A strong operating profit recorded in 2001 from the Publishing and Broadcasting Limited-controlled Crown Ltd reveals the extent of the bargain Mr Kerry Packer made when he paid $1.55 billion for the Melbourne casino in 1998.
The $1.2 billion-a-year monopoly business is worth up to three times more than what Mr Packer paid in December 1998, as shown by the casino’s 2001 full accounts, which were released on Friday.
The takeover bid was struck at an historic top-line price-earnings multiple of 14, and using that multiple for the $300.2 million EBITDA the casino made in 2001, Crown is now worth $4.23 billion.
Even against a more conservative benchmark of a 1998-99 price-earnings multiple of 7.75, the casino is now worth $2.33 billion, putting Mr Packer $780 million ahead.
The head of Crown, Mr Ian Johnson, who was paid $811,000 for the year, said Crown “was trading …