Latest / What the Flux / Star Entertainment rolls the dice | Oasis tests Ticketmaster's new pricing | Burberry's trench-fall

Transcript

Star Entertainment rolls the dice | Oasis tests Ticketmaster's new pricing | Burberry's trench-fall · What the Flux

• 0:05
  Speaker 1: This is what the Flux I'm Brandon Justin and it's Monday,
• 0:08
  Speaker 1: the ninth of September, Flux VAM.
• 0:10
  Speaker 2: Just when we thought the Reserve Bank of Australia could
• 0:12
  Speaker 2: be dropping the cash rat soon, we'll get quite a
• 0:15
  Speaker 2: wake up call. Late last week, the RBA Governor Michelle
• 0:18
  Speaker 2: Bullet warned it if the economy stays as it is,
• 0:21
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• 0:25
  Speaker 2: well then it may be time for a cash rate rise.
• 0:28
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• 0:31
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• 0:44
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• 0:46
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• 0:48
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• 0:50
  Speaker 2: Three budget stories today, Jossy boy, let's do it for
• 0:53
  Speaker 2: our first Star Entertainment, the major casino operator has put
• 0:57
  Speaker 2: chairs in a trading halt as it looks for ways to.
• 0:59
  Speaker 1: S Geez Star Entertainment really rolling the dice on this one,
• 1:03
  Speaker 1: b Man. So what is going on here.
• 1:04
  Speaker 3: Well, chase boys.
• 1:05
  Speaker 2: Star Entertainment is one of the largest casino operators in Australia,
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  Speaker 2: which and casinos in Sydney and the Gold Coast, and
• 1:11
  Speaker 2: don't forget bris Vegas where it just opened a brand
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  Speaker 2: spanking new casino.
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  Speaker 3: The cost around three point six billion bucks to bill.
• 1:17
  Speaker 1: Well ever budget as well, be Man. But that is
• 1:19
  Speaker 1: the positive stuff for Star. But things have been anything
• 1:21
  Speaker 1: but positive over the past few years.
• 1:23
  Speaker 3: Yep.
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  Speaker 2: Star Entertainment's being accused of let's see here, money laundering.
• 1:26
  Speaker 2: Cash has a bit of fraud in here. There's links
• 1:29
  Speaker 2: to organized crime gang.
• 1:30
  Speaker 1: Not exactly the kind of jackpot that you want to hit.
• 1:33
  Speaker 2: On top of that, it's new South Wales casino license
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  Speaker 2: was temporarily suspended and it was fined one hundred million bucks.
• 1:40
  Speaker 1: But now, be Man, after all of this was supposedly
• 1:42
  Speaker 1: behind Star Entertainment. They've now gone into a trading halt.
• 1:45
  Speaker 2: And that's because Star failed to provide its accounts to
• 1:48
  Speaker 2: the ASX on time.
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  Speaker 1: And after this value be Man, Star came out and
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  Speaker 1: warned that it's currently reviewing its financial and its liquidity position.
• 1:54
  Speaker 2: And by the way, it needs to restructure the company
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  Speaker 2: as soon as possible and find three hundred million bucks
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  Speaker 2: in cash to avoid collapse.
• 2:02
  Speaker 1: There to say, they are basically down to their very
• 2:04
  Speaker 1: last chips.
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  Speaker 2: They're begging the New South Wales and Queensland governments to
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  Speaker 2: spot them some cash before they're completely tapped out.
• 2:11
  Speaker 1: And it's not just a bad handbe man. They are
• 2:13
  Speaker 1: staring at a major liquidity crisis. Bang.
• 2:15
  Speaker 3: So what's the key learning here?
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  Speaker 1: A liquidity crisis happens when a company can't meet its
• 2:19
  Speaker 1: short term financial obligations.
• 2:21
  Speaker 2: It's kind of like being out of chips at the
• 2:23
  Speaker 2: table and unable to buy back in right now.
