.
Crown has also established an independent Responsible
Gaming Advisory Panel (the Panel), comprising three
leading Professors in the field of problem gambling, to
provide independent advice in relation to Crown’s
approach to responsible gaming and harm minimisation.
In August 2020, the Panel delivered a review of Crown’s
Responsible Gaming Framework, which included
recommendations for enhancement. These
recommendations are in the process of being
implemented.
People and Culture
Our Culture
Crown recognises the importance of maintaining the
right corporate culture. A culture that our employees
identify with, are proud to be a part of and is respected
and trusted by our customers, stakeholders and the
communities within which we operate. Importantly, a
comprehensive review of Crown’s culture has been
undertaken with a renewed target culture and a well-
charted roadmap for change which will commence
implementation in the first half of the 2022 financial
year. This roadmap for change will include a wholesale
reset of the ‘tone from the top’ under the leadership of
Crown’s new Board and Executive Team.
The culture transformation program comprises three
key elements and has been supported by external
experts in the field:
• Understanding the current state culture;
• Defining the target state, including a review of Crown’s
existing purpose and values; and
• Building a roadmap to move Crown from the current
state culture to the target state culture.
Leaders from across the business have come together to
develop and deliver on this program of work. Whilst there
is much work that is still to be done, Crown has made
great progress on this important program and the
roadmap for change will be launched in September 2021.
Crown’s leaders have emphasised that this is an
opportunity to recognise Crown’s strengths, repair areas
that need improvement, reimagine Crown’s strategy, and
put in place processes and structures to ensure Crown
lives its purpose and values. It is an opportunity to invest
in Crown’s people, particularly in relation to the care that
we show for our customers and the experiences they
enjoy within our properties. Our aim is to build a genuine
learning organisation and one that is continually looking
to improve. In doing so, we will curate Crown’s culture for
the next generation at Crown.
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By enacting initiatives to help align the behaviours and
mindsets of Crown’s employees to its purpose and
values, Crown can become what it aspires to be – an
organisation that has the trust of the community.
Our People
As the COVID-19 situation unfolded during the 2021
financial year, Crown was forced through the numerous
government-mandated closures to stand down a
significant proportion of its workforce for varying
periods of time.
During this highly disruptive time, Crown focussed on
the overall wellbeing of employees and has provided
various forms of assistance to employees impacted by
the pandemic.
Crown has also adapted to operating in a virtual
environment using a range of media to both initiate
opportunities for employees to interact with colleagues
and managers directly, as well as creating greater focus,
visibility and access on the range of support services
available for employees.
Employees have been provided ongoing support via
Crown’s HR Support Centre and Staff Support Contact
Centre, assisting employees with access to advice about
employment related options as well as practical support.
Crown continued its program to assist employees who
were stood down to access alternate temporary
employment with other organisations.
Thousands of employees were also financially supported
by the Australian Government’s JobKeeper Payment
scheme, with Crown Perth qualifying for the program
through to the end of September 2020 and Crown
Melbourne continuing to qualify through to the end of
the program in March 2021.
More recently, Crown’s practice has been to pay full
rostered shifts in week one of a lockdown followed by
discretionary payments from Crown to employees,
which is considered on a case-by-case basis depending
on their eligibility for government assistance. Crown is
also providing employees with information about the
Australian Government’s enhanced assistance for
individuals whose ability to work has been impacted by
the extended lockdown.
Another important initiative for many employees was
the continuation of the Crown Resorts Hardship Fund.
The purpose of the fund is to provide short-term
emergency financial assistance to current Crown
employees who are experiencing genuine short-time
financial hardship as a consequence of either having
been stood down or not offered shifts due to COVID-19.
To date, close to 1,000 employees have accessed this
fund to alleviate financial hardship caused by not being
able to work in lockdown.
Recognising the importance of reconnecting and
engaging with team members, upon re-opening, team
members attended face to face re-onboarding programs
to develop the knowledge and skills required to operate
in a COVID-19 safe way, and enable a comfortable
transition back into the workplace.
Health, Safety and Employee Wellbeing
Keeping everyone safe including Crown’s employees,
contractors, guests and the broader community
continued to be a key priority for Crown during the year.
The health and safety impacts of the COVID-19
pandemic required an agile response strategy as
Crown’s operations were frequently restricted and
modified to meet Government advice and expert
medical guidelines provided by local health authorities.
Conditions frequently changed following a number of
State-based circuit breaker lockdowns including revised
social distancing and hygiene requirements, face mask
provision and compliance and the imposition of capacity
restrictions on gaming and restaurant facilities.
COVID-19 Response Teams were established at each
property, with specialised managers and COVID-19
Corporate Responsibility continued
Crown Resorts Limited Annual Report 2021
25
safety officers, to inform COVID safety practices for
customers and team members and to ensure
compliance with government directions. The COVID-19
Response Teams performed their roles admirably and
were a constant reminder of the vigilance required in
meeting these requirements.
COVIDSafe plans were developed and implemented in
consultation with Health and Safety Representatives
across all business functions.
Crown recognises that the pandemic had a significant
impact on the mental health and wellbeing of our
employees. As a key focus for Crown’s Board and
Executive this led to the introduction and expansion of
various employee support programs.
A review was undertaken of the health and safety control
measures within Crown’s declared smoking areas
following the announcement that indoor smoking would
be phased out by December 2022. Ongoing air quality
and health monitoring will continue during this period.
Industrial Relations
Crown is committed to promoting and managing
industrial relations through open and effective
relationships with our employees, employee
associations and regulatory bodies, and acts in good
faith in all of our dealings with these parties.
Crown currently has six enterprise agreements in place,
including the establishment of the inaugural agreement
for Crown Sydney in the past year. These agreements
cover most of Crown’s frontline operational staff and
some employees at management level.
Crown College
Crown College provides accessible, industry-ready and
high-quality education and training for those aspiring to
forge a career in hospitality, leisure and tourism
industries. Crown College aims to maintain and
strengthen its position as a leader in the design,
development and delivery of training and education, in
order to address the employment needs of the
hospitality and tourism industries.
This year, Crown College is celebrating 25 years as one
of Australia’s largest and longest running private
Registered Training Organisations, a significant
milestone that Crown is proud to celebrate. Since
inception over 11,225 employees have graduated and
completed a qualification from Crown College; including
over 8,500 trainees and apprentices. Crown’s aim is to
create career pathways for its employees and, in the
2021 financial year, over 600 employees and students
are enrolled in Certificates III, IV, Diploma and Advanced
Diploma level qualifications.
Crown College Sydney was opened in July 2020, adding
another purpose-built training facility to the Crown
College brand. Crown College now comprises three
purpose-built training facilities located across
Melbourne (including a training restaurant in Melbourne
with 2 kitchens, known as Culinarium), Perth and now
Sydney, that provide ongoing professional development
to thousands of hospitality professionals each year.
Crown College’s ongoing commitment to delivering
education that leads to employment is evident through
the established 500 Training Places Program. This
Program was established to deliver qualifications with
Certificates II and III for retrenched Victorian workers
affected by industry restructuring. The program has
since been expanded to Indigenous Australians, people
who have been affected by family violence and those
who are disadvantaged in the workforce. The initiative
has received over 1,459 enquiries since its inception. To
date, there are over 352 participants in the program and
184 program graduates have gained employment within
the hospitality and security industries.
Crown College International
Crown’s commitment to education and training is evident
through the establishment of Crown College International
(CCI) in Melbourne. While the year was challenging due to
26
COVID restrictions, since conception CCI has received
over 680 applications, converting 356 enrolments from
25 countries.
CCI continues to increase student enrolments onshore
and build a social media presence to raise awareness of
its programs. As the team navigates through this
challenging time, the welfare of our students remains
our priority. The CCl team has been supporting our
students through several different initiatives such as
producing 500 meal care packs. The team also provided
1,200 lunch vouchers so students could dine in the
employee restaurant, and care packs and vouchers were
given free to our international students.
Crown Community
Overview
Crown is committed to developing a diverse and inclusive
workforce which values people’s individuality and enables
all employees to achieve their best, while contributing to
the communities in which Crown operates.
Crown provides a range of diversity and inclusion
programs, including the Indigenous Employment
Program, CROWNability, Family Support Network,
Gender Equity, Crown Pride and the Cultural and
Linguistically Diverse Employee Network (CALDEN).
Each year, Crown’s commitment to Crown Community is
celebrated in a week-long festival of who we are as a
community and the purpose and values that bind us
together. The week includes many employee events
which celebrate the diversity of Crown’s people and
reinforce the way in which they are united with a shared
passion and purpose.
For 2021, the theme was Celebrating diversity – be
memorably you; focussing on recognising the diversity
of each member of the Crown Community.
CROWNability
CROWNability is Crown’s strategy to provide an
employment pathway for people with disability into our
workforce. Launched in 2014, CROWNability continues
to work closely with industry partners and stakeholders,
and has successfully placed and supported over 650
candidates in employment. Crown is proud that Kurt
Fearnley AO, an Australian Paralympic gold medallist,
continues to represent Crown as the CROWNability
ambassador and has been a valuable support to
CROWNability employees during COVID.
In the 2021 financial year, the CROWNability program
was expanded to include Crown Sydney with the
appointment of a Program Manager and the placement
of 35 people with disability within the first six months. In
line with the CROWNability Action Plan to improve
access for patrons and staff across all Crown properties,
Crown has introduced a Changing Places facility at all
three properties which will be nationally accredited. The
nationally accredited facility at Crown Perth became the
first registered hotel complex in Australia to provide an
adult accessible change facility for people with disability.
Development of the next CROWNability Action Plan is
well underway and is centred on the theme “The Future
is Accessible”. The new action plan will continue to focus
on building a disability confident organisation for
employees, patrons and the wider community with
particular emphasis on premises, suppliers and partners,
information communication technology, learning and
development, communication and marketing, and
recruitment.
Indigenous Employment Program
Crown has an unwavering commitment to the
Traditional Owners of the lands on which it operates,
through respect for culture, lore and closing the gap on
Indigenous disadvantage.
Corporate Responsibility continued
Crown Resorts Limited Annual Report 2021
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Since its inception in November 2009, Crown’s award-
winning Indigenous Employment Program has provided
over 1,000 employment opportunities for First Nations
people representing a direct investment back into
Indigenous communities.
Crown’s Indigenous Employment Program continues to
build relationships with communities including National
Centre of Indigenous Excellence (NCIE) and Souths
Cares, both located in Sydney, and the ongoing
partnership with the Department of Justice – Western
Australia through which we have provided career
pathways for previously incarcerated Indigenous men
and women at Crown Perth.
Crown’s commitment to the learning and development of
our Indigenous employees has seen another participant
completing the coveted Emerging Indigenous Executive
Leadership Program (EIELP) in partnership with Elevate
RAP organisations and the University of New South Wales.
Crown remains a member of the select ‘Elevate’ group
with Reconciliation Australia, which is the highest level
of endorsement granted by Reconciliation Australia, and
is in the process of developing Crown’s next
Reconciliation Action Plan.
Crown Pride
Crown’s commitment to an inclusive community has
continued to progress. The Crown Pride network offers
information and support, networking events and the
opportunity to connect with others across Crown and
the wider community. Despite the operational
disruptions, Crown acknowledged and celebrated Wear
it Purple Day and IDAHOBIT day with team member
events and inclusion videos recounting the stories of
LGBTIQ members of its community. In addition, over the
past 12 months, Crown has been actively involved in
both internal and external LGBTIQ+ safe events.
In Melbourne, the Crown Pride committee hosted its
first onsite employee event for 2021 – a social Drag
Bingo event. This was a great success and lots of fun
and much-needed laughter was enjoyed by all in
attendance. In addition, Crown Pride community partner
GLOBE provides value to the Victorian LGBTIQ+
community through a Focus on Women and
Transgender diverse or non-binary (TDGNB) program.
Crown Pride hosted the Focus on Women event as a
business style event with three panel speakers –
Jennifer Gray, CEO Zoos Victoria, Virginia Lovett, CEO
Melbourne Theatre Company and Moana Hope, an
AFLW football player. This featured different topics of
discussion and aimed to provide a platform for different
people within our community. All events sold out and
received overwhelmingly positive feedback, which is a
testament to the Crown Pride network.
In Sydney, Crown signed on as a major sponsor of the
2021 Queer Screen Mardi Gras Film Festival. The film
festival ran over 15 days and featured three world
premieres, 94 Australian and international premieres,
and was shown in 26 languages showcasing LGBTIQ+
storytelling from 30 different countries. Employees
across all properties had access to discount movie
tickets and were able to attend as guests at the
screening of the sponsored movies. Crown also filmed
employees showcasing their diversity and created a
video which was screened to over 18,000 people at the
cinemas or online over the festival and shared in social
media channels.
In Perth, Crown hosted the second PrideFest luncheon
in November 2020, which saw over 500 people attend
from across the corporate community in Perth.
Throughout the year Crown Perth continued to engage
in the LGBTIQ inclusion discourse by supporting Pride in
Diversity events including attending the quarterly
roundtables, annual AWEI awards and participating in
other events, such as the Diversity Sapphire event,
“Gender Equity: Beyond the gender binary”, at which
Chile Hune, a Crown Perth employee, featured as a
speaker detailing her journey of inclusion experienced at
Crown Perth.
28
Finally, Crown Perth resolved to fly the LGBTIQ flag
permanently at the entrance of its resort, light up the
complex in rainbow colours during the days of LGBTIQ
significance and change its logo on social media
channels during pride month in support of the LGBTIQ
community.
Collectively, these programs and events represent
significant steps in developing a workplace where Crown
employees can confidently and comfortably bring their
whole selves to work and in developing a corporate
community that respects and enhances their
commitment to broaden the Pride Network.
Gender Equity
Crown’s first Gender Action Plan (GAP) was published at
the end of 2019. Crown’s GAP focusses on five key
themes of Attraction & Retention, Promotion,
Development, Flexibility and Cultural Change &
Communication. These focus areas were developed
through consultation with the business and by assessing
what changes will make a positive impact on employees.
The actions outlined in Crown’s GAP will continue
Crown’s push towards gender equity.
Crown partnered with Circle In to launch a Parents
Platform across the Group in March 2021 that allows
employees to plan and map out their journey as parents
and to guide managers to support their employees
through each stage – from planning parental leave to
returning to work.
Crown is still an active corporate partner of Women in
Gaming and Hospitality Australasia (WGHA). Recent
programs with WGHA include leadership courses and
also a focus on procurement and how this impacts
gender equity.
Crown recently was a sponsor for the Not In My
Workplace (NIMWP) Respect@Work Summit and will
continue to participate in NIMWP initiatives to prevent
sexual harassment in the workplace.
The next 12 months will see a continued focus on
further implementing and embedding the initiatives in
our GAP, working towards gender equity at Crown, as
well as continuing our partnerships with Champions of
Change Coalition, CEO’s for Gender Equity, WGHA and
NIMWP to contribute to gender equity more broadly in
the industry.
Crown’s work in Gender Equity also presented an
opportunity to expand its program to support
employees in their personal lives. As such, in 2018 the
Family Support (FSN) and Cultural and Linguistic
Diversity Employee Networks (CALDEN) launched at
Crown Melbourne. During the second half of 2020 both
networks were moved onto the Crown Resorts
Workplace platform to further engage employees
during the period of stand down. CALDEN has
celebrated a range of cultural days such as International
Mother Language Day and a sub network has been
created in which employees can assist one another in
remotely conversing in new languages they are learning.
The FSN has built resources with information on further
support for employees who may be experiencing
hardship in their personal lives.
Over the next 12 months Crown will continue to grow
these networks and subgroups into new areas based on
feedback from employees.
Corporate Responsibility continued
Crown Resorts Limited Annual Report 2021
29
Environmental
Crown’s approach to environmental sustainability
encompasses every aspect of the group. This year,
despite the ongoing challenges posed by the COVID-19
lockdowns, Crown has continued to seek to improve
energy, water and waste management efficiencies.
Developing more sustainable business practices and
aligning property approaches allows the business to
continue to improve its programs.
At the start of each lockdown, Crown sought to
minimise its food wastage by donating tonnes of food to
community groups servicing some of the city’s most
vulnerable. The recipient organisations across
Melbourne, Perth and Sydney have included the
Victorian Parliament House Kitchens, The Salvation
Army Project 614, Ronald McDonald House, and many
others.
Crown recognises that employees need to understand
and be aligned to the environmental sustainability
objectives, otherwise change is difficult to achieve and
short-lived. The 2021 financial year saw a continued
focus on staff engagement with regular events, training
and communications to ensure staff and contractors are
kept informed of Crown’s environmental performance
and progress; and to continue to embed sustainability as
part of Crown’s culture.
Supporting Our Communities
Crown takes its responsibility to community seriously,
proactively identifying ways to support the communities
in which it operates. Together with its employees,
Crown supports many community causes and
organisations through targeted partnerships, property
prizes, employee volunteering opportunities and
fundraising support.
It is a credit to the generosity of spirit and commitment of
Crown’s employees that so much community support was
able to be provided through such a challenging period. As
well as supporting colleagues through extended lockdowns,
Crown has continued to support communities in need.
COVID-19 restrictions provided significant challenges for
charity fundraising over the course of the year but
wherever possible, Crown has provided alternative
support, including prizes for online auctions and
assisting with virtual fundraisers. For example, when the
Children’s Cancer Foundation’s Million Dollar Lunch was
unable to physically proceed, with the support of Crown
Melbourne and other donors, it still managed to raise
$580,000 through an online fundraiser.
Crown is very proud of its employees who actively
organise team specific volunteering and fundraising
events. Team fundraising events raised funds for
organisations like Children’s Cancer Foundation, SIDS
and Kids, Oxfam and Jeans for Genes.
Raffle prizes were still provided to many community
groups and charitable organisations such as local
kindergartens, CFA units, and Surf Life Saving Clubs.
Additionally, for the 26th year, Crown provided 500
Christmas food hampers to be distributed to
Melbourne’s vulnerable and homeless, this year through
The Salvation Army Project 614.
30
During the year, in conjunction with the Victorian
Government and service providers, Crown Melbourne
continued to provide safe accommodation, at no cost, to
those experiencing family violence. The program
included the provision of hotel rooms, food and other
amenities such as meeting facilities for the provision of
counselling services in a safe environment. In total,
Crown provided over 1,230 room nights under this
program.
With snap lockdowns a recurring feature throughout the
year, Crown sought to donate as much of its food as
possible to support community members who were
struggling. Tonnes of food was donated to OzHarvest,
the Victorian Parliament House Kitchens, The Salvation
Army Project 614 and Bright Sparqe who then provided
the food to the homeless and vulnerable.
In February 2021 during the WA and Peel region
lockdown, Perth’s north-east faced a devastating
bushfire. To provide support and relief, Crown Perth
offered accommodation to impacted colleagues and
their immediate families at Crown Towers Perth.
Along with many people and organisations within
Australia and internationally, Crown Perth donated
$150,000 to the Lord Mayor’s Distress Fund to help
support the rebuilding of Kalbarri. In July 2021, Crown
Perth together with the Shire of Northampton hosted a
dinner in the coastal town of Kalbarri for 130 emergency
service workers who were tasked with the clean-up of
Kalbarri and Northampton in the devastating aftermath
of Cyclone Seroja. The successful evening was planned
to give thanks and provide the guests a well-deserved
break.
In collaboration with Victoria Park Council and
Burswood Parks Board, Crown Perth employees
supported initiatives including collecting rubbish for
Clean Up Australia Day and contributing to the planting
of 5,000 trees in support of the local park’s
rejuvenation program. Crown Perth employees also
supported Foodbank, with our apprentice chefs
preparing and donating soup each week, with
approximately 133 tonnes of soup being made for the
homeless and needy over the past 21 years.
In October 2020, the Telethon Ball, Live Telecast and
phone room was hosted at Crown Perth for the first
time. Crown donated $2.5 million to Perth’s biggest
charity drive, which raised a total of $46.3 million that
was distributed to 65 deserving Perth charities.
Other community campaigns included the Merrywell
‘Dude Tea’ which raised over $30,000 in support of
Movember, an organisation working to change the face
of men’s health. Crown Perth also collaborated with the
Perth Wildcats to raise over $60,000 for Breast Cancer
Care WA, with Crown contributing $27,000.
Crown Perth CEO Lonnie Bossi took part in the 2021
Vinnies CEO Sleepout and was the highest fundraiser
involved in the Western Australian event. Lonnie raised
$79,000 for the charity as he slept outside on a
concrete floor during one of the coldest nights of the
year to raise funds and awareness of the realities of
homelessness.
Crown Resorts Foundation
The conclusion of the 2021 financial year marks the
seventh year of the Crown Resorts Foundation’s
commitment to allocating $100 million to not-for-profit
organisations, focussing on Indigenous education, arts,
culture, community welfare and medical research
programs. Over this period, the Foundation has
allocated nearly $60 million and this year has provided
support to over 100 grant recipient organisations across
Australia, ranging from 10-year multi-million-dollar
commitments to one-off employee nominated grants.
The 2021 financial year has continued to be difficult for
the not-for-profit sector as both fundraising and
program delivery continued to be impacted by COVID-19
restrictions. The Foundation has worked with its
Corporate Responsibility continued
Crown Resorts Limited Annual Report 2021
31
program partners to ensure that the impact to program
recipients has been minimised, recognising that
continuity and consistency is critical when engaging with
marginalised communities.
Feedback from participants, teachers, principals,
program facilitators and community members has
remained positive and the Foundation would like to
acknowledge the tireless work these organisations
undertake in providing community support.
Indigenous education is a priority of the Foundation
which continues to identify opportunities to address the
imbalance in funding and fragmentation of Indigenous
girls’ education programs across Australia.
Community Champions
The Crown Resorts Foundation Community Champions
was established to deliver a creative employee-focussed
program aimed at recognising the work employees
undertake in the community and providing opportunities
for them to engage with Foundation partners and other
charities with which they are involved. The program has
been operating in Crown Melbourne for several years
and was introduced in Crown Perth in 2019 and
launched in Crown Sydney earlier this year.
Managed entirely by employees who volunteer their
time, Community Champions considers employee
engagement with their communities to be exceptionally
important, as it provides an opportunity to better
understand some of the challenges affecting the
community.
The Foundation provides funds to a number of
community welfare organisations which support
inner-city communities. These partnerships are strongly
supported by the Community Champions.
The Community Champions programs include
CROWNversations – a series of presentations where
employees have the rare opportunity to meet some
extraordinary Australians who are making a difference in
the community, CROWNverteering – a service open to
all Crown employees interested in volunteering, enabling
employees to be linked to charities in their area of
interest, and a Community Grants Program – focussing
on providing monetary support to charities and not-for-
profit organisations nominated by employees.
This group has led a number of exceptionally popular
Crown employee activations including book drives in
support of the Australian Literacy and Numeracy
Foundation where, to date, over 5,000 books have been
donated for distribution to Indigenous and newly-arrived
migrant communities across Australia. Over $350,000
has been donated to organisations across Melbourne
and Perth under the Community Grants Program.
32
Crown Resorts Limited Annual Report 2021
33
2021 Corporate Governance Statement
2021 Corporate Governance Statement
The Board of Crown Resorts Limited (Crown or the
Company) is committed to the implementation and
maintenance of good corporate governance practices.
This Statement sets out the extent to which Crown has
followed the ASX Corporate Governance Council’s Fourth
Edition of the Corporate Governance Principles and
Recommendations (the Principles and Recommendations).
This Statement is current as at 9 September 2021 and has
been approved by the Board.
Principle 1: Lay Solid Foundations for
Management and Oversight
Functions Reserved for the Board and Senior
Management
Functions Reserved for the Board
The Board is responsible for guiding and monitoring
Crown on behalf of its shareholders. In addition, the Board
(in conjunction with management) is responsible for
identifying areas of significant business risk and ensuring
arrangements are in place to adequately manage those
risks.
The Board has adopted a formal Board Charter which
sets out a list of specific functions that are reserved for the
Board.
Board appointments are made pursuant to formal terms of
appointment.
More information
The Crown Board Charter is available at:
www.crownresorts.com.au under the heading
Corporate Governance – Charters.
Functions Delegated to Senior Executives
Crown’s senior executives have responsibility for matters
which are not specifically reserved for the Board (such as
the day-to-day management of the operations and
administration of Crown).
Crown Board Committees
To assist in carrying out its responsibilities, the Crown
Board has established the following standing Committees:
• Audit and Corporate Governance Committee
• People, Remuneration and Nomination Committee
• Safety & Sustainability Committee
• Responsible Gaming Committee
• Risk Management Committee
Each standing Committee includes at least three
independent directors, the majority of whom are
independent. The composition and membership of the
standing Committees will change as the composition of
the Board is renewed.
Each standing Committee has adopted a formal Charter
that outlines its duties and responsibilities.
From time to time, the Board establishes special purpose
committees as appropriate.
More information
The Crown Committee Charters are available at:
www.crownresorts.com.au under the heading
Corporate Governance – Charters.
Director Probity Reviews and Elections
Every appointment of a Crown Director is subject to the
receipt of necessary gaming regulatory approvals.
The gaming industry is highly regulated and each of the
casinos and gaming operations in which Crown has an
interest is subject to extensive regulation under the laws,
rules and regulations of the jurisdiction where it is located.
Officers, Directors and certain key employees and senior
executives of Crown and its licensed subsidiaries must file
applications with relevant gaming authorities and may be
required to be licensed in certain jurisdictions. These
probity reviews generally concern the responsibility,
financial stability and character of the owners, managers
and persons with financial interests in gaming operations
and generally include requirements to obtain police
checks and credit checks.
A Director will only be formally appointed once all
necessary gaming regulatory approvals have been
obtained. As a separate exercise, Crown undertakes its
own internal investigations on the suitability of nominated
Directors as a pre-condition to a recommendation to the
Board to appoint a Director.
The Company’s Constitution requires that an election of
Directors must take place each year. In addition, Directors,
with the exception of the Managing Director, appointed to
fill casual vacancies during the year must retire from office
at the next annual general meeting following his or her
appointment but are eligible for re-election by
shareholders at that time. The Notice of Meeting for an
annual general meeting sets out all the material
information in the Company’s possession relevant to the
qualifications, skills and experience of the relevant
Director, details of any other material directorships
currently held, the term of office served and the
independence status of that director, and provides a
recommendation of the Board in relation to the proposed
election or re-election.
More information
Crown’s past and present Notices of Meeting are
available at: www.crownresorts.com.au under the
heading Investors & Media – Annual General
Meetings.
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2021 Corporate Governance Statement CONTINUED
2021 Corporate Governance Statement
Director and Senior Executive Agreements
Crown Directors are provided with an induction pack upon appointment which, among other things, includes a letter
agreement setting out the terms of that Director’s appointment. The letter agreement, which each Director must
countersign, describes when the appointment commences and when it ends, sets out the Director’s powers and duties
and the agreed remuneration arrangements and obliges the Director to comply with all Crown Policies, Procedures and the
Code of Conduct. In addition, the letter agreement requires the Director to enter into a separate undertaking to inform
Crown of any interests that Director may have in Crown securities (and contracts relevant to Crown securities) so that
Crown is able to comply with its disclosure requirements under Listing Rule 3.19A to provide the ASX with completed
Appendices 3X, 3Y and 3Z within the time period allowed by the ASX Listing Rules. In addition, the letter agreement
requires the Director to consult and advise the Chairman of any proposed new role which may give rise to a conflict of
interest.
Each senior executive of Crown has an employment contract setting out the terms of that senior executive’s appointment.
Company Secretary Accountability
The Company Secretary is accountable directly to the Board, through the Chair, on all matters to do with the proper
functioning of the Board. The decision to appoint or remove a Company Secretary must be made or approved by the
Board.
The role of the Company Secretary is set out in the Crown Board Charter and includes:
• advising the Board and its committees on governance matters;
• monitoring that Board and committee policy and procedures are followed;
• coordinating the timely completion and despatch of Board and committee papers;
• ensuring that the business at Board and committee meetings is accurately captured in the minutes; and
• helping to organise and facilitate the induction and professional development of Directors.
Each Director is able to communicate directly with the Company Secretary as the need arises.
More information
The Crown Board Charter is available at:
www.crownresorts.com.au under the heading Corporate Governance – Charters.
Crown Resorts Limited Annual Report 2021
35
2021 Corporate Governance Statement
Diversity and Inclusion Policy
Crown has established a Diversity & Inclusion Policy which is available on its website. The policy includes requirements for
the Board to establish measurable objectives for achieving gender diversity and for the Board to assess annually both the
objectives and the progress in achieving them.
The Board adopted a Gender Equity Action Plan (GAP) for F20 to F23 which sets out Crown’s commitment to diversity and
inclusion in the workplace.
Each focus area in the GAP, other than Intersectionality, includes a number of measurable objectives which are identified
as mid-term and long-term targets. A report on the progress against the five focus areas in the GAP and the Board
diversity objective is as follows:
Objective
Crown’s Progress
Recruitment and Promotion –
To achieve 40:40:20 representation
across the Group, with each
Executive accountable for achieving
this target within their business unit.
The over-arching aim of the GAP is to strive for representation of 40:40:20 (40%
women, 40% men and 20% flexible) across all levels rather than 50:50
representation. In setting this target, consideration was given to gender
representation at Crown at the time, what would be a realistic target that would
factor in future appointments, promotions and retention.
The tables below outline our progress:
Total percentage of female representation in each category
Category
2021
Other executives/general managers
34%
Senior manager
41%
Other manager
39%
Non managers
43%
The following initiatives have also been implemented to support female
representation across the business:
• Crown became a WORK180 Endorsed employer. WORK180 pre-screens
employers to ensure they have policies and benefits in place to support
women’s careers.
• Reporting dashboards created to monitor Crown’s progress against its
40:40:20 target.
• Gender diverse recruitment pools and selection panels at each stage of the
recruitment process.
• Custom reporting designed and built to track gender trends at each level of the
recruitment process (including drop off rates and stages).
• Recruitment policy updated to strengthen diversity practices within the
recruitment process.
36
2021 Corporate Governance Statement CONTINUED
2021 Corporate Governance Statement
Objective
Crown’s Progress
Retention and Development –
To ensure Crown retains women at
a level equitable or better than the
retention of their male colleagues
and that women at Crown receive
appropriate opportunities and
encouragement so that they benefit
from all that Crown has to offer.
Female representation
The below shows female representation across key employee lifecycle stages:
Hires
45%
Transfers
43%
Promotions
42%
Terminations
43%
Headcount
43%
As part of the focus on retention, Crown partnered with Circle In and launched an
online parental leave platform in early 2021 to assist employees on their parental
leave journey and how to navigate the return to work.
Cultural Change and
Communication – To ensure that
all employees work in a safe and
respectful environment where their
contributions are welcomed and
valued.
To progress and further promote diversity and inclusion across the business the
following has been implemented:
Communication
A social communications platform launched across Melbourne, Perth and Sydney
which has provided a greater reach to directly communicate with employees.
• This platform includes dedicated groups for diversity programs to communicate
and promote key initiatives.
• The platform provides greater connection between employees, their managers
and what is going on across the business.
• Enhancements were made to Crown’s Chatbot to provide employees with more
information in their hands at the times that suit them.
• The platform allowed for communication and connection during COVID-19
related shut down periods.
Cultural Change
• A sexual harassment initiative aligned to the national inquiry into Sexual
Harassment in the Workplace was launched in October 2020.
• Diversity KPIs included in performance plans across the business.
• Unconscious bias included in management training programs.
• Increased female participation at key company presentations.
Flexibility – To have flexibility for
every role at Crown.
Flexibility has increased substantially over the last 12 months, especially due to the
response to COVID-19 and the need to work remotely. To facilitate, support and
promote flexibility the following initiatives have been implanted:
• Policy updated to include flex principles that link to Crown’s values.
• Creation of a flex matrix to show the forms of flexibility available for every role.
• Extended purchase leave options implemented across the business.
• Technology rolled out and embraced by business as tools to improve flexible
work and communications.
• Integration of social communications platform with rostering system to provide
ease and access of rostering provisions (such as shift swaps that can be
completed from personal devices).
Crown Resorts Limited Annual Report 2021
37
2021 Corporate Governance Statement
Objective
Crown’s Progress
Intersectionality – To partner with
Crown’s Indigenous Program,
CROWNability program and Crown
Pride Committee to address
specific areas for women
participating in those programs.
There has been a continued focus on intersectionality with the following taking
place:
• Further awareness of Crown’s diversity programs promoted through Crown
Community and employee networks.
• During COVID-19, employee support/sharing groups set up on social
communications platform for employees to share information about their
background, including a group to support employees learning different
languages.
• Continued partnership with Crown’s Indigenous Program, including the support
of Ochre Ribbon.
• Continued partnership with Crown Pride on key events and initiatives.
• Crown became a member of Diversity Council Australia.
In addition to adopting the GAP, the Crown Board set the objective of having not less than 30% of directors on the Crown
Board of each gender by 30 June 2022. At at 30 June 2021, the Crown Board consisted of 75% female representation. The
Crown Board experienced significant turnover during the year. As the Board continues to pursue its renewal strategy, it is
likely that the percentage of female representation will change. The Crown Board however remains committed to its
objective of having not less than 30% of directors on the Board of each gender.
The proportion of women employees in the Group, women in senior executive positions and women on the Board as at 30
June 2021 was as follows:
Measure
Result
Proportion of women employees in
the Group
There were 5,370 women in the Group. This represents 43% of the total
workforce of 12,489 employees. This is a slight decrease (0.19%) on FY20.
Proportion of women in senior
executive positions in the Group
There were 30 women in senior executive positions in the Group. This represents
30% of senior executive positions in the Group. This is a 1% increase on FY20
(29%).
Proportion of women on the Board
As at 30 June 2021, there were three female Directors out of a total of four
Directors, or 75%.
For the purpose of these statistics, the term “senior executive position” refers to Executive Team and Business Operations
Team members of Crown Resorts Limited, Crown Melbourne, Crown Sydney and Crown Perth as well as the most senior
leaders from each operational unit therein. The Executive Team is comprised of persons with titles in the nature of, or
similar to, Executive General Manager, General Manager, Chief Information Officer, Chief Risk Officer, Chief People &
Culture Officer, Chief Marketing Officer and Group General Counsel together with the Chief Executive Officers, Chief
Operating Officers and Chief Financial Officers within the Group.
Crown’s Audit and Corporate Governance Committee has been delegated responsibility for developing and monitoring the
application of Crown’s Diversity & Inclusion Policy.
As noted above, Crown’s Diversity & Inclusion Policy requires that Crown reviews its Gender Objectives annually to ensure
that they remain relevant and appropriate for Crown.
Crown is a “relevant employer” under the Workplace Gender Equality Act 2012 (Cth) and, in accordance with the
requirements of the Act, Crown lodged its annual Public Report with the Workplace Gender Equality Agency for the
2020-2021 period which reports on the most recent “Gender Equality Indicators”.
More information
Crown’s Diversity & Inclusion Policy is available at:
www.crownresorts.com.au under the heading Corporate Governance – Policies.
Crown’s Workplace Gender Equality Report is available at: www.crownresorts.com.au under the heading Corporate
Governance – Gender Equality.
38
2021 Corporate Governance Statement CONTINUED
2021 Corporate Governance Statement
Process for Evaluating Performance of the
Board, its Committees and its Directors
A performance evaluation of the Board and of its
Committees is generally undertaken annually, following
completion of each financial year, by way of a
questionnaire sent to each Director.
The questionnaire covers the role, composition,
procedures and practices of the Board and of its
Committees. The individual responses to the questionnaire
are confidential to each Director, with questionnaire
responses provided to the Chair of the People,
Remuneration and Nomination Committee for
consideration and provision of a report to the Board.
Crown’s People, Remuneration and Nomination
Committee is also responsible for reviewing Crown’s
procedure for the evaluation of the performance of the
Board, its Committees and its Directors.
While there was substantial turnover in Directors during
the 2021 financial year, the Board intends to undertake an
evaluation of its performance by way of an internal
questionnaire issued to the current Directors.
It is the intention of the Board to undertake a more
detailed evaluation of the performance of the Board and
Committee in the 2022 financial year following the
completion of the Board renewal process and
management transition. The evaluation will be undertaken
with the assistance of an external and independent third
party.
Process for Evaluating Performance of Senior
Executives
Crown has established processes for evaluating the
performance of its senior executives. In summary, each
senior executive is evaluated against the achievement of
pre-agreed key performance objectives. The evaluation
process is conducted annually and is followed by the
determination of appropriate remuneration for the relevant
senior executive.
Detailed information regarding Crown’s remuneration
practices is provided in the Remuneration Report. An
evaluation of senior executives took place following the
end of the 2021 financial year and in accordance with the
processes described in the Remuneration Report.
Principle 2: Structure the Board to Be
Effective and Add Value
People, Remuneration and Nomination Committee
Crown has established a People, Remuneration and
Nomination Committee. The Committee has adopted a
formal Charter that outlines its duties and responsibilities
which is available at www.crownresorts.com.au under the
heading Corporate Governance – Charters.
At the time of writing, the current members of the People,
Remuneration and Nomination Committee are Antonia
Korsanos (Chair), Jane Halton AO PSM and Nigel
Morrison. The Committee is comprised of independent,
Non-executive Directors. Information about each
Committee member’s qualifications and experience is set
out in the Directors’ Statutory Report. Information
regarding the number of times the Committee met
throughout the period and the individual attendances of
the members at those meetings has also been provided in
the Directors’ Statutory Report.
The role of the Committee is to assist the Board to
develop, maintain and implement policies in relation to:
1. the selection and appointment practices for Directors;
and
2. the remuneration of Directors and relevant executives.
Selection, Appointment and Development of
Directors
The People, Remuneration and Nomination Committee is
required to:
• review Crown’s procedure for the selection and
appointment of new Directors (Selection Procedure)
and make appropriate recommendations to the Board
in relation to the Selection Procedure;
• implement the Selection Procedure and make
nomination recommendations to the Board;
• develop succession plans in order for the Board to
maintain appropriate experience, expertise and
diversity;
• review Crown’s procedure for the evaluation of the
performance of the Board, its Committees and its
Directors and be primarily responsible for the
implementation of the evaluation process; and
• oversee the induction process is in place for new
Directors.
Crown Resorts Limited Annual Report 2021
39
2021 Corporate Governance Statement
The Selection Procedure requires that, in the event that a new Director appointment is required, the People, Remuneration
and Nomination Committee (on behalf of the Board) must adhere to procedures including the following:
• the experience and skills appropriate for an appointee, the skills of the existing Board and any likely changes to the
Board will be considered;
• upon identifying a potential appointee, specific consideration will be given to that candidate’s:
– competencies and qualifications;
– independence;
– diversity;
– other directorships and time availability; and
– the effect that the appointment would have on the overall balance and composition of the Board, including by
reference to the Crown Board Skills Matrix adopted from time to time; and
• finally, all existing Board members must approve the proposed appointment.
The People, Remuneration and Nomination Committee also has responsibility for reviewing the Board Skills Matrix on an
annual basis to ensure it remains consistent with the objectives of Crown and existing regulatory requirements and
recommendations.
Remuneration of Directors and Relevant Executives
The role of the People, Remuneration and Nomination Committee also includes:
1. the review and recommendation of appropriate fees to be paid to Non-executive Directors;
2. the review and recommendation of appropriate remuneration arrangements for Executive Directors and relevant senior
management including the level of remuneration and relevant contracted term; and
3. the review of succession plans for Executive Directors and relevant senior management.
Following the end of the financial year, the Committee reviewed and approved:
• the remuneration for senior executives which will apply during the financial year ending 30 June 2022; and
• the short-term incentive arrangements applicable to senior executives referable to the financial year ended 30 June
2021.
A summary of the current remuneration arrangements is set out in more detail in the Remuneration Report. The objective
of Crown’s remuneration policy is to ensure that:
• senior executives are motivated to pursue the long-term growth and success of Crown; and
• there is a clear relationship between the performance of senior executives and their remuneration.
Board Skills Matrix
As noted above, the Selection Procedure for a Director nomination requires that the People, Remuneration and Nomination
Committee (on behalf of the Board) consider the effect that any proposed Director candidate would have on the overall
balance and composition of the Board including by reference to the Crown Board Skills Matrix adopted from time to time.
The Crown Board has adopted the following Board Skills Matrix which sets out the mix of skills and diversity that the Board
is looking to achieve in its membership. The Board Skills Matrix highlights the key skills and experience of the Board and
the extent to which those skills are currently represented on the Board.
Skill/Competency
Board1
Total Number of Directors
5
Executive leadership
CEO or senior executive experience in a large complex organisation.
5
Listed company experience
Experience as a non-executive director of ASX listed entities or international listed entities.
5
Strategy and innovation
Experience developing and directing the strategy of a large organisation to assist with the Board’s
oversight of strategy. Ability to think and act innovatively in a fast-moving environment with a focus on
business growth and responding to disruption.
5
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2021 Corporate Governance Statement CONTINUED
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Skill/Competency
Board1
Risk management
Experience in identifying, monitoring and overseeing material risks in complex organisations, including
regulatory, financial and non-financial risks. Experience with high standards of risk management and
governance, particularly in highly regulated sectors.
5
Financial acumen
Senior executive or equivalent experience in financial accounting and reporting, capital management with
long term investment horizons and substantial capital outlay, industry taxation, internal financial controls
and corporate financing arrangements, including the ability to analyse and assess financial performance,
controls and reporting.
5
Corporate governance and compliance
Experience with ASX listed entities and other large organisations subject to robust corporate governance
frameworks with an ability to assess the effectiveness of relevant governance processes. Commitment to
high standards and systems of governance and compliance within ethical frameworks.
5
Workplace health and safety
Experience in relation to workplace health and safety, particularly in industries with shift workers.
5
Sustainability, environment and corporate social responsibility
Experience in relation to sustainability, environmental and social responsibility and community.
5
Legal and regulatory
Experience in legal and regulatory matters including regulatory and contractual frameworks in highly
regulated sectors. Experience with regulation and law governing gaming matters including but not limited
to anti-money laundering and responsible conduct of gaming.
5
Technology
Knowledge and experience in developing or overseeing the application of technology systems, critical
infrastructure, digital technology, data management, cyber security, gaming systems and disruption and
data security.
5
People, culture and conduct
Experience in the management of human resources including engagement with organisational culture and
change, talent development, incentivisation, remuneration, succession planning and the ability to consider
and respond to matters relating to inclusion and diversity.
5
Customer focus
Senior executive or equivalent experience in marketing including a detailed understanding of the
Company’s strategic direction, customer service and management strategies and the ability to understand
the needs of customers and enhance their experience and outcomes.
4
Industry experience - gaming and entertainment
Senior executive or equivalent experience in the gaming and entertainment industries.
4
Industry experience - hospitality and management
Senior executive or equivalent experience in the hospitality and tourism industries.
2
Public policy and stakeholder engagement
Professional experience working in a highly regulated organisation, regulatory body or government
department/agency relevant to the Company with public policy and stakeholder engagement experience,
particularly in relation to gaming.
4
1. Includes Non-executive Directors subject to regulatory approval.
The Board Skills Matrix, albeit important, is only part of the Selection Procedure that the Board is required to follow. As
noted above, the People, Remuneration and Nomination Committee has responsibility for reviewing the appropriateness of
the Board Skills Matrix on an annual basis.
The People, Remuneration and Nomination Committee is responsible for developing Crown’s Board succession plan to
ensure that the Board maintains appropriate experience, expertise and diversity.
An objective of Crown’s reform agenda is to focus on rebuilding the Board with a full complement of independent Non-
executive Directors. Board succession is a continual process. Crown operates in a highly regulated industry whereby it takes
some time for each new Director to obtain the required probity and regulatory approval in all jurisdictions in which Crown
Crown Resorts Limited Annual Report 2021
41
2021 Corporate Governance Statement
operates. The departure of five Directors during the month of February 2021 did not allow for orderly succession. The
intention of the Board is to appoint further independent Non-executive Directors and the recruitment process is well underway
in this regard. The current Board, including members-elect, is comprised of independent, Non-executive Directors.
Relationships Affecting Independence
The table below sets out the Crown Directors as at 9 September 2021 and indicates which of those Directors are
considered to be independent Directors and notes the length of service of each Director from the date of their appointment
to 9 September 2021.
Name of Director
Independence
Status
Length of Tenure
(By years and complete months)
Jane Halton AO PSM, BA (Hons) Psychology, FIML,
FIPAA, Hon. FAAHMS, Hon. FACHSE, Hon. DLitt (UNSW)
Interim Chairman and Non-executive Director
Independent
3 Years, 4 Months
Antonia Korsanos, BEc, CA, GAICD
Non-executive Director
Independent
3 Years, 4 Months
Nigel Morrison B.Com, FCPA
Non-executive Director
Independent
5 months
Bruce Carter1 B.Econ, MBA, FAICD, FICA
Non-executive Director
Independent
Ziggy Switkowski AO2 PhD (Melbourne), FAA, FTSE,
FAICD
Chairman - Elect
Independent
Steve McCann3
Chief Executive Officer and Managing Director - Elect
Non-independent
1 Mr Carter was appointed to the Crown Resorts Board on 25 August 2021.
2 Crown announced the appointment of Dr Ziggy Switkowski AO as Chairman - Elect on 26 August 2021. Dr Switkowski’s appointment will become
effective upon receipt of regulatory approval.
3 Mr Steve McCann was appointed Chief Executive Officer and Managing Director on 1 June 2021, subject to receipt of regulatory approval. Mr McCann
will formally commence as Chief Executive Officer and Managing Director following receipt of regulatory approval.
Independent Board Directors
The Crown Board is currently comprised of six Directors, five of whom will be independent following receipt of regulatory
approval for Dr Switkowski. Mr McCann will be the only non-independent Director in his role as Chief Executive Officer and
Managing Director, following receipt of regulatory approval. The independence of Directors is assessed against a list of
criteria and materiality thresholds. Those criteria have been formally enshrined in the Crown Board Charter. Each Director
who is listed as an independent Director complies with the relevant criteria for independence set out in the Crown Board
Charter. The independence of Directors is assessed against a list of criteria and materiality thresholds. Those criteria have
been formally enshrined in the Crown Board Charter. Each Director who is listed as an independent Director complies with
the relevant criteria for independence set out in the Crown Board Charter.
Board Chair Independence
The roles of the Chairman and Chief Executive Officer are usually exercised by separate persons. In January 2020, the
Crown Board appointed The Honourable Helen Coonan as Chairman. At the same time, Ken Barton was appointed as the
Chief Executive Officer and Managing Director of Crown.
Following the departure of Mr Barton in February 2021, Ms Coonan was appointed Interim Executive Chairman while the
Board oversaw a search for a new Chief Executive Officer. In May 2021, the Board appointed Mr Steve McCann as Chief
Executive Officer and Managing Director of Crown, subject to the receipt of probity and regulatory approvals. Since 1 June
2021 when Mr McCann commenced, Ms Coonan continued to perform her executive responsibilities as Interim Executive
Chairman until her departure on 27 August 2021.
On 26 August 2021, the Crown Board announced the retirement of Ms Coonan and the appointment of a new independent
Non-executive Chairman, Dr Ziggy Switkowski, subject to regulatory approval.
The roles of the Chairman and Chief Executive Officer at Crown will revert to being exercised by separate persons.
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Director Professional Development
The induction process for new Directors involves both formal and informal elements, tailored to their existing skills,
knowledge and experience.
As noted above, new Directors are provided with a formal induction pack which includes important information that a
Director must know about the Company and their appointment terms and includes copies of relevant Constitutions, Board
Charters and Policies. In addition, new Directors are provided with tours of Crown’s main businesses and the opportunity
to spend time with various members of senior management.
The professional development framework for Directors has recently been enhanced with the introduction of a three-year
training calendar which captures a broad range of training and development areas specifically tailored to the role and
responsibilities of Crown’s Directors. The calendar sets out the anticipated timeframe for completion of training together
with any requirement for refresher training. The Board recognise that training and development is an ongoing process and
as such, the calendar will be reviewed bi-annually by the People, Remuneration and Nomination Committee to ensure it
remains up-to-date and relevant.
In addition, Directors are requested to complete certain of Crown’s online training modules, including Anti-money
Laundering, Anti-bribery and Corruption, Cyber Security Awareness and Responsible Gaming.
To provide more structure to Director professional development, the People, Remuneration and Nomination Committee
oversees the induction process which is in place for new Directors. This process involves, amongst other things, a review
of the Crown Board Skills Matrix and consideration of the extent to which those skills are currently represented on the
Board and on each of its Committees. Where skills, knowledge and experience are not currently adequately represented,
appropriate professional development in this area will be considered.
Principle 3: Instil a Culture of Acting Lawfully, Ethically and Responsibly
Reinforcing Culture, Purpose and Values
The Crown Board have adopted values which reflect the Company’s purpose and culture and outline the behaviours
expected of officers and employees. They reflect how Crown employees work, treat each other and interact with the
people and communities around Crown. These values are:
Being passionate about
what you do is… never giving
anything less than your best
and loving what you do.
Working together is…
believing in
“we before me” and
that together we thrive.
Acting respectfully is…
walking in each other’s
shoes and treating others as
you wish to be treated.
Doing the right thing…
is doing right by your
colleagues, customers,
community and company.
Culture reforms
Crown’s objective is to be one of the most responsible and respected operator of integrated resorts in the world – right
across Crown’s stakeholder mix including the community, regulators and governments, customers, shareholders and our
employees.
In 2021, the Crown Board instigated a culture reform transformation program. External experts were engaged to conduct
an organisation-wide culture review in support of assessing the current state culture at Crown. A comprehensive survey
was developed and rolled out to employees to provide a baseline and insights. The outcome of the survey has been used
to address shortcomings and has formed the basis of the roadmap for our cultural change, which has been developed and
will be launched in September 2021.
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2021 Corporate Governance Statement
Whilst there is much work still to be done, progress has
already been made through significant leadership renewal
at the Board and senior management level and
organisational restructures resulting in key governance
and compliance functions such as financial crime, risk,
internal audit and responsible gaming having direct
reporting relationships to the Board.
As part of the culture reform program, a review of Crown’s
current purpose and values was undertaken to ensure they
support Crown’s aspirational culture and align with its
overall strategic objectives. The outcome of this review will
see Crown’s current purpose and values evolve to focus on
creating a collaborative workforce where integrity is
paramount to decision making. Crown’s focus will be on
building relationships with stakeholders and our role within
the community, while we strive to deliver quality exceptional
experiences, pursue opportunities to exceed expectations
and continuously grow and improve.
