SkyCity Casino Leads 6 Other SkyCity Groups Casinos in Earnings

SkyCity Group's six other casino facilities and hotels last financial year. The Trans-Tasman group's net yearly profit rose 131% to $94.2 million at June 30th. The result was strong against the past year which was affected by a write-down in the worth of SkyCity's cinema complexes and was based on a 4.4% revenue improvement to $691.5 million.

"Normalized" net profit improvement was 13% bigger adjusting for the past year's write down. SkyCity Adelaide contributed a total of 42% growth in pre-tax earnings of $29.4 million based on a 10.5% improvement in revenues of $130.6 million, up by 19% in the 2nd half to $66 million.

SkyCity Chief Executive Officer Nigel Morrison said on August 19th, 2009 that they are very happy with the performance of their Adelaide casino facility this year. He said that Adelaide's full year earnings before interest, tax depreciation and amortization (EBITDA) is a direct result since the SKYCITY acquisition of the Adelaide casino facility in 2000.

Earnings were the results of execellent revenue growth and expense controls, particularly in the 6 months to June 30th, which grew almost 75% to $15 million. Nigel Morrison stated that the group had "re-positioned" Adelaide as a first casino entertainment establishment, opening a new baccarat room on the main gambling floor and improving custimer service.

The game of baccarat was now Adelaide's fastest growing casino table game, second in public popularity after roulette. Earnings from poker also increased by more than thirty percent last financial year.

Morrison said that under the newly restructured senior management team, SKYCITY Adelaide has significantly improved over the past year. Staff engagement levels have increased significantly and employee turnover has significantly reduced.

The Adelaide casino facility also continued its sponsorship of the Adelaide Fringe Festival and the Adelaide Casino Adelaide Cup and hosted its biggest New Years Eve event for more than eighteen thousand guests.

In comparison, the earnings for SkyCity Entertainment Group's New Zealand casino facilities grew by 0.6% to $373.3 million ($NZ457 million) while earnings were down by 0.1% to $190 million ($NZ232.6 million) as the challenging economic condition and tourism markets in New Zealand hampered earnings in hotels and casino facilities.

Margins had dropped for SkyCity Darwin which had acceptable revenue growth, up 8% to $109 million but earnings dropped 0.5% to $39.9 million as operations were disrupted by the resort expansion worth $40 million. The group said that the smoking bans to be introduced in Darwin on January 2nd, 2010 would be negative for gambling machine revenues.

SkyCity saw further opportunities improved the Adelaide Casino business aimed for net profit to imoroved by at least 10% this year. Shareholders will be paid a final fully franked 6.5c dividend on September 11th, 2009.

Thursday, September 03, 2009
John Palmer