• 2:26
  Speaker 1: Star can't pay its bills because it's short on cash,
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  Speaker 1: or it doesn't have enough assets that can be quickly
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  Speaker 1: turned into.
• 2:31
  Speaker 3: Cash and does it.
• 2:32
  Speaker 2: A liquidity crisis like this often leads to panic as
• 2:35
  Speaker 2: lenders and investors they lose confidence in the company's ability
• 2:38
  Speaker 2: to just pay its bills.
• 2:39
  Speaker 1: In Starr's case, they're facing a three hundred million dollar
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  Speaker 1: cash crunch.
• 2:42
  Speaker 2: And this type of crisis can snowball very quickly. It
• 2:45
  Speaker 2: already wants to write down the value of its assets
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  Speaker 2: by about one point four billion bucks.
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  Speaker 1: So be man. If they don't get more money or
• 2:51
  Speaker 1: convince the government to push back their tax payments, they
• 2:54
  Speaker 1: could be in some real trouble.
• 2:56
  Speaker 3: Yep.
• 2:56
  Speaker 2: For our second story, Ticketmaster's owner Live Nation is under
• 3:00
  Speaker 2: investigation after being criticized for inflating the price of concert
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  Speaker 2: tickets in the UK, and this very same issue could
• 3:06
  Speaker 2: soon be coming to Australia.
• 3:08
  Speaker 1: Oasis reforming equals Internet broken, Bman, So tell me more
• 3:11
  Speaker 1: about this story.
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  Speaker 3: Store my thunder their juzzy boys.
• 3:13
  Speaker 2: So this one starts with UK rock band Oasis, which
• 3:16
  Speaker 2: were one of the biggest rock bands of the nineteen.
• 3:19
  Speaker 1: Ninety with the two bros, a Liam and Noel Gallagher.
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  Speaker 2: In two thousand and nine they had a fallout of
• 3:24
  Speaker 2: epic proportions that left fans heartbroken.
• 3:26
  Speaker 1: Now Beman, fast forward nearly fifteen years and the unthinkable
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  Speaker 1: has happened. They're getting the band back together for a
• 3:32
  Speaker 1: UK and Ireland tour.
• 3:33
  Speaker 3: Now.
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  Speaker 2: Last week the tickets for the concert went on sale
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  Speaker 2: on Ticketmaster.
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  Speaker 1: Bands weighed up ten hours for one hundred and thirty
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  Speaker 1: five pound ticket.
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  Speaker 2: But when they got to the ticket page, the seats
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  Speaker 2: were more than three hundred and fifty pounds because tickets
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  Speaker 2: were in high demand. That's a new pricing model that
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  Speaker 2: would allow live nations company Ticketmaster to charge more for
• 3:51
  Speaker 2: tickets when demands sir, but.
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  Speaker 1: Low and behold all the tickets still sold and Oasis
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  Speaker 1: and Ticketmaster made a whole lot of bank.
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  Speaker 3: The juzzy boy.
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  Speaker 2: This has brought into q this new dynamic pricing ticketing
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  Speaker 2: for concerts.
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  Speaker 1: Been rolled up for concerts in the US, then the UK,
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  Speaker 1: and it's been announced that it will roll out in
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  Speaker 1: Australia soon too.
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  Speaker 2: And regulators in the UK and also around the world
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  Speaker 2: and now investigating whether dynamic pricing should actually be legal.
• 4:13
  Speaker 1: So what is the key learning here?
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  Speaker 2: Dynamic pricing is the idea that prices of a product
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  Speaker 2: or service can vary throughout the day or week depending
• 4:20
  Speaker 2: on the fluctuating demand and be man. This allows companies
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  Speaker 2: like Ticketmaster to maximize revenue by charging higher prices during
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  Speaker 2: peak demand periods.
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  Speaker 3: And offering lower prices when demand is lower.
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  Speaker 1: For example, tickets on a Saturday night concert in a
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  Speaker 1: major city might be priced a lot higher than a
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  Speaker 1: midweek event in a small town.