By reforming Crown’s culture, Crown intends to regain
trust from the community and support its social licence to
operate. The Board will oversee the cultural change which
will be driven by the new CEO and Chief People and
Culture Officer.
Code of Conduct
The Crown Board has adopted a Code of Conduct which
reflects the Company’s values and outlines the standard of
ethical behaviour that is expected of its Directors and of its
employees at all times. Any person who performs work for
or on behalf of Crown must comply with Crowns’ Code of
Conduct, which contains the Standards of Conduct and
procedure for reporting breaches of Code of Conduct as
core requirements. All Directors and employees receive
training on their obligations under the code and the Crown
Board is advised of any material breaches of the Code of
Conduct as soon as possible.
These values and requirements form the foundation of
Crowns’ corporate governance framework.
More information
Crown’s Code of Conduct is available at:
www.crownresorts.com.au under the heading
Corporate Governance – Codes.
Whistleblower Policy
Crown’s Whistleblower policy is designed to promote and
support a culture of integrity and ethical behaviour and to
encourage the reporting of misconduct and wrongdoing.
The Board recognises the important role whistleblowing
can play in the early detection of misconduct. Crown’s
Whistleblower Policy sets out:
• the disclosures which qualify for protection;
• how disclosures can be made and to whom;
• the process for investigating disclosures; and
• the importance of maintaining confidentiality and
protection against victimisation.
The procedure for investigation and how disclosures may
be made considering protection of identity and
confidentiality are outlined in the policy. Eligible
whistleblowers are encouraged to contact STOPLine to
make a disclosure under this Policy. STOPLine is an
independent and confidential service which is available 24
hours a day, seven days a week.
Whistleblower disclosures and periodic updates of matters
under this Policy are reported to Crown’s Risk
Management Committee.
The Company’s Whistleblower Policy was last reviewed
and updated in February 2021. The Policy is reviewed by
the Crown Board as required from time to time.
More information
Crown’s Whistleblower Policy is available at:
www.crownresorts.com.au under the heading
Corporate Governance – Policies.
Anti-bribery and Corruption Policy
The Crown Board has zero tolerance for any fraudulent or
corrupt business practices and has in place an Anti-
bribery and Corruption Policy.
The Anti-bribery and Corruption Policy articulates the
standards expected of Crown, its employees and
associates and its commitment to operating with the
highest levels of corporate integrity and preventing bribery
and corruption in all forms wherever and with whomever
Crown conducts business. Crown has undertaken a
systematic process to identify bribery and corruption risks.
Targeted compliance systems to prevent, detect and
manage issues of bribery and corruption are monitored
through Crown’s corporate compliance program and
operate within each business unit.
All Directors and employees receive training on their
obligations under the policy as a part of their induction
process. Periodic training is organised, as appropriate to
the roles of the employees, following induction.
The Risk Management Committee is kept informed and
receives periodical reports of any material breaches of the
Anti-bribery and Corruption Policy.
The Company’s Anti-bribery and Corruption Policy was
last reviewed and updated in February 2020. The Policy
will be reviewed by the Risk Management Committee and
the Crown Board as required from time to time.
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2021 Corporate Governance Statement CONTINUED
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Principle 4: Safeguard the Integrity of
Corporate Reports
Audit and Corporate Governance Committee
Crown has established a formal Audit and Corporate
Governance Committee to review the integrity of Crown’s
financial reporting and to oversee the independence of
Crown’s external auditors.
At the time of writing, the current members of the Audit
and Corporate Governance Committee are Antonia
Korsanos (Chair), Jane Halton AO PSM and Nigel Morrison
however this is subject to change given the current Board
renewal process underway. The Committee is comprised
of independent Non-executive Directors.
The Chair of the Audit and Corporate Governance
Committee, Mrs Korsanos, is an independent Director
who has extensive financial experience with over 25 years’
experience in financial and general management.
Further information about each Committee member’s
qualifications and experience is set out in the Directors’
Statutory Report. Information regarding the number of
times the Committee met throughout the period and the
individual attendances of the members at those meetings
has also been provided in the Directors’ Statutory Report.
The Audit and Corporate Governance Committee has
adopted a formal Charter that outlines its duties and
responsibilities. The Charter includes information on the
procedures for the selection and appointment of the
external auditor of Crown and for the rotation of external
audit engagement partners.
More information
The Audit and Corporate Governance Committee
Charter is available at: www.crownresorts.com.au
under the heading Corporate Governance – Charters.
CEO and CFO Declarations
Before approving the financial statements for each
financial period, the Board receives the necessary
confirmations required under section 295A of the
Corporations Act from each person who performs a chief
executive officer and the chief financial officer function
stating that, in their opinion:
• the financial records of Crown have been properly
maintained;
• the financial statements comply with the appropriate
accounting standards and give a true and fair view of
the financial position and performance of Crown; and
• the opinion has been formed on the basis of a sound
system of risk management and internal controls which
is operating effectively.
Any other announcements, including periodic corporate
reports not reviewed or audited by an external auditor, are
verified by the Disclosure Committee through the process
described in the Continuous Disclosure Policy available at
www.crownresorts.com.au under the heading Corporate
Governance – Policies.
Auditor’s Attendance at AGMs
Crown shareholders are provided with an opportunity at
the AGM to ask questions and make comments on
Crown’s Annual Report and on the business and
operations of the Company. Crown’s Auditor is required to
attend the AGM and shareholders are therefore also
provided a reasonable opportunity to ask the Auditor
questions about the Auditor’s Report and the conduct of
the audit of the Financial Report. Shareholders are
informed of their opportunity to address the Auditor in the
Notice of Meeting for the AGM.
Principle 5: Make Timely and Balanced
Disclosure
Policy to Ensure Compliance with ASX Listing
Rule Disclosure Requirements
Crown has a formal Continuous Disclosure Policy in place
which is designed to ensure compliance with ASX Listing
Rule requirements. The policy details processes for:
• ensuring that any information that could be market
sensitive or could involve reputational or material
regulatory issues or risks are communicated to the
Disclosure Officer;
• the assessment of information by the Disclosure
Committee and, where appropriate, the Board, and for
the disclosure of material information to the market; and
• the broader publication and assessment of material
information to the media, analysts and investors.
All new and substantive investor information, including
investor or analyst presentations are released as an
announcement on the ASX Market Announcements
Platform ahead of the presentation.
More information
Crown’s Continuous Disclosure Policy is available
at: www.crownresorts.com.au under the heading
Corporate Governance – Policies.
All ASX announcements, other than routine administrative
announcements, which do not have prior approval by the
Crown Board, are provided to the Crown Board promptly
after the ASX has acknowledged that the information has
been released to the market.
Crown Resorts Limited Annual Report 2021
45
2021 Corporate Governance Statement
Principle 6: Respect the Rights of
Security Holders
Providing Online Information to Investors
Crown has a dedicated corporate website which provides
information about itself and its governance to investors.
The website has a dedicated Corporate Governance tab
which sets out Crown’s Charters, Constitution, Policies
and Codes, describes Crown’s Board Committees and
includes copies of current and historical Corporate
Governance Statements and Remuneration Reports.
More information
More information is available at:
www.crownresorts.com.au under the heading
Corporate Governance.
Promotion of Effective Communication with
Shareholders
The Board aims to ensure that shareholders and
prospective investors are kept informed of all major
developments affecting Crown.
Crown’s investor relations program is designed to facilitate
effective communication between shareholders,
prospective investors and Crown.
Crown actively engages with shareholders and
prospective investors through a program of scheduled
interactions with institutional investors, sell-side and
buy-side analysts and the financial media. In addition,
meetings are held with shareholders and prospective
investors on request and responses are provided to
enquiries made from time to time.
Crown’s investor relations program works in tandem with
its obligations under its Continuous Disclosure Policy, a
copy of which is available on Crown’s website.
Crown’s Chief Executive Officer and Chief Financial Officer
regularly report to the Board on investor relations matters.
In addition, Crown has a Communications Policy which
seeks to promote effective communication with all its
shareholders, including smaller investors. The policy
explains how information concerning Crown will be
communicated to shareholders.
The communication channels include:
• Crown’s Annual Report;
• disclosures made to the ASX; and
• Notices of Meeting and other Explanatory Memoranda.
Advance notification of results announcements dates is
made via Crown’s website.
More information
Crown’s Continuous Disclosure Policy and
Communications Policy is available at:
www.crownresorts.com.au under the heading
Corporate Governance – Policies.
Shareholder Participation at Meetings
Shareholders are encouraged to participate in all meetings
of shareholders. The date of Crown’s AGM is advertised
well in advance on its website, is announced to the ASX
and is separately communicated to investors.
Shareholders are informed in the formal Notice of Meeting
for the AGM of their opportunity to participate in the
meeting by asking questions of either Crown Directors or
its Auditor. The AGM is also webcast live and an archive of
the AGM webcast is subsequently available on Crown’s
website.
At the AGM, the Chairman encourages shareholders to
ask questions on the items of business.
All substantive resolutions at a meeting of security holders
are decided by poll rather than by a show of hands.
More information
Crown’s Notices of Meeting and the webcast are
available at: www.crownresorts.com.au under the
heading Investors and Media – Annual General
Meetings.
Shareholder Communications
Crown shareholders have the option to receive
communications from Crown and to send communications
to Crown electronically. Crown’s share registry (on behalf
of Crown) actively encourages shareholders to receive
their shareholder communications electronically and
provides online access to shareholder information.
Separately, the Crown website includes a “Contact Us”
feature which can be used by both shareholders and
others to ask questions of the Company.
Principle 7: Recognise and Manage
Risk
Policy for Oversight and Management of Material
Business Risks
Crown has established a formal Risk Management
Committee to provide strategic risk management
leadership, oversight and analysis to the Crown Board.
At the time of writing, the current members of the Risk
Management Committee are Jane Halton AO PSM (Chair),
Bruce Carter and Antonia Korsanos. All members of the
Committee are independent Non-executive Directors.
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The Chair of the Risk Management Committee, Ms Halton,
is an independent Director who served a 34 year career in
the public service.
Further information about each Committee member’s
qualifications and experience is set out in the Directors’
Statutory Report. Information regarding the number of
times the Committee met throughout the period and the
individual attendances of the members at those meetings
has also been provided in the Directors’ Statutory Report.
The Risk Management Committee has adopted a formal
Charter that outlines its duties and responsibilities.
In December 2020, the Board implemented a new
organisational structure that included the separation of
Crown’s risk and internal audit functions. A new Chief Risk
Officer role was created with an elevated reporting line
directly to the Chief Executive Officer, and a reporting line
to the Risk Management Committee. The Chief Risk
Officer is also a member of the Executive Team for each
Crown property and attends the board meetings of each
property and the Crown Board.
More information
The Risk Management Committee Charter is
available at: www.crownresorts.com.au under the
heading Corporate Governance – Charters.
Design and Implementation of Risk Management
and Internal Control Systems
Crown has established a framework for the oversight and
management of material business risks and has adopted a
formal Risk Management Policy and articulated its Risk
Appetite. Risk management is an integral part of the
industry in which Crown operates.
Management is charged with monitoring the effectiveness
of Crown’s risk management systems and is required to
report to the Board via the Risk Management Committee.
The Board convened Risk Management Committee
administers Crown’s Risk Management Policy and
monitors management’s performance against the risk
management framework, including whether it is operating
within the Risk Appetite set by the Board.
The Risk Management Policy sets out procedures which
are designed to identify, assess, monitor and manage risk
at each of Crown’s controlled businesses and requires
that the results of those procedures are reported in a Risk
Profile to the Crown Board. The framework has been
developed using the model outlined in AS/NZS ISO
31000:2018 Risk Management – Guidelines.
Crown’s Risk Profile reflects major risks identified at an
operational level and provides the framework for the
reporting and monitoring of material risks across the
Crown group on an ongoing basis.
Management is required to conduct an annual review of its
Risk Profile to ensure that risk ratings and definitions
remain appropriate for Crown, and that adequate controls
are in place to manage them.
A review has been conducted during the reporting period
and presented to the Risk Management Committee for
approval. In the course of that review, the current Risk
Profiles of Crown’s major operating businesses were taken
into account and the risk environment of its operations
was also considered.
In addition, the Board has received, and will continue to
receive, periodic reports through the Risk Management
Committee, summarising the results of risk management
initiatives at Crown.
Overarching Risk Appetite Statement
The Crown Resorts Board has articulated its risk appetite
in the following manner:
In general, Crown’s risk appetite is a balanced one that
allows taking measured commercial risk as it pursues
strategic objectives whilst aiming to manage and
minimize risk in its operations. Crown’s Risk
Management Framework is designed to manage, rather
than eliminate the risk of failure to achieve business
objectives and can only provide reasonable and not
absolute assurance against breaches of risk appetite. In
this balanced stance, Crown is willing to accept, in
some circumstances, material commercial risks that
may result in impacts to our finances, services to our
customers or infrastructure, but only within pre-defined
limits and parameters.
There are a number of areas of the business where
Crown does not have appetite to accept material risks.
Specifically:
• Crown does not have appetite to accept material risk
related to regulatory, legal or statutory requirements,
including in respect of financial crime. Crown’s
relationships with its regulators and licensors are
foundational and paramount to how it does
business.
• Crown does not have appetite to accept material risk
related to any association with or influence from
criminal elements.
• Crown does not have appetite to accept material risk
related to any activity that would be inconsistent with
its social license to operate, which includes, in
addition to meeting its regulatory obligations,
material risk related to its reputation and brand.
Crown takes very seriously its stance on ‘doing the
right thing’ by all its stakeholders.
• Crown does not have appetite to accept material
risks related to employee health and safety, the
maintenance of appropriate security and surveillance
Crown Resorts Limited Annual Report 2021
47
2021 Corporate Governance Statement
across its properties or loss of, or otherwise
unauthorised or accidental disclosure of, customer
or other sensitive information or data.
This overarching statement is complemented by specific
qualitative statements against Crown’s major risk
categories and quantitative metrics that trigger reporting
to the Risk Management Committee.
Disclosure of Internal Audit Functions
An independent and objective internal audit function, with
auditors located across Perth, Melbourne and Sydney,
supports the Crown Board and its subsidiaries in
assessing that risks are appropriately managed in line with
the risk appetite, and that the internal controls are
operating effectively.
Internal audit activities focus on controls and related
activities (including policies, procedures, and systems)
which are in place to ensure:
• the adequacy and effectiveness of mitigating controls;
• compliance with applicable policies, standards,
procedures, regulations, and legislation;
• the economic acquisition, effective use and adequate
protection of Crown’s assets and resources;
• the accomplishment of Crown’s objectives; and
• the accuracy, reliability and timeliness of information
reviewed.
Internal audit may perform consulting and advisory
services relating to governance, risk management and
control as appropriate for Crown. It may also evaluate
within the confines of independence requirements,
specific operations at the request of the Board, Audit &
Corporate Governance Committee, or management as
appropriate.
The Boards of each major operating business and
management receive regular reports from internal audit on
the control environment, areas for improvement and
progress in addressing those areas for improvement.
To further enhance the Three Lines of Defence at Crown,
the internal audit function was separated from the risk
function in the current year and a fully independent Group
General Manager – Internal Audit was appointed. This role
reports administratively to the Chief Financial Officer
– Crown Resorts and functionally to the Crown Resorts
Audit & Corporate Governance Committee.
The internal audit function was externally assessed for
compliance with the Institute of Internal Auditor’s
International Professional Practices Framework in 2020
and was rated as generally conforms, which is the highest
rating that can be achieved.
Disclosure of Environmental and Social Risks
The Crown Group is exposed to a number of
environmental and social sustainability risks.
Crown’s goal is to be a leader in the entertainment and
tourism industry by creating long-term value for its
stakeholders across economic and environmental
dimensions. Crown aspires to be a model corporate
citizen and recognises that a company is assessed not
only on its financial performance, but also by its
commitment to corporate responsibility, which includes
consideration of, among others, the following factors:
• the quality of its workplace;
• its environmental footprint;
• its level of community engagement;
• the creation of a safe environment for its customers,
employees and contractors; and
• the provision of employment opportunities.
Environmental risks
Crown’s environmental sustainability program,
CROWNEARTH, has a clear aim to deliver strategy, plans,
actions and outcomes in environmental sustainability. The
CROWNEARTH brand is instantly recognisable by
managers and employees alike and signifies Crown’s
commitment to the three pillars of sustainability: people,
planet and prosperity.
Crown takes a group-wide approach to environmental
sustainability, aligning strategies and programs that further
reduce the environmental impact and contribute to
developing more sustainable practices, focussing on three
key areas: energy, waste and water management.
More information
Further information about Crown’s environmental
sustainability program, including environmental
initiatives, is available at www.crownresorts.com.au
and under the heading Our Contribution
- Sustainability.
Social risks
The material social risk affecting Crown relates to problem
gaming.
Crown is committed to an inclusive responsible service of
gaming approach at each resort, engaging internally and
externally to achieve socially responsible outcomes.
Crown recognises that in delivering its responsible gaming
programs and services, it does so as a shared
responsibility as part of the gaming industry, with
government, communities and individuals, all working in
partnership.
48
2021 Corporate Governance Statement CONTINUED
2021 Corporate Governance Statement
Each of Crown’s properties have onsite support facilities
for customers seeking assistance with their gaming
behaviours. Responsible Gaming Centres are staffed by
dedicated and professional team members and provide
free and confidential services, programs and referrals 24
hours a day, seven days a week, providing information in
English and other languages.
To assist employees in delivering high customer service
standards in relation to responsible gaming, the
Responsible Gaming department at each property,
together with Crown College, provide responsible service
of gaming training using modern learning techniques
which include on-line and facilitator led training.
Crown works closely with government, community and
academia to monitor its harm minimisation approach and
has established a group of Responsible Gaming
academics, the Responsible Gaming Advisory Panel, to
assist in the deliberation and advice in relation to
responsible gaming programs and services. Further,
Crown develops and maintains strong engagement with
many stakeholders including gambling help service
providers and other welfare organisations in each State.
More information
Further information in relation to Crown’s
Responsible Gaming program, including the
Responsible Gambling Code of Conduct, is available
at www.crownresorts.com.au and under the heading
Our Contribution - Responsible Gaming.
Principle 8: Remunerate Fairly and
Responsibly
People, Remuneration and Nomination
Committee
As noted in response to Recommendation 2.1, Crown has
established a formal People, Remuneration and
Nomination Committee. The People, Remuneration and
Nomination Committee has adopted a formal Charter that
outlines its duties and responsibilities.
At the time of writing, the current members of the People,
Remuneration and Nomination Committee are Antonia
Korsanos (Chair), Jane Halton AO PSM and Nigel Morrison
all of whom are independent Non-executive Directors.
Information about each Committee member’s
qualifications and experience is set out in the Directors’
Statutory Report. Information regarding the number of
times the Committee met throughout the period and the
individual attendances of the members at those meetings
has also been provided in the Directors’ Statutory Report.
Policy for Director Remuneration
A summary of current remuneration arrangements is set
out in more detail in the Remuneration Report. Crown
separately discloses the policies and practices regarding
the remuneration of Key Management Personnel in the
Remuneration Report.
Restrictions on Dealing in Equity Based
Remuneration
The rules of the Senior Executive Incentive Plan and the
Crown Digital Senior Executive Incentive Plan specifically
provide that a participant must not assign, transfer,
encumber, dispose of or have a Security Interest issued
over Plan Shares, or any beneficial interest in Plan Shares,
unless all restrictions on the transfer, encumbrance or
disposal of the Plan Shares have been met or waived by
the Board or the Board has provided prior written consent.
A Security Interest is defined to include any mortgage,
charge, pledge, lien, encumbrance or other third party
interest of any nature. The rules of the Senior Executive
Incentive Plan and the Crown Digital Senior Executive
Incentive Plan also require participants to comply with
Crown’s Securities Trading Policy at all times.
Crown Resorts Limited Annual Report 2021
49
Directors’ Statutory Report
Directors’ Statutory Report
Operating and Financial Review
The commentary included in this report omits some
information which might be considered relevant to Crown’s
business strategies, prospects for future financial years
and material risks on the basis that the Directors have
reasonable grounds to believe that disclosure would likely
result in unreasonable prejudice to Crown.
Principal Activities
Crown is one of Australia’s largest entertainment groups
with its core businesses and investments in the integrated
resorts sector.
In Australia, Crown owns and operates two of Australia’s
leading integrated resorts – Crown Melbourne and Crown
Perth.
Crown has recently completed construction of the Crown
Sydney Hotel Resort, with non-gaming operations
commenced progressively from December 2020.
Overseas, Crown owns and operates Crown Aspinalls in
London, one of the high-end licensed casinos in the West
End entertainment district.
Crown has interests in various digital businesses, including
Betfair Australasia (100%), DGN Games (100%) and Chill
Gaming (50%), and holds equity interests in Aspers Group
(50%) and Nobu (20%).
Crown also holds a 100% interest in the One
Queensbridge development site which is strategically
located adjacent to the Crown Melbourne entertainment
complex.
Business Strategies
Crown’s strategic plan is to focus on the following key
objectives:
• Restore public and regulatory confidence in operations
and support Crown’s regulatory and social licences to
operate by:
• fully cooperating with the various regulatory matters
Crown is subject to, and ensure sufficient resources
are devoted to responding to these investigations;
• implementing Crown’s transformation and remediation
plans, which is intended to position Crown as an
industry leader in its approach to governance,
compliance, responsible gaming and the
management of risk – in particular the risk of financial
crime – underpinned by an uplifted organisational
culture; and
• continuing to invest in technology to increase
automation and to ensure Crown is able to respond to
an environment of growing complexity of both extant
and emerging risks.
• Improve the underlying performance of the business by:
• managing costs during periods when the properties
are closed due to COVID-19 restrictions;
• driving the recovery of operations as the business
emerges from the current challenges of the COVID-19
pandemic, ensuring restrictions are adhered to and
safe operating environments are provided for patrons
and employees;
• commencing gaming operations at Crown Sydney
and continuing to ramp-up performance;
• reviewing the cost structure of the business; and
• reviewing the operating model of the VIP business
having regard to Crown’s decision to permanently
cease dealing with junkets, the directions issued by
respective state regulators, COVID-19 impacts on
travel and tourism and the outcomes of a marketing
risk assessment.
• Complete the sale of the remaining apartments in
Crown Sydney.
• Explore a sale of Crown’s non-core assets. Where
conditions do not allow for a sale, manage these
businesses for value.
• Maintain a strong capital position and a conservative
level of gearing to maximise financial flexibility.
Review of Operations
The 2021 financial year was very challenging for Crown,
with intense regulatory scrutiny and unprecedented
impacts on business operations from the COVID-19
pandemic.
For the year ended 30 June 2021, Crown recorded
statutory revenue of $1,536.8 million, down 31.3%, EBITDA
of $114.1 million, down 77.4%, and a net loss after tax
attributable to the parent of $261.6 million.
Theoretical1 EBITDA before Closure Costs2 and Significant
Items3 of $241.7 million was down 52.0%.
In the prior financial year, Crown was directed by relevant
State and Federal Governments to modify its operating
conditions and ultimately suspend its gaming activities and
other non-essential services in response to the COVID-19
pandemic. The Government-mandated closures were
effective from 20 March 2020 for Crown Aspinalls and 23
March 2020 for Crown Melbourne and Crown Perth.
1 Theoretical results have been adjusted to exclude the impact of any variance from theoretical win rate on VIP program play (at Crown Melbourne, Crown
Perth (until 24 February 2021) and Crown Aspinalls). The theoretical win rate is the expected hold percentage on VIP program play over time. The
theoretical result gives rise to adjustments to VIP program play revenue, operating expenses and income tax expense. Crown believes that theoretical
results are the relevant measure of viewing performance of the business as it removes the inherent volatility in VIP gaming revenue. Theoretical results
are a non-IFRS measure.
2 Costs incurred by Crown’s properties whilst gaming activities were closed due to Government orders, excluding net contribution in relation to hotel
quarantine services (Closure Costs). Closure Costs are a non-IFRS measure.
3 Significant items are transactions that are not in the ordinary course of business or are material and unexpected due to their size and nature. Significant
Items are a non-IFRS measure.
50
Directors’ Statutory Report CONTINUED
Directors’ Statutory Report
The COVID-19 pandemic continued to have a significant
impact on business performance throughout the 2021
financial year. The impact has differed across each of
Crown’s business operations, which are discussed in
further detail below.
During mandated closure periods, whilst Crown did not
generate any gaming revenues, Crown continued to incur
expenses to maintain its operations and corporate
responsibilities. Crown has separately identified these
costs in reporting its results for the full year ended 30 June
2021 as Closure Costs.
In addition to the impact of COVID-19 on Crown’s
business operations, throughout the 2021 financial year,
Crown was, and continues to be, under significant
regulatory and public scrutiny. This includes the Bergin
Inquiry and subsequent consultation process with ILGA,
the Victorian and Perth Royal Commissions and
AUSTRAC enforcement investigations. A summary of
these processes is outlined later in this Director’s Statutory
Report.
Crown Melbourne
As a result of the COVID-19 pandemic, Crown Melbourne
faced significant disruption and was closed for a large part
of the financial year.
Following the closure on 23 March 2020, Crown
Melbourne was closed for an extended period and did not
recommence gaming operations until 12 November 2020.
Crown Melbourne faced two further short-term closures,
with gaming operations closed for a total of 160 days
during the 2021 financial year due to Government
direction.
During the period in which Crown Melbourne was open,
variable operating restrictions were imposed which
impacted performance. These included capacity limits at
each venue, including the overall gaming floor or each
indoor space, density limits, restrictions on available
gaming product and physical distancing protocols,
including the deactivation of every second electronic
gaming machine and electronic table game, limits on the
number of players at a traditional table game and
minimum separation between tables.
Overall hotel occupancy across Crown Melbourne’s three
hotels was approximately 39%, with Crown Towers hotel
occupancy 39%, Crown Metropol hotel occupancy 42%
and Crown Promenade hotel occupancy 33%. These rates
include hotel rooms that were made available to the
Victorian Government for the purpose of quarantining
returned travellers early in the financial year.
Given the significant impact on operations, Crown
Melbourne qualified for the Commonwealth Government’s
JobKeeper scheme through to 28 March 2021. During the
financial year, Crown Melbourne recorded $54.9 million in
JobKeeper subsidies for employees who worked in either
a full or partial capacity and $91.0 million in JobKeeper
amounts that were paid in their entirety to Crown’s
employees who were stood down.
Theoretical revenue of $582.5 million was down 60.6% on
the prior comparable period (pcp).
Main floor gaming revenue was $406.9 million, down
54.3% on the pcp, which comprises table games (non-
program play) revenue of $241.2 million (down 56.0% on
the pcp) and gaming machine revenue of $165.7 million
(down 51.5% on the pcp).
Theoretical VIP program play revenue was $4.4 million,
comprising entirely of interstate play, down 98.0% on the
pcp. Actual VIP program play revenue was $0.6 million,
with a below theoretical win rate on VIP program play
turnover during the period.
Non-gaming revenue was $171.2 million, down 52.8% on
the pcp.
Theoretical EBITDA before Closure Costs and Significant
Items was $94.1 million, down 73.4% on the pcp, which
includes $41.7 million in payroll subsidies under the
Commonwealth Government’s JobKeeper scheme.
Closure Costs of $145.9 million were net of $13.2 million in
JobKeeper payroll subsidies. This figure includes a
provision of $25 million relating to a minimum tax
guarantee agreed with the Victorian Government in 2014.
Due to the closure of gaming operations, Crown was
unable to generate sufficient revenue to meet the
minimum guarantee for the 2021 financial year, which was
the final year of the guarantee.
EBITDA related Significant Items of $45.4 million were
recorded during the period relating to an underpayment of
casino tax and one-off allowance for expected credit
losses.
Reported EBITDA was a loss of $100.6 million, which
compared to a profit of $381.8 million in the pcp. The
reported EBITDA result takes into account the variance
from the theoretical VIP program play result which had a
negative EBITDA impact of $3.4 million. This compares to
a positive EBITDA impact of $93.3 million in the pcp.
Following year-end, Crown made a payment to the
Victorian Commission for Gambling and Liquor Regulation
(VCGLR) of $37.4 million representing an underpayment of
casino tax by Crown Melbourne over the period
commencing in the 2012 financial year to date relating to
the incorrect deduction of certain bonus rewards provided
to patrons in connection with play on Crown Melbourne’s
electronic gaming machines. Under the terms of Crown’s
regulatory agreements with the State of Victoria, Crown is
required to pay interest on any underpayment of casino
tax. As a result, an additional interest component of $23.8
million was also paid. Both the underpayment of casino
tax and interest were fully provided at 30 June 2021.
Crown Resorts Limited Annual Report 2021
51
Directors’ Statutory Report
Crown Perth
Crown Perth re-opened with restrictions towards the end
of June 2020 and remained open for the entirety of the
first half, trading above expectations. These COVID-19
related operating restrictions included capacity limits at
each venue based on a prescribed maximum density of
one person per two square metres, the deactivation of
every second electronic gaming machine and electronic
table game terminal, and restricting the number of players
at table games.
During the second half, Crown Perth was required to close
gaming operations for various periods of time for a total of
27 days in line with government restrictions imposed in
response to COVID-19. Whilst trading performance
rebounded quickly following each shutdown, overall
performance moderated throughout the course of the year.
Overall hotel occupancy across Crown Perth’s three hotels
was approximately 67%, with Crown Towers hotel
occupancy 71%, Crown Metropol hotel occupancy 72%
and Crown Promenade hotel occupancy 53%.
Crown Perth qualified for the Commonwealth
Government’s JobKeeper scheme until 27 September
2020. During the financial year, Crown Perth recorded
$24.7 million in JobKeeper subsidies for employees who
worked in either a full or partial capacity and $9.0 million in
JobKeeper amounts that were paid in their entirety to
Crown’s employees who were stood down.
Theoretical revenue of $742.8 million was up 21.1% on the
pcp.
Main floor gaming revenue was $478.3 million, up 38.9%
on the pcp, which comprises table games (non-program
play) revenue of $171.7 million (up 24.8% on the pcp) and
gaming machine revenue of $306.6 million (up 48.2% on
the pcp).
Theoretical VIP program play revenue was $0.4 million,
comprised entirely of interstate play, down 99.1% on the
pcp. Actual VIP program play revenue was $0.7 million,
with an above theoretical win rate on VIP program play
turnover during the period.
On 24 February 2021, Crown announced that the Gaming
and Wagering Commission of Western Australia had
issued directions to Crown Perth under the Casino Control
Act 1984 (WA) which provide that Crown Perth shall not
participate in the conduct of junkets, premium player
activity or privileged player activity. As a result, Crown no
longer offers VIP program play at Crown Perth.
Non-gaming revenue was $264.1 million, up 20.4% on the
pcp.
Theoretical EBITDA before Closure Costs and Significant
Items was $254.2 million, up 57.1% on the pcp, which
includes $24.7 million in payroll subsidies under the
Commonwealth Government’s JobKeeper scheme.
Closure Costs of $20.3 million were recorded during the
period, whilst Significant Items of $2.3 million related to
one-off allowance for expected credit losses.
Reported EBITDA was $231.8 million, up 50.4% on the
pcp. The reported EBITDA result takes into account the
variance from the theoretical VIP program play result
which had a positive EBITDA impact of $0.2 million. This
compares to a positive EBITDA impact of $12.1 million in
the pcp.
Excluding the impact of JobKeeper payroll subsidies
received during the period, the operating margin (at
theoretical and before Closure Costs and Significant
Items) increased from 26.4% to 30.9%. The increase in
margin was driven by a favourable mix of business, and
lower marketing and promotional costs.
Crown Sydney
Select non-gaming operations at Crown Sydney opened
to the public for the first time in a restricted capacity from
28 December 2020. Non-gaming operations progressively
commenced operation throughout the year, observing
encouraging property visitation.
Hotel occupancy was 31%, with higher occupancy on
weekends and strong average room rates.
While all areas of the hotel resort now complete, gaming
operations are yet to commence as Crown continues its
consultation process with the Independent Liquor and
Gaming Authority (ILGA) on suitability.
Notwithstanding the encouraging property visitation,
Crown Sydney delivered an operating loss given the
impact of COVID-19 related restrictions including border
closures and the limited scale of operations.
From 26 June 2021, stay-at-home orders were imposed
by the New South Wales Government, resulting in the
closure of food & beverage and conferencing facilities, and
a reduction in permissible hotel services.
The residential component of the project, “Crown
Residences”, is complete with residents commencing
move-ins from April 2021. As at 30 June 2021,
approximately $750 million in sale proceeds (net of GST)
had been received, of which approximately $650 million
was received during the year. Crown expects to receive a
further approximately $500 million in sale proceeds (net of
GST) in the 12 months to 30 June 2022, relating to
contracted sales yet to settle, pre-sale commitments and
unsold apartments, subject to the level of disruption
caused by COVID-19.
Total revenue was $68.6 million, which relates to Crown
Sydney’s non-gaming operations that progressively
opened throughout the year.
EBITDA before Significant Items was a loss of $22.8
million, with an overall operating margin of (33.2)%.
52
Directors’ Statutory Report CONTINUED
Directors’ Statutory Report
Reported EBITDA was $123.0 million, which includes the gain on sale apartments, off-set by Crown Sydney pre-opening
costs.
Crown Aspinalls
Crown Aspinalls was closed for the majority of the financial year in line with Government COVID-19 restrictions in operation
in the United Kingdom. While Crown Aspinalls was trading, performance was subdued given the constraints on
international travel, social distancing restrictions and reduced operating hours.
Theoretical EBITDA before Closure Costs and Significant Items was a loss of $6.3 million, which includes $1.1 million in
Coronavirus Job Retention Scheme payments under the employee retention scheme in operation in the UK, and compares
to a loss of $2.7 million in the pcp.
Closure Costs of $5.2 million were net of $3.5 million in Coronavirus Job Retention Scheme payments, whilst Significant
Items of $16.9 million were recorded during the period relating to a one-off allowance for expected credit losses.
Reported EBITDA was a loss of $28.4 million, which compared to a gain of $2.3 million in the pcp. The reported EBITDA
result takes into account the variance from the theoretical VIP program play result which had an immaterial EBITDA impact.
This compares to a positive EBITDA impact of $6.2 million in the pcp.
Crown has commenced a review of the Crown Aspinalls business, including a review of business performance, prospects
and gaming tax matters.
Crown Digital
Crown’s wagering and online social gaming operations comprise Betfair Australasia and DGN Games.
During the period, Crown increased its interest in DGN Games from 85% to 100% in exchange for the final earn-out
payment of US$9.5 million to the original founders of DGN. Crown also made the final contingent consideration payment
associated with the acquisition of Winners Club Limited of US$3.1 million.
EBITDA from Crown’s wagering and online social gaming operations was $34.1 million, down 2.0% on the pcp. Improved
revenue from Betfair was offset by increased expenses, particularly in the second half, as Betfair invested in business
initiatives to drive longer term growth. Conversely, lower revenues from DGN were offset by lower marketing costs.
International VIP Business
On 17 November 2020, the Board determined that Crown will permanently cease dealing with all junket operators, subject
to consultation with gaming regulators in Victoria, Western Australia and New South Wales. Subsequently, all three gaming
Regulators in Victoria, Western Australia and New South Wales have advised that they do not support junket operations in
their respective jurisdictions.
In addition, Crown has closed all remaining offshore offices, the international VIP team has been integrated into the broader
business and a number of former senior team members have left Crown.
During the year, Crown undertook a review of all outstanding gaming debts. This resulted in a one-off adjustment to the
allowance for expected credit losses, which has been separately classified as a Significant Item.
Corporate Costs
During the period, corporate costs before Significant Items were $111.6 million, $67.3 million above the pcp.
The increase in corporate costs was driven by legal, consulting and other costs associated with various regulatory
inquiries, and higher insurance costs. The prior year also recorded $20.6 million of corporate costs as Closure Costs.
Corporate costs are expected to remain at a similar level next year.
Equity Accounted Investments
Crown’s equity accounted result is comprised of its net equity accounted share of profit from Nobu, offset by the net equity
accounted shares of losses from Aspers Group and Chill Gaming. Crown’s net equity accounted share of NPAT across all
these investments was a loss of $8.7 million, reflecting the impact of the COVID-19 pandemic on their operations,
particularly Aspers which was closed for much of the financial year.
During the year, Crown committed to a plan to divest its interest in Aspers. Crown expects the transaction to be completed
by 31 December 2021. Accordingly, Crown’s investment in Aspers was reclassified as an Asset Held for Sale at 30 June
2021.
Crown Resorts Limited Annual Report 2021
53
Directors’ Statutory Report
Significant Items
During the financial year, several transactions occurred that were not in the ordinary course of business or were material
and unexpected due to their size and nature, which have been separately recorded as Significant Items as set out below.
For more details, see note 3(e) to the Financial Statements.
$m
F21
F20
Profit on disposal of Crown Sydney apartments
207.8
–
Crown Sydney pre-opening costs
(62.0)
(3.5)
Underpayment of casino tax by Crown Melbourne
(37.4)
–
One-off allowance for expected credit losses
(27.2)
–
Restructuring Costs
(21.7)
–
Contribution to the cost of the Bergin Inquiry
(12.5)
–
Significant Items included in EBITDA
47.0
(3.5)
Asset impairment – Queensbridge
(28.0)
–
Goodwill impairment – DGN
(17.3)
–
Impairment of associate – Aspers
(8.3)
–
Reassessment of contingent consideration – DGN
(2.0)
(1.7)
Interest on underpayment of casino tax by Crown Melbourne
(23.8)
–
Impairment – Aspinalls
–
(52.8)
Impairment – Nobu
–
(21.7)
Tax effect of Significant Items
(22.2)
1.0
Significant Items included in NPAT
(54.6)
(78.7)
Financial Position
Despite the challenges facing the business, Crown has maintained a strong financial position with a well-invested asset
base, significant tangible asset backing and a low level of gearing. As at the date of this report, Crown maintains an
investment grade credit rating with all three ratings agencies.
At 30 June 2021, Crown’s net debt position was $892.9 million (excluding working capital cash of $85.9 million and net of
hedges), broadly in line with the prior year. This consisted of total debt of $1,283.0 million and cash (excluding working
capital cash) of $390.1 million.
In August 2020, Crown entered into a $450 million project finance facility to support the construction of Crown Sydney.
This facility was repaid prior to the end of the financial year from proceeds from the settlement of Crown Sydney apartment
sales.
At 30 June 2021, total liquidity, excluding working capital cash, was $560.8 million, comprising $390.1 million in available
cash and $170.7 million in committed undrawn facilities.
Net operating cash flow for the period was an outflow of $14.0 million, which compared to net operating cash flow of
$326.9 million in the pcp, reflecting severe impact on business performance from the COVID-19 pandemic. Other material
cash flow items incurred during the period included capital expenditure of $559.1 million which primarily relates to the
continued construction of Crown Sydney, offset by approximately $650 million of proceeds received during the year from
the settlement of Crown Sydney apartment sales.
With the Crown Sydney project now substantially complete and only limited spend remaining on the project, capital
expenditure is expected to materially reduce. Further, Crown expects to receive a further approximately $500 million in
apartment sales in the 12 months to 30 June 2022, relating to contracted sales yet to settle, pre-sale commitments and
unsold apartments, subject to the level of disruption caused by COVID-19.
No dividends were declared or paid in respect of the 2021 financial year. Future dividends will be subject to the Board’s
assessment of Crown’s financial position at the appropriate time.
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Directors’ Statutory Report
With the ongoing impacts of the COVID-19 pandemic on
Crown’s operations and the various regulatory
investigations to which Crown is subject, Crown has been
proactively engaging with lenders to provide additional
financial flexibility through this challenging period.
Following financial year-end, Crown reached agreement
with its relationship banks regarding a series of
modifications to Crown’s existing financing arrangements,
including:
• An extension of near-term maturities by amending and
aligning the maturity date of all of the $560 million in
bilateral facilities to October 2023.
• A waiver of financial covenants in relation to the 31
December 2021 testing date. No waiver was required
for the 30 June 2021 testing date.
• A waiver of certain events of default that would
otherwise arise from cancellation or suspension (for a
certain period of time) of any of Crown’s Australian
casino licences. In the event such a licence event
occurs, Crown has agreed to a review process
providing it with a period of time to negotiate with
lenders or otherwise refinance the facilities.
As part of the arrangements agreed with lenders, Crown
has agreed not to declare or pay dividends in respect of
the half year ending 31 December 2021 or where a review
event is triggered as a result of a cancellation or
suspension of any of Crown’s Australian casino licences.
One of Crown’s relationship banks has agreed to provide a
new $250 million debt facility, subject to completion of
long form documentation. The facility will provide Crown
with debt funding of up to $250 million (based on the value
of unsold Crown Sydney apartments) to be used to partly
fund any required redemption of Crown’s Euro Medium
Term Notes and associated make whole premium, or in
certain circumstances, for general corporate purposes.
In addition to the modifications to Crown’s financing
arrangements detailed above, there are a number of other
measures Crown has in place and/or which are within its
discretion to manage risks to Crown’s liquidity position
arising out of the potential outcomes from the various
regulatory processes underway or due to the continued
impact on operations from the COVID-19 pandemic.
These include the ability to reduce cash outflows including
the reduction of capital expenditure and operating costs in
the event of prolonged COVID-19 lockdowns, and the
opportunity to raise additional funds through asset
disposal, additional financing or the issuance of new
shares, should the need arise.
Significant Changes in State of Affairs
Some of the significant changes in the state of affairs of
the consolidated group since 1 July 2020 include:
COVID-19
The COVID-19 pandemic has had a significant impact on
Crown. In particular, relevant State and Federal
Governments directed Crown at various times to suspend
its gaming activities and other non-essential services in
response to the COVID-19 pandemic and, when permitted
to reopen, to restrict its operating conditions.
The Government mandated closures of Crown’s gaming
facilities were effective as follows during the financial year:
• Crown Melbourne: 1 July to 11 November 2020, 13 to
17 February 2021, and 28 May to 17 June 2021;
• Crown Perth: 1 to 13 February 2021, 24 to 30 April
2021, 3 to 7 May 2021, and 28 June to 30 June 2021;
and
• Crown Aspinalls: 1 July to 14 August 2020 and 5
November 2020 to 16 May 2021.
Upon reopening, operating restrictions at Crown’s
Australian properties variously included:
• capacity limits in each room or across the property
including a prescribed maximum density;
• physical distancing between patrons at electronic
gaming machines and electronic table games, including
the deactivation of some electronic gaming machines
and electronic table game terminals; and
• closing all table games or restricting the number of
players at table games.
As the COVID-19 situation unfolded, a significant
proportion of Crown’s workforce was stood down for
varying periods of time.
Following the completion of the JobKeeper scheme,
Crown’s practice has been to pay full rostered shifts in
week one of a lockdown followed by discretionary
payments from Crown to employees, which is considered
on a case-by-case basis depending on their eligibility for
government assistance. Crown has also continued to
financially support employees through its Hardship Fund,
which provides additional, targeted financial assistance to
employees experiencing serious financial hardship as a
result of COVID-19.
As at the date of this report, Crown’s operations continue
to face significant disruption from COVID-19.
Crown Melbourne has been closed for the majority of the
new financial year in line with Victorian Government
restrictions imposed in response to COVID-19, and
currently remains closed. In addition, Crown Sydney has
been closed since 26 June 2021, other than for the
provision of limited hotel and related services, in line with
restrictions imposed by the New South Wales Government
in response to COVID-19.
Crown Resorts Limited Annual Report 2021
55
Directors’ Statutory Report
Conversely, Crown Perth recommenced operations in early
July 2021 following a short-term closure, with the removal
of remaining restrictions from 12 July 2021. Crown Perth’s
performance has rebounded quickly in line with recent
experience and seasonal trends.
Whilst the extent of future COVID-19 related impacts on
Crown and its operations remains uncertain, COVID-19
related closures and operating restrictions as well as travel
restrictions, including ongoing international border closures,
are likely to continue to materially influence business
performance.
Regulatory Processes
During the 2021 financial year, Crown was, and continues
to be, under significant regulatory and public scrutiny. The
outcome of those regulatory processes could have a range
of consequences and the potential to significantly impact
the financial performance and operations of Crown.
In addition, Crown expects to continue to incur elevated
corporate costs, including legal, consulting and associated
costs, whilst these regulatory, reform and any resulting
processes continue.
AUSTRAC
As announced by Crown on 19 October 2020 and 7 June
2021 respectively, each of Crown Melbourne and Crown
Perth is the subject of an AUSTRAC enforcement
investigation concerning potential non-compliance with the
Anti-Money Laundering and Counter-Terrorism Financing
Act 2006 (Cth) and the Anti-Money Laundering and
Counter-Terrorism Financing Rules 2007 (Cth). Crown
Melbourne and Crown Perth are fully cooperating with
AUSTRAC in relation to these enforcement investigations.
Each of these investigations is ongoing and AUSTRAC has
not informed Crown Melbourne or Crown Perth whether it
will take any enforcement action.
While it is at this stage uncertain as to whether AUSTRAC
will take enforcement action, or the type of enforcement
action it may take, Crown considers that AUSTRAC is very
likely to commence civil penalty proceedings against Crown
Melbourne and Crown Perth. If it does so, it is likely that
Crown Melbourne and Crown Perth will be required to pay
significant civil penalties.
Bergin Inquiry and resulting processes
On 9 February 2021, the Commissioner’s report (Bergin
Report) of the inquiry under section 143 of the Casino
Control Act 1992 (NSW) (Bergin Inquiry) was released. The
New South Wales regulator, ILGA wrote to Crown stating
that, having regard to the contents of the Bergin Report, it
presently considered that Crown Sydney Gaming Pty Ltd
(Crown Sydney Gaming) is no longer a suitable person to
give effect to the Restricted Gaming Licence in New South
Wales and that Crown Sydney Gaming had breached
clause 14(a) of the VIP Gaming Management Agreement
(VIP GMA).
Crown is continuing to consult with ILGA on a path to
suitability to give effect to the Restricted Gaming Licence
as part of the consultation process contemplated under
the VIP GMA, and is committed to driving the necessary
change. An Independent Monitor has been appointed to
report back to ILGA on several of Crown’s structural
changes, with a particular focus on anti-money laundering
measures.
On 13 May 2021, Crown announced that it had reached
agreement with ILGA on several matters regarding the
operation of Crown Sydney, and that it was in discussions
with ILGA to evaluate the necessary steps towards the
introduction of cashless gaming alternatives at Crown
Sydney. In addition, Crown announced that it had agreed
to make certain payments to ILGA, including paying a
contribution towards the cost of the Bergin Inquiry of
$12.5 million, and an annual Casino Supervisory Levy of
$5.0 million in each of FY2021 and FY2022 (adjusted for
CPI).
Victorian Royal Commission
On 22 February 2021, a Royal Commission was established
into the suitability of Crown Melbourne Limited to hold a
casino licence (Victorian Royal Commission). The
Honourable Ray Finkelstein was appointed as
Commissioner and Chairperson of the Royal Commission.
The initial hearing took place on 24 March 2021, and the
first public hearings commenced on 17 May 2021. Counsel
Assisting the Royal Commission delivered their closing
submissions on 20 July 2021. Parties with leave to appear,
including Crown, delivered their written closing submissions
on 2 August 2021 and presented their oral closing
submissions on 3 August 2021.
All submissions can be found at
https://www.rccol.vic.gov.au/submissions.
The Victorian Royal Commission is expected to deliver its
final report by 15 October 2021.
Perth Casino Royal Commission
On 5 March 2021, the Honourable Neville Owen, the
Honourable Lindy Jenkins and Mr Colin Murphy were
appointed as Royal Commissioners to inquire into the
suitability of Crown Perth to continue holding a casino
gaming licence in Western Australia (Perth Casino Royal
Commission). The Commissioners are also examining the
State’s regulatory framework for casino gaming, including
any matters that might enhance the Gaming and Wagering
Commission’s future capability and effectiveness.
On 30 June 2021, the Perth Casino Royal Commission
delivered its Interim Report on the Regulatory Framework to
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the Western Australian Government, which was tabled in
the Parliament of Western Australia on 3 August 2021.
The second phase of the Perth Casino Royal
Commission’s inquiry, including the suitability of the Perth
Casino licensee, commenced with opening statements on
26 July 2021, with witnesses called from 28 July 2021.
The Perth Casino Royal Commission is expected to deliver
its final report by 4 March 2022.
Other Regulatory Processes
On 27 April 2021, Crown announced that Crown
Melbourne had been issued with a letter of censure and
fined $1.0 million by the VCGLR in relation to historical
non-compliance by Crown Melbourne with its Internal
Control Statement for junket operations.
Regulators, including Crown’s gaming regulators, and
other bodies routinely conduct investigations and reviews
of Crown’s operations in the normal course of regulatory
oversight. Crown regularly receives various notices and
requests for information from regulators regarding a wide
variety of matters.
Crown has also been subject to a number of other
regulatory investigations, including by the VCGLR.
Crown will fully co-operate in relation to these matters and
will continue to engage with regulators in relation to
Crown’s Remediation Plan and any further remedial steps
identified.
Remediation Plan
As part of Crown’s response to matters raised throughout
various regulatory processes, Crown has taken action and
has focussed on driving transformation and remediation.
Crown has developed a comprehensive Remediation Plan
which is resulting in significant changes to the way Crown
conducts business.
Successful implementation of the Remediation Plan is
intended to position Crown as a leader in the industry in its
approach to governance, compliance, responsible gaming
and the management of financial crime risk, underpinned
by an uplifted organisational culture. This in turn is
intended to repair Crown’s reputation and support
Crown’s regulatory and social licences to operate.
Crown’s transformation and remediation plans broadly
comprise the following key areas:
• Corporate governance and organisation structure
(including Board / senior management change);
• AML/CTF Change Program;
• Culture;
• Responsible gaming;
• Risk management;
• Junkets/VIP and significant players; and
• CPH relationship.
Crown has been increasing resourcing and capability
across a number of key areas, including across Crown’s
Financial Crime, Compliance and Responsible Gaming
functions. Implementation of Crown’s Remediation Plan is
also resulting in other changes to Crown’s business
practices, such as the implementation of a Significant
Player Review process, which has resulted in the exit of a
number of customer relationships, ceasing dealing with all
junket operations, restructuring the VIP international
business (including closing all offshore offices) and
terminating the information sharing agreements that were
in place with CPH. There is also a substantial culture
reform program underway with the assistance of an
external consultant.
