Crown Resorts : 2016 Crown Resorts Limited Annual Report

ANNUAL REPORT 2016

Contents

Chairman's Message 1

Financial Performance 2

About Crown Resorts 4

Crown's Resort Portfolio 6

Chief Executive Officer's Report 10

Australian Resorts 12

Melco Crown Entertainment 16

Other International Interests 18

Crown Wagering &

Online Social Gaming Operations 19

Corporate Social Responsibility 20

Corporate Governance Statement 23

Nevada Information Statement 36

Directors' Statutory Report 40

Remuneration Report 50

Auditor's Independence Declaration 72

Independent Auditor's Report 73

Directors' Declaration 75

Financial Report 76

Shareholder Information 134

Additional Information 136

Corporate Information inside back cover

Financial Calendar

Record date for dividend 23 September 2016 Payment of final dividend 7 October 2016 Annual General Meeting 20 October 2016

2017 Interim results February 2017

Annual General Meeting

10.00am, Thursday 20 October 2016 The Astral Ballroom

Ground Floor, Crown Perth Burswood, Perth

CROWN RESORTS LIMITED ABN 39 125 709 953

Cover: The new luxury Crown Towers Perth, opening December 2016

Inside: Proposed design of One Queensbridge project (subject to planning approval) in Melbourne by architects Wilkinson Eyre

Chairman's Message

Crown Resorts has pursued important initiatives to increase transparency, unlock value for shareholders and position the company for the next decade of growth.

As a leading Australian tourism and entertainment company, Crown Resorts is building a worldwide reputation for the best in luxury experiences, gaming, hotel accommodation, signature dining and retail. It is this reputation that has helped make our Australian resorts so appealing to local and international visitors, attracting more than 31 million visits during the year.

Crown continues to invest in our tourism assets to ensure they are equal to or better than the finest resorts in the world. We are excited by the imminent opening of Crown Towers in Perth, which will be one of Australia's most luxurious hotels. We are also excited to have begun construction work on the highly anticipated Crown Sydney project and we continue to progress our planning application for a proposed fourth hotel development at Crown Melbourne.

Results

For the financial year ended 30 June 2016, Crown Resorts achieved a net profit of $393.6 million before significant items, which was down 11.8% from the previous year. This was a solid result considering the subdued markets in Western Australia and in Macau.

Reported net profit after significant items was $948.8 million, up 146.4%. In May 2016, Crown entered into an agreement with Melco Crown Entertainment (Melco Crown) for the repurchase of 155 million ordinary shares, resulting in a net gain to Crown of $602.0 million. This was by far the largest of the significant items reported.

The net proceeds from the partial sale of Melco Crown shares this year forms a key part of Crown's capital management strategy to reduce net debt.

Crown is in a sound financial position, our balance sheet is strong and we are well positioned to fund our current and proposed development projects.

Major initiatives to enhance shareholder value

One of Crown's major objectives is to increase shareholder returns and the Board has recently endorsed a number of initiatives designed to achieve this. Most important is a change in corporate structure through the demerger of certain international investments into a separately listed holding company.

Following the proposed demerger, Crown Resorts would continue to own and operate its wholly owned casino businesses Crown Melbourne, Crown Perth, Crown Sydney and Crown Aspinalls. A separate company would own a number of Crown's international investments, providing exposure to the major gaming markets of Macau, Las Vegas and the UK. It is proposed that our shareholders would receive new shares in the separate international company proportionate to their existing Crown Resorts shareholding.

The proposed new structure for the company will address what we believe is an undervaluation of the Australian resorts business. It is a structure that allows Crown's wholly owned operations to be valued independently of its broader international equity investments.

Importantly, transparency on the underlying quality of the assets and operations of the two entities will increase. The demerger will also provide shareholders with greater investment choice and the ability to tailor their investment towards their preferred company.

The proposed demerger is subject to further approval from the Crown Resorts Board as well as approval by Crown Resorts shareholders under a Scheme of Arrangement. The proposed demerger is also subject to a number of approvals, consents and waivers from third parties, including gaming regulators and State Governments.

Crown is also evaluating a potential initial public offer (IPO) of a real estate investment trust that would own a 49% interest in some of our Australian hotels. Crown Resorts would retain a 51% ownership interest. Implementation of

this proposed IPO is subject to approval from the Crown Resorts Board and approvals, consents and waivers from third parties, however it could realise significant value for shareholders.

Finally, in a move to increase cash returns to our shareholders, Crown Resorts has adopted a new dividend policy to pay 100% of normalised net profit after tax (before minorities and excluding profits from associates but including dividends received from associates). Effective for the full financial year ended 30 June 2016, a final dividend of 39.5 cents per share, franked to 70%, was declared. This brings the total dividend for the year to 72.5 cents per share, up 96% compared to the 2015 total dividend per share.

Our commitment to community

It has been a year of significant progress for Crown. Importantly, we continue our major contribution to the communities in which we operate through our corporate social responsibility programs and the important work of the Crown Resorts Foundation. This year Crown employed our 550th Indigenous employee and I am proud to advise that we now have 111 people employed under CROWNability, our disability employment program. We are also providing significant economic, social and cultural opportunities to thousands of worthy Australians through the Crown Resorts Foundation, which is now supporting over 85 community and education organisations across the country.

I sincerely thank you, as a valued shareholder of Crown Resorts, for your support as we work to position the company for the next decade of growth.

Chairman, Crown Resorts Limited

Crown Resorts Limited Annual Report 2016 1

Financial Performance

The 2016 full year result reflects a solid performance from the Australian operations and continued subdued trading in Macau. The result also includes the profit generated from the partial sale of Crown's Melco Crown shareholding, which was reported as a significant item.

• Crown reported a normalised net profit after tax (NPAT) of $406.2 million for the full year ended 30 June 2016, down 22.7%.

• A net gain from the partial sale of shares in Melco Crown was the major component of $555.2 million in significant items.

• Crown's Australian resorts achieved normalised EBITDA growth of 1.8% and normalised revenue growth of 0.8%.

• Weak market conditions in Macau adversely impacted Melco Crown's performance.

• Crown's share of Melco Crown's normalised NPAT of $58.1 million was down $103.2 million or 64.0%.

• A final dividend of 39.5 cps, franked to 70%, was declared bringing the total full year dividend to 72.5 cps.

Performance for the year ended 30 June 2016

1. Normalised results have been adjusted to exclude the impact of any variance from theoretical win rate on VIP program play and significant items.

2. Normalised earnings before interest, tax, depreciation and amortisation.

3. Normalised earnings before interest and tax.

4. Net profit after tax.

5. Significant items of $555.2 million in 2016, the major component of which is the net gain from the sale of shares in Melco Crown.

Australian Resorts Normalised Revenue

Australian Resorts Normalised EBITDA

3,500

$ millions

3,000

2,500

2,000

1,500

1,000

1,050

950

$ millions

850

750

650

550

450

350

500

F12

F13

F14

F15

F16

250

F12

F13

F14

F15

F16

Melbourne Perth

Melbourne Perth

2