Crown Resorts Share Price Up on New Conditions (ASX:CWN)
One of the country’s most famous casinos spent most of this year in hibernation due to COVID-19, but now with light at the end of the tunnel some positivity looks to be coming back to the company.
Crown Resorts Ltd [ASX:CWN] announced their reopening plan recently, which saw the CWN share price move up 2.5% to trade at $9.03 at the time of writing.
What’s happening at Crown Resorts Ltd?
This year was anything but easy for the casino business. With the COVID-19 pandemic in full swing shutting down travel and entertainment, Crown was hit hard.
Going back to March — when it became apparent just how nasty the virus was — the government stepped in and forced social distancing and temporary closures of public places.
Crown laid off 95% of its workforce of over 11,500 employees as a cost-cutting measure.
And things only got worse from there.
International and national borders closed, stopping people visiting Crown and staying in their hotels, and with the main Crown casino being Melbourne-based, business basically stopped due to the strict lockdown conditions the city went through.
The result of all this:
A reported EBITDA of $504.6 million, down 40.6%, and a 37% drop in the stock price from the April high to where it trades at the time of writing.
Where to from here for the Crown share price?
As Melbourne looks to reopen, Crown can look forward to reopening its doors.
In a recent announcement the company outlined its plan for reopening:
- ‘Restricting operation to ten designated VIP areas, each with a maximum capacity of ten patrons with no smoking permitted;
- ‘Physical distancing between patrons with every second electronic gaming machine and electronic table game deactivated;
- ‘Restricting patron activity to 90-minutes per day;
- ‘A COVID Marshal for each area
- ‘Enhanced hygiene protocols.
- ‘Gaming operations are expected to commence from Thursday, 12 November 2020.’
While this is positive news for the company and the city overall, there will still be a lot of work to do to get back to where they were pre-COVID-19.
Here are some key levels:
In the short term, with the hope being that patrons are looking to flock back to the casino, this will bring in revenue and hopefully boost the stock price. Should the price move back to the upside, then the levels of $9.81 and $10.74 may become the future focus.
Should the price fall back, then the level of $8.58 may come into focus — which proved to be strong in recent times.
For Money Morning
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