Crown has made significant progress in implementing
these changes and has committed to providing regulators
with regular updates on its progress.
Corporate Transaction Proposals
Blackstone
On 22 March 2021, Crown announced that it received an
unsolicited, non-binding and indicative proposal from a
company on behalf of funds managed and advised by The
Blackstone Group Inc. and its affiliates (together,
Blackstone), to acquire all of the shares in Crown by way
of a scheme of arrangement at an indicative price of
A$11.85 cash per share (Blackstone Proposal). The
Blackstone Proposal was subject to a number of
conditions. Crown noted that Blackstone has a
shareholding of 9.99% in Crown which it acquired from
Melco Resorts & Entertainment Limited for $8.15 per share
in April 2020. Crown undertook to assess the merits of the
Blackstone Proposal and engage with stakeholders and
regulatory authorities.
On 13 April 2021, Crown announced that it had received
from Blackstone a modification to the Blackstone Proposal
in the form of a revised regulatory approval condition and
confirmation that the proposal was not subject to debt
financing.
On 10 May 2021, Crown announced that it had received a
revised Blackstone Proposal at an indicative price of
$12.35 cash per share (the Revised Blackstone Proposal).
This represented an increase of $0.50 cash per share (or
4%) compared to the previous indicative offer price of
$11.85 cash per share, with the indicative offer price to be
reduced by the value of any dividends or distributions
declared or paid by Crown. Other key terms were
consistent with the original Blackstone Proposal.
On 17 May 2021, Crown announced that the Crown Board
had unanimously concluded that the Revised Blackstone
Proposal undervalued Crown and was not in the best
interests of Crown’s shareholders. In coming to this
conclusion, the Board considered a range of scenarios
given the regulatory inquiries in relation to Crown which
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were underway. The Board also carefully considered the
conditions of the Revised Blackstone Proposal including
the regulatory approval conditions. The Board believed
there was significant uncertainty as to the timing and
outcome of the regulatory approval process. As a result,
the Board considered the conditions of the Revised
Blackstone Proposal as understood presented an
unacceptable level of regulatory uncertainty for Crown
shareholders. The Board’s conclusion also considered the
fundamental value of Crown’s assets against the value of
the Revised Blackstone Proposal.
Oaktree
On 19 April 2021, Crown announced that it had received an
unsolicited, preliminary, non-binding and indicative
proposal from a company on behalf of funds managed and
advised by Oaktree Capital Management, L.P. (together,
Oaktree), to provide a funding commitment of up to
~A$3.0bn to Crown via a structured instrument with the
proceeds to be used by Crown to buy-back some or all of
the Crown shares which are held by Crown’s major
shareholder Consolidated Press Holdings Pty Limited
(CPH) on a selective basis (Oaktree Proposal). CPH
currently has a shareholding of approximately 37% in
Crown. Any selective buy-back of Crown shares held by
CPH would be subject to Crown shareholder approval (with
no votes being cast in favour of the resolution by CPH or its
associates). The Crown Board noted that it would
commence a process to assess the Oaktree Proposal.
On 15 June 2021, Crown announced that it had received a
revised proposal from Oaktree (Revised Oaktree Proposal).
The Revised Oaktree Proposal included:
• a $3.1 billion facility used to fund a selective buy back of
CPH’s shareholding in Crown, consisting of two
tranches:
• $2 billion private term loan (Loan Component); and
• $1.1 billion loan convertible into new shares to be
issued by Crown (Convertible Component);
• a term of seven years;
• a coupon of 6.0% p.a. that would be payable for the first
two years of the facility and the coupon would increase
to 6.5% p.a. from year 3 until the maturity of the facility;
and
• the ability for Oaktree, under the Convertible
Component, to convert the $1.1 billion tranche into new
shares in Crown at a strike price of $13.00 in specified
circumstances, including at any time after the first
anniversary of the facility provided that the Crown share
price is above $13.00 (based on a 30 day VWAP). The
number of new Crown shares which would be issued to
Oaktree upon conversion of the Convertible Component
would be capped such that Oaktree would hold 9.99%
of the total number of Crown shares on issue. The
remaining part of the Convertible Component would be
cash settled by Crown.
Following year end, Crown announced that it was no longer
in discussions with Oaktree regarding the Revised Oaktree
Proposal, as noted below.
Star
On 10 May 2021, Crown announced that it had received an
unsolicited, conditional, non-binding and indicative
proposal from The Star Entertainment Group Limited (Star)
to merge with Crown by way of a scheme of arrangement
(the Star Merger Proposal). The Star Merger Proposal terms
contemplated:
• a nil-premium share exchange ratio of 2.68 Star shares
for each Crown share, based on a 3-month volume-
weighted average share exchange ratio to 19 March
2021;
• a cash alternative of $12.50 per Crown share, subject to
a cap equal to 25% of Crown’s total shares on issue
(with any scale back to occur on a pro rata basis);
• the Board of the merged entity would initially comprise
the current Directors of each of Crown and Star; and
• that the proposal is subject to various conditions,
including definitive documentation, shareholder and
regulatory approvals, satisfactory due diligence, debt
financing and Crown and Star board approvals and
recommendations to shareholders to vote in favour of
the merger.
On 17 May 2021, Crown announced that in order to
facilitate the Crown Board’s assessment of the Star Merger
Proposal, Crown had requested Star to provide certain
information to allow the Crown Board to better understand
various preliminary matters.
Following year end, Star unilaterally withdrew the Star
Merger Proposal, as noted below.
Board Changes
During the year, the following individuals resigned as
directors of Crown Resorts:
• Mr John Alexander (22 October 2020);
• Mr Michael Johnston (10 February 2021);
• Mr Guy Jalland (10 February 2021);
• Mr Andrew Demetriou (11 February 2021);
• Mr Ken Barton (15 February 2021);
• Mr Harold Mitchell (22 February 2021);
• Mr John Poynton (28 February 2021); and
• Professor John Horvath (14 April 2021).
In addition to the above:
• On 10 February 2021, Crown announced John Poynton
was no longer a nominee of CPH on the Crown Board
as a result of the termination of his consultancy
arrangement with CPH.
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• On 11 February 2021, Andrew Demetriou resigned as
Chairman of Crown Melbourne Limited.
• On 28 February 2021, John Poynton resigned as
Chairman and Director of Burswood Limited
On 28 January 2021, Crown announced the appointment
of a new Non-executive Director, Nigel Morrison, to the
Crown Board, subject to the receipt of all necessary
regulatory approvals. On 6 April 2021, Crown announced
that Nigel Morrison’s appointment as a director of Crown
had become effective following receipt of all necessary
regulatory approvals.
On 12 April 2021, Crown announced the appointment of a
new Non-executive Director, Bruce Carter, to the Crown
Board, subject to the receipt of all necessary regulatory
approvals. On 27 August 2021, Crown announced that
Bruce Carter’s appointment as a Director of Crown had
become effective following receipt of all necessary
regulatory approvals.
Senior Executive Changes
On 20 August 2020, Crown announced that Alan
McGregor’s appointment as the Chief Financial Officer of
Crown had become effective following receipt of
regulatory approvals.
On 15 February 2021, Crown announced that Ken Barton
stepped down from his role of Chief Executive Officer and
Managing Director with immediate effect. Following the
resignation of Ken Barton, Helen Coonan was appointed
as Executive Chairman on an interim basis while the Board
oversaw a search for a new Chief Executive Officer.
On 18 February 2021, Crown announced that Mary Manos
stepped down from her role as General Counsel and
Company Secretary of Crown with immediate effect and
the separation of the General Counsel and Company
Secretary roles. Alan McGregor, Crown’s Chief Financial
Officer, was appointed as Interim Company Secretary of
Crown.
On 10 May 2021, Crown announced that the Board had
appointed Steve McCann as Chief Executive Officer and
Managing Director of Crown, subject to the receipt of
probity and regulatory approvals. Mr McCann joined
Crown on 1 June 2021.
During the financial year, the following additional senior
executive appointments were made, with the individuals
taking up their roles subject to necessary regulatory
approvals:
• Steven Blackburn as the Chief Compliance and Financial
Crime Officer (24 February 2021);
• Nick Weeks as Executive General Manager,
Transformation & Regulatory Response (11 March
2021);
• Tony Weston as Chief People and Culture Officer
(7 June 2021); and
• Betty Ivanoff as Group General Counsel (21 June 2021).
Financing and Credit Ratings
On 20 November 2020, Crown announced that Moody’s
Investors Service (Moody’s) had downgraded Crown’s
issuer rating from Baa2 to Baa3, with the rating remaining
on review for downgrade.
On 25 January 2021, Crown announced that Moody’s had
withdrawn its credit rating relating to the Euro Medium
Term Notes, however continued to provide an issuer rating
for Crown.
On 1 March 2021, Crown announced that it had been
informed by Moody’s that it had confirmed Crown’s
current issuer credit rating of Baa3 with the rating outlook
revised from review for downgrade to negative.
On 24 May 2021, Crown announced that, having regard to
the impact of COVID-19 on Crown’s businesses and the
various regulatory investigations, the Crown Board
decided not to redeem the $630 million of Crown
Subordinated Notes II on the First Call Date of 23 July
2021. Subject to there being no major change in
circumstance, Crown announced that it intends to review
the role of Notes II in its capital structure in around 12
months’ time. Crown also noted that the equity credit
classification that was ascribed to Notes II by Standard &
Poor’s from the Issue Date is expected to change from
“Intermediate” (50%) to “Minimal” (0%) from the First Call
Date.
Other Significant Transactions and Matters
On 19 August 2020, Crown announced that it had
appointed KPMG as its statutory auditor. The appointment
was approved at Crown’s 2020 Annual General Meeting.
On 21 October 2020, Crown announced the termination of
the Services Agreement dated 1 July 2016 (which enabled
Crown to request the provision of services by key CPH
executives at pre-agreed hourly rates) and the Controlling
Shareholder Protocol dated 31 October 2018 (which
enabled the sharing of confidential information by Crown
to CPH and James Packer).
On 18 November 2020, Crown announced that gaming
operations at Crown Sydney would not commence in
December 2020 following ILGA’s deferral of a number of
necessary applications.
On 14 December 2020, Crown announced that
Maurice Blackburn Lawyers had commenced a class
action proceeding against Crown in the Supreme Court
of Victoria. The claim alleges that, in the period from
11 December 2014 to 18 October 2020, Crown had
inadequate systems and processes for ensuring
compliance with its obligations under anti-money
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laundering laws and that Crown engaged in misleading
and deceptive conduct, breached its continuous
disclosure obligations and conducted its affairs contrary to
the interests of members as a whole in the period.
Maurice Blackburn has announced that the class action
aims to recover compensation from Crown, seeks the
potential buy-back of investors’ shares at a fair value, and
seeks that Crown implement a proper anti-money
laundering training program. Crown is defending the
proceeding.
On 16 December 2020, Crown announced that ILGA
granted Crown Sydney Property Pty Ltd an interim liquor
licence for certain non-gaming operations at Crown
Sydney, including the Crown Towers hotel, bars and some
restaurants. The liquor licence was granted for the period
16 December 2020 to 30 April 2021. On 27 April 20201,
Crown announced that new Crown Sydney liquor licences
had been granted by ILGA for the period 1 May 2021 to 31
October 2021.
On 5 March 2021, Crown announced it will phase out
indoor smoking at its Australian resorts by the end of
December 2022, with the move to a smoke-free indoor
gaming environment to commence immediately in some of
Crown’s premium gaming areas, and a transition period
for other areas until the end of December 2022 to enable
the progressive installation of appropriate outdoor
smoking areas for patrons.
On 16 April 2021, Crown announced that ILGA had issued
a news release stating that it reached agreement with
CPH on a number of undertakings regarding Crown and
its associates including that CPH will not seek to have its
executive or nominee appointed to Crown’s Board, or
requisition a meeting of Crown shareholders to seek the
appointment of any person as a director of Crown, before
October 2024.
Significant Events After Balance Date
On 6 July 2021, Crown Perth recommenced trading of
gaming and non-gaming operations at a reduced
capacity. From 12 July 2021, Crown Perth recommenced
trading of all gaming and non-gaming operations under
the same restrictions that were in place immediately prior
to the introduction of the lockdown on 29 June 2021.
On the evening of 15 July 2021, Crown Melbourne ceased
gaming activities and the majority of non-gaming
operations following a mandated closure by the Victorian
government due to COVID-19. From 28 July 2021, Crown
Melbourne recommenced operations in accordance with
Victorian Government restrictions, including a patron
capacity limit on the gaming floor of 100 patrons in each
indoor space, subject to a density limit of one person per
four square metres. On the evening of 5 August 2021,
Crown Melbourne ceased gaming activities and the
majority of non-gaming operations following a mandated
closure by the Victorian government due to COVID-19.
On 23 July 20201, Crown noted the announcement by The
Star that it had unilaterally decided to withdraw The Star
Merger Proposal announced on 10 May 2021. Crown also
noted that it remained willing to engage with The Star in
relation to a potential merger on terms acceptable to both
Crown and The Star and that the Board is committed to
maximising value for all Crown shareholders and will
carefully consider any proposal that is consistent with this
objective.
On 23 July 2021, the Western Australian Government
announced that it had extended the time to complete the
Perth Casino Royal Commission to 4 March 2022.
On 27 July 2021, Crown announced that it resolved to
make a payment to the VCGLR, representing an
underpayment of casino tax by Crown Melbourne of $37.4
million over the period commencing in the 2012 financial
year to date relating to the incorrect deduction of certain
bonus rewards provided to patrons in connection with play
on Crown Melbourne’s electronic gaming machines.
Under the terms of Crown’s regulatory agreements with
the State of Victoria, Crown is required to pay interest on
any underpayment of casino tax. The interest component
of an additional $23.8 million was also paid. Both the
underpayment of casino tax and interest on the
underpayment of casino tax were fully provided at 30 June
2021.
On 3 August 2021, the Victorian Government announced
the establishment of a new casino and gambling regulator,
the Victorian Gambling and Casino Control Commission
(VGCCC), which will have oversight of all gambling and
gaming activities within Victoria.
On 3 August 2021, Crown announced that Xavier Walsh
will cease in his role as Crown Melbourne Chief Executive
Officer on 20 August 2021 and will remain available to
assist the Company until his employment at Crown ends
on 9 December 2021.
On 18 August 2021, the NSW Government announced
that it agreed to support all 19 recommendations from the
Bergin Inquiry Report on the regulation of casinos in NSW
and the suitability of Crown Resorts to hold a restricted
gaming facility licence. Additionally, the NSW Government
announced an independent casino regulator will be
established and a number of legislative reforms will be
introduced as recommended by Commissioner Bergin.
On 20 August 2021, Crown announced that Steve
McCann had been appointed as Chief Executive Officer of
Crown Melbourne, in addition to his role as Chief
Executive Officer Crown Resorts (regulatory approvals
pending). Crown also noted that Steve McCann will
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relocate from Sydney to Melbourne as soon as practicable
and subject to COVID-19 interstate travel restrictions.
On 26 August 2021, Crown announced that the Board had
appointed Dr Ziggy Switkowski AO to succeed the
Honourable Helen Coonan as Chairman, subject to the
receipt of probity and regulatory approvals. As part of the
planned succession process, Ms Coonan retired from the
Board and as Executive Chairman on 27 August 2021.
Dr Switkowski will join the Board as Chairman immediately
upon receipt of all necessary regulatory approvals.
Pending receipt of those approvals, Crown Non-executive
Director Jane Halton AO PSM will act as Interim Chairman.
On 27 August 2021, Crown announced that Bruce
Carter’s appointment as a Director of Crown had become
effective following receipt of all necessary regulatory
approvals.
On 30 August 2021, Crown announced it was no longer in
discussions with Oaktree regarding the Revised Oaktree
Proposal that was previously announced by Crown to the
market on 15 June 2021.
Business Risks
As noted in the Review of Operations section of this
Report, Crown is currently subject to two Royal
Commissions into its suitability to hold casino licenses in
Melbourne and Perth. The Royal Commissions may make
adverse findings in relation to Crown’s suitability to hold
the Melbourne and Perth casino licenses, and in relation
to the suitability of certain associates of Crown. In
addition, Crown has been subject to the Bergin Inquiry in
NSW which found that Crown was not suitable to hold a
restricted gaming licence for its Sydney casino. These are
collectively referred to in this section of the report as the
Inquiries.
The Royal Commissions will make findings and
recommendations to the Victorian and Western Australian
Governments. The Governments and relevant Victorian
and Western Australian regulators will decide the
appropriate outcomes and actions to be taken in
response. In NSW, the regulator (ILGA) and Crown are
working together on a remediation plan that incorporates
recommendations from the Bergin Inquiry which it is
intended will, on implementation, make Crown suitable to
give effect to the restricted gaming licence. Crown is
addressing the failings identified through various
regulatory processes and any additional external reviews,
to ensure its legal, governance and compliance
frameworks are effective and facilitate a pathway for
Crown to be ‘best in class’, with a clear focus on regaining
the trust and confidence of all its stakeholders and
maintaining its social license to operate.
The findings and recommendations of the Inquiries and
the outcomes and actions taken by the regulators have
impacted and will continue to significantly impact Crown.
Crown is committed to assisting the Royal Commissions
and working with its regulators to address the issues
raised by the Inquiries. The significance of the Inquiries,
their outcomes, and Crown’s commitment to improving
the way it operates its businesses cannot be overstated.
The materiality of the risks listed in the table below should
be read in light of Crown’s current circumstances.
In addition, as noted in the Review of Operations section
of this Report, the COVID-19 pandemic continues to have
a significant impact on Crown, with relevant State and
Federal Governments directing Crown to modify its
operating conditions and mandating closures for various
periods of time since March 2020. Having regard to the
impacts of COVID-19 on Crown, the Board directly, and
through the Risk Management and Safety and
Sustainability Committees, has monitored and overseen
Crown’s response to the pandemic. The future impacts of
COVID-19 on Crown and its operations, including the
severity and duration, remain uncertain.
Crown has established a risk management framework,
using the model outlined in AS/NZS ISO 31000:2018 Risk
Management – Guidelines, for the oversight and
management of material business risks. It has adopted a
formal Risk Management Policy and articulated its Risk
Appetite. Risk management is an integral part of the
industry in which Crown operates.
Management is charged with monitoring the effectiveness
of Crown’s risk management systems and is required to
report to the Board through the Risk Management
Committee.
The Risk Management Committee administers the Risk
Management Policy and monitors management’s
performance against the risk management framework,
including whether it is operating within the Risk Appetite
set by the Board.
In light of the Inquiries, Crown has taken significant steps
to enhance its risk and compliance frameworks, as
detailed in the table below.
Various risks, some of which are beyond Crown’s
reasonable control, could have a material impact on the
achievement of Crown’s business strategies and future
prospects. These risks, together with the mitigating
strategies, are summarised below. The risks presented
below are not intended as an exhaustive list of all the risks
and uncertainties associated with Crown’s businesses.
Additional risks and uncertainties not presently known to
management and the Board, or that management and the
Board currently believe to be immaterial or manageable,
may also adversely impact Crown.
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Risk and Description
Mitigation Strategies
Legal and Regulatory Compliance
Crown operates in a highly regulated industry
and is subject to regulatory approvals in the
jurisdictions in which it conducts gaming and
non-gaming operations. Crown’s operations,
financial performance and future prospects are
dependent on the legal and regulatory
frameworks in which it operates.
Crown is subject to extensive regulatory
oversight, which can include enquiries, claims,
investigations, inquiries, enforcement actions,
and other forms of penalties where issues or
breaches are identified.
These activities represent a significant financial
and human capital effort for the organisation.
The range of possible consequences is broad
and could include (without limitation)
remediation plans, changes to Crown’s current
regulatory framework, or suspension, restriction
or cancellation of Crown’s licences.
In the current period, Crown has been and
continues to be the object of an ILGA Inquiry, a
Royal Commission in Victoria and another one in
Western Australia. Most of these events still
have to unfold and their impact is not yet fully
known to the business.
Crown has in place legal, governance and compliance frameworks at
each of its operations and at Group level. Crown continuously monitors
its legislative and regulatory requirements in the jurisdictions in which it
operates.
In addition, Crown’s internal control framework is designed to ensure
effectiveness of, and compliance with, relevant legislative and
regulatory requirements.
Crown provides relevant employees and contractors with training on
Crown’s compliance obligations, policies and procedures (where
applicable).
Crown obtains legal advice in appropriate circumstances and
jurisdictions as required.
Internal audit periodically reviews the effectiveness of the controls and
processes in place to manage Crown’s compliance frameworks and
the overall internal control framework.
Crown’s risk framework adopts a “3 lines of defence” model to identify
and manage key risks and to provide assurance over Crown’s controls in
managing those risks.
Crown is undergoing major change and transformation through the
implementation of its Remediation Plan to enhance its governance and
compliance processes, aiming to meet and exceed suitability
requirements.
Crown is committed to assisting the Royal Commissions and working
with its regulators to address the issues raised by the various regulatory
processes.
In light of these regulatory processes, Crown has taken significant
steps to enhance its risk and compliance frameworks, including:
• engaged consultants to review its current risk and AML/CTF
compliance framework and wider organisational culture;
• committed to a wide-ranging AML/CTF reform and transformation
program;
• revisited and restated its Risk Appetite;
• committed significant additional resources to its risk and compliance
functions;
• completed an organisational restructure, including the creation of a
new Compliance and Financial Crime department (independent of
business units), the separation of Risk and Internal Audit functions,
the creation of a Group HR function and the separation of General
Counsel and Company Secretary roles; and
• appointed new senior executives to the following roles:
• CEO;
• Chief Compliance and Financial Crime Officer;
• Chief Risk Officer;
• Group General Counsel;
• Chief People and Culture Officer; and
• Executive General Manager – Transformation & Regulatory
Response.
Crown’s implementation of its Remediation Plan is also subject to a
review by an independent monitor, appointed by ILGA.
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Directors’ Statutory Report
Risk and Description
Mitigation Strategies
Operational License(s)
Crown’s operations are regulated by laws,
licences, permits and other approvals from
relevant governments and regulators. The loss of
or failure to renew any material licence, permit,
authorisation or other approval (or the imposition
of additional conditions or renewal on less
favourable terms) may have an adverse impact on
the financial position, performance and operations
of Crown.
A cancellation of a gaming licence could also
trigger events of default or review events under
Crown’s debt facilities and other agreements.
In light of the various regulatory processes, Crown’s Board and
Executives have and will continue to engage with the relevant regulators
and governments to ensure that Crown is suitable to hold the licences
and regulatory approvals necessary to conduct Its operations.
As outlined above, Crown has developed and is in the process of
implementing a comprehensive Remediation Plan which seeks to
reform and uplift its governance and compliance processes, aimed at
meeting and exceeding suitability requirements.
Crown has agreed with its lenders a waiver of certain events of default
that would otherwise arise from cancellation of any of Crown’s
Australian casino licences. In the event such a licence event occurs,
Crown has agreed to a review process providing it with a period of time
to negotiate with lenders or otherwise refinance the facilities.
Legal and Regulatory Conditions and Changes
Crown operates in a highly regulated industry
and is subject to receiving and maintaining
regulatory approvals in the jurisdictions in which
it conducts gaming and non-gaming operations.
Legislative and regulatory changes may have an
adverse impact on Crown’s operational and
financial performance.
Crown proactively engages with relevant stakeholders and has in place
legal, governance and compliance frameworks at each of its operations
and at Group level. Crown monitors for legislative and regulatory
changes on an ongoing basis.
From time to time, Crown makes submissions relating to proposed
legislative and regulatory changes which may impact the Crown Group.
Crown provides relevant employees and contractors with training on
legislative and regulatory changes (where applicable).
Reputation
Negative publicity of Crown may have an
adverse impact on Crown’s operational and
financial performance.
Crown has in place legal, governance and compliance frameworks at
each of its operations and at Group level and provides relevant
employees and contractors with training on Crown’s compliance
obligations, policies and procedures (where applicable).
Crown has developed and is in the process of implementing a
comprehensive Remediation Plan which seeks to reform and uplift its
governance and compliance processes.
Crown recognises that its reputation is impacted by the conduct of its
people, which in turn is influenced by Crown’s corporate culture.
An important part of Crown’s Remediation Plan is the implementation
of a comprehensive culture transformation program with the support of
external experts in the field. This is further supported by an extensive
Board and Executive renewal process, a termination of arrangements
with CPH, a broader governance reform and the AML uplift program.
Relationships with Key Stakeholders
A breakdown in Crown’s relationships with key
stakeholders, including regulators and
governments, may have an adverse impact on
Crown’s operational and financial performance
Crown constructively and proactively engages with relevant
stakeholders and has in place legal, governance and compliance
frameworks at each of its operations and at Crown Group level.
This can help to address or prevent actual or potential issues from
arising or escalating.
It should also be acknowledged that through the Royal Commissions,
the strength and transparency of Crown’s engagement with its
regulators has been called into question. Crown is committed to
rebuilding a strong working relationship with its regulators with
openness and transparency.
Crown Resorts Limited Annual Report 2021
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Risk and Description
Mitigation Strategies
Volatility of Gaming Revenue
Crown’s gaming operations may experience
variations from theoretical win rates due to the
element of chance in gaming activities, including
in a lower gaming volume environment.
Sustained unfavourable variations in the actual
win rate compared to the theoretical win rate
would be likely to have an adverse impact on
Crown’s financial performance.
Crown monitors and reviews its gaming businesses and reports on the
basis of its actual and long-term theoretical win rates in its results.
Terrorism
As Crown’s properties are places where large
crowds may congregate, they may be the target
of a terrorist attack or the calculated use or
threat of violence.
Any such event may have an adverse impact on
Crown’s customers, employees and operational
and financial performance.
Crown has in place security and surveillance technology and
procedures at each of its properties which monitor for suspicious
behaviours.
In addition, Crown has a framework in place for responding to major
incidents and works with key law enforcement agencies for coordinated
and rapid responses.
Litigation
Any material litigation brought against Crown by
third parties may have an impact on Crown’s
financial performance.
Crown proactively monitors and responds to legal issues and engages
legal advisors as required.
In addition, Crown has in place legal, governance and compliance
frameworks at each of its operations and at Group level, which are
supported by insurance programs as appropriate.
Data Security
Crown maintains confidential customer and
commercially sensitive data.
The leak or unauthorised use of confidential
customer and commercially sensitive data may
have an adverse impact on Crown’s operational
and financial performance.
Crown has in place IT policies, procedures and training programs
which are further supported by a cyber security program.
Crown also has in place legal and compliance frameworks at each of its
operations and confidentiality arrangements in place with its employees
and contractors.
In addition, Crown has adopted a management framework for
responding to data breach incidents, should they occur.
External Events
Unfavourable changes in local and international
economic conditions and other events outside
of the control of Crown, including pandemics
and natural disasters, may have an adverse
impact on Crown’s customers and employees,
and operational and financial performance.
The continued lockdown conditions and
operating restrictions have the potential to
materially impact the financial strength of each
entity.
Although external factors cannot necessarily be influenced or controlled
by Crown, Crown has in place strategic, business and contingency
planning processes that seek to minimise their impact, and proactively
engages with relevant stakeholders as required.
Crown also reviews and manages its capital structure.
During the COVID-19 pandemic, Crown was able to flexibly manage its
workforce during periods of closure. During these periods, Crown has
implemented a number of support measures to look after its
employees, including health and wellbeing initiatives, financial support,
information programs and advice.
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Risk and Description
Mitigation Strategies
AML Compliance
Crown and its affiliate businesses operate in an
industry that presents high money-laundering
risks.
As a provider of ‘designated services’ under the
Anti-Money Laundering and Counter-Terrorism
Financing Act 2006 (Cth), the Crown Group
includes ‘reporting entities’ which are subject to
obligations under the AML/CTF Act. A failure to
comply with these obligations could expose
Crown to significant penalties.
Crown is currently the subject of enforcement
investigations by AUSTRAC in relation to Crown
Melbourne and Crown Perth. Should these
investigations result in a determination of
non-compliance, as is likely, Crown could face
significant penalties.
Crown has invested heavily in its ongoing Financial Crime and
Compliance Change Program, which includes the roll-out and
implementation of an enhanced joint AML/CTF program, the
introduction of enhanced controls and processes, the introduction of
greater automation in respect of client identification and transaction
monitoring, the broadening of capability and capacity through
additional resourcing, among other actions. All those actions are
supported by periodic internal audit reviews of the effectiveness of
controls and processes in place to manage Crown’s compliance
frameworks and the overall internal control framework. Crown is in the
process of engaging an external expert to conduct an independent
review of the joint AML/CTF program at the end of 2021.
Loss of Key Person(s)
Loss of key staff with corporate knowledge or
key governance and operational roles,
particularly following the various regulatory
processes which remain ongoing.
Crown has in place talent development and management programs as
well as succession planning program.
This process is significant for Crown as it continues to renew its Board
and senior management teams and enhances its capabilities in key
areas including people and culture, risk and compliance.
Treasury
Crown is exposed to risks relating to the cost
and availability of funds to support its
operations.
As part of its arrangements with its external
financiers, Crown is subject to a number of
conditions and financial covenants. A failure to
comply with these may require Crown to repay
borrowings earlier than anticipated, and in some
cases may result in increased financing costs
and/or penalty payments for Crown, which
could in turn adversely affect Crown’s financial
performance.
Extended lockdown conditions and operational
restrictions may lead to a breach of financial
covenants.
Crown monitors the terms of its financing arrangements, including its
covenants, and maintains continuous engagement with external
financiers, including seeking waivers of covenants or events where
required.
Crown also regularly investigates additional sources of capital in equity
and debt markets.
Crown Resorts Limited Annual Report 2021
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Directors’ Statutory Report
Risk and Description
Mitigation Strategies
Change Management
Crown is in the process of reforming and
enhancing its culture, governance and risk
management practices.
The complexity, timeframes and breadth of the
change program could lead to failures,
inadequate changes implemented, or changes
not well embedded enough to be sustained.
Crown has commissioned an independent review of its corporate
culture, the results of which will be used by the Board and management
to set the tone from the top and to ensure employees are clear on
Crown’s expectations.
To complement its culture work, Crown has undergone an
organisational restructure. A key element of Crown’s organisational
change is the restructure of compliance and risk functions to enhance
reporting to, and oversight by, the Board.
Crown has a dedicated executive leading a team who has ownership of
running and coordinating the overarching project.
There is also oversight by the Executives and the Board and the
support of external parties as required.
Responsible Provision of Gambling
Risk that gambling services are not provided by
Crown businesses in a responsible manner, in
accordance with Crown policies, relevant
responsible gambling codes and regulator or
community expectations.
Crown has in place a Responsible Gaming framework, including a 24/7
staffed Gaming Centre, with ongoing monitoring of play, and
overarching oversight by a dedicated Board Committee.
Training of all Crown staff on gaming harm signs and responses.
Crown is currently undertaking a thorough review of its responsible
gaming practices in collaboration with external advisors and will
consider further enhancement emerging from the Royal Commissions.
Crown’s aspiration is to establish a best practice responsible gambling
approach.
Environmental Regulation
The National Greenhouse and Energy Reporting Act 2007 (NGER Act) established a mandatory reporting system for
corporate greenhouse gas emissions and energy production and consumption. Crown is required to report emissions
under the NGER Act. Relevant reports have been submitted during the year.
Key features of the NGER Act include:
• reporting of greenhouse gas emissions, energy consumption and production by large corporations;
• corporate level public disclosure of greenhouse gas emissions and energy information; and
• providing consistent and comparable data for decision making.
Under the Western Australian Water By-laws legislation, Crown Perth is required to complete annual water management
assessments and submit water efficiency management plans. Relevant reports have been submitted during the year.
Environmental issues are important to Crown and it has taken a number of initiatives in this regard.
Crown acknowledges the potential impact climate change and extreme weather events could have on its operations and
its longer-term sustainability. This strategic consideration has been an area of focus for Crown.
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Directors and Officers
Director Details
Set out below are the names of each person who has been a Director of Crown during or since year end and the period for
which they have been a Director.
Name
Date Appointed
Date Ceased
John Henry Alexander
6 July 2007
22 October 2020
Kenneth McRae Barton
3 March 2020
15 February 2021
Bruce Carter
25 August 2021
The Honourable Helen Anne Coonan
2 December 2011
27 August 2021
Andrew Demetriou
29 January 2015
11 February 2021
Jane Halton AO PSM
23 May 2018
Professor John Stephen Horvath AO
9 September 2010
14 April 2021
Guy Jalland
16 April 2018
10 February 2021
Michael Roy Johnston
6 July 2007
10 February 2021
Antonia Korsanos
23 May 2018
Harold Charles Mitchell AC
10 February 2011
22 February 2021
Nigel Morrison
31 March 2021
John Hartley Poynton AO
20 November 2018
28 February 2021
Crown announced the appointment of Mr Steve McCann as Managing Director and Chief Executive Officer on 1 June
2021, subject to regulatory approval. Upon receipt of regulatory approval, Mr McCann’s appointment will become effective.
Crown announced the appointment of Dr Ziggy Switkowski AO as Chairman on 26 August 2021, subject to regulatory
approval. Upon receipt of regulatory approval, Dr Switkowski’s appointment will become effective.
The details of each Director’s qualifications and experience as at the date of this Report are set out below.
Details of all directorships of other Australian listed companies held in the three years before the end of the financial year
have been included.
Crown Resorts Limited Annual Report 2021
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Directors’ Statutory Report
Jane Halton was appointed to the Crown
Resorts Board on 23 May 2018. Ms
Halton became Interim Chairman on 27
August 2021.
Ms Halton’s 34 year career in the public
service includes the positions of Secretary
of the Australian Department of Finance,
Secretary of the Australian Department of
Health, Secretary for the Department of
Health and Ageing and Executive
Co-ordinator (Deputy Secretary) of the
Department of the Prime Minister and
Cabinet.
Ms Halton is a current Director of Australia
and New Zealand Banking Group Limited,
is the current Chair of Vault Systems and
Council on the Ageing Australia, is the
Chair and a Director of Coalition of
Epidemic Preparedness Innovations
(Norway) and is the Chair of Generics
Biosimilar Medicines Association advisory
board.
Ms Halton’s other roles include Director of
Naval Group Australia, Director of Clayton
Utz, Member of the Executive Board of
the Institute of Health Metrics and
Evaluation at the University of Washington,
Adjunct Professor of the University of
Sydney and the University of Canberra
and Council Member of the Australian
Strategic Policy Institute.
Ms Halton brings to the Board extensive
experience in finance, risk management,
information technology, human resources
and public policy.
Board and Board Committee
memberships:
• Chair of the Risk Management
Committee
• Director of Crown Melbourne Limited
• Director of Crown Sydney Gaming Pty
Ltd
• Member of the Audit and Corporate
Governance Committee
• Member of the People, Remuneration
and Nomination Committee
• Member of the Responsible Gaming
Committee
• Member of the Safety and
Sustainability Committee
Directorships of other Australian
listed companies held during the past
three years:
• Australia and New Zealand Banking
Group Limited from October 2016 to
current.
Jane Halton AO PSM
BA (Hons) Psychology, FIML, FIPAA,
Hon. FAAHMS, Hon. FACHSE, Hon.
DLitt (UNSW)
Interim Chairman
Dr Ziggy Switkowski AO
PhD (Melbourne), FAA, FTSE, FAICD
Chairman-Elect
The Board announced the appointment
of Dr Ziggy Switkowski as Crown
Resort’s new Chairman on 26 August
2021 (subject to regulatory approval). Dr
Switkowski will formally commence as
Chairman following receipt of regulatory
approval.
Dr Switkowski is currently Chancellor of
RMIT University and Chairman of NBN
Co. Dr Switkowski is a former Chairman
of Suncorp Group, the Australian
Nuclear Science and Technology
Organisation and of Opera Australia. He
has also served as a non-executive
director on the boards of Tabcorp
Holdings, Healthscope, Oil Search,
Lynas and Amcor.
Dr Switkowski has held positions as
Chief Executive Officer and Managing
Director of Telstra Corporation Limited
and Optus Communications Ltd.
Dr Switkowski is a Fellow of the
Australian Academy of Science, the
Australian Academy of Technological
Sciences and Engineering and the
Australian Institute of Company
Directors.
In 2014, Dr Switkowski was made an
Officer of the Order of Australia in
recognition of service to tertiary education
administration, scientific organisations
and the telecommunications sector, to
business, and to the arts.
Directorships of other Australian
listed companies held during the past
three years:
• Tabcorp Limited from 2006 to
February 2019.
• Healthscope from March 2018 to
June 2019.
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Steve McCann was appointed as
Managing Director and Chief Executive
Officer of Crown Resorts Limited on
1 June 2021 (subject to regulatory
approval). Mr McCann will formally
commence as Managing Director and
Chief Executive Officer following receipt
of regulatory approval. Mr McCann was
appointed as Chief Executive Officer
and Director of Crown Melbourne
Limited on 20 August 2021.
Mr McCann is a highly regarded and
experienced business leader with over
25 years of executive experience.
Mr McCann was previously the Group
Chief Executive Officer and Managing
Director of Lendlease from December
2008 to May 2021. Prior to his
appointment as Group Chief Executive
Officer at Lendlease, Mr McCann held the
positions of Group Finance Director and
Chief Executive Officer for Lendlease’s
Investment Management business.
Lendlease is a leading international
property development, investments and
construction business with over 10,000
employees and is listed on the ASX with a
market capitalisation of A$9b.
Prior to joining Lendlease, Mr McCann
had 15 years’ experience in property,
funds management, investment banking
and capital markets transactions gained
through senior leadership roles at ABN
AMRO and as Head of Property at
Bankers Trust. Previous roles included
four years as a mergers and acquisitions
lawyer at Freehills and four years in
taxation accounting.
While at Lendlease Mr McCann was a
strong advocate in the Property Council
of Australia’s Champions of Change
Coalition. In 2013, Mr McCann was
announced as the Property Person of
the Year by the Urban Taskforce
Australia.
Mr McCann holds a Bachelor of
Economics and a Bachelor of Laws from
Monash University in Melbourne,
Australia.
Directorships of other Australian
listed companies held during the past
three years:
• Lendlease Corporation Limited from
March 2009 to May 2021.
Steve McCann
LLB, BEc
Chief Executive Officer and
Managing Director - Elect
Crown Resorts Limited,
Chief Executive Officer and
Director Crown Melbourne Limited
Antonia Korsanos was the Chief
Financial Officer (2009 to 2018) and
Company Secretary (2011 to 2018) of
Aristocrat Leisure Limited. She has over
25 years’ experience in financial and
general management at companies
including Kellogg’s Australia and New
Zealand, Goodman Fielder Limited and
Coopers & Lybrand in Sydney.
Mrs Korsanos brings to the Board
extensive experience in the gaming
industry and experience in the areas of
technology, finance, strategy, mergers
and acquisitions, risk management and
financial and regulatory compliance.
Mrs Korsanos has a Bachelor of
Economics (Accounting & Finance) from
Macquarie University, is a Member of the
Institute of Chartered Accountants and
is a Graduate of Australian Institute of
Company Directors (GAICD). Mrs
Korsanos is also a Member of Chief
Executive Women, a Non-executive
Director of Treasury Wine Estates
Limited, Executive Vice Chair of
Scientific Games and former Non-
executive Director of Ardent Leisure
Group Limited and Webjet Limited.
Board and Board Committee
memberships:
• Chair of Crown Sydney Gaming Pty
Ltd
• Chair of the Audit and Corporate
Governance Committee
• Chair of the People, Remuneration
and Nomination Committee
• Director of Crown Melbourne Limited
• Member of the Responsible Gaming
Committee
• Member of the Risk Management
Committee
• Member of the Safety and
Sustainability Committee
Directorships of other Australian
listed companies held during the
past three years:
• Treasury Wine Estates Limited April
2020 to current.
• Ardent Leisure Group Limited from
July 2018 to June 2020.
• Webjet Limited from June 2018 to
March 2021.
Antonia Korsanos
BEc, CA, GAICD
Non-executive Director
Crown Resorts Limited Annual Report 2021
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Directors’ Statutory Report
Nigel Morrison was appointed to the
Crown Resorts Board on 31 March
2021. Mr Morrison has had an extensive
career in the casino industry from 1993
to 2016. From 2008 to 2016, Mr
Morrison was the Managing Director and
Chief Executive of SkyCity Entertainment
Group Limited, listed on both the
Australian and New Zealand stock
exchanges, which owned and operated
the Auckland casino in New Zealand
and the Adelaide and Darwin casinos in
Australia.
Prior to joining SkyCity, Mr Morrison
served as Group Chief Financial Officer
of Galaxy Entertainment Group Limited
in Hong Kong, Chief Executive of The
Federal Group in Tasmania and as Chief
Financial Officer and Chief Operating
Officer of Crown Limited in Melbourne.
Mr Morrison was a Corporate Advisory
Partner of Ernst and Young in Melbourne
prior to his career in the casino industry.
During that time, Mr Morrison played a
key role in the formation of the Crown
consortium and its successful bid to win
the Melbourne casino licence. Upon
winning the licence Mr Morrison was
invited to join Crown Limited as one of
its first employees in 1993.
Mr Morrison holds a Bachelor of
Commerce from the University of
Melbourne, is a graduate of the INSEAD
Advanced Management Program, is a
Fellow of CPA Australia and a graduate
of the Securities Institute of Australia. Mr
Morrison was formerly an Associate of
the Institute of Chartered Accountants in
Australia, an Associate of the Institute of
Arbitrators in Australia and formerly a
Fellow of the Institute of the Australian
Institute of Directors.
Board and Board Committee
memberships:
• Chair of Crown Melbourne Limited
• Member of the Audit and Corporate
Governance Committee
• Member of the People, Remuneration
and Nomination Committee
• Member of the Responsible Gaming
Committee
• Member of the Safety and
Sustainability Committee
Directorships of other Australian
listed companies held during the
past three years:
• Nil.
Nigel Morrison
B.Com, FCPA
Non-executive Director
Bruce Carter was appointed to the
Crown Resorts Board on 25 August
2021. Mr Carter is an experienced
company director and corporate advisor,
having worked across a broad range of
industries in both the public and private
sectors over the past 40 years. Mr
Carter is currently chair of the Australian
Submarine Corporation and Aventus
Capital, and holds directorships with the
Bank of Queensland and AIG Australia.
Mr Carter was previously deputy chair of
SkyCity Entertainment Group, where he
oversaw the expansion development at
SkyCity Adelaide. Mr Carter was a
director of Connecticut based global
railroad operator Genesee and Wyoming
Inc until its takeover by Brookfield.
During Mr Carter’s Executive career, he
co-founded Ferrier Hodgson in Adelaide,
and was previously at Ernst & Young for
14 years, working in the United States,
United Kingdom, Canada and Hong
Kong. Mr Carter has also been involved
in a number of government reviews and
economic advisory bodies at a state and
federal level.
Board and Board Committee
memberships:
• Chair of Burswood Limited (subject to
regulatory approval)
• Director of Crown Melbourne Limited
• Member of the Risk Management
Committee
Directorships of other Australian
listed companies held during the
past three years:
• Bank of Queensland Limited from
February 2014 to current.
• Aventus Holdings Limited from June
2015 to current.
• SkyCity Entertainment Group Limited
from October 2010 to March 2021.
Bruce Carter
B.Econ. MBA, FAICD, FICA
Non-executive Director
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Directors’ Statutory Report
Alan F McGregor
B.Com, CA
Chief Financial Officer and Interim
Company Secretary
Company Secretary Details
Alan McGregor was appointed to the
role of Chief Financial Officer of Crown
with effect from 20 August 2020. Mr
McGregor was appointed as Interim
Company Secretary of Crown on
18 February 2021.
Mr McGregor has a strong casino
background, having first joined Crown in
April 2005 as General Manager
Corporate Services at Crown Perth
(formerly Burswood Entertainment
Complex) and progressing to the role of
Chief Financial Officer of Crown Perth
in 2007.
Mr McGregor then moved to Melbourne
in April 2013 to assume the role of Chief
Financial Officer – Crown Melbourne,
before taking the collective role of Chief
Financial Officer – Australian Resorts
which he held from August 2014 until his
most recent appointment in August
2020.
Prior to joining Crown, Mr McGregor
worked for SkyCity Entertainment Group
for seven years in various finance roles.
Mr McGregor holds a Bachelor of
Commerce from the University of
Auckland and is a member of Chartered
Accountants of Australia and
New Zealand.
Relevant Interests of Directors
Details of relevant interests of Directors in Crown shares as at 30 June 20211 were as follows:
Director
Total number of
ordinary shares
The Hon. Helen Coonan2
10,000
Jane Halton AO PSM
948
Antonia Korsanos
10,000
Nigel Morrison
-
Bruce Carter
-
1 For more information on relevant interests of current Directors, please refer to the Remuneration Report.
2 Ms Coonan ceased being a Director on 27 August 2021.
Crown Resorts Limited Annual Report 2021
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Directors’ Statutory Report
Board and Committee Meetings
Set out below are details of the number of Board meetings and Committee meetings held by Crown during the 2021
financial year and the number of meetings attended by each Director.
Board
Meetings
Audit and
Corporate
Governance
Committee
Meetings
Corporate
Responsibility
Committee
Meetings*
People,
Remuneration
and Nomination
Committee
Meetings
Responsible
Gaming
Committee
Meetings
Risk Management
Committee
Meetings
Safety &
Sustainability
Committee
Meetings
A
B
A
B
A
B
A
B
A
B
A
B
A
B
H A Coonan1
46
46
-
-
2
1
5
5
2
2
2
2
1
1
J S Horvath AO2
36
35
-
-
2
2
9
9
4
4
-
-
2
2
K M Barton3
25
25
-
-
-
-
-
-
-
-
-
-
-
-
J H Alexander4
10
9
-
-
-
-
-
-
-
-
-
-
-
-
A Demetriou5
22
22
-
-
-
-
-
-
3
3
3
3
-
-
S J Halton AO PSM
46
45
5
5
-
-
5
5
2
2
5
5
1
1
G Jalland6
21
21
-
-
-
-
-
-
-
-
-
-
-
-
M R Johnston7
21
21
3
3
-
-
3
3
-
-
2
2
1
1
A Korsanos
46
45
5
5
-
-
6
6
5
5
5
5
1
1
H C Mitchell AC8
27
27
-
-
2
2
9
9
-
-
-
-
-
-
J Poynton AO9
27
22
-
-
-
-
-
-
-
-
-
-
2
2
N Morrison10
12
12
1
1
-
-
5
5
2
2
-
-
1
1
A – The number of meetings held during the time the Director held office, or was a member of the Committee during the year
B – Number of meetings attended
* Committee dissolved on 17 February 2021
(-) Dash – Not a member of the relevant Committee
1.
Ms Coonan ceased being a Director of Crown and its Committees on 27 August 2021.
2.
Professor Horvath ceased being a Director of Crown and its Committees on 14 April 2021.
3.
Mr Barton ceased being a Director of Crown and its Committees on 15 February 2021.
4.
Mr Alexander ceased being a Director of Crown and its Committees on 22 October 2020.
5.
Mr Demetriou ceased being a Director of Crown and its Committees on 11 February 2021.
6.
Mr Jalland ceased being a Director of Crown and its Committees on 10 February 2021.
7.
Mr Johnston ceased being a Director of Crown and its Committees on 10 February 2021.
8.
Mr Mitchell ceased being a Director of Crown and its Committees on 22 February 2021.
9.
Mr Poynton ceased being a Director of Crown and its Committees on 28 February 2021.
10. Mr Morrison was appointed as a Director on 31 March 2021.
Under Crown’s Constitution and its Board and Committee Charters, documents containing written resolutions assented to
by Directors are to be taken as a minute of a meeting of Directors or of a Committee (as the case may be). The Board
assented to eight written resolutions, the Audit and Corporate Governance Committee assented to one resolution and the
People, Remuneration and Nomination Committee assented to five written resolutions in the 2021 financial year.
Shares and Options
As at the date of this Report, Crown has 7.175 million unquoted options on issue (as set out below), as well as 429,520
performance right on issue (as set out below). Each option or right is granted over one fully paid ordinary share in Crown. In
addition, Crown Digital Holdings Pty Ltd (Crown Digital Holdings) (a wholly owned subsidiary of Crown) has 8,513,980
unquoted options on issue, each of which has been granted over one fully paid ordinary share in Crown Digital Holdings (as
set out below).
In April 2017, Crown issued 14 million options under the 2017 Senior Executive Incentive Plan to a small number of Senior
Executives. The options, with an expiry date of 22 February 2021, were granted with an initial exercise price of $11.43. The
exercise price of $11.43 per option may be varied over the life of the plan to take into account the value of any capital returns
and special dividends. All options issued under the 2017 Senior Executive Incentive Plan have lapsed unexercised on 22
February 2021.
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Directors’ Statutory Report
In August 2018, Crown issued an additional 7.175 million
options under the 2017 Senior Executive Incentive Plan to a
small number of Senior Executives. The options, with an
expiry date of 8 August 2022, were granted with an initial
exercise price of $13.35. The exercise price of $13.35 per
option may be varied over the life of the plan to take into
account the value of any capital returns and special
dividends.
In December 2018, Crown Digital Holdings issued 8,513,980
options to Mr Ken Barton under the Crown Digital Senior
Executive Option Plan. Each option has been granted over
one fully paid ordinary share in Crown Digital Holdings. The
options, with an expiry date of 19 December 2022, were
granted with an exercise price of $1.45. As Mr Ken Barton
was a good leaver, the Crown Digital Senior Executive
Option Plan continues to apply to Mr Ken Barton.
In respect of the Crown Digital Senior Executive Incentive
Plan, if Crown Digital Holdings undertakes a bonus issue of
shares during the term of the options, holders are entitled,
upon exercise of an option, and without payment of any
further consideration, to the number of Crown Digital
Holdings shares the holder would have received under that
bonus issue. If Crown Digital undertakes a pro rata issue of
shares during the term of the options, then the exercise price
of each option will be reduced in accordance with the Crown
Digital Senior Executive Incentive Plan Rules. No shares or
interests have been issued during FY21 or since year end as
a result of option exercise.
In June 2021, Crown issued 429,520 Sign-on Performance
Rights in a new plan to a small number of Senior Executives.
The Sign-on Performance Rights will vest three years after
issue, subject to the relevant Senior Executive being
employed on the vesting date or if terminated by Crown
without cause within the three-year period.
Indemnity and Insurance of Officers and
Auditors
Director and Officer Indemnities
Crown indemnifies certain persons as detailed in its
Constitution in accordance with the terms of the Crown
Constitution.
