Source: Radio New Zealand
RNZ / Ziming Li
Casino operator Sky City’s first half profit is nearly double that of the year earlier, despite a drop in revenue associated with ongoing regulatory costs and operational changes.
Chief executive Jason Walbridge said the first half reflected a planned period of operational transition, with the second half of the year ending in June focused on ongoing work to support its long-term operating objectives.
He said strong revenue contributions from food and beverage were a highlight of the result.
The company was also looking to sell some assets, targeting proceeds of $200 million within the next 12 months, which will be used to pay down debt.
- Net profit $12.1m vs $6m
- Revenue $411.7m vs $421m
- Underlying net profit $14.4m vs $38m
- Interim dividend nil vs nil
“We are undertaking a disciplined review of our operating model to ensure our cost structures reflect the current environment, while maintaining our commitment to compliance and customer experience,” Walbridge said.
He said revenue dropped 2.4 percent reflecting the introduction of mandatory carded play and continued investment in anti-money laundering (AML) measures and host responsibility capability, as well as costs associated with the opening of the International Convention Centre (NZICC) on 11 February.
Still, he said the full year underlying profit was tracking to expectations, though no dividends were expected to be paid in the near-term. SkyCity reaffirmed its full year underlying profit guidance in a range of $190-$210m, which compared with $72m in the first half.
Remediation costs
Walbridge said total costs were higher over the first half period partly because of ongoing investment in AML host responsibility and technology, particularly in Adelaide.
“Those remediation costs will leave our business when we complete the programme in June next year.”
Walbridge said the opening of the NZICC was a major milestone for SkyCity, with a strong forward events pipeline supporting future visitors to the precinct, with more than 110,000 expected over the next few months.
He said civil legal action between construction firm Fletcher Building and SkyCity over cost over-runs will play out over the next couple of years, with no meaningful update in the near future.
Asset sales
SkyCity was also actively marketing its 99 Albert Street building in Auckland, as well as continuing to look for a buyer of its Auckland car park concession, which had so far failed to attract an acceptable offer.
While it was considering the sale of other assets, Walbridge said those had not been disclosed so far.
“Carded play was introduced to strengthen our host responsibility framework and support player welfare,” Walbridge said.
“Six months on, we are seeing some operational benefits from the additional customer data and visibility it provides.”
Walbridge said SkyCity intended to take part in the New Zealand licensing process for online gambling, with legislation expected to be put in place from 1 May 2026.
– Published by EveningReport.nz and AsiaPacificReport.nz, see: MIL OSI in partnership with Radio New Zealand
