"Consensus earnings forecasts for the current financial year are for
Sky City to deliver earnings growth of about 17% (all eyes will be on the
interim result due later this month for verification).
In 2004,
however, that growth is expected to slow to 9%".
Comment: I don't care about the socalled "consensus earnings forecasts
and the 17% earnings rate.
David needs to realize that some proper research is better than a
consensus forecast.
The posts here (Sharetrader) have indicated a minimum net profit
of some $100 mill. and a maximum of $110 mill. That corresponds with a
range of earnings rates of 17.5%-29.2%.
However that ignores the 2.9 mill after tax saved by not having a
buyback. Adding that in will give a minimum of 20.9%.
I think it will be about $105 mill, and adding the discussed $2.9 mill.
to give us about $108 mill. or an earning rate of 26.9 %. The reasons for
this guidance number have been adequately set out in the posts in the past
few pages of Sharetrader and there is no need to repeat these.
The big ABN-AMRO broker had to upgrade their profit number to $106
mill. It is possible that McEwan has been using old data prior to the
upgrade.
Then his: "In 2004, however, that growth is expected to slow to
9%".
Please explain that to us in this column David. In Dec 2003, the new
Convention Centre will be opened. I heard it will have retail facilities
and am checking this out.
SKC will also supply the meals and banquets to the Convention goers and
that should augment profits. This centre can take up to 1500 Conference
delegates.
But above all, the location of the Convention Centre and the Hotel is
superb: next to the massive gaming complex and Tower and close to the
harbour.
And those features will be a magnet for International Convention
Organizers.
The New Convention Centre will be linked by an overbridge to the Gaming
complex so people don't have to cross the road. At the end of this will be
270 gaming machines and other facilities.
Thus there will be an income from Conference Fees, Retail, Food and
Wagering/visits to the Tower.
The existing Hotel will be full, no doubt while the new one is being
built. Existing rates for that hotel could be raised somewhat.
McEwan should realize the enormous pressure on the facilities-and
resulting dollars-the new Convention Centre will bring. There will be no
discounting, I think!
Gerry
I am not a financial advisor; suggest
you consult one before making any decision as to buying, holding or
selling a stock.
See IRG research reports