Directors’ and Officers’ Insurance
During the year Crown has paid insurance premiums to
insure officers of the Crown group against certain liabilities.
The insurance contract prohibits disclosure of the nature of
the insurance cover and the amount of the insurance
premiums payable.
Indemnification of Auditors
To the extent permitted by law, Crown has agreed to
indemnify its auditors, KPMG, as part of the terms of its audit
engagement agreement against claims by third parties
arising from the audit (for an unspecified amount). No
payment has been made to indemnify KPMG during or since
the end of the financial year.
Auditor Information
Auditor Details
KPMG was Crown’s auditor for the 2021 financial year.
Ms Rachel Milum was the KPMG partner responsible for
the audit of Crown’s accounts for the year ended 30 June
2021.
Non-Audit Services
Details of the amounts paid or payable to KPMG for
non-audit services provided during the year by the auditor
are outlined in note 25 of the Financial Report. Crown
acquired non-audit services from KPMG largely relating to
R&D tax services, modern slavery & human rights advice
services and payments times reporting consulting services.
Based on advice received from the Audit and Corporate
Governance Committee, the Directors are satisfied that the
provision of non-audit services during the 2021 financial
year by KPMG is compatible with, and did not compromise,
the general standard of independence for auditors imposed
by the Corporations Act 2021 (Cth) for the following
reasons:
• all non-audit services have been reviewed by the Audit
and Corporate Governance Committee to ensure that
they did not impact the impartiality and objectivity of the
auditor; and
• none of the services involved reviewing or auditing the
auditor’s own work or acting in a management decision-
making capacity for the Company.
Rounding
The amounts contained in this report and in the financial
report have been rounded to the nearest hundred thousand
dollars unless otherwise stated under the option available
to Crown Resorts Limited (Crown or the Company) under
ASIC Corporations (Rounding in Financial/Directors’
Reports) Instrument 2016/191. Crown is an entity to which
this Instrument applies.
Remuneration Report
The Remuneration Report set out on pages 73 to 95 forms
part of this Directors’ Statutory Report.
Crown Resorts Limited Annual Report 2021
73
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Remuneration Report
This Remuneration Report for the year ended 30 June 2021 outlines the Director and Executive remuneration
arrangements of Crown in accordance with the requirements of the Corporations Act 2001 (Cth) (Corporations Act) and the
Corporations Regulations 2001 (Cth). For the purposes of this Report, key management personnel (KMP) of the Crown
Group are defined as those persons having authority and responsibility for planning, directing and controlling the major
activities of the Crown Group, directly or indirectly, including any Director (whether Executive or otherwise) of Crown
Resorts Limited.
Contents
1. Introduction
76
2. Overview of FY21 Remuneration Policy & Framework
78
3. Our focus for FY21 and FY22
79
4. Remuneration structure for Senior Executives
82
5. Fees for Non-executive Directors
89
6. Additional Key Management Personnel Disclosures
92
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Remuneration Report CONTINUED
Letter from the Chair of the People, Remuneration and
Nomination Committee
Dear Shareholders,
On behalf of the Crown Resorts Limited (Crown) Board, I am pleased to present the Remuneration Report for the year
ended 30 June 2021 (FY21). As well as an explanation of the remuneration framework, performance and remuneration
outcomes for Crown in FY21, the Remuneration Report includes context on our critical people and cultural reform program
which forms part of the company’s broader reform agenda.
As outlined earlier in the Annual Report, there has been continued scrutiny on Crown’s operations and governance through
ongoing regulatory investigations and Royal Commissions during the financial year. From consultation we undertook
following our FY20 AGM, we understand these concerns were the overarching contributor to receiving a first ‘strike’ on our
FY20 Remuneration Report, with 34.34% of votes cast against the report. The Board understands shareholders’ concerns
related to governance, oversight and compliance and has taken action to reform our organisation in FY21 and beyond. We
have also updated our disclosures in this Remuneration Report to improve transparency on our approach to our evolving
people and culture changes.
FY21 Focus
In the context of these significant challenges, Crown has implemented ongoing initiatives designed to reform Crown’s
culture and the way we operate. The company has the capability, momentum and commitment to continue these initiatives
through FY22 and beyond. In FY21 the following changes have been made and programs initiated:
• Leadership renewal through material change to the Board and senior leadership team. During the year, our
Chairman, Ms Helen Coonan assumed the role of Executive Chairman while we undertook a search for a new CEO. We
were pleased to announce the appointment of Mr Steve McCann, an experienced executive, as Group CEO and MD,
subject to probity and regulatory approval, effective from 1 June 2021. Other key executive appointments and changes
are outlined in section 3. There has also been a renewal of the Board, with the departure of six Non-executive Directors
and two Executive Directors in FY21. All remaining Non-executive Directors are independent, and no shareholder
nominees remain on the Board. During the year we welcomed Mr Nigel Morrison to the Board. Mr Bruce Carter joined
the Board, initially as an Observer while awaiting probity and regulatory approval (subsequently approved in August
2021);
• Organisation changes to deliver the highest standards of governance and oversight by elevating the financial
crime, compliance, risk, internal audit and responsible gaming functions to a Group level with direct reporting
relationships to the Board; and
• Initiation of a comprehensive cultural reform program, including an independent review of Crown’s organisational
culture. This reform program is in progress and will address shortcomings in Crown’s culture identified through the
regulatory reviews and Royal Commissions.
Further detail of our focus for FY21 is outlined in section 3 of this report.
FY21 Performance and remuneration outcomes
As a Board, we carefully consider our approach to the assessment of performance and subsequent determination of
remuneration outcomes. Our business performance outcomes in FY21 were impaired by numerous lockdowns due to the
COVID-19 pandemic, with operating restrictions occurring outside these shutdowns. The Crown Group’s financial
performance was down this year compared to FY20, with Theoretical EBITDA before Closure Costs and Significant Items
of $241.7 million down 52.0% and Reported EBITDA of $114.1 million down 77.4%. Given the uncertainty of the impact of
the COVID-19 pandemic and the ongoing regulatory investigations on Crown, and the material change to the senior
leadership team, in FY21 the Board did not issue invitations to Senior Executives to participate in either the short term
incentive (STI) or long term incentive (LTI) Plans. Accordingly, no STI payments or LTI grants were made in relation to FY21.
While all 2017 options held by Senior Executives in the Senior Executive Incentive Plan vested during FY21, all options
lapsed unexercised. Therefore, no Senior Executive received any value from the vesting of options.
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Remuneration Report
FY22 and beyond
The Board is committed to maintaining momentum on the reform agenda in FY22 to make Crown a stronger, more
transparent and respected company, which includes and is underpinned by our efforts to continue to embed cultural
change throughout the organisation. We are also reviewing our executive remuneration framework to represent our new
purpose and values and align to the expectations placed on us by the community, regulators and governments, customers
and shareholders. Revisions to our remuneration framework include introducing new compliance and risk gatekeeper
provisions prior to any consideration of incentive payments and the introduction of deferred equity for our Senior Executive
STI Plan arrangements.
In line with our continued focus on leadership renewal, on 26 August 2021 we announced Dr Ziggy Switkowski AO will
commence as Chairman of the Board in FY22 and on 27 August 2021 Ms Coonan retired from the Board. Pending receipt
of Dr Switkowski’s regulatory approvals, Crown Non-executive Director Ms Jane Halton AO PSM will act as Interim
Chairman. To facilitate the Board renewal, we are proposing an increase in the Non-executive Directors’ fee cap, subject to
shareholder approval, to account for the increased number of independent Non-executive Directors expected to be serving
on the Crown Board in the future. The resolution to increase the fee cap is not being sought to increase the current fees
payable to Non-executive Directors. More information is available in section 5 of this report and further details will be
provided in the FY21 Notice of Meeting.
The Committee is responsible for oversight of all people and culture matters being driven through the reform agenda, as
well as engagement, diversity and inclusion. We encourage and seek open dialogue with our shareholders and other
stakeholders, including our employees, and welcome feedback and comments. On behalf of the Board, we look forward to
discussions with our shareholders and their advisors on this report including our remuneration approach.
Sincerely,
Toni Korsanos
Chair of the People,
Remuneration and Nomination Committee
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Remuneration Report
1. Introduction
Persons to Whom Report Applies
The remuneration disclosures in this Report cover the following Key Management Personnel (KMP):
Current KMP as at 30 June 2021
Name
Position
Term as KMP
Non-executive Directors
The Hon. Helen A Coonan
Chairman
Until 14 February 20211
Jane Halton AO PSM
Non-executive Director
Full financial year
Antonia Korsanos
Non-executive Director
Full financial year
Nigel Morrison
Non-executive Director
From 31 March 2021
Executive Director
The Hon. Helen A Coonan
Executive Chairman
From 15 February 2021
Other Company Executives and Key Management Personnel
Lonnie Bossi
Chief Executive Officer - Crown Perth (CEO - Perth)
From 9 December 2020
Peter Crinis
Chief Executive Officer - Crown Sydney (CEO - Sydney)
From 1 January 2021
Alan McGregor
Chief Financial Officer (CFO) and Interim Company Secretary2
From 20 August 2020
Xavier Walsh
Chief Executive Officer - Crown Melbourne (CEO - Melbourne)
From 9 December 2020
1 Ms Coonan was Chairman prior to her appointment as Executive Chairman effective 15 February 2021.
2 Mr McGregor was appointed as the Interim Company Secretary effective 18 February 2021.
The appointment of Bruce Carter as a Non-executive Director, subject to all necessary regulatory approvals, was announced
on 12 April 2021. Mr Carter has been an Observer on the Board since the announcement and formally joined the Board in
FY22 having received the necessary approvals effective from 25 August 2021.
The appointment of Steve McCann as Chief Executive Officer (CEO) and Managing Director, subject to probity and regulatory
approval, was announced on 10 May 2021. While Mr McCann joined Crown effective 1 June 2021, he is unable to assume
the full CEO role until approvals are obtained.
Mr McCann and Mr Carter have not been KMP during FY21 as they have not performed KMP duties prior to probity and
regulatory approvals and are not included in the statutory disclosures in this Report. However, for completeness, an overview
of Mr McCann’s remuneration arrangements has been outlined in this Report’s voluntary disclosures.
The following changes to KMPs and incoming KMPs have occurred since the end of FY21 and prior to the release of this
Report:
• Xavier Walsh retired from his role as CEO - Crown Melbourne effective 20 August 2021 and will remain with Crown in a
non-KMP capacity until his cessation of employment on 9 December 2021;
• Steve McCann was appointed CEO - Crown Melbourne in addition to his role as CEO (regulatory approvals pending)
effective 20 August 2021;
• Peter Crinis is due to retire from his role as CEO - Crown Sydney effective from 31 December 2021;
• Helen Coonan retired from the Board and as Executive Chairman on 27 August 2021;
• Dr Ziggy Switkowski AO was appointed as Chairman (regulatory approvals pending) on 27 August 2021; and
• Jane Halton AO PSM will act as Interim Chairman until receipt of Dr Switkowski’s approvals.
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Former KMP
Name
Position
Term as KMP
Non-executive Directors
Professor John S Horvath AO
Deputy Chairman
Until 14 April 2021
Andrew Demetriou
Non-executive Director
Until 11 February 2021
Guy Jalland
Non-executive Director
Until 10 February 2021
Michael R Johnston
Non-executive Director
Until 10 February 2021
Harold C Mitchell AC
Non-executive Director
Until 22 February 2021
John H Poynton AO
Non-executive Director
Until 28 February 2021
Executive Directors
John H Alexander
Executive Director
Until 22 October 20201
Ken M Barton
Chief Executive Officer and Managing Director
Until 15 February 20212
Other Company Executives and Key Management Personnel
Barry Felstead
Chief Executive Officer - Australian Resorts
Until 9 December 20203
W Todd Nisbet
Executive Vice President - Strategy and Development
Until 30 June 2021
1 Mr Alexander remained as an Executive of Crown in a non-KMP capacity until January 2021.
2 Mr Barton entered into a fixed term consultancy agreement from 8 March 2021. See section 4.7 for further information.
3 Mr Felstead remained as an Executive of Crown in a non-KMP capacity until 31 December 2020.
In this Report, the group of persons comprised in the categories of Executive Directors and Other Company Executives
(listed above) are collectively referred to as “Senior Executives”.
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Remuneration Report
2. Overview of FY21 Remuneration Policy and Framework
Crown’s FY21 remuneration policy framework supports Crown’s purpose and values and is outlined below. For Senior
Executives, remuneration is structured to reflect the individual’s role in the business, individual and company performance
and market context. Crown is reviewing our executive remuneration framework for FY22 to represent our new purpose and
values and align to the expectations placed on us by the community, regulators and governments, our customers and
shareholders. Please refer to section 4.3 for further details.
FY21 Remuneration Principles
Attract, retain and motivate in
leadership positions of the
highest calibre
Providing a clear and direct
link between remuneration and
performance
Ensuring remuneration
packages are competitive and
properly reflect a person’s
duties and responsibilities
The Board
• The process for determining remuneration of the
Non-executive Directors and Senior Executives has the
objective of ensuring maximum benefit for Crown by
attracting and retaining a high quality Board and senior
leadership team.
Senior Executives
• Senior Executives assist the Board and the Committee
in providing information relevant to remuneration
decisions and making recommendations to the
Committee.
• Remuneration information is obtained from external
advisors by the Senior Executives to assist the
Committee.
• The remuneration structure for Senior Executives
incorporates a mix of fixed and performance based
remuneration. Refer to section 4.1 for an overview of
the fixed and performance based elements of Executive
remuneration.
People, Remuneration and Nomination
Committee
• Details regarding the People, Remuneration and
Nomination Committee (Committee) and its main
objectives are outlined in the 2021 Corporate
Governance Statement.
• The Committee is comprised of independent Non-
Executive Directors and is subject to the direction and
control of the Board.
• The Committee determines the appropriate
remuneration for Non-executive Directors and Senior
Executives. Non-executive Directors’ fees are reviewed
periodically with reference to the fees paid to the
Non-executive Directors of comparable companies.
Senior Executives’ remuneration is reviewed annually.
Refer to section 4.1 for more details.
• The Committee may elect to receive advice from
independent remuneration consultants.
Remuneration Consultants and External
Advisors
• Remuneration consultants and external advisors
provide information relevant to remuneration decisions
and may make recommendations to the Committee.
Crown obtains remuneration information from external
advisors to assist the Committee.
• During FY21, Crown obtained information from Egan
Associates on market practices and advice from Egan
Associates as part of Crown’s review of market
remuneration practices and trends.
• In FY21, Crown did not receive any remuneration
recommendations from a remuneration consultant as
defined by the Corporations Act 2001 (Cth).
Crown Resorts Limited Annual Report 2021
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Remuneration Report
3. Our Focus for FY21 and FY22
FY21 has continued to be a year of significant challenge in the context of the COVID-19 pandemic and the impact of
operating restrictions on our business, together with the ongoing regulatory review and processes as outlined in the letter
from the Chair of the People, Remuneration and Nomination Committee.
Following the first ‘strike’ on our 2020 Remuneration Report, the Board has engaged with regulators, investors and proxy
advisors to understand key concerns and respond to feedback. The overarching feedback received from the consultation
were concerns largely unrelated to remuneration, such as how the Crown Group was operating and the level of
governance, oversight and compliance. In response to this feedback and ongoing discussions with regulators, including
the release of findings in February from the Bergin inquiry, the Board has focused in FY21 on driving transformation and
remediation to ensure Crown is a more transparent and respected company. We have made significant changes to the
organisation and our leadership to improve governance and oversight, including new operating structures, reporting lines,
capabilities and enhanced resourcing across the business. We are also revising our remuneration structures to improve
alignment between remuneration and our reform agenda. Outlined below are the key changes that have been made in
FY21 and the focus areas for FY22 to maintain momentum in reforming the business.
Changes made in FY21 and FY22
Culture reform
FY21 Changes
• Crown launched a set of new values in FY19. The values were incorporated into the Crown Code of
Conduct issued in July 2020 and the Crown Risk and Compliance Culture Framework issued in
March 2021.
• A comprehensive culture reform program was initiated in August 2020. An aspect of the program
involves a review by Deloitte into Crown’s organisational culture. Deloitte undertook fieldwork,
including focus groups, internal and external interviews and observations to further explore key
culture themes. In conjunction with the review, leadership forums lead by the Executive Leadership
team have taken place to review and revise the purpose and values of Crown. A revised set of
values and renewed purpose have been developed to form Crown’s ethical compass and
aspirational culture as a roadmap for cultural change.
Focus for FY22
• The Board will oversee and play a key role in the cultural change to be driven by the new CEO and
new Chief People and Culture Officer.
• The culture reform program has included the design of the organisation’s new aspirational culture
which incorporates the renewed purpose and values.
• The aspirational culture has been established based on feedback obtained from staff and key
stakeholders via the culture survey, focus group discussions and interviews.
• Communication and engagement of the aspirational culture, the renewed purpose and values and
the culture change plan to our staff and key stakeholders commenced in August 2021.
• A detailed action plan to drive the required change has been developed with implementation
commencing in September 2021.
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Changes made in FY21 and FY22
Organisation
change
FY21 Changes
• Crown implemented an organisational restructure, including elevated reporting lines for compliance
and financial crime, and risk and internal audit, together with the implementation of a ‘three lines of
defence’ governance model.
– Creation of a new Group Compliance and Financial Crime and Group Human Resources
function, separation of Risk and Internal Audit functions, separation of General Counsel and
Company Secretary roles.
– Appointment of a Chief Risk Officer role which has an elevated reporting line directly to the CEO
and a reporting line to the Risk Management Committee.
– Appointment of an independent Group General Manager - Internal Audit. This role reports
administratively to the CFO and functionally to the Audit and Corporate Governance Committee.
• Increase in Anti-Money Laundering / Counter-Terrorism Financing (AML/CTF) capability, including
significant further investment in people, systems, processes and training.
• Other key changes are:
– Transition to an Australian-based VIP model, with closure of all overseas offices and an
Australian-based business development function; and
– Cessation of dealings with junkets.
Focus for FY22
• Oversee that all elements of the changes announced in FY21 are implemented effectively and that
the overall organisational structure cohesively supports the realisation of our purpose and strategic
objectives.
• Our organisational structure, with new capabilities and enhanced resources, will balance the needs
of our customers, communities, regulators, and all stakeholders at the local level. It will also
maintain a cohesive, efficient and collaborative operation across the Crown Group.
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Changes made in FY21 and FY22
Leadership
changes
FY21 Changes
The People, Remuneration and Nomination Committee has overseen material changes in the
composition of the Board and Executive leadership team:
• All remaining Non-executive Directors are independent, with no major shareholder nominees.
• Helen Coonan became Chairman in January 2020 and Executive Chairman following the departure
of Ken Barton in February 2021. Nigel Morrison was formally appointed to the Board in March
2021. It was announced in April 2021 that Bruce Carter will join the Board and he was formally
appointed to the Board in August 2021 following receipt of regulatory approvals.
• Eight directors left the Board between October 2020 and April 2021.
– Executive Directors: John Alexander and Ken Barton (former CEO); and
– Non-executive Directors: Andrew Demetriou, John Hovarth (former Deputy Chairman), Guy
Jalland, Michael Johnston, Harold Mitchell and John Poynton.
• Changes in the organisational structure to separate the Risk and Compliance functions have
resulted in two of Crown’s Senior Executive roles being made redundant: Barry Felstead (CEO
- Australian Resorts) and Joshua Preston (Chief Legal Officer - Australian Resorts).
• In late February 2021, Steve Blackburn commenced as the Chief Compliance and Financial Crime
Officer. Mr Blackburn has substantial AML/CTF experience and expertise.
• In early March 2021, Nick Weeks was appointed as the Executive General Manager, Transformation
& Regulatory Response. He has carriage of the remediation plan and is responsible for overseeing
its implementation.
• In June 2021, the following Senior Executives joined Crown (subject to regulatory approvals):
– Steve McCann was appointed Group CEO;
– Tony Weston joined the group in the new role of Chief People and Culture Officer; and
– Betty Ivanoff commenced in the role of Group General Counsel.
Focus for FY22
• The Board continues to focus on its Board renewal strategy with the objective of independent
Non-executive Board representation.
• It was announced on 26 August 2021 that Dr Ziggy Switkowski AO will succeed Helen Coonan as
Chairman, subject to the receipt of probity and regulatory approvals. Ms Coonan retired from the
Board and as Executive Chairman on 27 August 2021.
Remuneration
reform
Focus for FY22
• Crown is in the process of developing a revised executive remuneration structure. As part of this,
Crown will introduce values-based gatekeeper provisions and mandatory compliance and risk key
performance indicators. Mercer recently reviewed Crown’s remuneration framework, with feedback
received in July 2021 which Crown will consider in developing these remuneration structures.
• Introduction of a new Long Term Incentive Plan for Senior Executives to be developed in FY22.
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Remuneration Report
4. Remuneration Structure for Senior Executives
Senior Executives’ remuneration is comprised of fixed remuneration and performance-based remuneration. This section
provides further details on the different elements of the Senior Executives’ remuneration structure.
4.1. FY21 elements of remuneration
Element
Objective
Approach
Fixed
remuneration
Provide a base level of
remuneration which is
appropriate to the Senior
Executive’s responsibilities, the
geographic location of the
Senior Executive and
competitive conditions in the
appropriate market.
Fixed remuneration is set with reference to available market
data, the scope and any unique aspects of an individual’s role
and having regard to the qualifications and experience of the
individual. From time to time, Crown seeks a range of specialist
advice to help establish the competitive remuneration for its
Senior Executives.
Fixed remuneration typically includes base salary and
superannuation and other non-cash benefits. This represents
the total employment cost (TEC) of the relevant Senior
Executive to Crown.
Senior Executives’ fixed remuneration is subject to annual
review. Any increases require approval of the CEO (except in
relation to the CEO) and the People, Remuneration and
Nomination Committee. Increases are dependent on the
individual’s Key Performance Objectives (KPOs), performance
and market changes.
Performance
based
remuneration
Align the rewards attainable by
Senior Executives with the
achievement of particular annual
and long term objectives of
Crown, achieving risk and
compliance hurdles and the
creation of shareholder value
over the short and long term.
The Short Term Incentive Plan is based on the achievement of
the Crown Group’s annual business plan and budget and the
Senior Executive achieving their KPOs.
In FY21, no Short Term Incentive or long term incentive grants
were given. For more information, refer to section 4.2.
For the Short Term Incentive Plan in FY22, Crown will introduce
values-based gatekeeper provisions and a heavier weighting to
non-financial metrics that will include mandatory compliance
and risk key performance indicators.
In FY22, a new Long Term Incentive Plan will be implemented
to replace the legacy Long Term Incentive Plans. Refer to
section 4.3 for more information on both the Short Term and
Long Term Incentive Plans for FY22.
4.2. Details of performance-based remuneration elements
Short Term Incentives (STI)
The remuneration of Senior Executives is linked to Crown’s short term annual performance through a cash based STI.
Senior Executives have a potential or target STI, which is subject to the Crown Group’s performance and the achievement
of the Senior Executive’s KPOs established at the beginning of each financial year. No Senior Executives were invited to
participate in the STI plan in FY21 and therefore no Senior Executives received an STI payment in FY21 (refer to section
4.5). For an explanation on the changes to the STI plan for FY22, please refer to section 4.3.
Long Term Incentives (LTI)
Senior Executive Incentive Plan and Crown Digital Incentive Plan
In FY21, no new LTI grants were awarded under the Senior Executive Incentive Plan or Crown Digital Incentive Plan. The
LTIs which vested during FY21 from previous grants in FY17 under the Senior Executive Incentive Plan lapsed on 22
February 2021. For more information on these legacy plans, please refer to section 4.8.
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It is the company’s intention to introduce a new LTI plan for Senior Executives in FY22. Please refer to section 4.3 for further
information.
Sign-on Performance Rights for the CEO
As outlined on 10 May 2021, Crown issued Sign-on Performance Rights in a new plan to the incoming CEO, Steve
McCann. The one-off grant of 400,000 Performance Rights was issued on 1 June 2021 and is subject to shareholder
approval at Crown’s 2021 AGM and other conditions, including the incoming CEO receiving and maintaining all regulatory
and probity approvals. These Performance Rights will vest three years after commencement, subject to Mr McCann being
employed on the vesting date, or if terminated by Crown without cause, within the three-year period. The Sign-on
Performance Rights will also vest if a “Fundamental Change” occurs pursuant to a transaction that results in a substantial
diminution to the CEO’s role, including where he is no longer the CEO of an Australian publicly listed company.
These Sign-on Performance Rights will be subject to the same terms and conditions of a new LTI plan to be determined by
the Board of Crown. Mr McCann may instead receive the cash equivalent of the Sign-on Performance Rights at the vesting
date if approval of Crown shareholders has not been obtained for the grant of the Sign-on Performance Rights.
Senior Executive
Grant date
Number of rights granted
Vesting date
Steve McCann
1 June 2021
400,000
1 June 2024
Given the grant of Sign-on Performance Rights, Mr McCann will not participate in the new LTI plan described in section 4.3
until the commencement of FY23.
4.3. Changes to remuneration structure in FY22
The People, Remuneration and Nomination Committee conducts comprehensive market reviews of remuneration for
executive roles when deemed appropriate. The review includes all key components of Crown’s remuneration structure and
also considers market trends in the context of the existing approach to remuneration and the strategy of Crown moving
forward. The Committee has recommended to the Board adjustments to the framework are required to ensure it remains fit
for purpose and focuses the Senior Executives’ efforts on the long term strength of the Company. Accordingly, in relation
to Senior Executives’ remuneration arrangements for FY22, Crown will develop and introduce a new, equity-based Long
Term Incentive Plan that will be offered to Senior Executives. In addition, Crown will introduce a heavier weighting on
values-based hurdles and mandatory compliance and risk key performance indicators to the plan with the intention to drive
and promote behaviours aligned to our aspirational culture.
The following section outlines the already determined changes to the FY22 remuneration structure to current Senior
Executives’ fixed remuneration and additional details on future variable remuneration.
Remuneration mix
The following diagrams illustrate the remuneration mix of the CEO and CFO for FY22. As mentioned in section 4.2,
incoming CEO, Mr McCann, will receive no LTI grant in FY22 as he has been granted Sign-on Performance Rights in FY21.
In FY23, the CEO’s remuneration mix will change to include LTI.
CEO - Maximum
CFO - Maximum
Fixed Remuneration
STI (Maximum - Immediate)
STI (Maximum - Deferred)
LTI (Maximum)
Fixed Remuneration
STI (Maximum - Immediate)
STI (Maximum - Deferred)
50%
25%
50%
19%
6%
25%
25%
The FY22 remuneration mix for other senior executives will be confirmed following the development of the new
remuneration structure.
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Future remuneration quantum
The remuneration quantum for the incoming CEO and current CFO is outlined in the below table. The graphs above
indicate which remuneration components are available to Senior Executives in FY22. For information on Mr Bossi, Mr Crinis
and Mr Walsh’s remuneration arrangements, refer to section 4.7.
Fixed remuneration
per annum1
STI maximum % of
fixed remuneration
STI maximum ($)
LTI grant value as
% of fixed
remuneration
LTI grant value ($)
Senior Executives (Current and Incoming)
Steve McCann2
$2,500,000
100%
$2,500,000
100%
$2,500,000
Alan McGregor
$1,100,000
50%
$550,000
50%
$550,000
1 Figures are inclusive of superannuation.
2 For Mr McCann, the LTI will apply from FY23.
STI Plan
It is Crown’s intention to invite Senior Executives to participate in a revised STI Plan in FY22. The FY22 Plan will introduce
values-based gatekeeper provisions and a heavier weighting on non-financial metrics that will include mandatory
compliance and risk key performance indicators. The details of this Plan are currently being developed by the Board of
Crown. Further details of the revised STI Plan, including the KPOs set for Senior Executives based on their level of influence
or responsibility, will be provided in the 2022 Annual Report.
LTI Plan
Senior Executives will be granted LTI awards under a new Performance Rights Plan. The details of this Plan are currently
being developed by the Board of Crown. The proposed LTI grant value for CEO and CFO is outlined in the above table.
Vesting of the LTI Performance Rights will be subject to a relative test based on Crown Resorts’ total shareholder return
(TSR) compared to comparable ASX Listed companies, or one or more ASX indices (Comparator Group). No LTI
Performance Rights will vest unless Crown’s TSR meets the 50th percentile of the Comparator Group at the relevant
vesting date. Further details will be provided in the 2022 Annual Report.
4.4. Relationship between remuneration outcomes and company performance
As detailed above in the sections on Fixed Remuneration and Performance Based Remuneration, various elements of
Crown’s Remuneration Policy are linked to company performance; in particular, the achievement of Crown’s Board
approved Annual Budget and Business Plan (in the case of STI), and in the legacy LTI plans, an increase in the value of
Crown shares or the Crown Digital portfolio. This section outlines the Company’s historical company performance and
relationship to remuneration outcomes for Senior Executives. It is Crown’s intention to revise the remuneration structure in
FY22 to strengthen the linkage between remuneration outcomes and company performance.
Historical performance
The table below sets out information about movements in shareholder wealth from FY17 to FY21. We have simplified the
table to focus on components relevant to shareholders. A consolidated full year dividend figure has been provided, along
with the removal of EBITDA and NPAT.
Year Ended
30 June 2017
Year Ended
30 June 2018
Year Ended
30 June 2019
Year Ended
30 June 2020
Year Ended
30 June 2021
Share price at start of period
$12.61
$12.28
$13.50
$12.45
$9.67
Share price at end of period
$12.28
$13.50
$12.45
$9.67
$11.91
Full year dividend
143.0 cents
60.0 cents
60.0 cents
30.0 cents
0 cents
Basic earnings per share
- Normalised1 (cents)
47.26
56.16
54.19
23.78
(12.43)
Basic earnings per share -
Actual (cents)
257.03
81.16
59.07
11.74
(38.63)
1. Normalised results have been adjusted to exclude the impact of any variances from theoretical win rate on VIP program play (at Crown Melbourne,
Crown Perth, Crown Aspinalls, and Melco Resorts and Entertainment Limited (MRE)), significant items and closure costs.
Crown Resorts Limited Annual Report 2021
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4.5. STI and LTI outcomes for Senior Executives
2021 STI remuneration outcomes
Due to the uncertainty of the impact of the COVID-19 pandemic, the ongoing regulatory investigations on Crown and the
material changes to the composition of the senior leadership team, no Senior Executives were invited to participate in the
STI plan in FY21. It is the Board’s intention to invite Senior Executives to participate in the STI in FY22. Please refer to
section 4.3 for further information on changes being introduced to the STI plan to increase accountability.
2021 LTI remuneration outcomes
This table shows the outcomes of LTI that vested during FY21. As all options issued in FY17 under the Senior Executive
Incentive Plan lapsed, no value was realised by Senior Executives in their LTI plans. For LTI plans still on foot, please refer to
section 4.8.
Plan name
Performance
measure
Number of
options
awarded
Accounting
value per
option ($)
Expiry
date
Number of
options
vested
Number of
options
exercised
Number of
options
lapsed
Former Senior Executives
John Alexander
Senior
Executive
Incentive
Plan (2017)
Service /
good leaver
5,000,000
$0.53
22 Feb
2021
5,000,000
0
5,000,000
Ken Barton
Senior
Executive
Incentive
Plan (2017)
Service /
good leaver
3,000,000
$0.53
22 Feb
2021
3,000,000
0
3,000,000
Barry Felstead
Senior
Executive
Incentive
Plan (2017)
Service /
good leaver
3,000,000
$0.53
22 Feb
2021
3,000,000
0
3,000,000
Todd Nisbet
Senior
Executive
Incentive
Plan (2017)
Service /
good leaver
3,000,000
$0.53
22 Feb
2021
3,000,000
0
3,000,000
4.6 Take home remuneration
The statutory table in section 6 is prepared in accordance with the requirements of the Corporations Act and the Australian
Accounting Standards and does not reflect amounts actually received by the Senior Executives during the relevant financial
year. Current Senior Executives is defined as at 30 June 2021. The following table sets out the remuneration which was
received during FY21 for each Senior Executive (note: remuneration for Mr Bossi, Mr Crinis, Mr McGregor and Mr Walsh is
presented for the period for which they served as KMP).
Remuneration is comprised of fixed remuneration, the STI referable to the previous financial year but which was received
after the end of the financial year, and the Long Term Incentives exercised in the relevant financial year. No STIs were
awarded for both FY20 and FY21. The termination benefits received by former Senior Executives comprise of payment in
lieu of notice and severance pay associated with their former positions being made redundant. This information is provided
as it is considered to be of interest to the users of this Report.
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Remuneration Table - Senior Executives take home remuneration
Financial
Year
Fixed
remuneration
($)
Non
Monetary1
($)
Other
benefits2
($)
STI
($)
LTI
($)
Super-
annuation
($)
Termination
benefits3
($)
Total
($)
Current Senior Executives
Lonnie Bossi
CEO - Perth
2021
574,724
-
-
-
-
10,847
-
585,571
Peter Crinis
CEO - Sydney
2021
614,153
-
-
-
-
10,847
-
625,000
Alan McGregor
CFO
2021
893,002
8,588
-
-
-
21,694
-
923,284
Xavier Walsh
CEO - Melbourne
2021
686,505
-
-
-
-
10,847
-
697,352
Former Senior Executives
John Alexander
Former Executive
Director
2021
1,984,752
-
-
-
-
16,271
-4
2,001,023
2020
3,559,988
2,560
4,785
-
-
21,003
-
3,588,336
Ken Barton
Former CEO and MD
2021
1,985,537
22,274
-
-
-
16,271
3,350,1285
5,374,210
2020
2,489,587
78,650
-
-
-
21,003
-
2,589,240
Barry Felstead
Former Chief
Executive Officer
- Australian Resorts
2021
1,157,991
3,458
-
-
-
10,847
3,206,2896
4,378,585
2020
2,231,531
126,012
-
-
-
21,003
-
2,378,546
Todd Nisbet
Former Executive Vice
President - Strategy &
Development
2021
2,327,862
391,367
430,893
-
-
21,694
3,117,6817
6,289,497
2020
2,231,531
321,590
392,995
-
-
21,003
-
2,967,119
2021 TOTALS
10,224,526
425,687
430,893
-
-
119,318
9,674,098
20,874,522
2020 TOTALS
10,512,637
528,812
397,780
-
-
84,012
-
11,523,241
1 Non-monetary benefits include salary packaged benefits, including motor vehicles, car parking, other salary sacrificed items and FBT payable on these items.
2 Other benefits include customary expatriate benefits and relocation benefits for Mr Nisbet.
3 Termination benefits include payment of notice period (in lieu) and redundancy on cessation of employment in accordance with contractual entitlements.
4 Mr Alexander’s annual leave accrual was $985,215 and his long service leave accrual was $774,206. Mr Alexander was employed by Crown for 13 years and
6 months (6 July 2007 - 22 January 2021). As leave payments were not termination benefits, they are not reflected in the above table.
5 Mr Barton’s termination benefits are comprised of a payment in lieu of 12 months’ notice of $2,430,000 and 16 weeks’ redundancy payment of $920,128.
Mr Barton was employed by Crown for 10 years and 11 months (9 March 2010 - 15 February 2021). In addition, Mr Barton received the following payments for
accrued leave: annual leave $918,492 and long service leave $546,720. As leave payments were not termination benefits, they are not reflected in the above
table.
6 Mr Felstead’s termination benefits are comprised of a payment in lieu of 12 months’ notice of $2,305,500 and 20 weeks’ redundancy payment of $900,789.
Mr Felstead was employed by Crown for 26 years and 3 months (7 September 1994 - 31 December 2020). In addition, Mr Felstead received the following
payments for accrued leave: annual leave $1,584,074 and long service leave $1,027,141. As leave payments were not termination benefits, they are not
reflected in the above table.
7 Mr Nisbet’s termination benefits are comprised of a payment in lieu of 12 months’ notice of $2,394,741 and 16 weeks’ redundancy payment of $722,941.
Mr Nisbet was employed by Crown for 13 years and 9 months (1 October 2007 - 30 June 2021). In addition, Mr Nisbet received the following payments for
accrued leave: annual leave $991,474 and his long service leave $425,141. Leave payments were not termination benefits, and are not reflected in the figures in
the above table.
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4.7 Terms of Senior Executives’ service agreements
Senior Executives are employed under employment agreements with Crown or a subsidiary of Crown. In addition to the
terms of the service agreements outlined in the tables below, all Senior Executives are entitled to complimentary privileges
at Crown Melbourne, Crown Perth and Crown Sydney facilities.
Additionally, Crown may ask Senior Executives to act as a Director of a member or associate of the Crown Group for no
additional remuneration.
Senior Executives are prohibited from gambling at any property within the Crown Group during the term of employment
and for a period following termination and a requirement that the Senior Executive maintains licences required and issued
by relevant regulatory authorities (such as the Victorian Commission for Gambling and Liquor Regulation, Western
Australian Gaming and Wagering Commission and the New South Wales Independent Liquor and Gaming Authority).
The tables below outline the contractual details for current and former Senior Executives who are or were employed under
employment agreements with Crown or a subsidiary of Crown. Helen Coonan served as Executive Chairman from
February 2021. In addition to her Chairman fees, she received $1,800,000 per annum for her temporary Executive
Chairman role with no performance-based pay. Refer to section 5 for further information on Ms Coonan’s Non-executive
Director remuneration and entitlements she received as a Non-executive Director.
Senior Executives as at 30 June 2021
Term
Alan McGregor
CFO
Xavier Walsh
CEO - Melbourne
Peter Crinis
CEO - Sydney
Lonnie Bossi
CEO - Perth
Contract type
Ongoing
Ongoing
Ongoing
Ongoing
Tenure as at
30 June 2021
16 years and
2 months
(from 18 April 2005)
12 years and
7 months
(from 3 November
2008)
23 years and
11 months
(from 7 July 1997)
27 years and
3 months
(from 7 March 1994)
Notice periods for termination
By Senior Executive
12 months
12 months
12 months
6 months
By Crown
12 months,
without notice for
serious breach or
misconduct
12 months
12 months
12 months
Post-employment
benefits
Nil
Nil
Nil
Nil
Post-employment
restraint period
12 months
12 months
12 months
12 months
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Former Senior Executives as at 30 June 2021
Term
John Alexander
Former Executive
Director
Ken Barton
Former CEO and MD
Barry Felstead
Former CEO -
Australian Resorts
Todd Nisbet
Former Executive
Vice President -
Strategy & Development
Contract type
Fixed term for
12 months from
24 January 20201
Ongoing
Ongoing
Ongoing
Tenure
13 years and
6 months
(6 July 2007 -
22 January 2021)
10 years and
11 months
(9 March 2010 -
15 February 2021)
26 years and
3 months
(7 September 1994
- 31 December 2020)
13 years and 8 months
(1 October 2007 -
30 June 2021)
Notice periods for
termination
By Senior Executive
4 weeks
12 months
12 months
12 months
By Crown
Without cause at any
time with payment
amounting to
remainder of
employment term,
without notice or
payment for serious
breach or misconduct
12 months, without
notice for serious
breach or misconduct
12 months’ notice
without cause, one
month’s notice for
performance issues,
three months’ notice
due to incapacity
12 months’ notice
without cause, one
month’s notice for
performance issues,
three months’ notice
due to incapacity
Termination
benefits2
Nil
Nil
Nil
Nil
Post-employment
benefits
Nil
Nil
Nil
Nil
Post-employment
restraint period
Up to 12 months
Up to 12 months
Up to 12 months
Up to 12 months
1 Mr Alexander’s previous contract with Crown Resorts Limited as Executive Chairman had no fixed term.
2 No further termination benefits are payable under the terms of the former Senior Executive agreements.
Following Mr Barton’s separation from Crown on 15 February 2021, Mr Barton entered into a fixed term consultancy
agreement with Crown effective from 8 March 2021 and concluding on 8 September 2021 via Popo Fibib Pty Limited to
assist with transition arrangements to the Executive Chairman and new CEO and the ongoing regulatory investigations.
4.8 Additional information
Legacy Plans
Crown has two legacy LTI plans in place. The Senior Executive Incentive Plan and the Crown Digital Senior Executive Plan
both sought to assist in the reward, retention and motivation of relevant Senior Executives, to link the reward to shareholder
value creation and to align the interests of relevant Senior Executives with shareholders. Further details on the Senior
Executive Incentive Plan and the Crown Digital Senior Executive Incentive Plan issued to KMP is outlined in the 2020
Remuneration Report.
Senior Executive Incentive Plan
The Senior Executive Incentive Plan sought to reward and retain those Senior Executives who had a primary responsibility
for delivering Crown’s key strategic priorities over the plan period. In 2017, the plan participants were Mr Alexander, Mr
Barton, Mr Felstead and Mr Nisbet, who were all issued with options with a four-year term from their date of issue. As Mr
Alexander, Mr Barton and Mr Felstead were all good leavers at the time of the options’ expiry, the plan continued to apply.
All options issued under the 2017 plan have lapsed unexercised on 22 February 2021. In FY19, Mr Bossi, Mr Crinis, Mr
McGregor and Mr Walsh were participants in the plan in their former non-KMP roles as outlined in the table below. The
options have an Exercise Price of $13.35 per option and are subject to a single Vesting Condition, being continued
employment with a member of Crown Group until the options’ expiry date. For further details please refer to section 6.
Crown Resorts Limited Annual Report 2021
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Plan name
Performance
measure
Number of
options
awarded
Accounting
value per
option
Expiry
date
Number of
options
vested
Current Senior Executives as at 30 June 2021
Lonnie Bossi
Senior
Executive
Incentive Plan
(2019)
Service
640,000
$0.73
8 August 2022
-
Peter Crinis
Senior
Executive
Incentive Plan
(2019)
Service
650,000
$0.73
8 August 2022
-
Alan
McGregor
Senior
Executive
Incentive Plan
(2019)
Service
395,000
$0.73
8 August 2022
-
Xavier Walsh
Senior
Executive
Incentive Plan
(2019)
Service
765,000
$0.73
8 August 2022
-
Crown Digital Senior Executive Incentive Plan
The Crown Digital Incentive Plan provided the offer and issue of options to Mr Barton which may be settled with Crown
Digital Holdings Pty Ltd (Crown Digital Holdings) shares. The options have an Exercise Price of $1.45 per option and are
subject to a single Vesting Condition, being the continued employment of the relevant participant for four years after the
grant date, or the classification of the Senior Executive as a good leaver at the expiry date. As Mr Barton was a good
leaver, the plan continues to apply to Mr Barton, with no other senior executives having outstanding awards from this plan.
Plan name
Performance
measure
Number of
options
awarded
Accounting
value per
option
Expiry
date
Number of
options
vested
Former Senior Executives
Ken Barton
Crown Digital
Incentive Plan1
Service /
good leaver
8,513,980
$0.10
19 Dec
2022
-
1 Ken Barton’s options under the Crown Digital Incentive Plan will vest on the vesting date as he was a ‘good leaver’, and will remain on foot until the
expiry date.
Loans for Incentive Plans
For the LTI plans described above, each participant was required to pay a fee equal to the market value of the options
through an Acquisition Loan advanced by the Crown Group. Please refer to section 6 for further information on Acquisition
Loans.
5. Fees for Non-executive Directors
Non-executive Directors
Non-executive Directors are entitled to a base fee per annum for acting as a Director of Crown.
No performance-based fees are paid to Non-executive Directors. Non-executive Directors are not entitled to participate in
Crown’s incentive plans and are not provided with retirement benefits other than statutory superannuation at the rate
prescribed under the Superannuation Guarantee (Administration) Act 1992 (Cth) (Superannuation Legislation).
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Non-executive Directors acting on the Board of Crown Melbourne Limited, Burswood Limited (i.e. Crown Perth) and Crown
Sydney Gaming Pty Ltd are entitled to receive a further fee in respect of that service. Non-executive Directors of Crown are
entitled to additional fees if they act as either Chair or a Member of an active Committee.
All Directors are entitled to complimentary privileges at Crown Melbourne, Crown Perth and Crown Sydney facilities.
The Chairman and Deputy Chairman fees are all-inclusive fees and no additional fees are payable for participation on any
Board Committee or Subsidiary Board.
Non-executive Directors’ fees which applied during FY21 were as follows:
Non-executive Director Role
Fees1
Chairman Fee:
$700,000
Deputy Chairman Fee2:
$350,000
Base Board Fees:
$170,000
Active Board Committees:
- Audit and Corporate Governance Committee
- Safety and Sustainability Committee
- People, Remuneration and Nomination Committee
- Responsible Gaming Committee
- Risk Management Committee
Chair
Member
$25,000
$15,000
Subsidiary Boards:
- Crown Melbourne Limited Board
- Crown Sydney Gaming Pty Ltd Board
- Burswood Limited Board
Chair
Member
$115,000
$60,000
– 80,000
1 In FY21, all fees paid to Non-executive Directors were inclusive of superannuation.
2 John Hovarth AO, Deputy Chairman, ceased as a Director of Crown on 14 April 2021. The role of Deputy Chairman has not been replaced on the Board.
In accordance with Crown’s Constitution, Non-executive Directors’ fees in FY21 were within the aggregate Non-executive
Directors’ Fee cap of $2,500,000 per annum.
Crown is undergoing substantial change and the refresh of the Board with a full complement of independent Non-executive
Directors is critical to the success of Crown’s transformation and remediation journey, as recommended by inquiries and
supported by public statements by Crown and the Executive Chairman. As part of this refresh, the Board has recently
appointed three new independent Non-executive Directors: Mr Nigel Morrison, Mr Bruce Carter and Dr Ziggy Switkowski.
To enable the Board to continue to attract and retain quality, high-calibre independent Non-executive Directors with a broad
range of skills, experience and expertise particularly during this period of challenges, Crown is seeking shareholder
approval for an increase in the fee cap by $500,000 to $3,000,000 per annum. The proposed new fee cap takes into
account the increased number of independent Non-executive Directors expected to be serving on the Crown Board in the
future. It also enables flexibility in considering the recommendations arising from regulatory investigations relating to
Crown’s governance practices and structures. The resolution to increase the fee cap is not being sought to increase the
current fees payable to Non-executive Directors. Further information will be available in the FY21 Notice of Meeting.
Other payments
Helen Coonan served as Executive Chairman from February 2021 until her retirement from the Board on the 27 August
2021. In this role, she performed CEO duties while a search for a new CEO was underway. Refer to section 4.7 for her
remuneration received as Executive Chairman. Ms Coonan’s remuneration as Executive Chairman relates to executive
duties and is not included in the Non-executive Directors’ fee cap. Ms Coonan did not receive any variable rewards in
relation to her role as Executive Chairman.
Non-executive Directors are not able to be formally appointed as KMP until regulatory approval is obtained. In FY21, both
Mr Morrison and Mr Carter were Observers on the Board from the period their appointment was announced until approval
was obtained. The Board has determined that an Observer fee equivalent to $170,000 per annum will be paid on a pro-rata
basis during the period Non-executive Directors are an Observer. This payment is not included in the Non-executive
Directors’ fee pool and will be made in FY22.
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Remuneration Report
Executive Chairman and NED remuneration
Set out below is a table showing Non-executive Director remuneration for FY21. During 2020, the Non-executive Directors
took a 20% reduction in fees from 16 April 2020 to 30 June 2020 in response to the impact of the COVID-19 pandemic on
Crown. Fees resumed to normal levels on 1 July 2020.
Helen Coonan received separate remuneration for her Executive duties and Chairman role, and the amount attributable to
each role is detailed below.
Remuneration Table – Non-executive Directors
Short Term Benefits
Post-
employment
Supe-
rannuation
Benefit
$
Long Term Incentives
Financial
Year
Fees
$
Executive
Salary
$
Non
Mon-
entary
$
Other
$
Cash
Based
$
Equity
Based
$
Ter-
mination
Benefits
$
Subotal
$
Current Executive Chair and Non-Executive Directors
Helen Coonan1
Chairman
2021
678,306
652,500
-
-
21,694
-
-
-
1,352,500
2020
416,932
-
-
-
20,502
-
-
-
437,434
Jane Halton AO PSM
Non-executive Director
2021
317,654
-
-
-
21,694
-
-
-
339,348
2020
231,622
-
-
-
18,295
-
-
-
249,917
Antonia Korsanos
Non-executive Director
2021
291,559
-
-
-
27,343
-
-
-
318,902
2020
241,351
-
-
-
22,451
-
-
-
263,802
Nigel Morrison2
Non-executive Director
2021
61,021
-
-
-
5,797
-
-
-
66,818
Former Non-executive Directors
Andrew Demetriou3
Non-executive Director
2021
178,596
-
-
-
16,967
-
-
-
195,563
2020
209,560
-
-
-
19,908
-
-
-
229,468
John Horvath AO4
Deputy Chairman
2021
258,665
-
-
-
17,452
-
-
-
276,117
2020
315,458
-
-
-
21,003
-
-
-
336,461
Guy Jalland5
Non-executive Director
2021
-
-
-
-
-
-
-
-
-
2020
-
-
-
-
-
-
-
-
-
Michael Johnston5
Non-executive Director
2021
-
-
-
-
-
-
-
-
-
2020
-
-
-
-
-
-
-
-
-
Harold Mitchell AC6
Non-executive Director
2021
131,431
-
-
-
12,725
-
-
-
144,156
2020
179,321
-
-
-
16,651
-
-
-
195,972
John Poynton AO7
Non-executive Director
2021
189,300
-
-
-
10,700
-
-
-
200,000
2020
238,012
-
-
-
14,243
-
-
-
252,255
Geoffrey Dixon8
Non-executive Director
2020
66,667
-
-
-
6,333
-
-
-
73,000
2021 TOTALS (NEDs Only)
2,106,532
-
-
-
134,372
-
-
-
2,240,904
2021 TOTALS (Executive Role)
-
652,500
-
-
-
-
-
-
652,500
2020 TOTALS
1,898,923
-
-
-
139,386
-
-
- 2,038,309
1 Refer to section 4.7 for further details on Ms Coonan’s Executive Chairman role.
2 Mr Morrison was appointed as a Director of Crown on 31 March 2021. Mr Morrison was an Observer on the Board from the period his appointment was
announced until approval was obtained. The Board has determined that an Observer fee equivalent to $170,000 per annum will be paid on a pro-rata
basis during the period Non-Executive Directors are an Observer. The same applied for Mr Carter.
