Shares in casino operator Crown (ASX: CWN) jumped 5.6% on Friday on news the company made solid revenue growth for the 2013 financial year and will raise the final dividend 37%. Normalised revenue for the year increased 5.6%, with non-gaming revenue jumping an impressive 8.1%.
The higher revenue contributed to a 4.1% increase in normalized net profit after tax (NPAT) before significant items of $491 million. Including significant items, Crown will report a profit of $395.8 million, which includes the impact of $69 million the company lost when it sold off its shareholding in competitor Echo Entertainment (ASX: EGP).
The loss, while significant, could be seen as a small price to pay to secure a long-term strategic advantage over rival Echo and gain a valuable foothold in Sydney. Crown emerged the victor in a battle to be the developer of a new fully integrated resort in Sydney, but had it lost, Crown would have still had a strategic shareholding in Sydney.
Crown's two key Australian casinos, Melbourne and Perth, both performed strongly in the last year. Revenue was up 7.1% and 6.4% respectively, with overall operating margins of 28% for both properties.
Just over one third of Crown's profit ($175 million) came from the company's 33% stake in the Melco Crown Entertainment, which owns the City of Dreams resort in Macau. The resort is set to commence construction of its fifth tower, which the company expects will be an added attraction to the competitive Macau casino resort market.
Crown continues to target the high value Chinese and VIP markets and continues to seek new investments to capitalise on potential growth. Crown chief executive Rowen Craigie reiterated that the company was looking at options to enter the Brisbane market, which could take a further bite out of Echo's market.
Friday's share price jump and news of a higher dividend adds to a great year for Crown investors who have already seen their shares soar 53% in the last 12 months.
Foolish takeaway
Crown did note it had seen softness in demand in the Australian market. However with a number of growth opportunities to focus on in the next year investors should keep their focus long-term.
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Motley Fool contributor Regan Pearson owns shares in SkyCity.