Star Entertainment (ASX:SGR) Loses Another CEO: Is This Casino Stock Worth the Gamble?

Star Entertainment CEO Steps Down: What Next for SGR?

Star Entertainment (ASX: SGR) shares rose 9.52% to close at A$0.12 on 17 December 2025, rebounding from A$0.105 the previous day after the company announced CEO Steve McCann had stepped down effective immediately. This marks the second time McCann has guided a troubled Australian casino through a crisis before walking away; he previously led Crown Resorts until Blackstone acquired it in 2022. With the stock still down nearly 50% from its 52-week high of A$0.21, this leadership change adds fresh uncertainty to an already high-risk turnaround story.

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What McCann’s Exit Signals for Star Entertainment

McCann joined Star Entertainment during its darkest hour with one job: stop the company from collapsing. On that front, he delivered. He helped secure recapitalisation support, including Bally’s ~A$200 million equity injection for ~2.5 billion shares, alongside the Mathieson family increasing their stake to ~23%.

That deal is now complete. Bally’s holds around 38% of Star, while the Mathieson family controls roughly 23%. Together, these new owners command a 61% stake. Bruce Mathieson Jr has stepped in as executive chairman while the board searches for a permanent CEO.

The timing is noteworthy. In our view, McCann’s exit suggests the rescue phase is done, and new owners want their own team running the show. This isn’t necessarily bad; Bally’s has turned around struggling casinos before, but it does mean more leadership change at a company that desperately needs stability.

Regulatory Risk: What Really Matters for Investors

For Star Entertainment shareholders, the CEO situation is secondary. The real question is whether this company can keep its casino licences.
The Star Sydney’s licence has been suspended since October 2022. The property remains open but operates under government-appointed manager Nick Weeks. NSW regulators extended the special manager arrangement to 30 September 2025, with a suitability reassessment scheduled then.

Queensland has taken a softer approach, repeatedly deferring any licence suspension for The Star Gold Coast and Treasury Brisbane. The latest deferral extends the suspension decision to 30 September 2025, with the Special Manager’s oversight also prolonged to that date. This indicates regulators see some improvement, but Star still hasn’t demonstrated it deserves full licence restoration.

The company also faces ongoing AUSTRAC civil penalty proceedings over anti‑money laundering compliance failures. The final amount remains unknown, though reports have referenced a potential penalty in the hundreds of millions of dollars. Any large fine would severely strain Star’s already weak balance sheet.

The numbers tell a tough story. Revenue dropped 29% to A$1.19 billion in FY25. The company posted a net loss of A$472 million, better than the A$1.69 billion loss in FY24, though that earlier figure included one-off write-downs. Star has suspended dividends since 2020, with no guidance on resumption.

The Investor’s Takeaway for Star Entertainment

The bull case comes down to price and backing. At 10-11 cents, Star trades near its all-time low of A$0.08 from August 2025. Bally’s Chairman Soo Kim believes he can unlock “hundreds of millions” in savings and revenue growth. If remediation succeeds, there’s meaningful upside from these beaten-down levels.

The bear case is equally strong. Analyst coverage is limited, but sentiment remains broadly cautious and skewed negative. Licence restoration is far from guaranteed, and leadership continues to be unsettled.

Our view is clear: Star Entertainment is a highly speculative punt, unsuitable for most retail investors. For those tempted, we suggest waiting until the September 2025 NSW suitability reassessment provides regulatory clarity. Until then, the risks outweigh the potential rewards.