3 Mr Demetriou ceased as a Director of Crown on 11 February 2021.
4 Professor Horvath ceased as a Director of Crown on 14 April 2021.
5 Mr Jalland and Mr Johnston ceased as Directors of Crown on 10 February 2021. Mr Jalland and Mr Johnston did not receive remuneration from Crown
for their participation as Non-executive Directors of Crown.
6 Mr Mitchell ceased as a Director of Crown on 22 February 2021.
7 Mr Poynton ceased as a Director of Crown on 28 February 2021.
8 Mr Dixon ceased as a Director of Crown on 24 October 2019.
92
Remuneration Report CONTINUED
Remuneration Report
6 Additional Key Management Personnel Disclosures
Remuneration Table – Statutory
Financial
Year
Short Term Benefits
Post-
employment
Benefits-
Superannuation3
($)
Long Term Incentives
Total
($)
Salary &
Fees
($)
Non
Monetary1
($)
Other2
($)
STI
($)
% of
target
STI
Cash
Based
($)
Senior
Executive
Incentive Plan
- 20174
($)
Senior
Executive
Incentive
Plan - 20195
($)
Senior
Executive
Incentive
Plan - Crown
Digital6
($)
Fringe Benefits
Tax Applicable
to the Senior
Executive
Incentive Plans
($)
Termination
Benefits7
($)
Current Senior Executives as at 30 June 2021
Lonnie Bossi8
CEO - Perth
2021
574,724
-
-
-
0%
10,847
-
-
65,541
-
14,099
-
665,211
Peter Crinis8
CEO - Sydney
2021
614,153
-
-
-
0%
10,847
-
-
59,549
-
12,810
-
697,359
Alan McGregor8, 9
CFO
2021
893,002
8,588
-
-
0%
21,694
-
-
62,461
-
13,437
-
999,182
Xavier Walsh8
CEO - Melbourne
2021
686,505
-
-
-
0%
10,847
-
-
78,342
-
16,853
-
792,547
Former Senior Executives
John Alexander
Former
Executive Director
2021
1,984,752
-
-
-
0%
16,271
-
383,381
-
-
135,535
-
2,519,939
2020
3,559,988
2,560
4,785
-
0%
21,003
-
657,225
-
-
168,735
-
4,414,296
Ken Barton
Former CEO
2021
1,985,537
22,274
-
-
0%
16,271
-
230,029
-
551,679
113,954
3,350,128
6,269,872
2020
2,489,587
78,650
-
-
0%
21,003
-
394,335
-
220,672
137,749
-
3,341,996
Barry Felstead
Former CEO
- Australian Resorts
2021
1,157,991
3,458
-
-
0%
10,847
-
230,029
-
-
81,321
3,206,289
4,689,935
2020
2,231,531
126,012
-
-
0%
21,003
-
394,335
-
-
101,241
-
2,874,122
Todd Nisbet
Former Executive
2021
2,327,862
391,367
430,893
-
0%
21,694
-
230,029
-
-
81,321
3,117,681
6,600,847
Vice President
- Strategy &
Development
2020
2,231,531
321,590 392,995
-
0%
21,003
-
394,335
-
-
101,241
-
3,462,695
2021 TOTALS
10,224,526
425,687
430,893
-
-
119,318
-
1,073,468
265,893
551,679
469,330
9,674,098
23,234,892
2020 TOTALS
10,512,637
528,812 397,780
-
-
84,012
-
1,840,230
-
220,672
508,966
- 14,093,109
1 Non-monetary benefits include salary packaged benefits, including motor vehicles, car parking, other salary sacrificed items and FBT payable on these items.
2 Other benefits include customary expatriate benefits and relocation benefits for Mr Nisbet.
3 Post-employment Benefits - Superannuation are the Superannuation entitlements receiving by the relevant Senior Executives during the relevant financial year.
4 The 2017 options under the Senior Executive Incentive Plan vested on 22 February 2021. All 2017 options lapsed unexercised.
5 The 2019 options under the Senior Executive Incentive Plan have been included in total remuneration on the basis that it is considered more likely than not that, at the date of this Report, the vesting condition will occur.
6 No Crown Digital Senior Executive Incentive Plan options were granted in FY21. Mr Barton’s options granted in FY19 remain on foot as he was considered a good leaver at cessation of employment. The Crown Digital Plan has
been included in total remuneration on the basis that it is considered more likely than not that, at the date of this Report, the vesting condition will occur.
7 All former executives were good leavers and received termination payments in lieu of notice and redundancy payments on cessation of employment in accordance with contractual entitlements. Refer to Take home remuneration
table in section 4.6 footnotes 4-7 for a breakdown of these payments.
8 Remuneration for Mr Bossi, Mr Crinis, Mr McGregor and Mr Walsh is presented for the period for which they served as KMP.
9 In addition to his fixed remuneration, Mr McGregor will receive a $200,000 one off payment (which may be varied at the Board’s discretion) in respect of his role as Interim Company Secretary, payable once Mr McGregor ceases to
act as Company Secretary.
Crown Resorts Limited Annual Report 2021
93
Remuneration Report
Shareholdings of Key Management Personnel
Set out below is a summary of equity instruments held directly, indirectly or beneficially by KMPs, close family or controlled
entities.
30 June 2021
Non-executive Directors
Directors
Balance
1 July 2020
Other
net change1
On leaving
Crown
Balance
30 June 2021
Current Executive Chair and Non-executive Directors
Helen A Coonan
10,000
-
-
10,000
Jane Halton AO PSM
948
-
-
948
Antonia Korsanos
10,000
-
-
10,000
Nigel Morrison
-
-
-
-
Former Directors
Harold Mitchell AC2
114,887
-
114,887
-
John Poynton AO3
1,000
-
1,000
-
1 Other net change represents the acquisition or sale of Crown Shares by Crown Executives.
2 Mr Mitchell ceased as a Director on 22 February 2021.
3 Mr Poynton ceased as a Director on 28 February 2021.
Crown Senior Executives
Executives
Balance
1 July 2020
Other
net change1
On leaving
Crown
Balance
30 June 2021
Current Executives
Lonnie Bossi
-
-
-
-
Peter Crinis
-
-
-
-
Alan McGregor
-
-
-
-
Xavier Walsh
-
-
-
-
Former Executives
John Alexander2
399,557
-
399,557
-
Ken Barton3
143,128
-
143,128
-
Barry Felstead
178,374
-
178,374
-
Todd Nisbet
244,531
-
244,531
-
1 Other net change represents the acquisition or sale of Crown Shares by Crown Executives.
2 Mr Alexander ceased as a Director on 22 October 2020.
3 Mr Barton ceased as a Director on 15 February 2021.
30 June 2020
Crown Non-executive Directors
Non-executive Directors
Balance 1 July 2019
Other net change Balance 30 June 2020
Jane Halton AO PSM
948
-
948
Helen A Coonan1
-
10,0001
10,000
Antonia Korsanos
10,000
-
10,000
Harold Mitchell AC
114,887
-
114,887
John Poynton AO
1,000
-
1,000
1 As required by the ASX Listing Rules, Ms Coonan provided Crown with an Appendix 3Y detailing her change in interests in Crown shares on 2 March
2020.
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Remuneration Report CONTINUED
Remuneration Report
Crown Senior Executives
Executives
Balance 1 July 2019
Other net change
Balance 30 June 2020
John Alexander
399,557
-
399,557
Ken Barton
143,128
-
143,128
Barry Felstead
178,374
-
178,374
Todd Nisbet
229,531
15,000
244,531
Senior Executive Option Holdings
Set out below is a summary of Options held directly, indirectly or beneficially by KMPs, close family or controlled entities.
Senior
Executives
Balance
1 July 2020
Options
granted
Other
net
change
Balance
30 June 2021
Options
vested
during year
Options
exercised
during year
Options
lapsed
during the
year
Current Executives as at 30 June 2021
Lonnie Bossi
640,000
-
-
640,000
-
-
-
Peter Crinis
650,000
-
-
650,000
-
-
-
Alan McGregor
395,000
-
-
395,000
-
-
-
Xavier Walsh
765,000
-
-
765,000
-
-
-
Former Executives
John Alexander
5,000,000
-
-
-
5,000,000
-
5,000,000
Ken Barton
11,513,9801
-
-
8,513,980
3,000,000
-
3,000,000
Barry Felstead
3,000,000
-
-
-
3,000,000
-
3,000,000
Todd Nisbet
3,000,000
-
-
-
3,000,000
-
3,000,000
1 Includes 3,000,000 options over Crown Shares issued to Mr Barton under the 2017 Senior Executive Incentive Plan and 8,513,980 options over Crown
Digital shares issued to Mr Barton under the Crown Digital Incentive Plan.
Loans to Key Management Personnel
As noted above, options under the 2019 Incentive Plan and Crown Digital Incentive Plan were issued to the Senior
Executives for a fee equal to the market value at the date they were originally agreed to be issued (i.e. 8 August 2018 ($0.83
per option (Fee)) and 19 December 2018 ($0.09 per option (Fee)) respectively). Each relevant Senior Executive paid the Fee
for the issue of the options through an Acquisition Loan advanced by Crown.
The Acquisition Loan is repayable on the exercise, lapse, cancellation or forfeiture of the options financed by the Acquisition
Loan. No interest is payable on the Loan.
The repayment amount of the Acquisition Loan is the lesser of the outstanding amount of the loan and:
• the market value of the Crown shares to be delivered on exercise; or
• in the case of a buy-back, the market value of the option; or
• in the case of lapse, cancellation or forfeiture, nil.
Crown Resorts Limited Annual Report 2021
95
Remuneration Report
The Senior Executives who have been granted an Acquisition Loan and the value of that Acquisition Loan are as follows:
Current Senior Executives as at 30 June 2021
2019 Senior Executive Incentive Plan Acquisition Loan Value
Lonnie Bossi
$531,200
Peter Crinis
$539,500
Alan McGregor
$327,850
Xavier Walsh
$634,950
Former Senior Executives
Crown Digital Incentive Plan Acquisition Loan Value
Ken Barton
$765,407
As all 2017 options issued under the Senior Executive Incentive Plan have lapsed, nil repayment was required and the
below acquisition loans have been cancelled.
Former Senior Executives
2017 Senior Executive Incentive Plan Acquisition Loan Value
John Alexander
$3,543,300
Ken Barton
$2,125,980
Barry Felstead
$2,125,980
Todd Nisbet
$2,125,980
There have been no other loans made, guaranteed or secured, directly or indirectly by the Company or any of its
subsidiaries in the reporting period in relation to KMPs, close family or controlled entities.
Transactions entered into with Key Management Personnel
Other than as has been disclosed in Note 28 of the Financial Report, there have been no transactions entered into during
the reporting period between the Company or any of its subsidiaries and KMPs, close family and controlled entities.
96
Auditor’s Independence Declaration CONTINUED
Auditor’s Independence Declaration
Auditor’s Independence Declaration
kpmg
©2021 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms
affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.
The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global
organization. Liability limited by a scheme approved under Professional Standards Legislation.
Lead Auditor’s Independence Declaration under
Section 307C of the Corporations Act 2001
To the Directors of Crown Resorts Limited
I declare that, to the best of my knowledge and belief, in relation to the audit of Crown Resorts Limited
for the financial year ended 30 June 2021 there have been:
i.
no contraventions of the auditor independence requirements as set out in the
Corporations Act 2001 in relation to the audit; and
ii.
no contraventions of any applicable code of professional conduct in relation to the audit.
KPMG
Rachel Milum
Partner
Sydney
9 September 2021
Crown Resorts Limited Annual Report 2021
97
Independent Auditor’s Report
Independent Auditor’s Report
kpmg
©2021 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms
affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.
The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global
organisation. Liability limited by a scheme approved under Professional Standards Legislation.
Independent Auditor’s Report
To the shareholders of Crown Resorts Limited
Report on the audit of the Financial Report
Opinion
We have audited the Financial Report of Crown
Resorts Limited (the Company).
In our opinion, the accompanying Financial Report
of the Company is in accordance with the
Corporations Act 2001, including:
•
giving a true and fair view of the Group’s
financial position as at 30 June 2021 and of its
financial performance for the year ended on
that date; and
•
complying with Australian Accounting
Standards and the Corporations Regulations
2001.
The Financial Report comprises:
• Statement of financial position as at
30 June 2021;
• Statement of profit or loss, Statement of
comprehensive income, Statement of changes
in equity, and Cash flow statement for the
year then ended;
• Notes including a summary of significant
accounting policies; and
• Directors’ Declaration.
The Group consists of the Company and the
entities it controlled at the year-end or from time
to time during the financial year.
Basis for opinion
We conducted our audit in accordance with Australian Auditing Standards. We believe that the audit
evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Our responsibilities under those standards are further described in the Auditor’s responsibilities for the
audit of the Financial Report section of our report.
We are independent of the Group in accordance with the Corporations Act 2001 and the ethical
requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for
Professional Accountants (including Independence Standards) (the Code) that are relevant to our audit of
the Financial Report in Australia. We have fulfilled our other ethical responsibilities in accordance with the
Code.
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Material uncertainty related to Going Concern
We draw attention to Note 1.1, “Going Concern” in the financial report. The conditions disclosed in Note
1.1 indicate a material uncertainty exists that may cast significant doubt on the Group’s ability to continue
as a going concern and, therefore, whether it will realise its assets and discharge its liabilities in the normal
course of business, and at the amounts stated in the financial report. Our opinion is not modified in
respect of this matter.
In concluding there is a material uncertainty related to going concern we evaluated the extent of
uncertainty regarding events or conditions casting significant doubt on the Group’s assessment of going
concern, with particular attention paid to potential impacts and changes resulting from COVID-19 and the
ongoing legal and regulatory matters. These procedures included:
Analysing the cash flow projections by:
•
Evaluating the underlying data used to generate the projections for consistency with other information
tested by us, our understanding of the Group’s intentions, and past results and practices;
•
Assessing the planned levels of operating and capital expenditures for consistency of relationships
and trends to the Group’s historical results, particularly in light of recent loss-making operations
impacted by COVID-19, results since year end, and our understanding of the business, industry and
expected economic conditions impacting the Group;
•
We specifically evaluated and checked the cash flow projections were updated for COVID-19
implications to the business based on credible and authoritative sources, for consistency with other
information tested by us, our understanding of the Group’s intentions, and past results and practices.
We specifically assessed this against our understanding of plans prepared by management/Directors
in response to anticipated ongoing COVID-19 impacts. Critical elements considered included the
potential for further/future impacts to the Group, an estimated rate of recovery, and expectations of
a return to historical levels of trading activity;
•
Assessing significant non-routine forecast cash inflows and outflows including the impact of the
Crown Sydney apartment sales and, where possible, the potential outcomes of the legal and
regulatory matters as disclosed in note 24 for feasibility, quantum and timing. We used our
knowledge of the Group, its industry and our understanding of the current status of legal and
regulatory matters to assess the level of associated uncertainty, which we consider to be fundamental
to readers of the Group’s financial report;
•
Assessing the forecast financial impact of uncertain future events, including COVID-19 and, where
possible, potential outcomes of the legal and regulatory matters and implications for adherence to
covenants and conditions, against the requirements of the Group’s financing agreements as at
30 June 2021;
•
In connection with the review of the Group’s cash flow forecast and consideration of available
financing, we evaluated the terms of the existing financing agreements, changes to the maturity of
existing debt facilities and additional debt facilities put in place by the Group subsequent to
30 June 2021. We also evaluated the impact of the terms of the waivers agreed subsequent to
30 June 2021 and considered the residual uncertainties; and
•
Evaluating the Group’s going concern disclosures in the financial report by comparing them to our
understanding of the matter and the COVID-19, legal and regulatory implications for the Group, the
events or conditions incorporated into the cash flow projections, the Group’s plans to address those
events or conditions, and accounting standard requirements. We specifically focused on the principal
matters giving rise to the material uncertainty.
Independent Auditor’s Report CONTINUED
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kpmg
Key Audit Matters
In addition to the matters described in the
Material uncertainty related to going concern
section, we have determined the matters
described below to be the Key Audit
Matters:
• Provisions and contingent liabilities –
estimation uncertainty; and
• Valuation of goodwill and intangible
assets.
Key Audit Matters are those matters that, in our
professional judgement, were of most significance
in our audit of the Financial Report of the current
period.
These matters were addressed in the context of our
audit of the Financial Report as a whole, and in
forming our opinion thereon, and we do not provide
a separate opinion on these matters.
Provisions and contingent liabilities – estimation uncertainty (Legal and regulatory matters)
Refer to Note 24 of the financial report
The key audit matter
How the matter was addressed in our audit
Provisions and contingent liabilities as they relate to
legal and regulatory matters are a key audit matter.
Applying AASB 137 Provisions, Contingent
Liabilities and Contingent Assets (AASB 137)
requires significant judgement for each of the
fundamental principles. The principles we
considered were:
1. Does a present obligation exist;
2. If so, can it be reliably measured, leading to
recording a provision; and
3. If not, a contingent liability is reported with
sufficient information disclosed to provide
the users of the financial statements with
an understanding of the matter and where
practical the uncertainties and potential
timing.
When assessing ongoing legal and regulatory
matters, as compared to known contractual
liabilities, these principles are complex and prone to
greater uncertainty.
The Group has a number of significant pending and
ongoing legal disputes and regulatory investigations,
the status of which remain open with no known or
certain quantifications. Given the nature and status
of these matters, and the uncertainty associated
with each matter, we focused our effort on how the
Group complied with the requirements of the
Working with our various specialists our
procedures included:
•
Evaluating the Group’s assessment of whether
a present obligation exists arising from past
events, against the criteria in AASB 137 based
on the facts and circumstances available;
•
In order to assess the facts and circumstances
with respect to the investigations, assessing
underlying documentation of the Group’s
internal and external specialist investigations
performed and other relevant documents;
•
Reading minutes from relevant committees,
attending audit committee meetings and board
meetings where this topic was tabled;
•
Inquiring with senior management of the
Group, the Group’s legal counsel and AML/CTF
management for consistency;
•
Obtaining and inspecting external lawyers’
letters and legal opinions against knowledge
obtained from our other procedures;
•
Inquiring with the external lawyers of the Group
for consistency;
•
Evaluating, where relevant, correspondence
with regulators;
•
Where the Group determined a present
obligation to exist, assessing the basis for
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kpmg
accounting standard and the information used to
form its judgements.
Due to the subjective nature of interpreting the
accounting standard and any resultant
measurement of these types of provisions,
assumptions tend to be prone to greater risk for
potential bias, error and inconsistent application.
These conditions necessitate additional scrutiny by
us.
We involved specialists to supplement our senior
audit team members in assessing this key audit
matter.
reliable measurement of a provision, against the
criteria in the accounting standards including
matters such as probability of outflow, amounts
and timing, and our understanding of the matter
from our investigations;
•
Where the Group determined a present
obligation was highly probable, however given
the nature and status of the matter the timing
and amount of any outflow could not be reliably
estimated, we challenged the Group’s
conclusion against the criteria in the accounting
standards, evaluation of precedents, underlying
data and their authority and knowledge from
our investigations;
•
Obtaining specific management representations
in relation to compliance with laws and
regulations and the status of various
investigations; and
•
Assessing the appropriateness of disclosures
against the requirements of the accounting
standards, with a particular focus on the
qualitative information included in Note 24 to
the Financial Report.
Valuation of goodwill and intangible assets ($1,361m)
Refer to Note 12 and Note 13 of the financial report
The key audit matter
How the matter was addressed in our audit
A key audit matter for us was the Group’s annual
testing of goodwill for impairment, and
assessment of licences and Casino management
agreement intangible assets for impairment,
given the size of the balance (being 19% of total
assets),the significantly higher estimation
uncertainty from the business disruptions of the
COVID-19 global pandemic and the status of
current legal and regulatory matters.
Certain conditions impacting the Group increased
the judgement applied by us when evaluating the
evidence available. We focused on the significant
forward-looking assumptions the Group applied
in their value in use models and the disclosures
of these key assumptions as they provide
important information on the potential outcome if
key assumptions were to change, including:
Working with our various specialists our
procedures included:
•
Evaluating the appropriateness of the value
in use method applied by the Group to
perform the annual test of goodwill and
intangible assets for impairment against the
requirements of the accounting standards;
•
Assessing, along with our various specialists,
the integrity of the value in use models used,
including the accuracy of the underlying
calculation formulas;
•
Meeting with management of the Group to
understand the impact of COVID-19 and the
potential outcomes of legal and regulatory
Crown Resorts Limited Annual Report 2021
101
Independent Auditor’s Report
kpmg
•
forecast operating cash flows, growth rates
and terminal growth rates – the Group has
experienced significant business disruption
as a result of COVID-19. These conditions
and the uncertainty of their continuation,
along with the impact of potential outcomes
from ongoing legal and regulatory matters on
cash flows, increase the risk of inaccurate
forecasts or a significantly wider range of
possible outcomes for us to consider and the
possibility of goodwill and intangible assets
being impaired. We focused on the expected
rate of recovery for the Group and what the
Group considers as their future operating
basis when assessing the feasibility of the
Group’s forecast cashflows.
•
forecast growth rates and terminal growth
rates – in addition to the uncertainties
described above, the Group’s models are
sensitive to changes in these assumptions
which reduce available headroom. This drives
additional audit effort specific to their
feasibility and consistency of application to
the Group’s strategy.
•
discount rates - these are complicated in
nature and vary according to the conditions
and environment the specific CGU is subject
to from time to time, and the modelling
methodology for incorporating risks into the
cash flows or discount rates. The Group’s
modelling is sensitive to changes in the
discount rates.
The Group uses complex models to perform their
annual testing of goodwill and intangible assets
for impairment. The models are largely manually
developed and include a range of internal and
external sources as inputs to the assumptions.
Complex modelling, using forward-looking
assumptions tend to be prone to greater risk for
potential bias, error and inconsistent application.
These conditions necessitate additional scrutiny
by us, in particular to address the objectivity of
sources used for assumptions, and their
consistent application.
We involved specialists to supplement our senior
audit team members in assessing this key audit
matter.
matters to the forecast operating cash flows;
•
Considering the sensitivity of the models by
varying key assumptions, such as expected
rate of recovery for the Group, what the
Group considers as their future operating
basis, forecast growth rates, terminal growth
rates and discount rates, within a reasonably
possible range. We also considered the
interdependencies of key assumptions when
performing the sensitivity analysis and what
the Group consider to be reasonably
possible. We did this to identify those CGUs
at higher risk of impairment and to focus our
procedures;
•
Challenging the Group’s significant forecast
cash flow and growth assumptions in light of
the status of current legal and regulatory
matters and the expected continuation of
uncertainty and business disruption from the
impacts of the COVID-19 global pandemic.
We did this using our knowledge of the
Group, our industry experience,
understanding of the legal and regulatory
matters, and with input from our specialists;
•
Comparing forecast growth rates and
terminal growth rates to authoritative
published studies of industry trends and
expectations and considered differences for
the Group’s operations. We assessed key
assumptions such as expected rate of
recovery for the Group and what the Group
considers as their future operating basis;
•
Independently developing a discount rate
range using publicly available market data for
comparable entities; and
•
Assessing the disclosures in the financial
report using our understanding of the issue
obtained from our testing and against the
requirements of the accounting standards
with particular focus on the information of
potential outcomes if key assumptions were
to change.
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Other Information
Other Information is financial and non-financial information in Crown Resorts Limited’s annual reporting
which is provided in addition to the Financial Report and the Auditor’s Report. The Directors are
responsible for the Other Information.
Our opinion on the Financial Report does not cover the Other Information and, accordingly, we do not
express an audit opinion or any form of assurance conclusion thereon, with the exception of the
Remuneration Report and our related assurance opinion.
In connection with our audit of the Financial Report, our responsibility is to read the Other Information.
In doing so, we consider whether the Other Information is materially inconsistent with the Financial
Report or our knowledge obtained in the audit, or otherwise appears to be materially misstated.
We are required to report if we conclude that there is a material misstatement of this Other Information,
and based on the work we have performed on the Other Information that we obtained prior to the date
of this Auditor’s Report we have nothing to report.
Responsibilities of the Directors for the Financial Report
The Directors are responsible for:
• preparing the Financial Report that gives a true and fair view in accordance with Australian
Accounting Standards and the Corporations Act 2001
• implementing necessary internal control to enable the preparation of a Financial Report that gives a
true and fair view and is free from material misstatement, whether due to fraud or error
• assessing the Group and Company’s ability to continue as a going concern and whether the use of
the going concern basis of accounting is appropriate. This includes disclosing, as applicable, matters
related to going concern and using the going concern basis of accounting unless they either intend
to liquidate the Group and Company or to cease operations, or have no realistic alternative but to
do so.
Auditor’s responsibilities for the audit of the Financial Report
Our objective is:
• to obtain reasonable assurance about whether the Financial Report as a whole is free from material
misstatement, whether due to fraud or error; and
• to issue an Auditor’s Report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in
accordance with Australian Auditing Standards will always detect a material misstatement when it
exists.
Misstatements can arise from fraud or error. They are considered material if, individually or in the
aggregate, they could reasonably be expected to influence the economic decisions of users taken on
the basis of the Financial Report.
A further description of our responsibilities for the audit of the Financial Report is located at the
Auditing and Assurance Standards Board website at
https://www.auasb.gov.au/admin/file/content102/c3/ar1_2020.pdf This description forms part of our
Auditor’s Report
Crown Resorts Limited Annual Report 2021
103
Independent Auditor’s Report
Independent Auditor’s Report
kpmg
Report on the Remuneration Report
Opinion
In our opinion, the Remuneration Report of
Crown Resorts Limited for the year ended
30 June 2021, complies with Section 300A of the
Corporations Act 2001.
Directors’ responsibilities
The Directors of the Company are responsible for
the
preparation
and
presentation
of
the
Remuneration Report in accordance with Section
300A of the Corporations Act 2001.
Our responsibilities
We have audited the Remuneration Report
included in pages 73 to 95 of the Directors’ report
for the year ended 30 June 2021.
Our responsibility is to express an opinion on the
Remuneration Report, based on our audit
conducted in accordance with Australian Auditing
Standards.
KPMG
Rachel Milum
Partner
Sydney
9 September 2021
104
Financial Report
Financial Report
105
Statement of
Profit or Loss
106
Statement of
Comprehensive Income
107
Statement of
Financial Position
108
Cash Flow Statement
109
Statement of
Changes in Equity
110
Notes to the
Financial Statements
FINANCIAL REPORT 2021
Crown Resorts Limited Annual Report 2021
105
Statement of Profit or Loss
Statement of Profit or Loss
For the year ended 30 June 2021
2021
2020
Note
$m
$m
Revenues
3
1,536.8
2,237.2
Other income
3
207.8
0.1
Expenses
3
(1,975.4)
(2,074.2)
Share of profits/(losses) of associates
2,9
(8.7)
0.3
Profit/(loss) before income tax and finance costs
(239.5)
163.4
Finance costs
3
(69.1)
(10.2)
Profit/(loss) before income tax
(308.6)
153.2
Income tax benefit/(expense)
2,5
47.3
(71.3)
Net profit/(loss) after tax
(261.3)
81.9
Attributable to:
Equity holders of the Parent
(261.6)
79.5
Non-controlling interests
0.3
2.4
(261.3)
81.9
The above Statement of Profit or Loss should be read in conjunction with the accompanying notes.
2021
2020
Cents
Cents
Note
per share
per share
Earnings per share (EPS)
Basic EPS
27
(38.63)
11.74
Diluted EPS
27
(38.63)
11.74
EPS calculation is based on the weighted average number of shares on issue
throughout the period
Dividends per share
Current year final dividend declared
4
-
-
Current year interim dividend paid
4
-
30.00
106
FINANCIAL REPORT 2021 CONTINUED
Statement of Comprehensive Income
Statement of Comprehensive Income
For the year ended 30 June 2021
2021
2020
$m
$m
Net profit/(loss) after tax
(261.3)
81.9
Other Comprehensive Income
Items that may be reclassified subsequently to profit or loss:
Foreign currency translation
(16.0)
5.3
Movement in cash flow hedge reserve
(13.7)
(6.6)
Other comprehensive income / (loss) for the period, net of income tax
(29.7)
(1.3)
Total comprehensive income / (loss) for the period
(291.0)
80.6
Attributable to:
Equity holders of the Parent
(290.4)
78.1
Non-controlling interests
(0.6)
2.5
(291.0)
80.6
The above Statement of Comprehensive Income should be read in conjunction with the accompanying notes.
Crown Resorts Limited Annual Report 2021
107
Statement of Financial Position
Statement of Financial Position
As at 30 June 2021
2021
2020
Note
$m
$m
Current assets
Cash and cash equivalents
22
476.0
286.9
Trade and other receivables
6
19.6
111.2
Income tax receivable
65.3
-
Inventories
21.5
17.2
Prepayments
45.4
41.6
Assets held for sale
7
425.8
-
Total current assets
1,053.6
456.9
Non-current assets
Other financial assets
8
12.7
29.3
Investments in associates
9
127.4
186.0
Property, plant and equipment
10
4,316.6
4,871.2
Intangible assets - licences
12
1,030.6
1,047.3
Other intangible assets
13
330.4
355.6
Deferred tax assets
5
183.5
170.7
Other assets
15
45.6
48.8
Total non-current assets
6,046.8
6,708.9
Total assets
7,100.4
7,165.8
Current liabilities
Trade and other payables
16
429.4
426.5
Interest-bearing loans and borrowings
17
314.3
8.2
Income tax payable
-
32.5
Provisions
18
304.1
200.3
Other financial liabilities
0.1
2.4
Total current liabilities
1,047.9
669.9
Non-current liabilities
Other payables
16
177.2
172.3
Interest-bearing loans and borrowings
17
974.1
1,121.8
Deferred tax liabilities
5
406.7
420.5
Provisions
18
28.7
27.0
Total non-current liabilities
1,586.7
1,741.6
Total liabilities
2,634.6
2,411.5
Net assets
4,465.8
4,754.3
Equity
Contributed equity
19
(203.3)
(203.3)
Reserves
20
(23.8)
3.1
Retained earnings
20
4,692.9
4,954.5
Total equity
4,465.8
4,754.3
The above Statement of Financial Position should be read in conjunction with the accompanying notes.
108
FINANCIAL REPORT 2021 CONTINUED
Cash Flow Statement
Cash Flow Statement
For the year ended 30 June 2021
2021
2020
Note
$m
$m
Cash flows from operating activities
Receipts from customers
1,605.2
2,258.3
Payments to suppliers and employees
(1,471.6)
(1,847.5)
Dividends received
-
5.9
Interest received
1.1
12.2
Borrowing costs paid
(76.4)
(66.0)
Income tax paid
(72.3)
(36.0)
Net cash flows from/(used in) operating activities
22b
(14.0)
326.9
Cash flows from investing activities
Purchase of property, plant and equipment
(559.1)
(746.3)
Proceeds from sale of property, plant and equipment
650.5
0.1
Payment for the acquisition of equity accounted associates
(1.8)
(3.9)
Payment for the acquisition of controlled entities
(16.3)
-
Other (net)
0.3
-
Net cash flows from/(used in) investing activities
73.6
(750.1)
Cash flows from financing activities
Proceeds from borrowings
590.0
315.1
Repayment of borrowings
(459.8)
(328.8)
Dividends paid
-
(406.2)
Net cash flows from/(used in) financing activities
130.2
(419.9)
Net increase/(decrease) in cash and cash equivalents
189.8
(843.1)
Cash and cash equivalents at the beginning of the financial year
286.9
1,126.0
Effect of exchange rate changes on cash
(0.7)
4.0
Cash and cash equivalents at the end of the financial year
22a
476.0
286.9
Government subsidies and JobKeeper are presented net of cash receipts and payments in payments to suppliers and
employees.
The above Cash Flow Statement should be read in conjunction with the accompanying notes.
Crown Resorts Limited Annual Report 2021
109
Statement of Changes in Equity
Statement of Changes in Equity
For the year ended 30 June 2021
Ordinary
Shares
Retained
Earnings
Reserves
Total
Non-
Controlling
Interest
Total
Equity
$m
$m
$m
$m
$m
$m
Year ended 30 June 2021
Balance at 1 July 2020
(203.3)
4,954.5
3.1
4,754.3
-
4,754.3
Profit/(loss) for the period
-
(261.6)
-
(261.6)
0.3
(261.3)
Other comprehensive income/(loss)
-
-
(28.8)
(28.8)
(0.9)
(29.7)
Total comprehensive income/(loss)
for the period
-
(261.6)
(28.8)
(290.4)
(0.6)
(291.0)
Transactions with owners in their
capacity as owners:
Movement in non-controlling interest
put option
-
-
(1.4)
(1.4)
0.6
(0.8)
Share based payments
-
-
3.3
3.3
-
3.3
Balance at 30 June 2021
(203.3)
4,692.9
(23.8)
4,465.8
-
4,465.8
Year ended 30 June 2020
Balance at 1 July 2019
(203.3)
5,298.8
1.4
5,096.9
-
5,096.9
Adoption impact of AASB 16
-
(17.6)
-
(17.6)
-
(17.6)
Adjusted balance at 1 July 2019
(203.3)
5,281.2
1.4
5,079.3
-
5,079.3
Profit/(loss) for the period
-
79.5
-
79.5
2.4
81.9
Other comprehensive income/(loss)
-
-
(1.4)
(1.4)
0.1
(1.3)
Total comprehensive income/(loss)
for the period
-
79.5
(1.4)
78.1
2.5
80.6
Transactions with owners in their
capacity as owners:
Dividends paid
-
(406.2)
-
(406.2)
-
(406.2)
Movement in non-controlling interest
put option
-
-
(0.3)
(0.3)
(2.5)
(2.8)
Share based payments
-
-
3.4
3.4
-
3.4
Balance at 30 June 2020
(203.3)
4,954.5
3.1
4,754.3
-
4,754.3
The above Statement of Changes in Equity should be read in conjunction with the accompanying notes.
110
FINANCIAL REPORT 2021 CONTINUED
Notes to the Financial Statements
Notes to the Financial Statements
For the year ended 30 June 2021
1. Significant Accounting Policies
1.1 Basis of preparation
This financial report is a general-purpose financial report,
which has been prepared in accordance with the
requirements of the Corporations Act 2001, Australian
Accounting Standards and other authoritative
pronouncements of the Australian Accounting Standards
Board. The financial report has also been prepared on a
historical cost basis, except for derivative financial
instruments, contingent consideration and investments
that have been measured at fair value and investments in
associates accounted for using the equity method.
The amounts contained in the financial report have been
rounded to the nearest hundred thousand dollars unless
otherwise stated under the option available to Crown
Resorts Limited (Crown or the Company) under ASIC
Corporations (Rounding in Financial/Directors’ Reports)
Instrument 2016/191. Crown is an entity to which this
Instrument applies.
The financial report of Crown Resorts Limited and its
controlled entities (the Group) for the year ended 30 June
2021 was authorised for issue in accordance with a
resolution of the directors on 8 September 2021 subject to
final approval by a subcommittee. Crown is a for profit
company limited by shares incorporated in Australia
whose shares are publicly traded on the Australian
Securities Exchange.
Statement of Compliance
The financial report complies with Australian Accounting
Standards as issued by the Australian Accounting
Standards Board and International Financial Reporting
Standards (IFRS) as issued by the International Accounting
Standards Board.
Going concern
At 30 June 2021, the Group is in a net current asset
position of $5.7 million (2020: net current liability position
of $213.0 million). At 30 June 2021, the Group had $390.1
million in available cash and cash equivalents (excluding
working capital cash) (refer note 22) and $170.7 million in
committed un-drawn bank facilities (refer note 17). The
financial statements have been prepared on a going
concern basis. In determining the appropriateness of the
basis of preparation, the Group has considered the impact
of the COVID-19 pandemic on the Group’s financial
position at 30 June 2021 and its operations in future
periods.
During the financial year, in response to the COVID-19
pandemic, Crown was directed by relevant State and
Federal Governments, at various times, to suspend its
gaming activities and other non-essential services at
Crown Melbourne, Crown Perth, Crown Sydney and
Crown Aspinalls. When operating, restrictions remained in
place around the number of patrons allowed onsite and
strict adherence to health and safety standards. It remains
uncertain how long these conditions will remain in place.
The impact of COVID-19 and the potential outcomes of the
various regulatory inquiries and investigations has created
material uncertainties surrounding going concern
particularly given the interdependencies of the events and
conditions on the Group’s forecasts. In preparing the
financial report on a going concern basis, Crown has
performed detailed scenario planning on the Group’s cash
flow forecast and forecast liquidity position.
Critical to this are the assumptions used regarding the
impact of COVID-19 and its expected continuation, the
potential outcomes of the various regulatory inquiries and
investigations, the continued support of the Group’s
financiers and maintaining an investment grade credit
rating and the expected proceeds from the sale of Crown
Sydney apartments during the next 12 months. Each of
these contain a range of uncertainties, the key details of
which include:
COVID-19:
• The impacts of COVID-19 on Crown’s operations has
created significant uncertainty in relation to the Group’s
cash flow forecast and its forecast liquidity position.
There is uncertainty surrounding the duration of closure
of Crown’s properties and the restrictions in place
when opened, in relation to the number of patrons
allowed onsite and adherence to COVID protocols. The
Group has undertaken scenario modelling to consider
the unfavourable impact of potential closures of
Crown’s operations on operating cash flows for the
next twelve months. Given the nature of the pandemic,
uncertainty surrounding the closures and the potential
operating restrictions and their longevity, a wide range
of outcomes are possible. This uncertainty may lead to
a breach of financial covenants under the Group’s
financing arrangements of which $420 million was
drawn at 30 June 2021.
Regulatory Inquiries:
• In the event of a cancellation or suspension of any of
Crown’s Australian casino licences, there was the
potential for an event of default to arise under the
Group’s financing arrangements of which $420 million
was drawn and $99.3 million of letters of credit were
issued at 30 June 2021.
Euro Medium Term Notes:
• Under the terms of Crown’s Euro Medium Term Notes
(Notes), in the event that the Notes are unrated, or are
rated below investment grade by any rating agency
which rates the Notes (currently Fitch Ratings and
Standard & Poor’s), any holder of the Notes would be
entitled to require redemption of its Notes at the
outstanding principal amount plus a make whole
premium, subject to the terms of the Notes.
Crown Sydney Apartment sales:
• The Group has assumed that the remaining Crown
Sydney apartment sales are settled throughout and
prior to 30 June 2022. If sales are delayed this may
Crown Resorts Limited Annual Report 2021
111
Notes to the Financial Statements
result, in conjunction with the above assumptions, in an
unfavourable impact on liquidity.
To address the uncertainty arising from one or more of the
above scenarios occurring the Group has reached
agreement with its relationship banks post 30 June 2021 in
relation to the following key measures:
• A waiver of financial covenants under the Group’s
financing arrangements in relation to the 31 December
2021 testing date.
• The Group has extended the $410 million of bank
facilities with relationship banks that were due to mature
in April 2022 to October 2023 of which $102.5 million is
undrawn. At the same time the $150 million of bank
facilities maturing in April 2024 has been aligned with
the October 2023 maturity.
• A waiver of certain events of default that would
otherwise arise from cancellation or suspension (for a
certain period of time) of any of Crown’s Australian
casino licences. In the event such a licence event
occurs, Crown has agreed to a review process providing
it with a period of time to negotiate with lenders or
otherwise refinance the facilities.
• One of Crown’s relationship banks has agreed to
provide a new $250 million debt facility, subject to
completion of long form documentation. The facility will
provide Crown with debt funding of up to $250 million
(based on the value of unsold Crown Sydney
apartments) to be used to partly fund any required
redemption of Crown’s Euro Medium Term Notes and
associated make whole premium as described above,
or in certain circumstances, for general corporate
purposes.
• As part of the arrangement agreed with lenders, Crown
has agreed not to declare or pay dividends in respect of
the half year ending 31 December 2021 or where a review
event is triggered as a result of a cancellation or
suspension of any of Crown’s Australian casino licences.
Additional measures the Group has in place and/or which
are at its discretion are:
• At 30 June 2021, the Group had only $14.9 million in
capital commitments (refer note 21). The Group has the
ability to control the cash flow of certain uncommitted
capital expenditure, should the need arise.
• The Group expects to realise $34.9 million related to the
disposal of Crown’s investment in Aspers, which was
held for sale at 30 June 2021 (refer note 7).
• In the event of prolonged COVID-19 lockdowns the
Group has the ability to reduce cash outflows including
the reduction of capital expenditure and operating costs.
• The Group has the opportunity to raise additional funds
through asset disposal, additional financing or the
issuance of new shares, should the need arise.
Based on the above, the Group is satisfied that it will be
able to continue to meet its liabilities as and when they fall
due, for a minimum of the next twelve months.
1.2 Changes in accounting policies
In the current year, the Group has adopted the following
amendments and interpretations to accounting standards
that apply for the first time from July 2020. The adoption of
the amendments and interpretations did not have a
material impact on the financial position or performance of
the Group during the period.
• AASB 2018-6 Amendments to Australian Accounting
Standards – Definition of a Business
• AASB 2018-7 Amendments to Australian Accounting
Standards – Definition of Material
• AASB 2019-1 Amendments to Australian Accounting
Standards – References to the Conceptual Framework
• AASB 2019-3 Amendments to Australian Accounting
Standards – Interest Rate Benchmark Reform
• IFRS Interpretations Committee agenda decision
– Configuration or Customisation Costs in a Cloud
Computing Arrangement (IAS 38)
1.3 Standards issued but not yet effective
Standards and Interpretations not expected to be
material
Certain other new Accounting Standards and
Interpretations have been published that are not mandatory
for the 30 June 2021 reporting period. The Group has
assessed the impact of these new Accounting Standards
and Interpretations that are relevant to the Group, and does
not expect any material impact on net assets, net profit,
presentation or disclosures when these standards become
effective and are adopted.
1.4 Basis of consolidation
The consolidated financial statements are those of the
consolidated entity, comprising Crown Resorts Limited (the
parent entity) and all entities that Crown Resorts Limited
controlled from time to time during the year and at
reporting date (the Group). Control is achieved when the
Group is exposed, or has rights, to variable returns from its
involvement with the investee and has the ability to affect
those returns through its power over the investee.
The Group re-assesses whether or not it controls an
investee if facts and circumstances indicate that there are
changes to one or more of the three elements of control.
Information from the financial statements of subsidiaries is
included from the date the parent entity obtains control
until such time as control ceases. Where there is loss of
control of a subsidiary, the consolidated financial
statements include the results for the part of the reporting
period during which the parent entity has control. Change
of ownership interest of a subsidiary without the loss of
control is accounted for as an equity transaction.
Subsidiary acquisitions are accounted for using the
acquisition method of accounting. The financial statements
of subsidiaries are prepared for the same reporting period
as the parent entity, using consistent accounting policies.
Adjustments are made to bring into line any dissimilar
accounting policies that may exist.
112
FINANCIAL REPORT 2021 CONTINUED
Notes to the Financial Statements
All inter-company balances and transactions, including
unrealised profits arising from intra-group transactions,
have been eliminated in full.
The accounting policies adopted have been applied
consistently throughout the two reporting periods.
1.5 Significant accounting judgements,
estimates and assumptions
The carrying amounts of certain assets and liabilities are
often determined based on judgements, estimates and
assumptions of future events. The key judgements,
estimates and assumptions that have a significant risk of
causing a material adjustment to the carrying amounts of
certain assets and liabilities within the next annual
reporting period are:
Impairment of non-financial assets
Impairment exists when the carrying value of an asset or
cash generating unit exceeds its recoverable amount,
which is the higher of its fair value less costs of disposal
and its value in use. The Group determines whether
goodwill and intangibles with indefinite useful lives are
impaired at least on an annual basis. This requires an
estimation of the recoverable amount of the cash-
generating units to which the goodwill and intangibles with
indefinite useful lives are allocated.
At 30 June 2021, COVID-19 continues to have a major
impact on Australian and International economies. The
duration of restricted operating conditions and border
restrictions remains uncertain. This means that cash flow
assumptions and forecasts may change significantly and
unexpectedly over a relatively short period of time. The
level of uncertainty has resulted in increased difficulty in
developing cash flow assumptions and forecasts.
Crown is subject to a number of regulatory inquiries and
investigations, the outcomes of which remain uncertain.
The assumptions used in the valuation of the recoverable
amounts assumes prevailing licence and regulatory
conditions.
The assumptions used in this estimation of recoverable
amounts and the carrying amount of non-financial assets
are discussed in note 14.
Taxes
Deferred tax assets are recognised for all unused tax
losses to the extent that it is probable that taxable profit
will be available against which the losses can be utilised.
Management judgement is required to determine the
amount of deferred tax assets that can be recognised,
based upon the likely timing and the level of future taxable
profits.
Management periodically evaluates positions taken in the
tax returns with respect to situations in which applicable
tax regulations are subject to interpretation and
establishes provisions where appropriate.
Expected credit losses
An allowance is recognised based on the expected credit
loss from the time the financial instrument is initially
recognised.
An impairment analysis is performed at each reporting
date to measure allowance for expected credit losses. The
allowance for expected credit losses is based on a
provision matrix that reflects the Group’s historical credit
loss experience, adjusted for management’s knowledge of
specific customers’ circumstances, including changes in
financial circumstances, significant delay in payments and
gambling activity, as well as current collection trends and
business conditions.
The estimates and assumptions associated with the
Group’s expected credit loss model were revised as a
result of prevailing economic conditions at 30 June 2021,
reflecting the uncertainty regarding the duration of
restricted operating conditions and border closures, and
Crown’s announcement to cease dealing with junket
operators. Extended periods of restricted operations and
border closures create uncertainty regarding the
collectability of those debts.
The assumptions used in the estimation of the allowance
for expected credit losses are discussed further in note 6.
Trade receivables are written off, after taking into account
regulatory considerations, when there is no reasonable
expectation of recovery.
Market value rent for Crown Melbourne Main Site
In 1993 Crown Melbourne entered into a ninety-nine year
lease agreement for the site upon which the Crown
Melbourne Entertainment Complex is located. For years
one to forty inclusive, the annual rent payable is one dollar
per annum. For years forty-one to ninety-nine inclusive,
the annual rent payable will be the then current market
rent for the site. On adoption of AASB 16 in July 2019, this
lease was recognised as a right-of-use asset and lease
liability. The carrying value of the right-of-use asset has
been determined as if the standard had always applied,
based on the payments in years forty-one to ninety-nine
using the estimated market rent at commencement date
of the lease, applying the incremental borrowing rate at
date of initial application of the standard. In estimating the
market rent at commencement date, the Group engaged
an independent property valuer.
The lease liability is measured at the present value of the
lease payments to be made in years forty-one to ninety-
nine using the estimated market rent at commencement
date of the lease.
Lease – Estimating the incremental borrowing rate
If the Group cannot readily determine the interest rate
implicit in the lease, it uses its incremental borrowing rate
(IBR) to measure lease liabilities. The IBR is the rate of
interest that the lessee would have to pay to borrow over a
similar term, and with a similar security, the funds
necessary to obtain an asset of a similar value to the
right-of-use asset in a similar economic environment. The
1. Significant Accounting Policies continued
Notes to the Financial Statements continued
For the year ended 30 June 2021
Crown Resorts Limited Annual Report 2021
113
Notes to the Financial Statements
IBR therefore reflects what the lessee ‘would have to pay’,
which requires estimation when no observable rates are
available (such as for subsidiaries that do not enter into
financing transactions) or when they need to be adjusted
to reflect the terms and conditions of the lease. The Group
estimates the IBR using observable inputs (such as market
interest rates) when available and is required to make
certain entity-specific estimates.
Crown Sydney development costs
The Group engaged an independent expert to determine
a fair and reasonable apportionment of the total
development costs between the assets used in the
ongoing operation of Crown Sydney and the residential
apartments.
The portion of the development costs relating to the
ongoing operation of Crown Sydney will be depreciated
over the useful life of the assets in accordance with the
Group’s depreciation policy.
For residential apartments that were settled prior to 30
June 2021, the cost of each residential apartment is
allocated against the proceeds to determine the gain on
disposal. The costs relating to residential apartments held
by the Group at 30 June 2021 have been disclosed as
Assets Held for Sale.
Provisions and Contingent Liabilities
The recognition and measurement of provisions is an
inherently uncertain process involving using judgement to
determine when a present obligation exists and estimates
regarding probability, amounts and timing of cash flows.
The Group is subject to a number of ongoing legal and
regulatory matters, the outcome of which remains
uncertain. The degree of uncertainty and the method of
making accounting estimates depends on the individual
matter, with judgement required to determine the
probability of the outcome and to make a reliable estimate
amount of the potential obligation and the timing of
outflows that may arise. The Group has recognised
provisions for various matters as appropriate, using the
Group’s best estimate of the outcome and expenditure
required to settle the obligation. For matters where it is not
possible to make a reliable estimate of the amount of the
obligation, no provision is recognised, however a
contingent liability is disclosed. When a contingent liability
has been disclosed, where practical, the uncertainties and
anticipated timing has been provided.
Significant items
Significant items are transactions that are not in the
ordinary course of business or are material and
unexpected due to their size and nature. Information
relating to Significant items is presented within note 2
Segment Information and is disclosed to allow users of the
financial report to see the performance of the Group in a
comparable form to that of the comparative period. This is
consistent with the information provided to and used by
the Chief Operating decision makers to evaluate the
performance of the Group during the period.
Costs incurred during mandated closure (Closure costs)
Crown’s businesses ordinarily operate each day of the
year and, apart from minor exceptions, 24 hours each day.
Due to the unprecedented nature of the directions from
State and Federal Governments to suspend gaming
activities and other non-essential services at Crown
Melbourne, Crown Perth and Crown Aspinalls due to the
COVID-19 pandemic, the circumstances surrounding
Crown’s closure are exceptional. Given these
circumstances, Crown has provided information relating to
the costs incurred during mandated closure within note 2
Segment Information, on the basis this is consistent with
information used by the Chief Operating decision makers
during the period.
1.6 Summary of significant accounting policies
(a) Income tax
Current tax assets and liabilities for the current and prior
periods are measured at the amount expected to be
recovered from or paid to the taxation authorities based
on the current period’s taxable income. The tax rates and
tax laws used to compute the amount are those that are
enacted or substantively enacted by the reporting date.
Deferred tax is provided on most temporary differences at
the reporting date between the tax bases of assets and
liabilities and their carrying amounts for financial reporting
purposes.