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  Speaker 3: But does a boy.
• 4:38
  Speaker 2: Although this is kind of new for entertainment dynamic pricing
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  Speaker 2: isn't actually a new concept for some other industries.
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  Speaker 1: Airlines have been doing it for decades. Given Live Nation
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  Speaker 1: CEO has warned it will also come to Australia. It's
• 4:48
  Speaker 1: shined the light on the laws around it.
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  Speaker 2: Yep, right now in Australia, there's nothing illegal about a
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  Speaker 2: business doing dynamic prices.
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  Speaker 1: As long as it doesn't misrepresent what its price is.
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  Speaker 2: And while not all music artists are getting into the
• 5:00
  Speaker 2: dynamic pricing vibes, it is expected that we might start
• 5:02
  Speaker 2: to see it more and more.
• 5:04
  Speaker 1: For our third and final story, Birbury is set to
• 5:07
  Speaker 1: be dropped from London's foot Sea hundred index after fifteen years,
• 5:11
  Speaker 1: as its share price plummets to its lowest price since
• 5:14
  Speaker 1: twenty ten.
• 5:14
  Speaker 2: Those trench coats just aren't hitting like they used to.
• 5:17
  Speaker 2: Juzzy boy, what's the story right here, right now.
• 5:19
  Speaker 1: Babe man Well. Berbury is the British luxury fashion brand
• 5:22
  Speaker 1: that was founded in the eighteen fifties and listed on
• 5:24
  Speaker 1: the stock market in two thousand and five.
• 5:26
  Speaker 3: But over the last few years Birbury has been battling
• 5:29
  Speaker 3: with weak demand.
• 5:30
  Speaker 1: Fact its share price has dropped over seventy six percent
• 5:32
  Speaker 1: since April.
• 5:33
  Speaker 2: Last year, and now Birbery is set to be dropped
• 5:35
  Speaker 2: from the foot Sea one hundred ie the Financial Times
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  Speaker 2: Stock Exchange.
• 5:39
  Speaker 1: That's an index of the top one hundred companies listed
• 5:42
  Speaker 1: in the UK by market value.
• 5:43
  Speaker 2: Now Berbery has been on that list for fifteen years
• 5:45
  Speaker 2: in a row until now.
• 5:47
  Speaker 1: How did it drop out? Now?
• 5:49
  Speaker 2: Very simple, juzzy boy, its market cap dropped too low
• 5:51
  Speaker 2: to be kept in the list.
• 5:53
  Speaker 1: While this sounds like a little bit of a symbolic drop,
• 5:55
  Speaker 1: there are many consequences that go more than.
• 5:57
  Speaker 3: Just being symbolic. So what is the key learning here?
• 6:00
  Speaker 1: Off the index ladder can often mean tumbling down the market.
• 6:03
  Speaker 3: Here's the thing.
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  Speaker 2: When the company is included on an index like the
• 6:06
  Speaker 2: Footsy one hundred or the ASEX two hundred, it gains
• 6:08
  Speaker 2: more than just the title.
• 6:10
  Speaker 3: For me through this well it does a boy.
• 6:12
  Speaker 2: Being on an index usually gives a company access to
• 6:14
  Speaker 2: a new form of investors and investment funds.
• 6:17
  Speaker 1: The ETFs mutual funds, which often track major indexes and
• 6:20
  Speaker 1: hold the stocks in there. And this could push Burbery's
• 6:23
  Speaker 1: already damage share price even further down. Be Man, I
• 6:26
  Speaker 1: just uncovered that I am paying sixty five dollars a
• 6:29
  Speaker 1: month for a gym subscription that I barely even.
• 6:32
  Speaker 2: Use and the only not good for a guy running
• 6:33
  Speaker 2: a financial education company.
• 6:35
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• 6:38
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• 6:40
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• 6:42
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• 6:44
  Speaker 1: all out.
• 6:45
  Speaker 2: Thanks for listening and we'll see you on Wednesday.