Deferred tax liabilities are recognised for all taxable
temporary differences except:
• where the deferred tax liability arises from the initial
recognition of an asset or liability in a transaction that is
not a business combination and, at the time of the
transaction, affects neither the accounting profit or loss
nor taxable profit or loss; or
• in respect of taxable temporary differences associated
with investments in subsidiaries, associates and
interests in joint ventures, when the timing of the
reversal of the temporary differences can be controlled
and it is probable that the temporary differences will not
reverse in the foreseeable future.
Deferred tax assets are recognised for all deductible
temporary differences, carry-forward of unused tax assets
and unused tax losses, to the extent that it is probable
that taxable profit will be available against which the
deductible temporary differences, and the carry-forward
of unused tax assets and unused tax losses can be
utilised except:
• when the deferred tax asset relating to the deductible
temporary difference arises from the initial recognition
of an asset or liability in a transaction that is not a
business combination and, at the time of the
transaction, affects neither the accounting profit nor
taxable profit or loss; or
• in respect of deductible temporary differences
associated with investments in subsidiaries, associates
and interests in joint ventures, deferred tax assets are
Notes to the Financial Statements continued
For the year ended 30 June 2021
114
FINANCIAL REPORT 2021 CONTINUED
Notes to the Financial Statements
recognised only to the extent that it is probable that the
temporary differences will reverse in the foreseeable
future and taxable profit will be available against which
the temporary differences can be utilised.
The carrying amount of deferred tax assets is reviewed at
each reporting date and reduced to the extent that it is no
longer probable that sufficient taxable profit will be
available to allow all or part of the deferred tax asset to be
utilised.
Deferred tax assets and liabilities are measured at the tax
rates that are expected to apply to the year when the
asset is realised or the liability is settled, based on tax
rates (and tax laws) that have been enacted or
substantively enacted at the reporting date.
Income taxes relating to items recognised directly in equity
are recognised in equity and not the Statement of Profit or
Loss.
(b) Other taxes
Revenues, expenses and assets are recognised net of the
amount of GST except:
• where the GST incurred on a purchase of goods and
services is not recoverable from the taxation authority,
in which case the GST is recognised as part of the cost
of acquisition of the asset or as part of the expense
item as applicable;
• gaming revenues; and
• receivables and payables are stated with the amount of
GST included.
The net amount of GST recoverable from, or payable to,
the taxation authority is included as part of receivables or
payables in the Statement of Financial Position.
Cash flows are included in the Cash Flow Statement on a
gross basis and the GST component of cash flows arising
from investing and financing activities, which is
recoverable from, or payable to, the taxation authority, are
classified as operating cash flows.
Commitments and contingencies are disclosed net of the
amount of GST recoverable from, or payable to, the
taxation authority.
Gaming taxes and levies are recognised as an expense
when incurred.
(c) Foreign currency translation
Both the functional and presentation currency of Crown
Resorts Limited and its Australian subsidiaries is Australian
dollars.
Each foreign entity in the Group determines its own
functional currency and items included in the financial
statements of each foreign entity are measured using that
functional currency, which is translated to the presentation
currency for Group reporting purposes.
Transactions in foreign currencies are initially recorded in
the functional currency at the exchange rates ruling at the
date of the transaction. Monetary assets and liabilities
denominated in foreign currencies are retranslated at the
rate of exchange ruling at the reporting date.
Non-monetary items that are measured in terms of
historical cost in a foreign currency are translated using
the exchange rate as at the date of the initial transaction.
Non-monetary items measured at fair value in a foreign
currency are translated using the exchange rates at the
date when the fair value was determined.
As at the reporting date the assets and liabilities of
overseas subsidiaries are translated into the presentation
currency of Crown Resorts Limited at the rate of exchange
ruling at the reporting date and the profit or loss is
translated at the weighted average exchange rates for the
period. The exchange differences arising on the
retranslation are recognised through Other
Comprehensive Income (OCI) and accumulated in the
foreign currency translation reserve in equity.
On disposal of a foreign entity, the deferred cumulative
amount recognised in the foreign currency translation
reserve relating to that particular foreign operation is
recognised in the Statement of Profit or Loss.
(d) Cash and cash equivalents
Cash and cash equivalents in the Statement of Financial
Position comprises of cash at bank and on hand, and
short term deposits with an original maturity of three
months or less that are readily convertible to known
amounts of cash and which are subject to an insignificant
risk of changes in future value.
For the purposes of the Cash Flow Statement, cash and
cash equivalents consist of cash and cash equivalents as
defined above, net of outstanding bank overdrafts.
(e) Trade and other receivables
Trade receivables are recognised and carried at original
invoice amount less an allowance for any expected credit
losses.
An allowance for expected credit losses is recognised
based on the expected credit loss from the time the
financial instrument is initially recognised. Trade
receivables are written off when there is no reasonable
expectation of recovery.
Receivables from associates and other related parties are
carried at amortised cost less an allowance for
impairment.
Interest, when charged, is taken up as income on an
accrual basis.
1. Significant Accounting Policies continued
1.6 Summary of significant accounting policies
continued
(a) Income tax continued
Crown Resorts Limited Annual Report 2021
115
Notes to the Financial Statements
(f) Inventories
Inventories are valued at the lower of cost and net
realisable value.
Costs incurred in bringing each product to its present
location and condition are accounted for as follows:
• Inventories which include food, beverages and other
consumables are costed on a weighted average basis;
and
• net realisable value is the estimated selling price in the
ordinary course of business, less estimated costs of
completion and the estimated costs necessary to make
the sale.
(g) Investments in associates
The financial statements of the associates are used by the
Group to apply the equity method. Where associates
apply different accounting policies to the Group,
adjustments are made upon application of the equity
method.
Investments in associates are carried in the Statement of
Financial Position at cost plus post-acquisition changes in
the Group’s share of net assets of the associates, less any
impairment in value. The Statement of Profit or Loss
reflects the Group’s share of the results of operations of
the associates.
Where there has been a change in the associates’ OCI or
equity, the Group recognises its share of any changes and
discloses this, when applicable, in the Statement of
Comprehensive Income.
When the Group’s share of losses in an associate equals
or exceeds its interest in the associate, including any
unsecured long term receivables and loans, the Group
does not recognise further losses unless it has incurred
obligations or made payments on behalf of the associate.
(h) Investments and other financial assets
Financial assets are classified based on:
(i) The objective of the entity’s business model for
managing the financial assets; and
(ii) The characteristics of the contractual cash flow.
The classification depends on the purpose for which the
financial assets were acquired. Management determines
the classification of its financial assets at initial recognition.
For instruments not held for trading, an irrevocable
election is made by instrument to determine if the
instrument is measured at fair value either through OCI or
in the Statement of Profit or Loss.
When financial assets are recognised initially, they are
measured at fair value, plus, in the case of assets at
amortised costs or fair value through OCI, directly
attributable transaction costs.
The best evidence of fair value is quoted prices in an
active market. The fair value of the investments and other
financial assets that do not have a price quoted in an
active market have been estimated using valuation
techniques based on assumptions that are not supported
by observable market prices or rates. The fair value is
reassessed each reporting period.
If the fair value through Statement of Profit or Loss
approach is adopted, increments and decrements on the
fair value of the financial asset at each reporting date are
recognised in the Statement of Profit or Loss.
If the fair value through OCI approach is adopted,
increments and decrements on the fair value are
recognised in OCI, without recycling of gains and losses
between the Statement of Profit or Loss and OCI, even on
disposal of the investment. Dividends in respect of these
investments that are a return on investment are
recognised in the Statement of Profit or Loss.
Purchases or sales of financial assets that require delivery
of assets within a time frame established by regulation or
convention in the market place (regular way trades) are
recognised on the trade date, i.e., the date that the Group
commits to purchase or sell the asset.
(i) Property, plant and equipment
Property, plant and equipment is stated at cost less
accumulated depreciation and any impairment in value.
Depreciation and amortisation is calculated on a straight-
line basis over the estimated useful life of the asset as
follows:
• Buildings - 40 to 75 years;
• Fixtures and fittings in buildings - 4 to 20 years; and
• Plant and equipment - 2 to 20 years.
The asset’s residual values, useful lives and amortisation
methods are reviewed, and adjusted if appropriate, at
each financial year end.
Cost for construction work in progress includes any costs
directly attributable to bringing the asset to the location
and condition necessary for it to be capable of operating
in the manner intended by management.
Impairment
The carrying values of property, plant and equipment are
reviewed for impairment when events or changes in
circumstances indicate the carrying value may not be
recoverable. For an asset that does not generate largely
independent cash inflows, the recoverable amount is
determined for the cash-generating unit to which the asset
belongs. If any such indication exists and where the
carrying values exceed the estimated recoverable amount,
the assets or cash-generating units are written down to
their recoverable amount.
The recoverable amount of property, plant and equipment
is the greater of fair value less costs of disposal and value
in use. In assessing value in use, the estimated future cash
flows are discounted to their present value using a
post-tax discount rate that reflects current market
Notes to the Financial Statements continued
For the year ended 30 June 2021
116
FINANCIAL REPORT 2021 CONTINUED
Notes to the Financial Statements
assessments of the time value of money and the risks
specific to the asset.
Derecognition
An item of property, plant and equipment is derecognised
upon disposal or when no future economic benefits are
expected to arise from the continued use of the asset.
Any gain or loss arising on derecognition of the asset
(calculated as the difference between the net disposal
proceeds and the carrying amount of the item) is included
in the Statement of Profit or Loss in the period the item is
derecognised.
(j) Intangible assets
Licences
Licences are carried at cost less any accumulated
amortisation and any accumulated impairment losses.
The directors regularly assess the carrying value of casino
licences so as to ensure they are not carried at a value
greater than their recoverable amount.
The casino licences are carried at cost of acquisition. The
Crown Melbourne licence is being amortised on a
straight-line basis over the remaining life of the licence to
2050. The Crown Perth licence is assessed as having an
indefinite useful life and, as such, no amortisation is
charged. The Crown Perth licence is subject to an annual
impairment assessment.
Amortisation will commence on the Crown Sydney licence
once the gaming activities are operational.
Goodwill
Goodwill on acquisition is initially measured at cost, being
the excess of the aggregate of the consideration
transferred and the amount recognised for non-controlling
interest and any previous interest held over the net
identifiable assets acquired and liabilities assumed.
Following initial recognition, goodwill is measured at cost
less any accumulated impairment losses. Goodwill is not
amortised.
As at the acquisition date, any goodwill acquired is
allocated to each of the cash-generating units expected to
benefit from the combination’s synergies.
Goodwill is reviewed for impairment, annually or more
frequently if events or changes in circumstances indicate
that the carrying value may be impaired. Impairment is
determined by assessing the recoverable amount of the
cash generating unit to which the goodwill relates. Where
the recoverable amount of the cash-generating unit is less
than the carrying amount, an impairment loss is
recognised.
Where goodwill forms part of a cash-generating unit and
part of the operation within that unit is disposed of, the
goodwill associated with the operation disposed of is
included in the carrying amount of the operation when
determining the gain or loss on disposal of the operation.
Goodwill disposed of in this circumstance is measured on
the basis of the relative values of the operation disposed of
and the portion of the cash-generating unit retained.
Other intangible assets - Acquired both separately and
from a business combination
Intangible assets acquired separately are capitalised at
cost and from a business combination are capitalised at
fair value as at the date of acquisition. Following initial
recognition, the cost model is applied to the class of
intangible assets.
The useful lives of these intangible assets are assessed to
be either finite or indefinite. Where amortisation is charged
on assets with finite lives, this expense is taken to the
Statement of Profit or Loss.
Intangible assets created within the business are not
capitalised and expenditure is charged against profits in
the period in which the expenditure is incurred.
Intangible assets are tested for impairment where an
indicator of impairment exists, and annually in the case of
intangible assets with indefinite lives, either individually or
at the cash generating unit level. Useful lives are also
examined on an annual basis and adjustments, where
applicable, are made on a prospective basis.
Gains or losses arising from derecognition of an intangible
asset are measured as the difference between the net
disposal proceeds and the carrying amount of the asset
and are recognised in the Statement of Profit or Loss
when the asset is derecognised.
(k) Recoverable amount of non-financial assets
At each reporting date, the Group assesses whether there
is any indication that an asset may be impaired. Where an
indicator of impairment exists, the Group makes a formal
estimate of recoverable amount. Where the carrying
amount of an asset exceeds its recoverable amount the
asset is considered impaired and is written down to its
recoverable amount.
Recoverable amount is the greater of fair value less costs
of disposal and value in use. For the purposes of
assessing impairment, assets are grouped at the lowest
levels for which there are separately identifiable cash flows
that are largely independent of the cash inflows from other
assets or groups of assets (cash-generating units). In
assessing value in use, the estimated future cash flows are
discounted to their present value using a post-tax discount
rate that reflects current market assessments of the time
value of money and the risks specific to the asset.
(l) Trade and other payables
Trade and other payables are recognised for amounts
payable in relation to goods received and services
rendered, whether or not billed to the Group at reporting
1. Significant Accounting Policies continued
1.6 Summary of significant accounting policies
continued
(i) Property, plant and equipment continued
Impairment continued
Crown Resorts Limited Annual Report 2021
117
Notes to the Financial Statements
date. The Group operates in a number of diverse markets,
and accordingly the terms of trade vary by business.
(m) Interest-bearing loans and borrowings
All loans and borrowings are initially recognised at fair
value received less directly attributable transaction costs.
After initial recognition, interest-bearing loans and
borrowings are subsequently measured at amortised cost
using the effective interest method.
Borrowings are classified as current liabilities unless the
Group has an unconditional right to defer settlement of the
liability for at least 12 months after the reporting date.
Borrowing costs
Borrowing costs directly associated with qualifying assets
are capitalised, including any other associated costs
directly attributable to the borrowing. The capitalisation
rate to determine the amount of borrowing costs to be
capitalised is the weighted average interest rate applicable
to the Group’s outstanding borrowings during the year, in
this case 4.5% (2020: 5.4%). Once qualifying assets are
ready for use, capitalisation of borrowing costs ceases.
All other borrowing costs are expensed in the period they
are incurred.
(n) Provisions and Contingent Liabilities
Provisions are recognised when the Group has a present
obligation (legal or constructive) to make a future sacrifice
of economic benefits to other entities as a result of past
transactions or other events, it is probable that a future
sacrifice of economic benefit will be required and a reliable
estimate can be made of the amount of the obligation.
Where the Group expects some or all of a provision to be
reimbursed, the reimbursement is recognised as a
separate asset. The expense relating to any provision is
presented in the Statement of Profit or Loss net of any
reimbursement.
If the effect of the time value of money is material,
provisions are discounted using a current pre-tax rate that
reflects the risks specific to the liability. When discounting
is used, the increase in the provision due to the passage
of time is recognised as a finance cost.
A provision for dividends is not recognised as a liability
unless the dividends are declared, or publicly
recommended on or before the reporting date.
In the extremely rare circumstances where a reliable
estimation of the amount of the obligation cannot be
made, a provision is not recognised and a contingent
liability is disclosed. When a contingent liability has been
disclosed, where practical, the uncertainties and
anticipated timing has been provided.
(o) Employee benefits
Provision is made for employee benefits accumulated as a
result of employees rendering services up to reporting
date including related on-costs. The benefits include
wages and salaries, incentives, compensated absences
and other benefits, which are charged against profits in
their respective expense categories when services are
provided or benefits vest with the employee.
The provision for employee benefits is measured at the
remuneration rates expected to be paid when the liability
is settled. Benefits expected to be settled after twelve
months from the reporting date are measured at the
present value of the estimated future cash outflows to be
made in respect of services provided by employees up to
the reporting date.
The liability for long service leave is recognised in the
provision for employee benefits and measured as the
present value of expected future payments to be made in
respect of services provided by employees up to the
reporting date using the projected unit credit method.
Consideration is given to expected future wage and salary
levels, experience of employee departures, and periods of
service. Expected future payments are discounted using
market yields at the reporting date on bonds with terms to
maturity and currencies that match, as closely as possible,
the estimated future cash outflows.
(p) Leases
Group as lessee
(i) Right-of-use assets
The Group recognises right-of-use assets at the
commencement date of the lease (i.e., the date the
underlying asset is available for use). Right-of-use assets
are measured at cost, less any accumulated depreciation
and impairment losses, and adjusted for any
remeasurement of lease liabilities. The cost of right-of-use
assets includes the amount of lease liabilities recognised,
initial direct costs incurred, and lease payments made at
or before the commencement date less any lease
incentives received. Unless the Group is reasonably
certain to obtain ownership of the leased asset at the end
of the lease term, the recognised right-of-use assets are
depreciated on a straight-line basis over the shorter of its
estimated useful life and the lease term. Right-of-use
assets are tested for impairment.
Right-of-use assets are included in the heading Property,
plant and equipment on the Statement of Financial
Position.
(ii) Lease liabilities
At the commencement date of the lease, the Group
recognises lease liabilities measured at the present value
of lease payments to be made over the lease term. The
lease payments include fixed payments (including in-
substance fixed payments) less any lease incentives
receivable, variable lease payments that depend on an
index or a rate initially measured using the index or rate as
at commencement date, and amounts expected to be paid
under residual value guarantees. The lease payments also
include the exercise price of a purchase option reasonably
certain to be exercised by the Group and payments of
penalties for terminating a lease, if the lease term reflects
the Group exercising the option to terminate. The variable
Notes to the Financial Statements continued
For the year ended 30 June 2021
118
FINANCIAL REPORT 2021 CONTINUED
Notes to the Financial Statements
lease payments that do not depend on an index or a rate
are recognised as an expense in the period on which the
event or condition that triggers the payment occurs.
In calculating the present value of lease payments, the
Group uses the incremental borrowing rate at the lease
commencement date if the interest rate implicit in the
lease is not readily determinable. After the
commencement date, the amount of lease liabilities is
increased to reflect the accretion of interest and reduced
for the lease payments made. In addition, the carrying
amount of lease liabilities is remeasured if there is a
modification, a change in the lease term, a change in the
in-substance fixed lease payments or a change in the
assessment to purchase the underlying asset.
Lease liabilities are included in the headings current and
non-current Interest-bearing loans and borrowings on the
Statement of Financial Position.
(iii) Short-term leases and leases of low-value assets
The Group applies the short-term lease recognition
exemption to its short-term leases of property, plant and
equipment (i.e., those leases that have a lease term of 12
months or less from the commencement date and do not
contain a purchase option). It also applies the lease of
low-value assets recognition exemption to leases that are
considered of low value. Lease payments on short-term
leases and leases of low-value assets are recognised as
an expense on a straight-line basis over the lease term.
Group as lessor
Leases in which the Group does not transfer substantially
all the risks and rewards of ownership of an asset are
classified as operating leases. Initial direct costs incurred
in negotiating and arranging an operating lease are added
to the carrying amount of the leased asset and recognised
over the lease term on the same basis as rental income.
Variable lease payments are recognised as revenue in the
period in which the event or condition that triggers those
payments occurs.
(q) Derecognition of financial instruments
The derecognition of a financial asset takes place when
the Group no longer controls the contractual rights that
comprise the financial asset, which is normally the case
when the instrument is sold, or all the cash flows
attributable to the instrument are passed through to an
independent third party.
A financial liability is derecognised when the obligation
under the liability is discharged, cancelled or expires.
(r) Derivative financial instruments and hedging
Derivatives are carried as assets when their fair value is
positive and as liabilities when their fair value is negative.
Any gains or losses arising from changes in the fair value
of derivatives, except for those that qualify as cash flow
hedges, are taken directly to profit or loss for the year.
The fair value of forward exchange contracts are
calculated by reference to current forward exchange rates
for contracts with similar maturity profiles. The fair values
of interest rate swaps are determined by reference to
market values for similar instruments.
Hedges that meet the strict criteria for hedge accounting
are accounted for as follows:
(i) Fair value hedges
Fair value hedges are hedges of the Group’s exposure to
changes in the fair value of a recognised asset or liability or an
unrecognised firm commitment, or an identified portion of
such an asset, liability or firm commitment that is attributable
to a particular risk and could affect profit or loss. For fair value
hedges, the carrying amount of the hedged item is adjusted
for gains and losses attributable to the risk being hedged and
the derivative is remeasured to fair value. Gains and losses
from both are taken to profit or loss.
The Group discontinues fair value hedge accounting if the
hedging instrument expires or is sold, terminated or
exercised, the hedge no longer meets the criteria for hedge
accounting or the Group revokes the designation. Any
adjustment to the carrying amount of a hedged financial
instrument for which the effective interest method is used
is amortised to profit or loss. Amortisation may begin as
soon as an adjustment exists and shall begin no later than
when the hedged item ceases to be adjusted for changes
in its fair value attributable to the risk being hedged.
(ii) Cash flow hedges
Cash flow hedges are hedges of the Group’s exposure to
variability in cash flows that is attributable to a particular
risk associated with a recognised asset or liability that is a
firm commitment and that could affect profit or loss. The
effective portion of the gain or loss on the hedging
instrument is recognised directly in equity, while the
ineffective portion is recognised in the Statement of Profit
or Loss.
Amounts taken to OCI are accumulated in the cash flow
hedge reserve in equity and are transferred out of equity
and included in the measurement of the hedged
transaction (finance costs or inventory purchases) when
the forecast transaction occurs. If the hedging instrument
expires or is sold, terminated or exercised without
replacement or rollover, or if the hedging relationship is
discontinued, amounts previously recognised in equity
remain in equity until the forecast transaction occurs.
(s) Put options over non-controlling interests
Put options granted to holders of non-controlling interests
(‘NCI puts’) at the date of acquiring control of a subsidiary
(or after gaining control) gives rise to a financial liability.
1. Significant Accounting Policies continued
1.6 Summary of significant accounting policies
continued
(p) Leases continued
Group as lessee continued
(ii) Lease liabilities continued
Crown Resorts Limited Annual Report 2021
119
Notes to the Financial Statements
When the Group does not have a present ownership
interest in the shares subject to the NCI put, the Group
applies the partial recognition of NCI approach. Under this
approach, the following accounting method is applied at
the end of each reporting period:
• The Group determines the amount that would have
been recognised for the NCI, including an update to
reflect allocations of profit or loss, allocations of
changes in other comprehensive income and dividends
declared for the reporting period;
• The Group derecognises the NCI as if it was acquired
at that date;
• The Group recognises a financial liability and continues
to re-assess the liability at the present value of the
amount payable on exercise of the NCI put, with the
difference recognised in equity; and
• The Group accounts for the difference between the NCI
derecognised and the financial liability recognised as
an equity transaction.
If the NCI put is exercised, the same treatment is applied
up to the date of exercise. The amount recognised as the
financial liability at that date is extinguished by the
payment of the exercise price.
If the NCI put expires unexercised, the position is unwound
so that the NCI is recognised at the amount it would have
been, as if the NCI put had never been granted. The
financial liability is derecognised as an equity transaction.
(t) Contributed equity
Ordinary shares are classified as equity. Issued capital is
recognised at the fair value of the consideration received,
less transaction costs and share buy-backs.
(u) Revenue from contracts with customers
Crown Melbourne, Crown Perth, Crown Sydney
and Crown Aspinalls
Gaming Revenue
Gaming revenue is the net difference between gaming
wins and losses, and is recognised upon the outcome of
the game. Commissions rebated to gaming customers or
promoters are recorded as a reduction of revenue.
Food and beverage revenue
Food and beverage revenue is recognised as the goods
are provided.
Hotel, entertainment and other operating revenues
Hotel, entertainment and other operating revenues are
recognised as services are performed, which for hotels is
over the term of the customer’s stay and for entertainment
is when the event is held. Advance deposits for hotels and
advance ticket sales for entertainment are recorded as
customer deposits (i.e. contract liability) until services are
provided to the customer.
Commissions rebated to third parties relating to Hotel
revenue are recorded as an expense.
Complimentary goods or services
For gaming transactions that include complimentary
goods or services being provided to customers, the Group
allocates revenue from the gaming transaction to the good
or service provided based on the standalone selling price
which is the arm’s length price for that good or service
available to the public.
Contract and contract-related liabilities
In providing goods and services to its customers, there
may be a timing difference between cash receipts from
customers and recognition of revenues, resulting in a
contract or contract-related liability.
The Group primarily has liabilities related to contracts with
customers as follows:
• Unredeemed casino chips, which represent the
amounts owed to customers for chips in their
possession.
• Loyalty program liabilities, which represent the deferral
of revenue until loyalty points are redeemed or expire.
• Advance customer deposits, which represent casino
front money deposits that are funds deposited by
customers before gaming play occurs, gift vouchers
and advance payments on goods and services yet to
be provided such as deposits on hotel rooms and
convention space.
These liabilities are generally expected to be recognised
as revenues within one year of being purchased, earned,
or deposited and are recorded within current trade and
other payables on the Statement of Financial Position.
Decreases in these balances generally represent the
recognition of revenues and increases in the balances
represent additional chips held by customers, increases in
customer loyalty program balances and additional
deposits made by customers.
Wagering and Online
Revenue from exchange betting
Revenue from exchange betting represents commission
and other charges earned on betting activity. Revenue is
recognised as the performance obligations are satisfied,
which is considered to be upon the outcome of the bet
being determined.
Social gaming revenue
Social gaming revenue is derived from the purchase of
credits. Revenue is recognised in the accounting periods
in which the transactions occur on a gross basis and
commission costs are expensed as incurred.
(v) Other revenue
Interest
Revenue is recognised as the interest accrues (using the
effective interest method, which is the rate that exactly
discounts estimated future cash receipts through the
expected life of the financial instrument to the net carrying
amount of the financial asset).
Notes to the Financial Statements continued
For the year ended 30 June 2021
120
FINANCIAL REPORT 2021 CONTINUED
Notes to the Financial Statements
Dividends
Revenue is recognised when the shareholders’ right to
receive the payment is established.
(w) Government Grants
Government grants are recognised where there is
reasonable assurance that the grant will be received and all
attached conditions will be complied with. When the grant
relates to an expense item, it is deducted against the
relevant expense on a systematic basis over the periods
that the related costs, for which it is intended to
compensate, are expensed.
(x) Assets held for sale
Non-current assets, or disposal groups comprising assets
and liabilities, are classified as held for sale if it is highly
probable that they will be recovered primarily through sale
rather than through continuing use, management is
committed to a plan to sell the asset, there is an active
programme to locate a buyer and the sale is expected to
complete within 12 months from the date of classification.
Such assets, or disposal groups, are generally measured at
the lower of their carrying amount and fair value less costs of
sale. Any impairment loss on a disposal group is allocated
first to goodwill, and then to the remaining assets and
liabilities on a pro-rata basis, except that no loss is allocated
to inventories, financial assets, deferred tax assets or
employee benefit assets, which continue to be measured in
accordance with the Group’s other accounting policies.
Impairment losses on initial classification as held-for-sale and
subsequent gains or losses on remeasurement are
recognised in profit and loss.
Once classified as held for sale, intangible assets and
property, plant and equipment are no longer amortised or
depreciated, and any equity-accounted investee is no
longer equity accounted.
(y) Share-based payments
Employees (including senior executives) of the Group
receive remuneration in the form of share-based payments,
whereby employees render services as consideration for
equity instruments.
The cost of equity-settled transactions is determined by the
fair value at the date when the grant is made using an
appropriate valuation model.
That cost is recognised in employee benefits expense,
together with a corresponding increase in equity (reserves),
over the period in which the service is fulfilled (the vesting
period). The cumulative expense recognised for equity-settled
transactions at each reporting date until the vesting date
reflects the extent to which the vesting period has expired.
If the terms of an equity-settled award are modified, the
minimum expense recognised is the grant date fair value of
the unmodified award, provided the original terms of the
award are met. An additional expense, measured as at the
date of modification, is recognised for any modification that
increases the total fair value of the share-based payment
transaction, or is otherwise beneficial to the employee.
Where an award is cancelled by the entity or by the
counterparty, any remaining element of the fair value of the
award is expensed immediately through profit or loss.
The dilutive effect of outstanding options is reflected as
additional share dilution in the computation of diluted
earnings per share, except when the outstanding options
are anti-dilutive.
(z) Earnings per share (EPS)
Basic EPS is calculated as net profit or loss after tax,
adjusted to exclude any costs of servicing equity (other than
dividends), divided by the weighted average number of
ordinary shares, adjusted for any bonus element.
Diluted EPS is calculated as net profit or loss after tax,
adjusted for:
• costs of servicing equity (other than dividends);
• the after tax effect of dividends and interest associated
with dilutive potential ordinary shares that have been
recognised as expenses; and
• other non-discretionary changes in revenues or
expenses during the period that would result from the
dilution of potential ordinary shares;
divided by the weighted average number of ordinary shares
and dilutive potential ordinary shares, adjusted for any
bonus element.
(aa) Segment Information
The Group’s operating segments have been determined
based on geographic location, management reporting
structure and the nature of the products and services
offered by the Group. Crown has identified the Board of
Directors as its Chief Operating decision maker that
allocates resources and assesses the performance of the
operating segments. The segment information presented
below is consistent with internal management reporting.
The Group has five operating segments being Crown
Melbourne, Crown Perth, Crown Sydney, Crown Aspinalls
and Wagering & Online.
(ab) Business Combinations
Business combinations are accounted for using the
acquisition method. The consideration transferred in a
business combination shall be measured at fair value, which
shall be calculated as the sum of the acquisition date fair
values of the assets transferred by the acquirer, the liabilities
incurred by the acquirer to former owners of the acquiree
and the equity issued by the acquirer, and the amount of
any non-controlling interest in the acquiree. Acquisition-
related costs are expensed as incurred.
For each business combination the group elects whether to
measure the non-controlling interest in the acquiree at the
fair value or at the proportionate share of the acquiree’s
identifiable net assets.
1. Significant Accounting Policies continued
1.6 Summary of significant accounting policies
continued
(v) Other revenue continued
Crown Resorts Limited Annual Report 2021
121
Notes to the Financial Statements
When the Group acquires a business, it assesses the
financial assets and liabilities assumed for appropriate
classification and designation in accordance with the
contractual terms, economic conditions, the Group’s
operating or accounting policies and other pertinent
conditions as at the acquisition date. This includes the
separation of embedded derivatives in host contracts by
the acquiree.
If the business combination is achieved in stages, the
acquisition date fair value of the acquirer’s previously held
equity interest in the acquiree is remeasured to fair value
at the acquisition date through profit or loss.
Any contingent consideration to be transferred by the
acquirer will be recognised at fair value at the acquisition
date. Subsequent changes to the fair value of the
contingent consideration which is deemed to be an asset
or liability will be recognised in accordance with AASB 9 in
the Statement of Profit or Loss. If the contingent
consideration is classified as equity, it should not be
remeasured until it is finally settled within equity.
2. Segment Information
Closure of Crown’s Operations
During the financial year, in response to the COVID-19
pandemic Crown was directed by relevant State and
Federal Governments to suspend its gaming activities and
other non-essential services at Crown Melbourne, Crown
Perth and Crown Aspinalls.
Government mandated closures that occurred during the
financial year are detailed below:
Property
Dates of Closure (1)
Crown Melbourne
1 Jul 20 – 11 Nov 20
Crown Melbourne
13 Feb 21 – 17 Feb 21
Crown Melbourne
28 May 21 – 17 Jun 21
Crown Perth
1 Feb 21 – 13 Feb 21
Crown Perth
24 Apr 21 – 30 Apr 21
Crown Perth
3 May 21 – 7 May 21
Crown Perth
29 Jun 21 – 30 Jun 21(2)
Crown Aspinalls
1 Jul 20 – 14 Aug 20
Crown Aspinalls
5 Nov 20 – 16 May 21
(1) Following year-end, on the evening of 15 July 2021, Crown
Melbourne ceased gaming activities and the majority of
non-gaming operations due to COVID-19 restrictions. From 28
July 2021, Crown Melbourne recommenced operations in
accordance with Victorian Government restrictions, including
patron capacity limits. On the evening of 5 August 2021, Crown
Melbourne ceased gaming activities and the majority of
non-gaming operations due to COVID-19 and remains closed.
(2) Gaming activities recommenced at Crown Perth on 6 July 2021.
The closure dates reflect the periods when no gaming
activities were permitted at the properties. In some
instances, during the closure periods when gaming
activities were not permitted at the properties, Crown was
able to continue operating certain Food & Beverage and
Hotel operations in a severely limited capacity. Given the
restrictions in place in the relevant cities at the time, as well
as a large portion of the properties being closed, volumes in
Food & Beverage and Hotels were minimal, apart from hotel
quarantine services. During July and August 2020, Crown
Melbourne’s hotels remained open largely to provide the
State Government with hotel quarantine services. All other
operations were closed or severely limited during these
closure periods in accordance with Government direction.
Crown’s businesses ordinarily operate each day of the
year and, apart from minor exceptions, 24 hours each day.
Due to the unprecedented nature of the Government
mandated closures during the period, the circumstances
surrounding Crown’s closure are exceptional. During the
closure period, whilst Crown did not generate any gaming
revenues, Crown continued to incur expenses to maintain
its operations. Given these exceptional circumstances,
Crown has separately disclosed all costs incurred during
the mandated closure period. The closure costs exclude
costs in relation to hotel quarantine services provided
during the closure period but include the impact of the
JobKeeper program and other similar reimbursements,
such as the Government support scheme in the UK. There
were no closure costs associated with Crown’s Wagering
and Online businesses as their operations were not
suspended during the reporting period.
In addition, Crown recorded a provision in relation to a
minimum tax obligation at Crown Melbourne. In 2014,
Crown reached agreement with the Victorian Government
regarding a number of reforms to the Crown Melbourne
casino licence. The agreement included an increase to the
maximum number of gaming machines, table games, and
fully automated table games permitted to operate. A
condition of the increase in product was that Crown agreed
to pay the State a minimum of $35.0 million per annum in
casino taxes in relation to the new product over the six-year
period commencing from the 2016 financial year. As a result
of the casino being closed for significant periods throughout
the 2021 financial year, Crown was unable to generate
sufficient revenue from the new product to meet its tax
obligation. Accordingly, at balance date Crown has
recognised a provision of approximately $25 million for the
anticipated tax shortfall. The 2021 financial year is the final
year the minimum tax obligation is applicable.
Net costs incurred at Crown’s properties whilst gaming
facilities were closed due to Government orders, excluding
costs in relation to hotel quarantine services (Closure
Costs) for the 2021 financial year were $171.4 million
(2020: $107.3 million), including the tax shortfall of
approximately $25 million as described above.
This is consistent with the information provided to and
used by the Chief Operating decision makers to evaluate
the performance of the Group during this period.
Notes to the Financial Statements continued
For the year ended 30 June 2021
122
FINANCIAL REPORT 2021 CONTINUED
Notes to the Financial Statements
Theoretical Result (1)(6)
ACTUAL
30 June 2021
Crown
Melbourne
Crown
Perth
Crown
Sydney
Crown
Aspinalls
Wagering
& Online
Unallocated
Crown
Group
VIP Win Rate &
Commission
Adjustment(1)(2)
Crown
Group
$m
$m
$m
$m
$m
$m
$m
$m
$m
Operating revenue
Main floor tables
241.2
171.7
-
-
-
-
412.9
-
412.9
Main floor machines
165.7
306.6
-
-
-
-
472.3
-
472.3
VIP program play
4.4
0.4
-
2.1
-
-
6.9
(3.4)
3.5
Wagering & Non gaming
171.2
264.1
68.6
0.2
147.0
-
651.1
-
651.1
Commission adjustment
-
-
-
-
-
-
-
(2.8)
(2.8)
Intersegment
(1.2)
-
(1.2)
Operating revenue
582.5
742.8
68.6
2.3
147.0
- 1,542.0
(6.2)
1,535.8
Interest revenue
1.0
-
1.0
Total revenue
582.5
742.8
68.6
2.3
147.0
- 1,543.0
(6.2)
1,536.8
EBITDA before Closure Costs (3) & Significant items(6)
94.1
254.2
(22.8)
(6.3)
34.1
(111.6)
241.7
(3.2)
238.5
Costs incurred during mandated closure (3)
(145.9)
(20.3)
-
(5.2)
-
-
(171.4)
-
(171.4)
EBITDA related Significant items (4)
(45.4)
(2.3)
145.8
(16.9)
-
(34.2)
47.0
-
47.0
EBITDA after Closure Costs (3) & Significant items (5)(6)
(97.2)
231.6
123.0
(28.4)
34.1
(145.8)
117.3
(3.2)
114.1
Depreciation and amortisation
(169.9)
(75.7)
(24.6)
(4.5)
(11.4)
(4.2)
(290.3)
-
(290.3)
Asset impairments (4)
-
-
-
(17.3)
(36.3)
(53.6)
-
(53.6)
Reassessment of contingent consideration (4)
-
-
-
-
(2.0)
-
(2.0)
-
(2.0)
Earnings before interest and tax (EBIT) (6)
(267.1)
155.9
98.4
(32.9)
3.4
(186.3)
(228.6)
(3.2)
(231.8)
Equity accounted share of associates’ net profit/(loss)
(8.7)
Net interest income/(expense)
(44.3)
Interest - Significant item (4)
(23.8)
Profit/(loss) before tax
(308.6)
Income tax benefit/(expense)
47.3
Profit/(loss) after tax
(261.3)
Non-controlling interest
(0.3)
Profit/(loss) attributable to equity holders of the Parent
(261.6)
(1) Theoretical results have been adjusted to exclude the impact of any variance from theoretical win rate on VIP program play (at Crown Melbourne, Crown Perth and Crown Aspinalls). The theoretical
win rate is the expected hold percentage on VIP program play over time. The theoretical result gives rise to adjustments to VIP program play revenue, operating expenses and income tax expense.
Revenue from gaming transactions that include complimentary goods or services being provided to customers is not allocated from gaming revenue to the good or service provided.
(2) During the year Crown incurred $2.8 million of actual VIP program play commission expenses. In the actual results, the commission expenses have been allocated out of Operating Expenses and
recognised as a reduction to revenue. This difference between the theoretical and actual result is included in the VIP Win Rate & Commission Adjustment column above.
(3) Closure Costs reflect all costs incurred at Crown Melbourne, Crown Perth and Crown Aspinalls whilst gaming facilities were closed due to Government direction (refer commentary above), excluding
costs in relation to hotel quarantine services at Crown Melbourne and including the Crown Melbourne tax shortfall obligation of approximately $25 million. No portion of corporate costs has been
allocated to Closure Costs in the 2021 financial year due to the ad-hoc nature of the property closures during the year.
(4) These items have been classified as Significant items. Refer note 3(e) for further details. Significant items are transactions that are not in the ordinary course of business or are material and
unexpected due to their size and nature.
(5) Significant items in ‘EBITDA after Closure Costs & Significant items’ includes EBITDA related Significant items only.
(6) Non-IFRS measures.
2. Segment Information continued
Crown Resorts Limited Annual Report 2021
123
Notes to the Financial Statements
Theoretical Result (1)(7)
ACTUAL
30 June 2020
Crown
Melbourne
Crown
Perth
Crown
Aspinalls
Wagering
& Online
Unallocated
Crown
Group
VIP Win Rate &
Commission
Adjustment(1)(2)
Crown
Group
$m
$m
$m
$m
$m
$m
$m
$m
Operating revenue
Main floor tables
548.7
137.6
-
-
-
686.3
-
686.3
Main floor machines
341.9
207.0
-
-
-
548.9
-
548.9
VIP program play
224.9
49.5
32.3
-
-
306.7
133.4
440.1
Wagering & Non gaming
362.3
219.2
0.8
135.5
0.3
718.1
-
718.1
Commission adjustment
-
-
-
-
-
-
(165.0)
(165.0)
Intersegment
(1.4)
-
(1.4)
Operating revenue
1,477.8
613.3
33.1
135.5
0.3
2,258.6
(31.6)
2,227.0
Interest revenue
10.2
-
10.2
Total revenue
1,477.8
613.3
33.1
135.5
0.3
2,268.8
(31.6)
2,237.2
EBITDA before Closure Costs (3) & Significant items (7)
354.3
161.8
(2.7)
34.7
(44.3)
503.8
111.6
615.4
Costs incurred during mandated closure (3)
(65.8)
(19.7)
(1.2)
-
(20.6)
(107.3)
-
(107.3)
Crown Sydney pre-opening costs (4)
-
-
-
-
(3.5)
(3.5)
-
(3.5)
EBITDA after Closure Costs (3) & Significant items (5)(7)
288.5
142.1
(3.9)
34.7
(68.4)
393.0
111.6
504.6
Depreciation and amortisation
(176.0)
(79.6)
(4.8)
(9.4)
(5.7)
(275.5)
-
(275.5)
Impairment - Crown Aspinalls (4)
-
-
(52.8)
-
-
(52.8)
-
(52.8)
Impairment - Nobu (4)
-
-
-
-
(21.7)
(21.7)
-
(21.7)
Reassessment of contingent consideration - DGN (4)
-
-
-
(1.7)
-
(1.7)
-
(1.7)
Earnings before interest and tax (EBIT) (7)
112.5
62.5
(61.5)
23.6
(95.8)
41.3
111.6
152.9
Equity accounted share of associates’ net profit/(loss) (6)
6.7
Equity accounted share of associates’ net profit/(loss) during mandated closure (6)
(6.4)
Net interest income/(expense)
0.0
Profit/(loss) before tax
153.2
Income tax benefit/(expense)
(71.3)
Profit/(loss) after tax
81.9
Non-controlling interest
(2.4)
Profit/(loss) attributable to equity holders of the Parent
79.5
(1) Theoretical results have been adjusted to exclude the impact of any variance from theoretical win rate on VIP program play (at Crown Melbourne, Crown Perth and Crown Aspinalls). The theoretical
win rate is the expected hold percentage on VIP program play over time. Accordingly, the theoretical result gives rise to adjustments to VIP program play revenue, operating expenses and income
tax expense. Revenue from gaming transactions that include complimentary goods or services being provided to customers is not allocated from gaming revenue to the good or service provided.
(2) During the year Crown incurred $165.0 million of actual VIP program play commission expenses. In the actual results, the commission expenses have been allocated out of operating expenses and
recognised as a reduction to revenue. This difference between the theoretical and actual result is included in the VIP Win Rate & Commission Adjustment column above.
(3) Closure Costs reflect all costs incurred whilst the properties were closed due to Government direction (refer commentary above), excluding costs in relation to hotel quarantine services and
Crown’s Wagering and Online businesses during the closure period. The operating segments impacted by the closures were Crown Melbourne, Crown Perth, Crown Aspinalls, corporate costs and
Crown’s share of associates.
(4) These items have been classified as Significant items. Refer note 3(e) for further details. Significant items are transactions that are not in the ordinary course of business or are material and
unexpected due to their size and nature.
(5) Significant items in ‘EBITDA after Closure Costs & Significant items’ includes EBITDA related Significant items only.
(6) In addition to the mandated closure of Crown’s core businesses, Crown’s associates, Aspers and Nobu, were also subject to mandated closure orders. Accordingly, Crown’s equity accounted
share of losses during these mandated closure periods have been separately identified in the table above, consistent with the treatment of Crown’s core businesses.
(7) Non-IFRS measures.
Notes to the Financial Statements continued
For the year ended 30 June 2021
124
FINANCIAL REPORT 2021 CONTINUED
Notes to the Financial Statements
3. Revenue and Expenses
2021
2020
$m
$m
Profit before income tax expense includes the following revenues and expenses:
(a) Revenue
Crown Melbourne
567.5
1,580.9
Crown Perth
740.9
607.5
Crown Sydney
68.4
-
Crown Aspinalls
2.5
42.7
Wagering & Online
145.9
134.7
Other
-
0.2
Less Commissions
(2.8)
(165.0)
Total Revenue from Contracts with Customers
1,522.4
2,201.0
Tenancy revenue
13.4
26.0
Interest
1.0
10.2
1,536.8
2,237.2
(b) Other income
Profit on disposal of Crown Sydney apartments
207.8
-
Profit on disposal of other non-current assets
-
0.1
207.8
0.1
(c) Expenses (1)
Employment costs (2)
695.4
738.9
Superannuation expenses
53.2
59.1
Depreciation and amortisation (refer below)
290.3
275.5
Taxes & levies
373.1
425.3
Cost of sales
112.7
124.1
Property costs
102.7
98.5
Net credit loss expense
27.4
27.0
Asset impairment - Queensbridge
28.0
-
Goodwill impairment - DGN
17.3
-
Impairment of associate - Aspers
8.3
-
Reassessment of contingent consideration - DGN
2.0
1.7
Goodwill impairment - Crown Aspinalls
-
52.8
Impairment of associate - Nobu
-
21.7
Net foreign currency (gains)/losses
0.1
(0.2)
Other expenses (3)
264.9
249.8
1,975.4
2,074.2
Depreciation of non-current assets (included in 3(c))
Buildings
106.8
92.5
Plant and equipment
153.7
151.4
Right-of-use assets
7.9
5.9
268.4
249.8
(1) During the current year, the Group modified the presentation of ‘Expenses’ to show more detailed information on the nature of each operating
activity. In order to conform with the current period’s presentation, certain comparatives have been re-classified for consistency. Since this is a
change of presentation within operating activities, this did not have any effect on the consolidated statement of financial position or profit and loss.
(2) Employment costs include salaries, wages, bonuses, redundancies and other benefits, net of government grants, refer note 26 for further
information.
(3) Other expenses include marketing and promotional costs, IT costs, operating supplies and corporate expenses.
Crown Resorts Limited Annual Report 2021
125
Notes to the Financial Statements
2021
2020
$m
$m
Amortisation of non-current assets (included in 3(c))
Casino licence fee and management agreement
20.3
20.4
Other assets
1.6
5.3
21.9
25.7
Total depreciation and amortisation expense
290.3
275.5
(d) Other income and expense disclosures
Finance costs expensed:
Debt facilities
85.6
66.8
Lease liabilities
2.9
2.4
Interest significant items (refer to note 3(e))
23.8
-
Capitalised interest
(43.2)
(59.0)
69.1
10.2
(e) Significant items - income / (expense)(1)
Profit on disposal of Crown Sydney apartments (2)
207.8
-
Crown Sydney pre-opening costs (3)
(62.0)
(3.5)
Underpayment of casino tax (4)
(37.4)
-
One-off allowance for expected credit losses (5)
(27.2)
-
Restructuring costs (6)
(21.7)
-
Contribution to cost of the Bergin Inquiry (7)
(12.5)
-
EBITDA related Significant items
47.0
(3.5)
Asset impairment - Queensbridge (8)
(28.0)
-
Goodwill impairment - DGN (9)
(17.3)
-
Impairment of associate - Aspers (10)
(8.3)
-
Reassessment of contingent consideration - DGN (11)
(2.0)
(1.7)
Interest on underpayment of casino tax (4)
(23.8)
-
Goodwill impairment - Crown Aspinalls
-
(52.8)
Impairment of associate - Nobu
-
(21.7)
Income tax benefit/(expense) on significant items
(22.2)
1.0
Total Significant items (net of tax)
(54.6)
(78.7)
(1) Significant items are transactions that are not in the ordinary course of business or are material and unexpected due to their size and nature.
(2) Profit on disposal of Crown Sydney apartments represents the proceeds received for apartments settled during the year less construction
and selling costs.
(3) The pre-opening costs primarily relate to payroll and other ancillary operating costs incurred before the opening of Crown Sydney including
recruitment and training expenses. The pre-opening costs also include Gaming relating costs (including an appropriate allocation of Support
Departments) that continue to be incurred prior to the commencement of gaming operations.
(4) On 27 July 2021, Crown announced that it resolved to make a payment to the Victorian Commission for Gambling and Liquor Regulation
(VCGLR), representing an underpayment of casino tax by Crown Melbourne of $37.4 million over the period commencing in the 2012 financial
year to date relating to the incorrect deduction of certain bonus rewards provided to patrons in connection with play on Crown Melbourne’s
electronic gaming machines. Under the terms of Crown’s regulatory agreements with the State of Victoria, Crown is required to pay interest
on any underpayment of casino tax. The interest component is $23.8 million.
(5) During the year, Crown announced that it would permanently cease dealing with all junket operators, subject to consultation with gaming
regulators in Victoria, Western Australia and New South Wales. Subsequently, all three gaming Regulators in Victoria, NSW and WA have
advised that they do not support junket operations in their respective jurisdictions. Furthermore, in February 2021, the WA regulator issued
direction that Crown Perth shall not participate in the conduct of junkets, premium player activity or privileged player activity. In light of the
above and given the COVID-19 related impacts to Crown’s customers, Crown undertook a review of all outstanding gaming debts. This
resulted in a one-off adjustment to the allowance for expected credit losses.
(6) Restructuring and redundancy costs relating to corporate management and international VIP operating activities.
(7) During the year, Crown reached an agreement with the NSW Independent Liquor and Gaming Authority (ILGA) to pay a contribution towards
the costs of the Bergin Inquiry of $12.5 million.
(8) Impairment of assets in Queensbridge land. Refer note 10 for further information.
(9) Impairment of goodwill in DGN. Refer note 14 for further information.
(10) Impairment of investment in Aspers. Refer note 9 for further information.
(11) Reassessment of contingent consideration related to acquisition of DGN.
Notes to the Financial Statements continued
For the year ended 30 June 2021
126
FINANCIAL REPORT 2021 CONTINUED
Notes to the Financial Statements
4. Dividends Paid and Declared
2021
2020
$m
$m
(a) Dividends declared and paid during the financial year
Prior year final dividend
No prior year final dividend paid (2019: 30.0 cents per share franked at 25% at the
Australian tax rate of 30%)
-
203.1
Current year interim dividend
No interim dividend paid (2020: 30.0 cents per share unfranked)
-
203.1
Total dividends appropriated
-
406.2
(b) Dividends declared and not recognised as a liability
Current year final dividend
No final dividend declared (2020: No final dividend declared)
-
-
(c) Franking credits
The amount of franking credits available for the subsequent financial year:
Franking account balance as at the end of the financial year at 30% (2020: 30%)
72.3
0.1
Franking credits/(debits) that will arise from the payment/(receipt) of income taxes payable/
(refundable) as at the end of the financial year
(64.9)
33.1
Total franking credits available for future reporting periods
7.4
33.2
5. Income Tax
2021
2020
$m
$m
(a) Income tax expense/benefit
The prima facie tax expense/benefit, using the Australian tax rate multiplied by profit/loss
differs from income tax provided in the financial statements as follows:
Profit/(loss) before income tax
(308.6)
153.2
Prima facie income tax expense/(benefit) on profit/loss at the Australian rate of 30% (2020: 30%)
(92.6)
46.0
Tax effect of:
Non deductible depreciation and amortisation
1.7
1.7
Share of associates’ net losses/(profits)
2.6
(0.1)
Differences in foreign tax rates
1.9
0.3
Deferred tax balances not previously brought to account
(4.3)
4.1
Income tax (over)/under provided in prior years
1.7
(8.9)
Non-deductible/(non-assessable) significant items (1)
31.9
22.8
Revenue losses not brought to account
2.5
0.2
Other items - net
7.3
5.2
Income tax expense/(benefit)
(47.3)
71.3
Income tax expense/(benefit) comprises:
Current expense/(benefit)
(27.4)
62.9
Deferred expense/(benefit)
(21.6)
17.3
Adjustments for current income tax of prior periods
1.7
(8.9)
(47.3)
71.3
(b) Deferred income taxes
Deferred income tax assets
183.5
170.7
Deferred income tax liabilities
(406.7)
(420.5)
Net deferred income tax assets/(liabilities)
(223.2)
(249.8)
(1) Non-deductible/(non-assessable) significant items includes asset impairments and reassessment of contingent consideration.
Crown Resorts Limited Annual Report 2021
127
Notes to the Financial Statements
Statement of
Financial Position
Statement of
Profit or Loss
2021
2020
2021
2020
$m
$m
$m
$m
(c) Deferred income tax assets and liabilities at
the end of the financial year
The balance comprises temporary differences
attributable to:
Allowance for expected credit losses
28.0
25.5
(2.5)
(7.3)
Employee benefits provision
53.2
46.1
(7.1)
(5.1)
Losses available for offsetting against future taxable
income
0.5
1.7
1.2
23.9
Other receivables
-
0.3
0.3
0.2
Other provisions
41.0
36.7
(4.3)
4.2
Prepaid casino tax
(13.1)
(13.6)
(0.5)
(0.4)
Licences and intangibles
(204.2)
(205.1)
(0.9)
(20.5)
Property, plant & equipment
(147.9)
(155.2)
(7.3)
21.4
Other
19.3
13.8
(0.5)
0.9
Deferred income tax expense/(income)
(21.6)
17.3
Net deferred income tax assets/(liabilities)
(223.2)
(249.8)
2021
2020
$m
$m
(d) Movements in deferred income tax assets and liabilities during the
financial year
Carrying amount at the beginning of the year
(249.8)
(242.0)
Tax income / (expense) during the period recognised in profit or loss
21.6
(17.3)
Adjustment on adoption of AASB 16 Leases
-
6.6
Exchange differences
(0.9)
0.1
Tax income / (expense) - derivatives
5.9
2.8
Carrying amount at the end of the year
(223.2)
(249.8)
(e) Tax losses not brought to account, as the realisation of the benefits
represented by these balances is not considered to be probable
Tax losses arising in Australia for offset against future capital gains
564.9
548.9
Foreign income tax losses for offset against future foreign profits
849.7
885.7
Foreign capital losses for offset against future capital gains
346.2
-
Total tax losses not brought to account
1,760.8
1,434.6
Potential tax benefit at respective tax rates
419.9
350.7
(f) Unrecognised temporary differences
At 30 June 2021, there is no recognised or unrecognised deferred income tax liability (2020: $nil) for taxes that would be
payable on the unremitted earnings of certain of the Group’s subsidiaries, associates or joint ventures, as the Group has no
liability for additional taxation should such amounts be remitted.
Notes to the Financial Statements continued
For the year ended 30 June 2021
128
FINANCIAL REPORT 2021 CONTINUED
Notes to the Financial Statements
(g) Tax consolidation
Crown Resorts Limited and its 100% owned Australian resident subsidiaries have formed a tax consolidated group with
effect from 1 July 2007. Crown Resorts Limited is the head entity of the tax consolidated group. Members of the group
have entered into a tax sharing arrangement with Crown Resorts Limited in order to allocate income tax expense between
Crown Resorts Limited and the wholly owned subsidiaries. In addition, the agreement provides for the allocation of income
tax liabilities between the entities should the head entity default on its tax payment obligations. At the balance date the
possibility of default is remote.
(h) Tax effect accounting by members of the tax consolidated group
Members of the tax consolidated group have entered into a tax funding agreement. The tax funding agreement provides
for the allocation of current and deferred taxes to members of the tax consolidated group in accordance with their taxable
income for the period. The allocation of taxes under the tax funding agreement is recognised as an increase / decrease in
the subsidiaries inter-company accounts with the tax consolidated group head company, Crown Resorts Limited.
6. Trade and Other Receivables
2021
2020
$m
$m
Current
Trade receivables
174.6
193.5
Allowance for expected credit losses (a)
(166.5)
(139.0)
8.1
54.5
Other receivables
11.5
56.7
19.6
111.2
(a) Allowance for expected credit losses
Trade receivables are non-interest bearing and are generally 30 day terms. An allowance for expected credit losses is
recognised based on the expected credit loss model from the time the financial instrument is initially recognised. The
expected credit loss model the Group uses includes a matrix of historical default rates, as well as taking to account current
conditions, the time value of money and forecasts of future operating and economic conditions. In addition, during the year
Crown announced it would permanently cease dealing with all junket operators, with gaming regulators in Victoria, Western
Australia and New South Wales subsequently advising that they do not support junket operators in their respective
jurisdictions. Furthermore, the Western Australian regulator issued direction that Crown Perth shall not participate in the
conduct of junkets, premium player activity or privileged player activity. As a result, Crown reviewed all gaming related
trade receivables on a case-by-case basis. The estimates and assumptions applied by the Group in determining the
allowance for expected credit losses at 30 June 2021 were updated to incorporate the uncertainty around the duration for
which restricted operating conditions and border restrictions continue, as well as the change in Crown’s VIP operations.
Movements in the allowance for expected credit losses
2021
2020
$m
$m
Allowance for expected credit losses at the beginning of the year
(139.0)
(108.0)
Net credit loss expense
(27.4)
(27.0)
Net amounts written off/(recovered)
0.7
(4.3)
Exchange differences
(0.8)
0.3
(166.5)
(139.0)
5. Income Tax continued
Crown Resorts Limited Annual Report 2021
129
Notes to the Financial Statements
Ageing analysis of trade receivables
0-30 days
>30 days -
<1 year
>1 year
Total
$m
$m
$m
$m
2021 - consolidated
Gross carrying amount
5.3
2.5
166.8
174.6
Allowance for expected credit losses
-
(0.9)
(165.6)
(166.5)
Net carrying amount
5.3
1.6
1.2
8.1
2020 - consolidated
Gross carrying amount
6.5
101.3
85.7
193.5
Allowance for expected credit losses
-
(66.9)
(72.1)
(139.0)
Net carrying amount
6.5
34.4
13.6
54.5
7. Assets held for sale
During the year, Crown committed to a plan to divest its interest in Aspers. Crown expects the transaction to be completed
by 31 December 2021. An impairment loss of $8.3 million has been recognised for the write down of the investment to the
lower of its carrying value and fair value less costs of disposal. Refer note 9 for further information.
During the year, Crown commenced settling Crown Sydney apartments. There are a number of apartments that are yet to
settle, which are substantially complete and are being actively marketed for sale. Crown expects the apartments to be
settled by 30 June 2022. Accordingly, Crown has reclassified the construction costs of the apartments from Property, Plant
and Equipment to Assets Held for Sale.
The major classes of assets associated with the assets classified as held for sale are detailed below.
2021
2020
$m
$m
Assets
Investments in associates
34.9
-
Property, plant and equipment
390.9
-
Total assets
425.8
-
8. Other Financial Assets
2021
2020
$m
$m
Non-current
Cross currency swap derivative asset
12.7
29.3
12.7
29.3
Details of the Group’s exposure to interest rate risk and foreign currency changes are provided in note 33.
Notes to the Financial Statements continued
For the year ended 30 June 2021
130
FINANCIAL REPORT 2021 CONTINUED
Notes to the Financial Statements
9. Investments in Associates
2021
2020
$m
$m
Investment details
Associated entities - unlisted shares
127.4
186.0
Total investments in associates
127.4
186.0
Share of profit/(loss) of associates
Nobu Group
5.2
3.4
Aggregate share of profit/(loss) from non material associates
(13.9)
(3.1)
Net profit/(loss) from associates
(8.7)
0.3
% Interest
Investments in
Associates
Reporting
Date
Principal Activity
Principal
Place
of
Business
30 June
2021
30 June
2020
Nobu Group
31 Dec(1)
Restaurants/Hotels
USA
20.0
20.0
Aspers Holdings (Jersey) Ltd
30 June
Casino and gaming machine operator
UK
50.0(2)
50.0
Chill Gaming Pty Ltd
30 June
Gaming software developer
Australia
50.0
50.0
(1) The Group uses 30 June results to equity account the investments.
(2) Investment in Aspers Holdings (Jersey) Ltd was transferred to Assets held for sale during the financial year.
The associates outlined above are accounted for using the equity method in these consolidated financial statements.
Summarised financial information in respect of each of the Group’s material associates is set out below.
2021
2020
$m
$m
Carrying amount of investment - Nobu Group:
Balance at the beginning of the financial year
121.2
142.5
Share of associates’ net profit/(loss) for the year
5.2
3.4
Impairment
-
(21.7)
Foreign exchange movements
(9.6)
2.9
Dividends received
-
(5.9)
Carrying amount of investment in the Nobu Group at the end of the financial year
116.8
121.2
Impairment testing
At each reporting date, the Group assesses for each associate whether there is any objective evidence of impairment as a
result of one or more events that occurred after initial recognition of the net investment, and that event (or events) has an
impact on the estimated future cash flows from the net investment that can be reliably estimated. No objective evidence of
impairment was identified for Nobu and Chill Gaming.
Aspers
As outlined in note 7, during the period the Group’s investment in Aspers was reclassified as an Asset Held for Sale. As a
result, the investment was required to be valued at the lower of carrying value and fair value less cost of disposal. Crown
assessed the fair value less cost of disposal of the investment and based on this analysis, the fair value less cost of
disposal of the Group’s investment in Aspers was $34.9 million as at 30 June 2021, compared to the carrying value of
$43.2 million. Crown has therefore reduced the carrying amount of the investment in Aspers by $8.3 million. This
impairment loss has been included in the Statement of Profit or Loss.
The Group will continue to monitor the performance of all associates going forward and consider the impact on the
carrying value.
Crown Resorts Limited Annual Report 2021
131
Notes to the Financial Statements
10. Property, Plant and Equipment
Property, Plant and Equipment comprises owned and leased assets.
2021
2020
$m
$m
Property, Plant and Equipment - owned
4,271.1
4,837.4
Right-of-use assets - leased (refer note 11)
45.5
33.8
4,316.6
4,871.2
Owned assets
Freehold
land &
buildings
Buildings on
leasehold
land
Plant &
equipment
Construction
work in
progress
Total
property,
plant &
equipment
$m
$m
$m
$m
$m
Year ended 30 June 2021
At 1 July 2020, net of accumulated depreciation
and impairment
1,757.2
765.2
560.1
1,754.9
4,837.4
Additions
5.3
16.9
72.7
480.1
575.0
Disposals
-
-
(0.9)
(459.7)
(460.6)
Depreciation expense
(43.4)
(63.4)
(153.7)
-
(260.5)
Impairment
(28.0)
-
-
-
(28.0)
Exchange differences
-
0.2
(1.5)
-
(1.3)
Reclassification/transfer
1.0
1,269.6
84.9
(1,355.5)
-
Reclassification/transfer to Assets held for sale
-
-
-
(390.9)
(390.9)
At 30 June 2021, net of accumulated
depreciation and impairment
1,692.1
1,988.5
561.6
28.9
4,271.1
At 30 June 2021
Cost (gross carrying amount)
2,289.4
2,903.8
2,701.8
28.9
7,923.9
Accumulated depreciation and impairment
(597.3)
(915.3)
(2,140.2)
-
(3,652.8)
Net carrying amount
1,692.1
1,988.5
561.6
28.9
4,271.1
Under its financing facilities, Crown has provided security to the lenders in the form of first ranking mortgages over certain
Property, Plant and Equipment.
Impairment Testing
At 30 June 2021, given the continued impact of COVID-19 and the potential impact on commercial development, Crown
engaged an independent valuation firm to determine the fair value of the land and buildings at the Queensbridge
development site. Based on the review of the anticipated recoverable amount of a sale of the land and associated
buildings, calculated using the fair value less cost to sale method, the carrying value of Property, Plant and Equipment
relating to the Queensbridge development project (including directly attributable costs incurred from acquisition) has been
written down to its recoverable amount. As a result, a net impairment loss of $28.0 million has been recorded in the
Group’s Statement of Profit or Loss (2020: nil). The recoverable amount was categorised as a Level 2 fair value (as defined
in note 33), utilising a comparison of the site with evidence of sales of other development sites in the Southbank precinct.
Notes to the Financial Statements continued
For the year ended 30 June 2021
132
FINANCIAL REPORT 2021 CONTINUED
Notes to the Financial Statements
Freehold
land &
buildings
Buildings on
leasehold
land
Plant &
equipment
Construction
work in
progress
Total
property,
plant &
equipment
$m
$m
$m
$m
$m
Year ended 30 June 2020
At 1 July 2019, net of accumulated depreciation
and impairment
1,705.9
795.8
611.3
1,146.0
4,259.0
Additions
93.8
18.5
92.6
617.0
821.9
Depreciation expense
(43.4)
(49.1)
(151.4)
-
(243.9)
Exchange differences
-
-
0.4
-
0.4
Reclassification/transfer
0.9
-
7.2
(8.1)
-
At 30 June 2020, net of accumulated
depreciation and impairment
1,757.2
765.2
560.1
1,754.9
4,837.4
At 30 June 2020
Cost (gross carrying amount)
2,283.1
1,616.9
2,568.8
1,754.9
8,223.7
Accumulated depreciation and impairment
(525.9)
(851.7)
(2,008.7)
-
(3,386.3)
Net carrying amount
1,757.2
765.2
560.1
1,754.9
4,837.4
11. Leases
Group as Lessee
The Group has lease contracts for various items of property, offices, warehouses, vehicles and other equipment. Major
property leases include the Crown Melbourne main site (discussed further below), Crown Melbourne staff car park (leases
expiring 2040), a portion of the Crown Aspinalls property (lease expiring in 2031) and administration offices adjacent to the
Crown Sydney complex (lease terms of 5 to 7 years).
Set out below are the carrying amounts of Right-of-use assets (included under Property, Plant and Equipment):
Land &
buildings
Other
Total
$m
$m
$m
Net carrying amount
30 June 2021
42.9
2.6
45.5
Depreciation expense for the year ended
30 June 2021
6.5
1.4
7.9
Land &
buildings
Other
Total
$m
$m
$m
Net carrying amount
30 June 2020
30.2
3.6
33.8
Depreciation expense for the year ended
30 June 2020
3.9
2.0
5.9
Additions to right-of-use assets during 2021 were $21.1 million (2020: $9.0 million).
10. Property, Plant and Equipment continued
Crown Resorts Limited Annual Report 2021
133
Notes to the Financial Statements
Set out below are the carrying amounts of lease liabilities (included under interest-bearing loans and borrowings) and the
movements during the period:
2021
2020
$m
$m
Balance at the beginning of the financial year
58.7
-
Balance on adoption of AASB16 Leases
-
54.5
Additions
21.1
9.0
Accretion of interest
2.9
2.4
Payments
(10.5)
(7.1)
Exchange differences
0.3
(0.1)
Balance at the end of the financial year
72.5
58.7
Current
6.8
7.2
Non-current
65.7
51.5
72.5
58.7
The maturity analysis of lease liabilities is disclosed in note 33.
The Group also has certain leases with lease terms of 12 months or less. The Group applies the ‘short-term lease’
recognition exemptions for these leases. The group recognised rent expense from short-term leases of $0.3 million (2020:
$1.3 million) and variable lease payments of $0.2 million (2020: $1.0 million) during the financial year. In addition, Crown has
adopted the COVID-19 Related Rent Concessions Amendment to AASB16 and applied the practical expedient, where
conditions were met, to recognise all rent relief of $0.5 million (2020: $0.2 million) granted due to the impact of COVID-19 in
the Statement of Profit & Loss.
The Group had total cash outflows for leases of $10.5 million in 2021 (2020: $9.2 million). As at 30 June 2021,
undiscounted potential future cash outflows of $8.2 million (2020: $7.7 million) relating to leases with extension options have
not been included in the lease liability because it is not reasonably certain that the options will be exercised.
Crown Melbourne main site lease
In 1993 Crown Melbourne entered into a ninety-nine year lease agreement for the site upon which the Crown Melbourne
Entertainment Complex is located. For years one to forty inclusive, the annual rent payable is one dollar per annum. For
years forty-one to ninety-nine inclusive, the annual rent payable will be the then current market rent for the site. The
carrying value of the right-of-use asset has been determined as if the standard had always applied, based on the payments
in years forty-one to ninety-nine using the estimated market rent at commencement date of the lease, applying the
incremental borrowing rate at date of initial application of the standard. In estimating the market rent at commencement
date, the Group engaged an independent property valuer.
Group as Lessor
The Group has entered into operating leases for retail tenancies within its Crown Melbourne, Crown Perth and Crown
Sydney properties. The undiscounted lease payments to be received for the operating leases are shown in the table below.
The leases have terms between 3 and 25 years.
2021
2020
$m
$m
Payable within one year
16.2
20.6
Payable after one year but not more than five years
40.4
51.0
Payable more than five years
9.7
11.6
66.3
83.2
Crown granted rent relief to its tenants as a result of the closure of Crown’s properties. The above amounts represent the
lease payments contracted, and therefore may be reduced by the rental relief provided to tenants. The extent of rent relief
that may be provided depends on the on-going restrictions impacting Crown’s properties.
The total variable lease income recognised during the year is $1.4 million (2020: $4.6 million). Variable lease income which
may become receivable in the future and separately invoiced amounts for recovery of property outgoings are excluded
from the table above.
Notes to the Financial Statements continued
For the year ended 30 June 2021
134
FINANCIAL REPORT 2021 CONTINUED
Notes to the Financial Statements
12. Intangible Assets - Licences
2021
2020
$m
$m
Balance at the beginning of the financial year
1,047.3
1,064.0
Amortisation expense
(16.7)
(16.7)
Balance at the end of the financial year
1,030.6
1,047.3
Cost (gross carrying amount)
1,297.0
1,297.0
Accumulated amortisation and impairment
(266.4)
(249.7)
Net carrying amount
1,030.6
1,047.3
The casino licences are carried at cost and amortised on a straight line basis over their useful lives.
The Crown Melbourne licence ($490.2 million, 2020: $506.9 million) is being amortised until 2050. The Crown Perth licence
($440.4 million) is assessed as having an indefinite useful life, as it does not expire, and therefore no amortisation is charged.
Amortisation will commence on the Crown Sydney licence ($100.0 million) once the gaming activities are operational.
13. Other Intangible Assets
Goodwill (1)
Casino
Management
Agreement (1)
Other
Total
$m
$m
$m
$m
Year ended 30 June 2021
At 1 July 2020, net of accumulated amortisation and
impairment
243.2
111.6
0.8
355.6
Impairment (2)
(17.3)
-
-
(17.3)
Exchange differences
(4.2)
-
-
(4.2)
Amortisation expense
-
(3.6)
(0.1)
(3.7)
At 30 June 2021, net of accumulated amortisation
and impairment
221.7
108.0
0.7
330.4
At 30 June 2021
Cost (gross carrying amount)
221.7
245.3
18.4
485.4
Accumulated amortisation
-
(137.3)
(17.7)
(155.0)
Net carrying amount
221.7
108.0
0.7
330.4
Year ended 30 June 2020
At 1 July 2019, net of accumulated amortisation and
impairment
295.4
115.3
4.6
415.3
Impairment (3)
(52.8)
-
-
(52.8)
Exchange differences
0.6
-
-
0.6
Amortisation expense
-
(3.7)
(3.8)
(7.5)
At 30 June 2020, net of accumulated amortisation
and impairment
243.2
111.6
0.8
355.6
At 30 June 2020
Cost (gross carrying amount)
243.2
245.3
18.4
506.9
Accumulated amortisation
-
(133.7)
(17.6)
(151.3)
Net carrying amount
243.2
111.6
0.8
355.6
(1) Purchased as part of business combinations.
(2) Impairment relates to the goodwill in DGN. Refer note 14 for further details.
(3) Impairment relates to the goodwill in Crown Aspinalls. Refer note 14 for further details.
Crown Resorts Limited Annual Report 2021
135
Notes to the Financial Statements
Goodwill is considered to have an indefinite life and is
tested annually for impairment (see note 14). The goodwill
balance at 30 June 2021 is allocated to Crown Melbourne
$26.9 million (2020: $26.9 million), Crown Perth $144.0
million (2020: $144.0 million), DGN $30.9 million (2020:
$52.4 million) and Betfair $19.9 million (2020: $19.9 million).
The useful life of the Crown Melbourne Casino
Management Agreement is amortised on a straight line
basis to 2050.
14. Impairment Testing of Intangible
Assets
Intangible assets deemed to have indefinite lives are
allocated to the Group’s cash generating units (CGUs)
identified according to the lowest levels for which there are
separately identifiable cash flows that are largely
independent of the cash flows from other assets or groups
of assets.
The allocation of goodwill and other intangible assets with
indefinite useful lives to the Group’s CGUs are outlined in
note 12 and note 13.
The recoverable amount of a CGU is defined as the higher
of the value in use and the fair value less cost of disposal.
This implied value is then compared with the carrying
value of the CGU to determine any impairment required.
The recoverable amount of the Crown Melbourne, Crown
Perth, Crown Sydney and Betfair CGUs at 30 June 2021
has been determined based on a value in use calculation
using a discounted cash flow methodology covering a five
year period, with an appropriate terminal value at the end
of that period. The methodology utilises cash flow
forecasts that are based primarily on business plans
prepared by management. The recoverable amount of
Crown Sydney at 30 June 2020 was determined based on
a fair value less costs of disposal method.
The recoverable amount of the DGN CGU, in both the
current and prior years, has been determined based on
fair value less costs of disposal, utilising a combination of
independent valuations undertaken by third parties,
market acquisition prices as well as trading multiples of
entities of a similar nature to each CGU.
Value in use assessment
The following describes each key assumption on which the
Group has based its cash flow projections to undertake
impairment testing under the value in use method.
• Cash flow forecasts are based on past performance
and expectations for the future using a five year cash
flow period, risk adjusted where applicable. COVID-19
continues to have a major impact on Australian and
international economies. A level of uncertainty
previously unseen has resulted in increased difficulty in
developing cash flow forecasts. Therefore the Group
considered the uncertainty around the likelihood and
duration of restricted operating conditions and border
restrictions in determining cash flow forecasts.
• For the purposes of impairment testing, allowances
have been made in order to reflect the ongoing impact
of COVID-19 on Crown’s businesses. Based on
information available at 30 June 2021, with respect to
Crown Melbourne, Crown Perth and Crown Sydney the
impairment modelling assumed Crown Sydney’s
gaming operations commence in the period prior to 31
December 2021, prevailing regulatory and licence
conditions at Crown Melbourne and Crown Perth and
that the properties remain under social distancing and
capacity restrictions for the first year, with international
borders remaining closed. International borders were
assumed to reopen from 1 July 2022, leading to
tourism into Australia recommencing, no further
COVID-19 related lockdowns, and a recovery to pre
COVID-19 levels of economic activity over the short to
medium term within the context of the 5 year forecast
period.
• Impairment testing assumptions for Betfair anticipate
continued trading with no adverse material impact on their
operations as a result of COVID-19, which is consistent
with the circumstances observed to 30 June 2021.
• Terminal value is calculated using a perpetuity growth
formula based on cash flow forecasts using a weighted
average cost of capital (after tax) and forecast growth
rate.
• Forecast growth rates are based on past performance
and management’s expectations of future performance
as at 30 June 2021, based on the current
circumstances and the nature of the products and
industries in which each business operates. The
terminal growth rates do not exceed the forecasted
long-term Australian inflation rate of 2.50% (2020:
2.50%).
• A weighted average cost of capital (before tax) of
between 9.8% and 13.6% (2020: 9.1% and 14.7%) was
used by the Group in impairment testing, risk adjusted
where applicable.
Fair value less costs of disposal assessment
The following describes each key assumption on which
management has based its recoverable amount
calculations under the fair value less costs of disposal
method.
In addition to independent valuations undertaken by third
parties, for calculations using market acquisition prices
and current trading multiples of entities of a similar nature
to each CGU the key assumptions are:
• Acquisition multiples of around 6.0x last twelve month
EBITDA have been utilised.
• Trading multiples of publicly listed companies and
entities of a similar nature to the CGU of between 8.0x
and 9.0x next twelve months EBITDA have been
utilised.
Notes to the Financial Statements continued
For the year ended 30 June 2021
136
FINANCIAL REPORT 2021 CONTINUED
Notes to the Financial Statements
• Cost of disposal of between 5.0% and 6.0% have been
utilised to discount the implied fair value.
The fair value measurement for the DGN CGU is
considered to be level 3 in the fair value hierarchy, as it is
based on using inputs that are not based on observable
market data. Where available, applicable level 2
information has been taken into account (refer to note 33
for explanation of the valuation hierarchy).
Outcome of impairment tests
Based on the valuation techniques performed, an
impairment loss of $17.3 million related to the DGN CGU
has been recorded against the Group’s intangible assets
during the year. At 30 June 2020 there were indicators of
impairment for the Crown Aspinalls CGU, and based on
the impairment testing, an impairment loss of $52.8 million
was recorded against the goodwill of Crown Aspinalls in
the prior year, resulting in no intangible assets remaining at
the CGU.
As at 30 June 2020, goodwill relating to the acquisition of
DGN was $52.4 million (US$36.1 million). At 30 June 2021,
indicators of impairment were identified for the DGN CGU.
These indicators were considered taking into account the
re-forecast of cash flows of DGN, along with indications of
a likely fair value of the CGU in the current market. Based
on the impairment testing undertaken, the carrying
amount of the CGU exceeded its recoverable amount at
30 June 2021. As a result, Crown has reduced goodwill
relating to the acquisition of DGN by $17.3 million (US$13.0
million). This impairment loss has been included in the
Statement of Profit or Loss.
Sensitivity analysis
The key estimates and assumptions used to determine the
value in use or fair value less costs of disposal for each
CGU are based on management’s current expectations
based on past experience, prevailing regulatory and
licence conditions, prevailing COVID-19 conditions, future
plans and external market information. They are
considered to be reasonably achievable, however
significant changes in any of the key estimates and
assumptions or regulatory environments may result in a
CGUs carrying value exceeding its recoverable value,
resulting in an impairment charge.
With respect to Crown Sydney, based on the cash flows
adopted in the calculation of recoverable amount, an
increase in the discount rate (weighted average cost of
capital after tax) of 80bps, a decrease in terminal growth
rate of 110bps or a decrease in EBITDA by 9.3% per
annum throughout the plan period, in isolation and with all
other assumptions held constant, could give rise to an
impairment.
In the case of DGN where an impairment charge was
taken, an adverse change in any of the assumptions
utilised to determine the recoverable amount would lead to
a further impairment charge of the CGU.
Crown is currently subject to regulatory processes
regarding the suitability of Crown Melbourne, Crown Perth
and Crown Sydney to hold casino licences. The outcome
of these processes remains uncertain.
On 9 February 2021, the Commissioner’s report of the
inquiry under section 143 of the Casino Control Act 1992
(NSW) (Inquiry Report) was released. The New South
Wales Independent Liquor and Gaming Authority (ILGA)
wrote to Crown stating that, having regard to the contents
of the Inquiry Report, it presently considered that Crown
Sydney Gaming Pty Ltd (Crown Sydney Gaming) was no
longer a suitable person to give effect to the Restricted
Gaming Licence in New South Wales and that Crown
Sydney Gaming had breached clause 14(a) of the VIP
Gaming Management Agreement (VIP GMA) and had
given Crown a notice to that effect. The consultation
process contemplated under the VIP GMA was enlivened
and Crown is well advanced with a comprehensive
remediation plan. Crown continues to cooperate fully with
ILGA as it works through the remediation process.
The key estimates and assumptions used to determine the
recoverable amounts of the CGUs assumes prevailing
regulatory and licence conditions at Crown Melbourne and
Crown Perth, and the issuance of the casino licence
following the consultation process at Crown Sydney.
Given the uncertainty regarding the outcome of the
current regulatory processes, Crown considered the
impact on the carrying amount of each CGU in the event
that Crown is found not suitable and the casino licence at
each property cancelled. The outcome of the sensitivity
analysis of the cancellation of the Crown Melbourne
casino licence would result in the impairment of the Crown
Melbourne licence ($490.2 million), the casino
management agreement asset ($108.0 million) and
prepaid casino tax asset ($43.9 million).
The outcome of the sensitivity analysis of the cancellation
of the Crown Perth casino licence would be an impairment
of the Crown Perth licence ($440.4 million).
In both CGUs, cancellation of the licence could result in
the potential impairment of the goodwill intangible as well
as adjustments to any deferred tax balances relating to the
licences.
The outcome of the analysis of Crown Sydney not being
issued the casino licence would result in an impairment of
the Crown Sydney licence ($100.0 million) and a probable
impairment to the property, plant and equipment relating
to the CGU.
The Group will continue to monitor the performance of all
CGUs going forward and consider the impact on the
impairment testing assumptions and carrying value.
14. Impairment Testing of Intangible Assets continued
Crown Resorts Limited Annual Report 2021
137
Notes to the Financial Statements
15. Other Assets
2021
2020
$m
$m
Non-current
Prepaid casino tax at cost
100.8
100.8
Accumulated amortisation
(56.9)
(55.4)
43.9
45.4
Other prepayments
1.7
3.4
45.6
48.8
Prepaid casino tax relates to Crown Melbourne, is carried at cost and amortised on a straight line basis to 2050.
16. Trade and Other Payables
2021
2020
$m
$m
Current - unsecured
Trade and other payables
231.5
190.1
Contract and contract-related liabilities (1)
128.5
137.8
Contingent consideration
-
2.4
Other
69.4
96.2
429.4
426.5
Non-current - unsecured
Casino licence payable (2)
177.2
172.3
177.2
172.3
(1) Contract and contract related liabilities include unredeemed casino chips, loyalty program liabilities and advance customer deposits which
decreased by $9.3 million during the year (2020: decreased by $14.7 million).
(2) Net present value of the $250.0 million payment due in 2033 relating to the Crown Melbourne Casino licence.
17.
Interest-Bearing Loans and Borrowings
2021
2020
$m
$m
Current
Bank Loans
307.5
-
Lease Liabilities
6.8
7.2
Other loans
-
1.0
314.3
8.2
Non-current
Bank Loans
112.5
280.0
Capital Markets Debt
795.9
790.3
Lease Liabilities
65.7
51.5
974.1
1,121.8
Fair Value Disclosures
Details of the fair value disclosures of the Group’s interest bearing liabilities are set out in note 33.
Notes to the Financial Statements continued
For the year ended 30 June 2021
138
FINANCIAL REPORT 2021 CONTINUED
Notes to the Financial Statements
Financial Risk Management
Information about the Group’s exposure to interest rate and foreign currency changes is provided in note 33.
Financing and Credit Facilities
Credit facilities are provided as part of the overall debt funding structure of the Crown Group as follows:
Facility
Amount
Drawn
Amount
Letters
of Credit
Issued
Available
Expiry
Facility Type
$m
$m
$m
$m
Dates
Bank Facilities
Bilateral Facilities
630.0
420.0
39.3
170.7
Apr 22 - Apr 24
Letter of Credit Facilities
60.0
-
60.0
-
Jun 30
690.0
420.0
99.3
170.7
Debt Capital Markets
Euro Medium Term Notes
180.0
180.0
-
-
Jul 2036
AUD Subordinated Notes
615.9
615.9
-
-
Apr 2075
795.9
795.9
-
-
Total at 30 June 2021
1,485.9
1,215.9
99.3
170.7
Total at 30 June 2020
1,636.6
1,071.3
164.0
401.3
As part of the refinancing undertaken in April 2020, Crown secured new bank financing facilities totalling $560 million. These
bank facilities are secured by Property, Plant and Equipment as outlined in note 10. The remainder of the bank facilities are
provided on an unsecured basis by domestic banks. Refer note 33(a)(i) for further details regarding interest rates.
The debt capital markets drawn amounts represent unsecured notes issued to domestic and international debt investors.
Crown is able to make advances and issue letters of credit under the letter of credit facility and the bilateral facilities.
Each of the above mentioned facilities are issued by or supported by a Group guarantee from Crown and certain
subsidiaries and impose various affirmative covenants on Crown, which may include compliance with certain financial
ratios and negative covenants, including restrictions on encumbrances, and customary events of default, including a
payment default, breach of covenants, cross-default and insolvency events.
Under the terms of Crown’s Euro Medium Term Notes (Notes), in the event that the Notes are unrated, or are rated below
investment grade by any rating agency which rates the Notes (currently Fitch Ratings and Standard & Poor’s), any holder of
the Notes would be entitled to require redemption of its Notes at the outstanding principal amount plus a make whole
premium, subject to the terms of the Notes.
Subsequent to 30 June 2021, the Group has extended the $410 million of bank facilities with relationship banks that were
due to mature in April 2022 to October 2023 of which $102.5 million is undrawn. At the same time the $150 million of bank
facilities maturing in April 2024 of which $37.5 million is undrawn has been aligned with the October 2023 maturity. In
addition, as part of this process, Crown obtained a waiver of financial covenants in relation to the 31 December 2021
testing date. No waiver was required for the 30 June 2021 testing date.
Crown also obtained a waiver of certain events of default that would otherwise arise from cancellation or suspension (for a
certain period of time) of any of Crown’s Australian casino licences. In the event such a licence event occurs, Crown has agreed
to a review process providing it with a period of time to negotiate with lenders or otherwise refinance the facilities.
In addition, one of Crown’s relationship banks has agreed to provide a new $250 million debt facility, subject to completion
of long form documentation. The facility will provide Crown with debt funding of up to $250 million (based on the value of
unsold Crown Sydney apartments) to be used to partly fund any required redemption of Crown’s Euro Medium Term Notes
and associated make whole premium, or in certain circumstances, for general corporate purposes.
During the current and prior year, there were no defaults or breaches on any of the loans or borrowings.
Refer to note 22(c) for a summary of Crown’s overdraft facilities.
17. Interest-Bearing Loans and Borrowings continued
Crown Resorts Limited Annual Report 2021
139
Notes to the Financial Statements
18. Provisions
Employee
Entitlements(1)
Other(2)
Total
$m
$m
$m
At 1 July 2020
192.5
34.8
227.3
Arising during the year
79.0
87.6
166.6
Utilised during the year
(56.7)
(4.4)
(61.1)
At 30 June 2021
214.8
118.0
332.8
Current 2021
200.3
103.8
304.1
Non-current 2021
14.5
14.2
28.7
At 30 June 2021
214.8
118.0
332.8
Current 2020
177.5
22.8
200.3
Non-current 2020
15.0
12.0
27.0
At 30 June 2020
192.5
34.8
227.3
(1) Employee entitlements are comprised of provisions for annual leave, long service leave, employee incentives, self-insurance liability and other
employee entitlements.
(2) Other provisions are comprised of provisions for gaming tax matters, including Crown Melbourne tax shortfall of approximately $25 million
(refer note 2) and provision for underpayment of casino tax (including interest) of $61.2 million (refer note 3(e)), and legal and regulatory matters.
19. Contributed Equity
2021
2020
$m
$m
Issued share capital
Ordinary shares fully paid
(203.3)
(203.3)
2021
2020
No.
No.
Issued share capital
Ordinary shares fully paid
677,158,271
677,158,271
Due to share buy-backs in prior periods being undertaken at higher prices than the original subscription prices, the
balance of contributed equity is reflected as a negative balance, which shows the excess value of shares bought over the
original amount of subscribed capital. Refer note 32 for details of the Parent Entity’s share capital, which has significant
paid up capital.
Terms and Conditions of Contributed Equity
Ordinary shares entitle the holder to participate in dividends and the proceeds on winding-up of the Company in proportion
to the number of shares held.
The voting rights attaching to ordinary shares provide that each ordinary shareholder present in person or by proxy or
attorney or being a corporation present by representative at a meeting shall have:
(a) on a show of hands, one vote only;
(b) on a poll, one vote for every fully paid ordinary share held.
Capital Management
When managing capital, the Group’s objective is to maintain optimal returns to shareholders and benefits for other
stakeholders. The Group also aims to maintain a capital structure that ensures the lowest cost of capital available to the entity.
During 2021, the Group did not pay any dividends (2020: $406.2 million). The Group’s dividend policy is to pay 60 cents
per share on a full year basis, subject to Crown’s financial position. Having regard to the impact of COVID-19 on Crown’s
businesses from the mandatory closures and restrictions on trade, as well as ongoing regulatory matters, Crown has
determined not to declare a final dividend on ordinary shares. Future dividends will be subject to the Board’s assessment
of Crown’s financial position at the appropriate time, and subject to arrangements agreed with Crown’s lenders.
Notes to the Financial Statements continued
For the year ended 30 June 2021
140
FINANCIAL REPORT 2021 CONTINUED
Notes to the Financial Statements
20. Reserves and Retained Earnings
2021
2020
$m
$m
Foreign currency translation reserve
(38.7)
(23.6)
Employee equity benefits reserve
25.6
22.3
Net unrealised gains reserve
(15.8)
(14.4)
Cash flow hedge reserve
5.1
18.8
(23.8)
3.1
Foreign Currency Translation Reserve
The foreign currency translation reserve is used to record exchange differences arising
from the translation of the financial statements of foreign operations. It is also used to
recognise gains and losses on hedges of the net investment in foreign operations.
Balance at the beginning of the financial year
(23.6)
(28.8)
Net foreign exchange translation
(16.0)
5.3
Non-controlling interest
0.9
(0.1)
Balance at the end of the financial year
(38.7)
(23.6)
Employee Equity Benefits Reserve
The employee equity benefits reserve is used to record share based remuneration
obligations to executives in relation to ordinary shares.
Balance at the beginning of the financial year
22.3
18.9
Movement for the period
3.3
3.4
Balance at the end of the financial year
25.6
22.3
Net Unrealised Gains Reserve
The net unrealised gains reserve records the movement from changes in ownership
interests in a subsidiary, investments and associates equity, which do not impact control.
Balance at the beginning of the financial year
(14.4)
(14.1)
Movement in non-controlling interest put option
(1.4)
(0.3)
Balance at the end of the financial year
(15.8)
(14.4)
Cash Flow Hedge Reserve
The cash flow hedge reserve records the portion of the gain or loss on a hedging
instrument in a cash flow hedge that is determined to be an effective hedge.
Balance at the beginning of the financial year
18.8
25.4
Movement in interest rate swaps
1.7
1.4
Movement in cross currency swaps
(15.4)
(4.2)
Movement in forward exchange contracts
-
(3.8)
Balance at the end of the financial year
5.1
18.8
Retained Earnings
Balance at the beginning of the financial year
4,954.5
5,298.8
Adoption of AASB 16 Leases
-
(17.6)
Net profit/(loss) after tax attributable to equity holders of the parent
(261.6)
79.5
Total available for appropriation
4,692.9
5,360.7
Dividends provided for or paid
-
(406.2)
Balance at the end of the financial year
4,692.9
4,954.5
Crown Resorts Limited Annual Report 2021
141
Notes to the Financial Statements
21. Commitments
Capital expenditure commitments
2021
2020
$m
$m
Estimated capital expenditure contracted for at balance date, but not provided for:
Payable within one year
14.9
447.7
14.9
447.7
Crown Sydney gaming tax guarantees
Crown has provided two gaming tax guarantees to the NSW Government relating to Crown Sydney. Firstly, Crown has
guaranteed that over the three consecutive financial years, beginning with the financial year in which Crown Sydney commences
gaming operations, the aggregate of normalised gaming taxes generated by Crown and The Star is at least equal to three times
the normalised gaming taxes generated by The Star in the financial year prior to commencement of gaming at Crown Sydney.
Secondly, that over the first 15 years of Crown Sydney’s full operations, the NSW Government will receive from Crown at least $1
billion in normalised gaming taxes, including the licence fee of $100 million previously paid.
22. Cash Flow Statement Reconciliation
2021
2020
$m
$m
(a) Cash balance represents:
Cash on hand and at bank
471.7
158.3
Deposits at call
4.3
128.6
476.0
286.9
The above closing cash balances includes $85.9 million (2020: $48.4 million) of cash on the company’s premises and
cash held in bank accounts to run the day to day operations of the businesses and cash (including deposits on call) of
$390.1 million (2020: $238.5 million) for other purposes. All deposits at call are with approved counterparties with
investment grade ratings. Refer note 33(c) for further details.
2021
2020
$m
$m
(b) Reconciliation of the profit/(loss) after tax to the net cash flows
from operating activities
Profit/(loss) after tax
(261.3)
81.9
Non cash items and items dealt with separately:
- Depreciation and amortisation
290.3
275.5
- Asset impairment
53.6
74.5
- Share of associates’ net (profit)/loss
8.7
(0.3)
- Net foreign exchange (gain)/loss
(0.1)
(0.2)
- Reassessment of contingent consideration - DGN
2.0
1.7
- Other non cash expenses
3.4
2.3
Cash items not included in profit/(loss) after tax:
- Dividends received from associates
-
5.9
Items classified as investing/financing activities:
- (Profit)/loss on sale of property, plant and equipment
(207.8)
(0.1)
Working Capital changes:
- (Increase) / decrease in trade receivables and other assets
42.9
74.9
- (Increase) / decrease in inventories
(4.3)
(0.5)
- (Decrease) / increase in tax provisions
(117.6)
(113.7)
- (Decrease) / increase in trade and other payables, accruals, provisions and other
liabilities
176.2
(75.0)
Net cash flows from operating activities
(14.0)
326.9
Notes to the Financial Statements continued
For the year ended 30 June 2021
142
FINANCIAL REPORT 2021 CONTINUED
Notes to the Financial Statements
(c) Bank Overdraft Facilities
The Group has bank overdraft facilities available as follows:
Bank
2021
2020
ANZ Banking Group Limited
A$20 million
A$20 million
Citibank NA
- US$10 million
Royal Bank of Scotland PLC
-
£18 million
As at 30 June 2021 there were no drawn down amounts on the overdraft facilities (2020: nil).
23. Events After the Reporting Period
On 6 July 2021, Crown Perth recommenced trading of gaming and non-gaming operations at a reduced capacity. From 12 July
2021, Crown Perth recommenced trading of all gaming and non-gaming operations under the same restrictions that were in place
immediately prior to the introduction of the lockdown on 29 June 2021.
On the evening of 15 July 2021, Crown Melbourne ceased gaming activities and the majority of non-gaming operations following a
mandated closure by the Victorian Government due to COVID-19. From 28 July 2021, Crown Melbourne recommenced operations
in accordance with Victorian Government restrictions, including a patron capacity limit on the gaming floor of 100 patrons in each
indoor space, subject to a density limit of one person per four square metres. On the evening of 5 August 2021, Crown Melbourne
ceased gaming activities and the majority of non-gaming operations following a mandated closure by the Victorian Government
due to COVID-19.
On 26 July 2021, the Perth Royal Commission commenced. On the same day, the Western Australian Government announced that it
had extended the time to complete the WA Royal Commission to 4 March 2022.
On 27 July 2021, Crown announced that it resolved to make a payment to the Victorian Commission for Gambling and Liquor
Regulation (VCGLR), representing an underpayment of casino tax by Crown Melbourne of $37.4 million over the period commencing in
the 2012 financial year to date relating to the incorrect deduction of certain bonus rewards provided to patrons in connection with play
on Crown Melbourne’s electronic gaming machines. Under the terms of Crown’s regulatory agreements with the State of Victoria,
Crown is required to pay interest on any underpayment of casino tax. The interest component was an additional $23.8 million. Both the
underpayment of casino tax and interest on the underpayment of casino tax were fully provided at 30 June 2021.
On 3 August 2021, the Victorian Government announced the establishment of a new casino and gambling commission, Victorian
Gambling and Casino Control Commission (VGCCC), which will have oversight of all gambling and gaming activities within Victoria.
On 18 August 2021, the NSW Government announced that it agreed to support all 19 recommendations from the Bergin Inquiry
Report on the regulation of casinos in NSW and the suitability of Crown Resorts to hold a restricted gaming facility licence.
Additionally, the NSW Government announced an independent casino regulator will be established and a number of legislative
reforms will be introduced as recommended by Commissioner Bergin.
On 26 August 2021, Crown announced that the Board has appointed Dr Ziggy Switkowski AO to succeed the Honourable Helen
Coonan as Chairman, subject to the receipt of probity and regulatory approvals. As part of the planned succession process, Ms
Coonan retired from the Board and as Executive Chairman on 27 August 2021. Dr Switkowski will join the Board as Chairman
immediately upon receipt of all necessary regulatory approvals. Pending receipt of those approvals, Crown Non-executive Director
Jane Halton AO PSM will act as Interim Chairman.
As outlined in note 17, following year-end, Crown reached agreement with its relationship banks regarding a series of modifications
to Crown’s existing financing arrangements, including:
• An extension of near-term maturities by amending and aligning the maturity date of all of the $560 million in bilateral facilities to
October 2023.
• A waiver of financial covenants in relation to the 31 December 2021 testing date. No waiver was required for the 30 June 2021
testing date.
• A waiver of certain events of default that would otherwise arise from cancellation or suspension (for a certain period of time) of
any of Crown’s Australian casino licences. In the event such a licence event occurs, Crown has agreed to a review process
providing Crown with a period of time to negotiate with lenders or otherwise refinance the facilities.
As part of the arrangements agreed with lenders, Crown has agreed not to declare or pay dividends in respect of the half year ending
31 December 2021 or where a review event is triggered as a result of a cancellation or suspension of any of Crown’s Australian casino
licences.
In addition, one of Crown’s relationship banks has agreed to provide a new $250 million debt facility, subject to completion of long
form documentation. The facility will provide Crown with debt funding of up to $250 million (based on the value of unsold Crown
Sydney apartments) to be used to partly fund any required redemption of Crown’s Euro Medium Term Notes and associated make
whole premium, or in certain circumstances, for general corporate purposes.
22. Cash Flow Statement Reconciliation continued
Crown Resorts Limited Annual Report 2021
143
Notes to the Financial Statements
24. Contingent Liabilities and Related
Matters
Litigation matters
As announced by Crown on 4 December 2017, Maurice
Blackburn Lawyers commenced a class action proceeding
against Crown in the Federal Court of Australia which Crown
is defending. The proceeding, which relates to the detention
of Crown employees in China in 2016, has been filed on
behalf of persons who acquired an interest in Crown shares
between 6 February 2015 and 16 October 2016. The matter
has been set for hearing by the Court on 25 October 2021.
Further detail in relation to this class action, including copies
of the Statement of Claim, Amended Statement of Claim,
and Further Amended Statement of Claim is available on
Maurice Blackburn’s website.
As announced by Crown on 14 December 2020, Maurice
Blackburn Lawyers commenced a class action
proceeding against Crown in the Supreme Court of
Victoria. The claim alleges that, in the period from 11
December 2014 to 18 October 2020, Crown had
inadequate systems and processes for ensuring
compliance with its obligations under anti-money
laundering laws and that Crown engaged in misleading
and deceptive conduct, breached its continuous
disclosure obligations and conducted its affairs contrary to
the interests of members as a whole in the period. Maurice
Blackburn has announced that the class action aims to
recover compensation from Crown, seeks the potential
buy-back of investors’ shares at a fair value, and seeks
that Crown implement a proper anti-money laundering
training program. Crown is defending the proceeding.
The potential outcome and total costs related to the above
matters remain uncertain.
In addition to the above matters, entities within the group
are defendants from time to time in legal proceedings
arising from the conduct of their business. The Group
does not consider that the outcome of any proceedings
ongoing at balance date, either individually or in
aggregate, is likely to have a material effect on its financial
position. Where appropriate, provisions have been made.
Regulatory matters
AUSTRAC enforcement investigations
As announced by Crown on 19 October 2020 and 7 June
2021 respectively, each of Crown Melbourne and Crown
Perth is the subject of an AUSTRAC enforcement
investigation. Crown Melbourne and Crown Perth are fully
cooperating with AUSTRAC in relation to these
enforcement investigations.
Each of these investigations is ongoing and AUSTRAC has
not informed Crown Melbourne or Crown Perth whether it
will take any enforcement action.
While it is at this stage uncertain as to whether AUSTRAC
will take enforcement action, or the type of enforcement
action it may take, Crown considers that AUSTRAC is very
likely to commence civil penalty proceedings against
Crown Melbourne and Crown Perth. If it does so, it is likely
that Crown Melbourne and Crown Perth will be required to
pay significant civil penalties.
Crown notes that AUSTRAC has commenced civil penalty
proceedings on three occasions against other reporting
entities, each of which concluded with the Federal Court
ordering that the respondent pay significant civil penalties.
These civil penalties were: $45 million (ordered in 2017);
$700 million (ordered in 2018); and $1.3 billion (ordered in
2020). As the judgments in each of the three civil penalty
proceedings AUSTRAC has commenced make clear, the
Federal Court’s determination of the appropriate penalty
was very specific to the facts in each case, and was
arrived at only after consideration of the detailed agreed
Statement of Agreed Facts and Admissions and joint
submissions filed by AUSTRAC and the respondents.
If AUSTRAC does commence proceedings against Crown
Melbourne and/or Crown Perth, in determining the
appropriate penalty, the Federal Court would be required
to have regard to all relevant matters, including the nature
and extent of the contraventions and any loss and damage
suffered as a result, the efforts Crown has made to date to
address potential gaps in our systems and processes, as
well as the size of Crown Melbourne and/or Crown Perth.
Until there is greater certainty as to each of the relevant
matters, Crown considers that this is one of the extremely
rare circumstances in which it is not possible to reliably
estimate the amount that Crown Melbourne and/or Crown
Perth may ultimately be required to pay if civil penalty
proceedings are commenced. Accordingly, no provision
has been raised in respect of these matters.
If AUSTRAC does commence proceedings, the time by
which Crown Melbourne and/or Crown Perth will be
required to pay any civil penalty will depend on a number
of factors, including the date on which AUSTRAC
commences proceedings, the timetable ordered by the
Federal Court and whether the parties are able to agree
any proposed settlement, to be put to the Federal Court
for approval.
Further information in relation to the enforcement
investigations into Crown Melbourne and Crown Perth is
set out below.
The Crown Melbourne enforcement investigation
AUSTRAC has informed Crown that its enforcement
investigation into Crown Melbourne concerns potential
non-compliance with the Anti-Money Laundering and
Counter-Terrorism Financing Act 2006 (Cth) (AML/CTF
Act) and the Anti-Money Laundering and Counter-
Terrorism Financing Rules 2007 (Cth) (AML/CTF Rules).
AUSTRAC has informed Crown Melbourne that the potential
non-compliance includes concerns in relation to ongoing
customer due diligence, and adopting, maintaining and
complying with an anti-money laundering and counter-
terrorism financing (AML/CTF) program. The concerns were
identified in the course of a compliance assessment that
commenced in September 2019 and focussed on Crown
Notes to the Financial Statements continued
For the year ended 30 June 2021
144
FINANCIAL REPORT 2021 CONTINUED
Notes to the Financial Statements
Melbourne’s management of customers identified as high risk
and politically exposed persons.
When informing Crown Melbourne of the enforcement
investigation, AUSTRAC stated that it had not made a
decision regarding the appropriate regulatory response,
including whether enforcement action will be taken, and that
Crown Melbourne would be advised in due course as to the
outcomes of the investigation.
AUSTRAC has so far issued three statutory notices to Crown
Melbourne requiring the provision of extensive information
and the production of a significant volume of documents.
Crown Melbourne is continuing to provide information and
documents in response. The statutory notices request
information and documents concerning a range of matters,
including matters made public during the Bergin inquiry.
The Crown Perth enforcement investigation
AUSTRAC has informed Crown that its enforcement
investigation into Crown Perth concerns potential serious
non-compliance with the AML/CTF Act and the AML/CTF
Rules. The potential serious non-compliance was
identified by AUSTRAC as a result of its review of
information and documents provided by Crown Perth in
response to a number of requests from AUSTRAC since
August 2020, as well as information made public during
the Bergin inquiry.
When informing Crown Perth of the enforcement
investigation, AUSTRAC stated that it had not made a
decision regarding the appropriate regulatory response
that it may apply to Crown Perth, including whether or not
enforcement action will be taken.
AUSTRAC has so far issued one statutory notice to Crown
Perth requiring the provision of information and the
production of documents. Crown Perth is continuing to
provide information and documents in response.
Other regulatory matters
Regulators, including Crown’s gaming regulators, and
other bodies routinely conduct investigations and reviews
of Crown’s operations in the normal course of regulatory
oversight. Crown regularly receives various notices and
requests for information from regulators regarding a wide
variety of matters.
In addition, Crown is undertaking a review of various
indirect tax matters across local and overseas operations
and will engage with relevant authorities as required.
New South Wales
On 9 February 2021, the Commissioner’s report of the
inquiry under section 143 of the Casino Control Act 1992
(NSW) (Inquiry Report) was released. The New South
Wales Independent Liquor and Gaming Authority (ILGA)
wrote to Crown stating that, having regard to the contents
of the Inquiry Report, it presently considered that Crown
Sydney Gaming Pty Ltd (Crown Sydney Gaming) is no
longer a suitable person to give effect to the Restricted
Gaming Licence in New South Wales and that Crown
Sydney Gaming had breached clause 14(a) of the VIP
Gaming Management Agreement (VIP GMA) and had
given Crown a notice to that effect.
The consultation process contemplated under the VIP GMA
is well advanced and Crown continues to cooperate fully
with ILGA as it works through the remediation process.
Victoria
On 22 February 2021, a Royal Commission was
established into the suitability of Crown Melbourne Limited
to hold a casino licence. The Hon. Ray Finkelstein AO QC
was appointed as Commissioner and Chairperson of the
Royal Commission. The initial hearing took place on 24
March 2021, and the first public hearings commenced on
17 May 2021. Counsel Assisting the Royal Commission
delivered their closing submissions on 20 July 2021.
Crown’s final submissions were delivered in two parts:
i. its closing submissions dated 2 August 2021, which
respond to the submissions of Counsel Assisting the
Victorian Royal Commission and also address certain
governance matters on which the Commissioner
sought submissions; and
ii. a further written submission dated 9 August 2021
which responds to certain enquiries made by the
Commissioner at the hearing of oral closing
submissions on 3 August 2021 and addresses the
areas of the Melbourne Casino Complex which may
be required to be sub-let if Crown Melbourne’s
licence is cancelled or surrendered.
All submissions can be found at https://www.rccol.vic.gov.
au/submissions.
The Royal Commission is expected to deliver its final
report by 15 October 2021.
Western Australia
On 5 March 2021, 2021, the Honourable Neville Owen
(AO), the Honourable Lindy Jenkins and Mr Colin Murphy
(PSM), were appointed Royal Commissioners to inquire
into the suitability of Crown Perth to continue holding a
casino gaming licence in Western Australia. The
Commissioners are also examining the State’s regulatory
framework for casino gaming, including any matters that
might enhance the Gaming and Wagering Commission’s
future capability and effectiveness. The initial hearing took
place on 12 April 2021, and the first public hearings
occurred over the period from 10 May 2021 to 27 May
2021. The next phase of hearings commenced on 26 July
2021. On 23 July it was announced the Commission’s
deadline for a final report has been extended from
mid-November 2021 to 4 March 2022.
24. Contingent Liabilities and Related Matters continued
Crown Resorts Limited Annual Report 2021
145
Notes to the Financial Statements
25. Auditor’s Remuneration
2021
2020
$
$
Auditor of the Group(1)
Fees for auditing the statutory financial report of the parent covering the group and auditing
the statutory financial reports of any controlled entities
1,658,100
1,534,982
Fees for other assurance and agreed-upon-procedures services under other legislation or
contractual arrangements where there is discretion as to whether the service is provided by
the auditor or another firm
75,525
67,300
Fees for other services:
• Taxation services
86,681
2,479,861
• Other
213,372
30,000
2,033,678
4,112,143
Related network firms of the auditor of the Group(1)
Fees for auditing the financial report of any controlled entities
-
127,583
Fees for other services:
• Taxation services
-
537,350
-
664,933
(1) In 2021, all amounts were paid to member firms of KPMG. In 2020, all amounts were paid to member firms of Ernst & Young, being the Group’s
auditors for that financial year.
26. Government Grants
During the year, Crown was entitled to government payments relating to employee retention schemes in Australia and the
UK as a result of COVID-19 totalling $184.2 million (2020: $113.9 million). Crown has presented grants related to payroll
expenses as a deduction against the related expense in the Statement of Profit or Loss on a systematic basis over the
periods that the related costs, for which it is intended to compensate, were expensed.
Crown Melbourne qualified for JobKeeper for the entire program, including the extensions through to 28 March 2021.
Crown Perth qualified for JobKeeper through to the end of the first phase on 27 September 2020.
Under the JobKeeper program, Crown recorded $79.6 million (2020: $43.4 million) in payroll subsidies which related to the
period from 1 July 2020 through to 28 March 2021 for employees that continued to work in either a full or partial capacity.
The subsidy amount has been recognised as a reduction in Employment costs in note 3(c).
Crown has recorded a further $100.0 million (2020: $67.9 million) in JobKeeper payments relating to employees who were
stood down during the period. These amounts were paid in their entirety to Crown’s employees and had no net impact on
the Statement of Profit or Loss.
In addition, Crown received a further $4.6 million (2020: $2.6 million) in Coronavirus Job Retention Scheme (UK) payments
relating to employees that were stood down at Crown Aspinalls.
There are no unfulfilled conditions or contingencies attached to these payments relating to employee retention schemes.
During the year, Crown also received government grants relating to the following employee hiring and training schemes in
Australia:
• JobMaker hiring scheme - Crown Sydney qualified for JobMaker from 7 October 2020. Crown received $32,643 during
the financial year from the scheme. There are no unfulfilled conditions or contingencies attached to this payment.
• Training Services – Crown Melbourne, Crown Perth and Crown Sydney received $1.0 million (2020: $1.0 million) in
Commonwealth and State funding related to training services of employees, including Trainees and Apprentices. In
accordance with the terms of the grant, Crown must provide training services as outlined in the funding agreements and
apply costs to training services for employees for whom the grant has been claimed.
• Indigenous Employment Program – Crown Melbourne and Crown Perth received $0.4 million (2020: $0.3 million) in
Commonwealth funding related employment pathways for Indigenous jobseekers. In accordance with the terms of the
grants, Crown must provide employment pathways for Indigenous employees employed under the Indigenous
Employment Program and support their ongoing development.
At 30 June 2021, there were no amounts receivable to Crown in relation to employee retention or hiring schemes.
Notes to the Financial Statements continued
For the year ended 30 June 2021
146
FINANCIAL REPORT 2021 CONTINUED
Notes to the Financial Statements
27. Earnings Per Share (EPS)
2021
2020
The following reflects the income and share data used in the calculations of
basic and diluted EPS:
Net profit / (loss) after tax used in calculating basic and diluted EPS ($m)
(261.6)
79.5
Weighted average number of ordinary shares used in calculating basic EPS (‘m)
677.2
677.2
Weighted average number of ordinary shares used in calculating diluted EPS (‘m)
677.2
677.2
28. Key Management Personnel Disclosures
(a) Details of key management personnel
(i) Directors
The Hon. Helen A Coonan
Executive Chairman (appointed as interim Executive Chairman on 15 February 2021
until 27 August 2021)
Professor John S Horvath AO
Deputy Chairman (until 14 April 2021)
Kenneth M Barton
Managing Director and Chief Executive Officer (until 15 February 2021)
John H Alexander
Executive Director (Director until 22 October 2020; Executive until 22 January 2021)
Andrew Demetriou
Non-Executive Director (until 11 February 2021)
Jane Halton AO PSM
Non-Executive Director
Guy Jalland
Non-Executive Director (until 10 February 2021)
Michael R Johnston
Non-Executive Director (until 10 February 2021)
Antonia Korsanos
Non-Executive Director
Harold C Mitchell AC
Non-Executive Director (until 22 February 2021)
John Poynton AO
Non-Executive Director (until 28 February 2021)
Nigel Morrison
Non-Executive Director (appointed 31 March 2021)
On 12 April 2021, Crown announced the appointment of Bruce Carter as Non-Executive Director, subject to the receipt of any
necessary regulatory approvals. On 25 August 2021, following receipt of the regulatory approvals, Mr Carter’s appointment
became effective. On 10 May 2021, Crown announced the appointment of Steve McCann as Chief Executive Officer and
Managing Director, subject to the receipt of regulatory approvals. On 20 August 2021, Crown announced that in addition to
those appointments, Steve McCann had been appointed as Chief Executive Officer – Crown Melbourne. On 26 August 2021,
Crown announced the appointment of Dr Ziggy Switkowski AO as Chairman, subject to the receipt of regulatory approvals.
(ii) Executives
Lonnie Bossi
Chief Executive Officer – Crown Perth (from 9 December 2020)
Peter Crinis
Chief Executive Officer – Crown Sydney (from 1 January 2021)
Barry Felstead
Chief Executive Officer – Australian Resorts (KMP until 9 December 2020; Executive until 31 December 2020)
Alan McGregor
Chief Financial Officer (appointed 20 August 2020) and
Interim Company Secretary (appointed 18 February 2021)
W Todd Nisbet
Executive Vice President – Strategy and Development (until 30 June 2021)
Xavier Walsh
Chief Executive Officer – Crown Melbourne (from 9 December 2020 until 20 August 2021)
(b) Remuneration of key management personnel
Total remuneration for key management personnel for the Group and Parent Entity during the financial year are set out below:
2021
2020
Remuneration by category
$m
$m
Short term benefits
13.8
13.3
Post employment benefits
0.3
0.2
Long term incentives
2.4
2.6
Termination benefits
9.7
-
26.2
16.1
Further details regarding key management personnel and detailed disclosures of share based payment arrangements are
contained in the Remuneration Report.
Crown Resorts Limited Annual Report 2021
147
Notes to the Financial Statements
29. Related Party Disclosures
(a) Parent entity
Crown Resorts Limited is the ultimate parent entity of the Group.
(b) Controlled entities, associates and joint ventures
Interests in significant controlled entities are set out in note 30.
Investments in associates and joint ventures are set out in note 9.
(c) Entity with significant influence over the Group
Based on a substantial shareholder notice dated 11 June 2019 lodged by the Consolidated Press Holdings Group (CPH),
comprising Consolidated Press Holdings Pty Limited and its related corporations, a group related to Mr James Packer,
CPH had a relevant interest in 249,253,302 of the Company’s fully paid ordinary shares at balance date. This equates to
36.81% of the Company’s fully paid ordinary shares (2020: 36.81%) based on the total number of shares on issue at the
relevant balance date.
(d) Key management personnel
Disclosures relating to key management personnel are set out in note 28, and in the Remuneration Report.
(e) Terms and conditions of transactions with related parties
Sales to and purchases from related parties are made in arm’s length transactions both at normal market prices and on
normal commercial terms, unless otherwise stated.
(f) Transactions with related parties
The Group had the following transactions with related parties:
(i) Director related entities and entities with significant influence over the Group
CPH provided management services in accordance with a Services Agreement, in addition to corporate secretarial
and administrative services, of $0.1 million during the year (2020: $1.2 million). On 21 October 2020, the Services
Agreement with CPH was terminated. Crown reimbursed CPH for costs paid on behalf of Crown to third parties,
totalling $0.2 million during the year (2020: $0.7 million). At 30 June 2021 there were no amounts owing to CPH (2020:
$0.4 million).
Crown and its controlled entities did not provide any services to CPH during the year (2020: $11,000 of hotel and
banqueting services). At 30 June 2021 there were no amounts owing from CPH (2020: $nil).
In 2017, Crown entered into an agreement with Mr James Packer to sell two floors of the Crown Sydney Residences at
the Crown Sydney Hotel Resort to Mr Packer for $60 million. In 2017, the sale was approved by Crown’s independent
directors. Crown has received full payment of the $60 million in advance of settlement of the sale. In addition, as at 30
June 2021 Crown has been reimbursed an additional $11.5 million for customised fit-out costs incurred above the
fit-out allowance in the sales contract.
In line with its commitment to the NSW Government, Crown has ongoing access rights to the golf course and other
facilities at Ellerston. During the period Crown paid $1.0 million for the access rights (2020: $1.0 million).
(ii) Associates
During the period, Crown paid the Nobu Group $2.0 million (2020: $2.2 million) in license and management fees
relating to restaurants at Crown Melbourne, Crown Perth and Crown Sydney. At 30 June 2021 there was $0.1 million
owing to Nobu (2020: $0.1 million).
Notes to the Financial Statements continued
For the year ended 30 June 2021
148
FINANCIAL REPORT 2021 CONTINUED
Notes to the Financial Statements
30. Investment in Controlled Entities
The consolidated financial statements include the financial statements of Crown Resorts Limited and its controlled entities.
Significant controlled entities and those that are party to a Deed of Cross Guarantee with the parent entity are set out
below:
Footnote
Country of
Incorporation
Beneficial Interest Held by
the Consolidated Entity(1)
2021
2020
2021
2020
%
%
Crown Resorts Limited
Australia
Parent Entity
Artra Pty Ltd
Australia
100
100
Aspinall’s Club Limited
United Kingdom
100
100
Betfair Pty Ltd
A
A
Australia
100
100
Betfair Australasia Pty Ltd
A
A
Australia
100
100
Burswood Limited
A
A
Australia
100
100
Burswood Nominees Ltd
A
A
Australia
100
100
Burswood Resort (Management) Ltd
A
A
Australia
100
100
Capital Club Pty Ltd
Australia
100
100
Club Gaming Pty Ltd
Australia
100
100
Crown Asia Investments Pty Ltd
A
A
Australia
100
100
Crown Australia Pty Ltd
A
A
Australia
100
100
Crown Capital Golf Pty Ltd
Australia
100
100
Crown Cyprus Pty Ltd
Australia
100
100
Crown CCR Group Holdings One Pty Ltd
A
A
Australia
100
100
Crown CCR Group Holdings Two Pty Ltd
Australia
100
100
Crown CCR Group Holdings General Partnership
USA
100
100
Crown CCR Holdings LLC
USA
100
100
Crown CPS Holdings Pty Ltd
A
A
Australia
100
100
Crown Digital Holdings Pty Ltd
A
A
Australia
100
100
Crown Entertainment Group Holdings Pty Ltd
A
A
Australia
100
100
Crown (Gaming Technology) Holdings Pty Ltd
Australia
100
100
Crown Gateway Luxembourg Pty Ltd
Australia
100
100
Crown Group Finance Limited
A
A
Australia
100
100
Crown Group Securities Ltd
A
A
Australia
100
100
Crown Resorts International Holdings Ltd
Bahamas
100
100
Crown Investment Holdings LLC
USA
100
100
Crown Management Holdings Pty Ltd
A
A
Australia
100
100
Crown Management Pty Ltd
A
A
Australia
100
100
Crown Melbourne Limited
A
A
Australia
100
100
Crown North America Holdings One Pty Ltd
Australia
100
100
Crown North America Investments LLC
USA
100
100
Crown Overseas Investments Pty Ltd
A
A
Australia
100
100
Crown Queensbridge Development Pty Ltd
Australia
100
100
Crown Queensbridge Holdings Pty Ltd
Australia
100
100
Crown Queensbridge Property (Hotel) Pty Ltd
Australia
100
100
Crown Queensbridge Property (Residential) Pty Ltd
Australia
100
100
Crown Queensbridge Nominees One Pty Ltd
Australia
100
100
Crown Queensbridge Nominees Two Pty Ltd
Australia
100
100
Crown Sydney Pty Ltd
Australia
100
100
Crown Sydney Gaming Pty Ltd
A
Australia
100
100
Crown Sydney Holdings Pty Ltd
A
A
Australia
100
100
Crown Sydney Property Pty Ltd
A
A
Australia
100
100
Crown Resorts Limited Annual Report 2021
149
Notes to the Financial Statements
Footnote
Country of
Incorporation
Beneficial Interest Held by
the Consolidated Entity(1)
2021
2020
2021
2020
%
%
Crown Training Pty Ltd
Australia
100
100
Crown US Investments LLC
USA
100
100
Crown UK Investments Ltd
United Kingdom
100
100
Crown (Western Australia) Pty Ltd
A
A
Australia
100
100
Crown (Western Australia) Finance Holdings Pty Ltd
A
A
Australia
100
100
Crown (Western Australia) Finance Pty Ltd
A
A
Australia
100
100
DGN Games LLC(2)
USA
100
85
Flienn Pty Ltd
Australia
100
100
Gender Fitness Pty Ltd
Australia
100
100
Jade West Entertainment Pty Ltd
Australia
100
100
Jemtex Pty Ltd
A
A
Australia
100
100
Melbourne Golf Academy Pty Ltd
Australia
100
100
PBL Overseas (CI) Pty Ltd
A
A
Australia
100
100
PBL (CI) Finance Pty Ltd
Australia
100
100
Pennwin Pty Ltd
Australia
100
100
Publishing and Broadcasting (Finance) Ltd
A
A
Australia
100
100
Renga Pty Ltd
Australia
100
100
Royal Gaming Pty Ltd
Australia
100
100
Sociologic Games Limited(2)
Israel
100
85
(1) The proportion of ownership interest is equal to the proportion of voting power held.
(2) The Group acquired the remaining interest in DGN Games LLC and Sociologic Games Limited during the period.
A These controlled entities have entered into a deed of cross guarantee dated 21 June 2017 with the parent entity under ASIC Instrument
2016/785 - the “Closed Group” (refer note 31).
31. Deed of Cross Guarantee
Crown Resorts Limited and certain controlled entities, as detailed in note 30, are parties to a Deed of Cross Guarantee
dated 21 June 2017 under which each company in the Closed Group guarantees the payment in full of all debts of the
other entities in the Closed Group in the event of their winding up.
By entering into the Deed, pursuant to ASIC Instrument 2016/785, certain controlled entities of Crown have been granted
relief from the Corporations Act 2001 requirements for preparation, audit and reporting of financial reports and directors’
reports.
The consolidated Statement of Profit or Loss and Statement of Financial Position of the entities which are members of the
Closed Group are detailed below.
Closed Group
2021
2020
Consolidated Statement of Profit or Loss
$m
$m
Profit / (loss) before income tax
(237.2)
432.5
Income tax (expense) / benefit
49.0
(83.0)
Net profit / (loss) after income tax
(188.2)
349.5
Retained earnings / (accumulated losses) at the beginning of the financial year
4,967.7
5,040.0
Adoption of AASB 16 Leases
-
(15.6)
Dividends provided for or paid
-
(406.2)
Retained earnings / (accumulated losses) at the end of the financial year
4,779.5
4,967.7
Crown Resorts Limited Annual Report 2021
Notes to the Financial Statements continued
For the year ended 30 June 2021
150
FINANCIAL REPORT 2021 CONTINUED
Notes to the Financial Statements
Closed Group
2021
2020
Consolidated Statement of Financial Position
$m
$m
Current assets
Cash and cash equivalents
454.2
271.3
Trade and other receivables
25.3
77.3
Income tax receivable
64.6
-
Inventories
20.4
16.2
Prepayments
44.0
41.0
Assets Held for Sale
425.9
-
Total current assets
1,034.4
405.8
Non-current assets
Receivables
870.9
848.1
Other financial assets
1,574.4
1,692.0
Investment in associates
-
54.1
Property, plant and equipment
4,132.9
4,658.4
Intangible assets - licences
1,030.6
947.3
Other intangible assets
299.6
303.3
Deferred tax assets
171.9
155.9
Other assets
45.6
48.8
Total non-current assets
8,125.9
8,707.9
Total assets
9,160.3
9,113.7
Current liabilities
Trade and other payables
426.2
398.2
Interest-bearing loans and borrowings
313.0
5.9
Income tax payable
-
33.2
Provisions
301.9
195.6
Other financial liabilities
-
2.4
Total current liabilities
1,041.1
635.3
Non-current liabilities
Other payables
177.2
172.3
Interest-bearing loans and borrowings
1,217.4
1,371.1
Deferred tax liability
404.8
418.6
Provisions
28.7
27.0
Total non-current liabilities
1,828.1
1,989.0
Total liabilities
2,869.2
2,624.3
Net assets
6,291.1
6,489.4
Equity
Contributed equity
1,480.0
1,480.0
Reserves
31.6
41.7
Retained earnings
4,779.5
4,967.7
Total equity
6,291.1
6,489.4
31. Deed of Cross Guarantee continued
Crown Resorts Limited Annual Report 2021
151
Notes to the Financial Statements
32. Parent Entity Disclosures
Crown Resorts Limited
2021
2020
$m
$m
Results of the parent entity
Profit after tax for the period
(112.1)
564.5
Other comprehensive income/(loss)
-
-
Total comprehensive income for the period
(112.1)
564.5
Financial position of the parent entity
Current assets
66.7
17.2
Non-current assets
14,244.8
14,401.5
Total assets
14,311.5
14,418.7
Current liabilities
43.8
95.6
Non-current liabilities
5,060.9
5,004.1
Total liabilities
5,104.7
5,099.7
Total equity of the parent entity comprising of:
Issued capital
9,277.1
9,277.1
Employee equity benefits reserve
13.0
13.0
Accumulated profits/(losses)
(83.3)
28.9
Total equity
9,206.8
9,319.0
Contingent liabilities
There are no other contingent liabilities for the parent entity at 30 June 2021 (2020: $nil), other than those disclosed in note
24.
Capital expenditure
The parent entity does not have any capital expenditure commitments for the acquisition of property, plant and equipment
contracted but not provided for at 30 June 2021 (2020: $nil).
Parent entity guarantees in respect of debts of its subsidiaries
The parent entity has entered into a deed of cross guarantee as well as bank and capital market debt facilities with the
effect that the Company guarantees debts in respect of its subsidiaries. Further details of the deed of cross guarantee and
the subsidiaries subject to the deed, are set out in notes 30 and 31 and further details on bank and capital market debt
facilities are set out in note 17.
Notes to the Financial Statements continued
For the year ended 30 June 2021
152
FINANCIAL REPORT 2021 CONTINUED
Notes to the Financial Statements
33. Financial Risk Management Objectives and Policies
The Group’s principal financial instruments comprise receivables, payables, bank loans, lease liabilities, capital market
debt, cash and short term deposits and derivatives.
The Group’s business activities expose it to the following risks; market risks (interest rate and foreign exchange), credit risk
and liquidity risk. For each of these risks, the Group considers the counterparties, geographical area, currency and
markets as applicable to determine whether there are concentrations of risk. Other than as described in this note, the
Group is satisfied that there are no material concentrations of risk.
The Group has policies in place to manage different types of risks to which it is exposed. Policies include monitoring the
level of interest rate and foreign exchange risk and assessments of market forecasts for interest rates and foreign exchange
rates. Ageing analysis of and monitoring of exposures to counterparties is undertaken to manage credit risk. Liquidity risk
is monitored through the employment of rolling cash flow forecasts.
Financial risk management is carried out under policies approved by the Board of Directors. The Group identifies, evaluates
and hedges financial risks in accordance with approved polices. The Board is informed on a regular basis of risk
management activities.
(a) Market Risk
(i) Interest rate risk – cash flow
The Group’s exposure to market interest rates relates primarily to the Group’s cash and cash equivalents and long term
debt obligations as outlined in note 17.
At balance date, the Group had the following mix of financial assets and liabilities exposed to variable interest rates that are
not designated as cash flow hedges.
2021
2020
$m
$m
Financial assets
AUD cash on hand and at bank
368.8
96.8
AUD deposits at call
1.7
126.7
GBP cash on hand and at bank
9.2
4.9
USD cash on hand and at bank
7.7
8.2
USD deposits at call
2.7
1.9
Total financial assets
390.1
238.5
Financial liabilities
AUD bank loans
420.0
280.0
AUD capital market debt
365.9
415.7
Total financial liabilities
785.9
695.7
Net exposure
(395.8)
(457.2)
As at balance date, the Group maintained floating rate liabilities of $785.9 million (2020: $695.7 million) that were not
hedged by interest rate swaps. The associated interest rate risk is partially mitigated by total financial assets of $390.1
million (2020: $238.5 million). Under the AUD financial liabilities outstanding the Group pays the Bank Bill Swap rate
(BBSW) plus a margin of between 200 and 400 basis points.
Of the AUD cash on hand and at bank $368.8 million (2020: $96.8 million) is interest bearing and is invested at
approximately BBSW. Deposits at call of $1.7 million (2020: $126.7 million) are invested at approximately BBSW. The Group
maintains cash and cash equivalents on hand of $85.9 million for operational purposes which is non interest bearing (2020:
$48.4 million).
As at balance date, the Group had GBP cash on hand and at bank of $9.2 million which is interest bearing and accrues at
approximately the UK daily cash rate (2020: $4.9 million). The Group had no floating rate borrowings in GBP (2020: nil).
As at balance date, the Group had USD cash on hand and at bank of $7.7 million which is interest bearing and is invested
at approximately the US overnight rate (2020: $8.2 million). In addition, the Group had USD deposits at call of $2.7 million,
which is invested at approximately the US overnight rate (2020: $1.9 million). The Group maintained no floating rate
borrowings in USD (2020: $nil).
Crown Resorts Limited Annual Report 2021
153
Notes to the Financial Statements
Group Sensitivity
As a result of an increase in interest rates of 50 basis points the Group’s post-tax-profit for the year would have decreased
by $1.4 million (2020: decreased by $1.6 million). As a result of a decrease in interest rates to zero (between 8 basis points
and 10 basis points) the Group’s post-tax-profit/loss for the year would have increased by $0.2 million (2020: increased by
$0.5 million).
The Group, where appropriate, uses interest rate swaps to manage the risk of adverse movements in interest rates for its
long term floating rate borrowings which are subject to variable rates.
The Group uses cross-currency interest rate swaps to manage the risk of adverse movements in interest rates for its long
term foreign currency denominated borrowings which are subject to variable rates.
As at balance date the notional principal amounts and period of expiry of the interest rate swap contracts were as follows:
2021
2020
$m
$m
Cash flow hedge
Maturity under 1 year
250.0
200.0
Maturity 1 -5 years
-
-
Maturity over 5 years
174.6
174.6
Closing Balance
424.6
374.6
As at balance date the key terms of the interest rate swap contracts were as follows:
Cross Currency Swaps
2021
2020
$m
$m
Hedged Item
EMTN borrowing
EMTN borrowing
Pay Fixed Rate
7.05%
7.05%
Hedged AUD:JPY FX Rate
85.89
85.89
Maturity Date
July 2036
July 2036
Notional Amount
JPY 15,000
JPY 15,000
Carrying Amount of Hedging Instrument
Assets - Other Financial Assets
12.7
29.3
Liabilities - Other Financial Liabilities
-
-
Effective portion recognised in reserves (1)
7.3
29.3
During the year
Change in fair value of the hedging instrument
(16.6)
(6.0)
Change in fair value of the hedged item
(16.6)
(6.0)
Effective portion recognised in reserves from change in fair value of
continued hedge relationships
(22.0)
(6.0)
Hedge ineffectiveness recognised in profit or loss
-
-
Amount reclassified from reserves to profit or loss
5.4
-
(1) Hedging reserves includes both cash flow hedge reserve and cost of hedging reserve, before tax
Notes to the Financial Statements continued
For the year ended 30 June 2021
154
FINANCIAL REPORT 2021 CONTINUED
Notes to the Financial Statements
Interest Rate Swap
2021
2020
$m
$m
Hedged Item
AUD Floating Rate Debt
AUD Floating Rate Debt
Pay Fixed Rate
0.10% (weighted ave)
2.55% (weighted ave)
Maturity Date
June 2022
December 2020
Notional Amount
AUD 250.0
AUD 200.0
Carrying Amount of Hedging Instrument
Assets - Other Financial Assets
-
-
Liabilities - Other Financial Liabilities
(0.1)
(2.4)
Effective portion recognised in reserves (1)
(0.1)
(2.4)
During the year
Change in fair value of the hedging instrument
2.3
2.0
Change in fair value of the hedged item
2.3
2.0
Effective portion recognised in reserves from change in fair value of
continued hedge relationships
2.3
2.0
Hedge ineffectiveness recognised in profit or loss
-
-
Amount reclassified from reserves to profit or loss
-
-
(1) Hedging reserves includes both cash flow hedge reserve and cost of hedging reserve, before tax
The terms of each of the swap contracts are matched directly against the appropriate loan and interest expense and as
such are highly effective.
(ii) Interest rate risk – fair value
Where appropriate, the Group enters into fixed rate debt to mitigate exposure to interest rate risk. As the Group holds fixed
rate debt there is a risk that the fair value of financial instruments will fluctuate because of market movements in interest
rates. The level of fixed rate debt at balance date was $424.6 million (2020: $375.7 million). The Group pays between 4.1%
and 7.1% (2020: 6.5% and 8.5%) on fixed rate debt. As at balance date, the carrying amounts of the Group’s fixed rate debt
were not materially different from the fair values (2020: not material).
As at balance date the Group had no interest rate swaps in place to hedge fixed rate debt issuances (2020: nil).
(iii) Foreign exchange risk
The Group has currency exposure as a result of capital expenditure and investments/sales in currencies other than the
functional currency of the relevant entity.
The Group uses forward exchange contracts and cash flow hedges to minimise the currency exposure on any significant
receivables or payables as is deemed appropriate.
33. Financial Risk Management Objectives and Policies continued
(a) Market Risk continued
Group Sensitivity continued
Crown Resorts Limited Annual Report 2021
155
Notes to the Financial Statements
All forward exchange contracts must be in the same currency as the firm commitment and the Group negotiates the terms
of the hedges to exactly match the underlying commitment to maximise hedge effectiveness. As at balance date, the
Group had the following material foreign exchange exposures that were not designated as cash flow hedges:
2021
2020
USD Exposure
$m
$m
Financial assets
Cash and cash equivalents
3.8
4.2
Total financial assets
3.8
4.2
Net exposure
3.8
4.2
2021
2020
GBP Exposure
$m
$m
Financial assets
Cash and cash equivalents
8.5
5.7
Total financial assets
8.5
5.7
Financial liabilities
Trade and other payables
5.3
5.1
Total financial liabilities
5.3
5.1
Net exposure
3.2
0.6
2021
2020
HKD Exposure
$m
$m
Financial assets
Cash and cash equivalents
4.2
4.4
Trade and other receivables
0.3
2.4
Total financial assets
4.5
6.8
Financial liabilities
Trade and other payables
1.3
1.4
Total financial liabilities
1.3
1.4
Net exposure
3.2
5.4
Group sensitivity
Based on the financial instruments held at balance date, the sensitivity to fair value movements through profit and loss and
other comprehensive income as a result of reasonably possible changes in exchange rates are as follows:
Notes to the Financial Statements continued
For the year ended 30 June 2021
156
FINANCIAL REPORT 2021 CONTINUED
Notes to the Financial Statements
Post tax profit
higher/(lower)
Other comprehensive
income higher/(lower)
2021
2020
2021
2020
$m
$m
$m
$m
AUD/USD +10 cents (2020: +10 cents)
(0.4)
(0.5)
-
-
AUD/USD -10 cents (2020: -10 cents)
0.6
0.7
-
-
AUD/GBP +5 cents (2020: +5 cents)
(0.3)
-
-
-
AUD/GBP -5 cents (2020: -5 cents)
0.3
0.1
-
-
AUD/HKD +50 cents (2020: +50 cents)
(0.3)
(0.5)
-
-
AUD/HKD -50 cents (2020: -50 cents)
0.3
0.6
-
-
The Group uses derivative instruments such as forward exchange contracts to manage the currency risks arising from the
Group’s operations and its sources of finance.
Derivatives are exclusively used for hedging purposes and not as trading or other speculative instruments. These
derivatives qualify for hedge accounting and are based on limits set by the Board.
Cash flow hedges
At balance date the Group had no cash flow hedges in relation to foreign exchange contracts (2020: nil).
(b) Price Risk
(i) Equity Securities Price Risk
In December 2018, Crown entered into a derivative instrument to hedge its exposure under the 2017 Senior Executive
Incentive Plan. This hedge does not qualify for hedge accounting and therefore has not been designated in a hedge
accounting relationship. At inception the derivative asset was valued at $4.0 million, with the value of the instrument
reduced to nil at 30 June 2020. During the period the derivative instruments matured and were not exercised by the Group.
At balance date, neither the Group nor the parent entity is exposed to equity securities price risk.
(ii) Commodity Price Risk
Neither the Group nor the parent entity is exposed to commodity price risk.
(c) Credit Risk
Credit risk arises from the financial assets of the Group, which comprise cash and cash equivalents, trade and other
receivables and derivative instruments. The Group’s exposure to credit risk arises from the potential default of the
counterparty, with a maximum exposure equal to the carrying amount of these instruments. Exposure at balance date is
outlined under each applicable note.
The Group does not hold any credit derivatives or collateral to offset its credit exposure.
All investment and financial instruments activity is with approved counterparties with investment grade ratings and is in
accordance with approved policies. There are no significant concentrations of credit risk within the Group and the
aggregate value of transactions is spread amongst a number of institutions to minimise the risk of default of counterparties.
In assessing the doubtful debts provisioning for trade receivables, the Group has measured credit risk using the ‘Simplified
Approach’. The Simplified Approach requires the recognition of lifetime expected credit losses at all times. The Group has
elected to use a provision matrix utilising historical default rates, as well as taking into account current conditions and
forecasts of future economic conditions. If the Group becomes aware of circumstances relevant to an individual or group of
debtors that results in the matrix not being an appropriate basis for provisioning, then management discretion will be
applied.
33. Financial Risk Management Objectives and Policies continued
(a) Market Risk continued
(iii) Foreign exchange risk continued
Crown Resorts Limited Annual Report 2021
157
Notes to the Financial Statements
(d) Liquidity Risk
It is the Group’s objective to maintain a balance between continuity of funding and flexibility through the use of cash
reserves, committed bank lines and capital markets debt in order to meet its financial commitments in a timely manner.
At balance date 25.3% or $307.5 million of the Group’s interest bearing liabilities will mature in less than 12 months (2020:
0.7% or $8.2 million).
As at balance date the Group had $170.7 million in undrawn committed bank lines and $476.0 million in cash and cash
equivalents to mitigate the maturing liabilities (2020: $401.3 million and $286.9 million respectively).
As outlined in note 17, subsequent to year end the Group extended the maturity of the $307.5 million of interest bearing
liabilities that were due to mature in less than 12 months to October 2023. In addition, the Group has reached agreement
with one of its relationship banks to provide a new $250 million debt facility, subject to completion of long form
documentation. The facility will provide Crown with debt funding of up to $250 million (based on the value of unsold Crown
Sydney apartments) to be used to partly fund any required redemption of Crown’s Euro Medium Term Notes and
associated make whole premium, or in certain circumstances, for general corporate purposes.
Maturity analysis of financial assets and liabilities
The table below analyses the Group’s contractual undiscounted cash flows of financial assets and financial liabilities, net
and gross settled derivative financial instruments into relevant maturity groupings based on the remaining period at balance
date to the contractual maturity date.
1 year or less
1 to 5 years
more than 5 years
Total
2021
2020
2021
2020
2021
2020
2021
2020
$m
$m
$m
$m
$m
$m
$m
$m
Financial assets
Cash and cash equivalents
476.0
286.9
-
-
-
-
476.0
286.9
Receivables - trade
19.6
111.2
-
-
-
-
19.6
111.2
Cross currency interest rate
swaps receivable
8.3
9.0
33.1
35.9
82.7
98.8
124.1
143.7
Total financial assets
503.9
407.1
33.1
35.9
82.7
98.8
619.7
541.8
Financial liabilities
Trade and other payables
429.4
426.5
-
-
177.2
172.3
606.6
598.8
Lease liabilities
7.9
7.8
21.7
15.8
150.6
140.8
180.2
164.4
Other loan liabilities
-
1.0
-
-
-
-
-
1.0
Capital markets
-
-
-
-
795.9
790.3
795.9
790.3
Bank loans
307.5
-
112.5
280.0
-
-
420.0
280.0
Interest rate swaps payable
0.1
2.2
-
-
-
-
0.1
2.2
Cross currency interest rate
swaps payable
12.3
12.3
49.2
49.2
123.1
135.4
184.6
196.9
Total financial liabilities
757.2
449.8
183.4
345.0
1,246.8
1,238.8
2,187.4
2,033.6
Net maturity
(253.3)
(42.7)
(150.3)
(309.1)
(1,164.1)
(1,140.0)
(1,567.7)
(1,491.8)
Notes to the Financial Statements continued
For the year ended 30 June 2021
158
FINANCIAL REPORT 2021 CONTINUED
Notes to the Financial Statements
(e) Fair Value of Financial Instruments
The fair value of the Group’s financial assets and financial liabilities approximates the carrying value as at balance date.
The Group uses various methods in estimating the fair value of a financial instrument. The methods comprise:
Level One
–
the fair value is calculated using quoted prices in active markets;
Level Two
–
the fair value is estimated using inputs other than quoted prices included in Level One that are
observable for the asset or liability, either directly (as prices) or indirectly (derived from prices); and
Level Three – the fair value is estimated using inputs for the asset or liability that are not based on observable market
data, including cash flow forecasts, implied growth rates and implied discount rates.
The fair value of the financial instruments as well as the methods used to estimate the fair value are summarised in the table
below.
Valuation Technique
Quoted
market
price
Observable
inputs
Non market
observable
Level One
Level Two
Level Three
Total
$m
$m
$m
$m
Year ended 30 June 2021
Financial Assets
Cross currency swap contracts
-
12.7
-
12.7
-
12.7
-
12.7
Financial Liabilities
Interest rate swap contracts
-
0.1
-
0.1
-
0.1
-
0.1
Year ended 30 June 2020
Financial Assets
Cross currency swap contracts
-
29.3
-
29.3
-
29.3
-
29.3
Financial Liabilities
Contingent consideration
-
-
2.4
2.4
Interest rate swap contracts
-
2.4
-
2.4
-
2.4
2.4
4.8
There have been no transfers between fair value measurement levels during the financial year ended 30 June 2021.
Reconciliation of Level Three fair value movements
2021
2020
$m
$m
Financial Liabilities
Opening balance
2.4
0.7
Profit and Loss
2.0
1.7
Cash settlement of liability
(4.4)
-
Closing Balance - Financial Liabilities
-
2.4
33. Financial Risk Management Objectives and Policies continued
Crown Resorts Limited Annual Report 2021
159
Notes to the Financial Statements
(f) Changes in liabilities arising from financing activities
Bank
Loans
Capital
Markets
Debt
Lease
Liabilities
Other
Loans
Derivatives
Total
Liabilities
from
Financing
Activities
$m
$m
$m
$m
$m
$m
Year ended 30 June 2021
At 1 July 2020
280.0
790.3
58.7
1.0
2.4
1,132.4
Cash flows
140.0
-
(8.8)
(1.0)
-
130.2
Foreign exchange variations
-
5.4
0.3
-
-
5.7
Movement in fair value
-
-
-
-
(2.3)
(2.3)
Other
-
0.2
22.3
-
-
22.5
At 30 June 2021
420.0
795.9
72.5
-
0.1
1,288.5
Year ended 30 June 2020
At 1 July 2019
28.5
1,049.1
-
1.0
4.5
1,083.1
Adoption of AASB16
-
-
54.5
-
-
54.5
Cash flows
251.9
(259.1)
(6.5)
-
-
(13.7)
Foreign exchange variations
(0.4)
-
(0.1)
-
-
(0.5)
Movement in fair value
-
-
-
-
(2.1)
(2.1)
Other
-
0.3
10.8
-
-
11.1
At 30 June 2020
280.0
790.3
58.7
1.0
2.4
1,132.4
160
Directors’ Declaration
1. In the opinion of the Directors:
a. the financial statements and notes of the consolidated entity are in accordance with the Corporations Act 2001
(Cth), including:
i. giving a true and fair view of the consolidated entity’s financial position as at 30 June 2021 and of its performance
for the year ended on that date; and
ii. complying with Australian Accounting Standards (including the Australian Accounting Interpretations) and the
Corporations Regulations 2001 (Cth);
b. the financial statements and notes also comply with International Financial Reporting Standards issued by the
International Accounting Standards Board as disclosed in Note 1 of the Financial Report; and
c. there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become
due and payable.
2. This declaration has been made after receiving the declarations required to be made to the Directors in accordance with
section 295A of the Corporations Act 2001 (Cth) for the financial year ended 30 June 2021.
3. In the opinion of the Directors, as at the date of this declaration, there are reasonable grounds to believe that the
members of the Closed Group identified in Note 30 of the Financial Report will be able to meet any obligations or
liabilities to which they are or may become subject, by virtue of the Deed of Cross Guarantee.
Signed in accordance with a resolution of the Directors.
Jane Halton AO PSM
Interim Chairman
9 September 2021
Directors’ Declaration
Crown Resorts Limited Annual Report 2021
161
Shareholder Information
Substantial shareholders as at 31 August 2021
The following information is extracted from substantial shareholder notices received by Crown.
Shareholder
Number of
Ordinary
Shares
% of
Issued
Capital
Consolidated Press Holdings Pty Limited
249,253,302
36.81%
Midnight Acacia Holdings Pte. Limited
67,675,000
9.99%
Perpetual Limited
62,418,654
9.22%
Holders of each class of securities as at 31 August 2021
Crown has 677,158,271 ordinary shares on issue held by 41,646 shareholders.
Voting rights of ordinary shares
Crown’s Constitution sets out the information in relation to the voting rights attached to shares. In summary, at a general
meeting:
(a) on a show of hands, every member present has one vote; and
(b) on a poll, every member present has:
(i) one vote for each fully paid share held by the member and in respect of which the member is entitled to vote; and
(ii) a fraction of a vote for each partly paid share held by the member and in respect of which the member is entitled to
vote, equivalent to the proportion which the amount paid on the share bears to the total amounts paid and payable
on the share.
Distribution of shareholders as at 31 August 2021
Size of Holdings
Number of
Shareholders
% of
Issued
Capital
1 – 1,000
29,865
1.56
1,001 – 5,000
10,283
3.26
5,001 – 10,000
991
1.03
10,001 – 100,000
453
1.45
100,001 and over
54
92.70
Total
41,646
100.00
The number of shareholders holding less than a marketable parcel of ordinary shares is 3,404 (based on a closing market
price of ordinary shares on 31 August 2021).
Shareholder Information
162
Shareholder Information
Shareholder Information continued
The 20 largest shareholders as at 31 August 2021
Name
No. of
Shares
% of
Issued
Capital
1
CPH CROWN HOLDINGS PTY LTD
237,025,000
35.00
2
CITICORP NOMINEES PTY LIMITED
127,062,018
18.76
3
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
113,321,488
16.73
4
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED
78,645,816
11.61
5
NATIONAL NOMINEES LIMITED
13,310,550
1.97
6
BNP PARIBAS NOMINEES PTY LTD
10,645,569
1.57
7
UBS NOMINEES PTY LTD
9,481,212
1.40
8
BNP PARIBAS NOMS PTY LTD
7,834,424
1.16
9
CONSOLIDATED PRESS HOLDINGS PTY LIMITED
6,000,000
0.89
10
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED - A/C 2
4,505,738
0.67
11
BNP PARIBAS NOMINEES PTY LTD SIX SIS LTD
2,273,872
0.34
12
CITICORP NOMINEES PTY LIMITED
2,155,900
0.32
13
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
1,633,974
0.24
14
ARGO INVESTMENTS LIMITED
1,609,184
0.24
15
WARBONT NOMINEES PTY LTD
1,101,157
0.16
16
BNP PARIBAS NOMS (NZ) LTD
790,773
0.12
17
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
623,563
0.09
18
AUSTRALIAN EXECUTOR TRUSTEES LIMITED
600,712
0.09
19
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
497,274
0.07
20
NETWEALTH INVESTMENTS LIMITED
466,723
0.07
Total
619,584,947
91.50
Crown Resorts Limited Annual Report 2021
163
Additional Information
Shareholder enquiries
Shareholders may access their details by visiting the website of Crown’s Share Registry, Computershare, at
www.investorcentre.com. For security reasons, shareholders will be required to enter their Securityholder Reference
Number (SRN) or Holder Identification Number (HIN) and postcode to access personal information. Security holding
information may be updated online at any time. Alternatively, shareholders can update their details by phone or by writing
to the Share Registry. Shareholders with queries about their shareholdings should contact the Share Registry either online
at www.investorcentre.com, by phone on 1300 659 795 (within Australia) or on +61 3 9415 4000 (outside Australia) or
alternatively by writing to: Computershare Investor Services, GPO Box 2975, Melbourne, Victoria 3001.
Electronic shareholder communications
Crown encourages shareholders to elect to receive shareholder communications electronically instead of by post as it
enables shareholders to:
• receive important shareholder and company information faster;
• reduce the impact on the environment;
• securely store important shareholder documents online; and
• access all documents conveniently 24/7.
Shareholders who wish to receive email alerts with copies of Crown’s Annual Reports, Notices of Meeting, Issuer Holding
Statements, Payment Advices and other company related information may update their communication preference online
at www.investorcentre.com or by contacting the Share Registry.
Change of address
Issuer sponsored shareholders should immediately update their details online at www.investorcentre.com or by contacting
the Share Registry. Changes in addresses for broker sponsored holders should be directed to the sponsoring brokers with
the appropriate HIN.
Direct payment to shareholders’ accounts
Dividends may be paid directly to any bank, building society or credit union account in Australia. Payments are
electronically credited on the dividend date with advisory confirmation containing payment details either mailed or sent
electronically to shareholders. Shareholders who wish to have their dividends paid directly to their account should update
their payment instructions online at www.investorcentre.com or by contacting the Share Registry prior to the dividend
record date.
Tax File Numbers
Crown is obliged to deduct tax at the top marginal tax rate plus the Medicare levy from unfranked or partially franked
dividends paid to Australian resident shareholders who have not supplied their Tax File Number (TFN) or exemption details.
If you wish to provide your TFN or exemption details, please update your details online at www.investorcentre.com or by
contacting the Share Registry.
Consolidation of multiple holdings
If you have multiple holdings that you wish to consolidate, please advise the Share Registry in writing. If your holdings are
broker sponsored, please contact the sponsoring broker directly.
Crown’s website
Crown has a dedicated corporate website at www.crownresorts.com.au which includes Crown’s Annual Reports, Notices
of Meeting and other Explanatory Memoranda and disclosures made to the ASX.
Investment warning
All information provided in the Annual Report is provided as at the date stated or otherwise as at the date of this Report.
This Report has not taken into account any particular investor’s investment objectives or other circumstances. Investors are
encouraged to make an independent assessment of Crown or to seek independent professional advice.
Additional Information
Directors
Jane Halton AO PSM, BA (Hons) Psychology, FIML, FIPAA, Hon. FAAHMS, Hon. FACHSE, Hon. DLitt (UNSW),
Interim Chairman
Dr Ziggy Switkowski AO, PhD (Melbourne), FAA, FTSE, FAICD, Chairman-Elect (subject to regulatory approval)
Steve McCann, LLB, BEc, Chief Executive Officer and Managing Director-Elect Crown Resorts Limited
(subject to regulatory approval), Chief Executive Officer and Director Crown Melbourne Limited
Antonia Korsanos, BEc, CA, GAICD
Nigel Morrison, B.Com, FCPA
Bruce Carter, B.Econ, MBA, FAICD, FICA
Company Secretary
Alan F McGregor, B.Com, CA
Crown’s Registered Office and Principal Corporate Office
Level 3
Crown Towers
8 Whiteman Street
Southbank VIC 3006
Australia
Phone: +61 3 9292 8824
Share Registry
Computershare Investor Services Pty Limited
Yarra Falls
452 Johnston Street
Abbotsford VIC 3067
Phone: 1300 659 795 (within Australia)
+61 3 9415 4000 (outside Australia)
Fax:
+61 3 9473 2500
Website: www.computershare.com.au
Securities Exchange Listing
Crown’s ordinary shares are listed on the Australian Securities Exchange under the code “CWN”.
Crown’s Subordinated Notes II are listed on the Australian Securities Exchange under the code “CWNHB”.
The home exchange is Melbourne.
Annual General Meeting
10:00am Australian Eastern Standard Time (AEST)
Thursday, 21 October 2021
Virtual Meeting
Website
www.crownresorts.com.au
Auditor
KPMG
Corporate Information
164
© Crown Resorts Limited 2021.
Photographs are the copyright of Crown Resorts Limited or its related companies or are used under licence.
Crown takes the safety of its employees, customers, and community seriously. All photography used within this Annual
Report was produced in line with government restrictions.
crownresorts.com.au