Sky City posts $57m full-year profit

By NZPA

Tuesday 27th August 2002

Casino operator Sky City Entertainment Ltd today posted a net after tax profit of $57 million for the full year to June 30.

The company, whose shares last traded up 5 cents at $6.65 -- a fresh high -- will pay a dividend of 22.5 cents per share.

Analysts surveyed by Multex Global Estimates had expected Sky City to record a net profit after tax but before abnormals of about $78 million.

The company reported a profit of $68 million for the same period a year earlier.

Today's result was hit by a $27.9 million write-down from Sky City's cinema subsidiary Force Corp.

Excluding that write-down, the company recorded an $85 million operating surplus -- up 21 percent on the previous year.

"This is a very pleasing result," managing director Evan Davies said.

Group revenues rose by 17 percent during the period to $NZ510 million.

Overall revenues at the company's Auckland casino rose by 9 percent, giving an earnings before interest, tax, depreciation and amortisation (ebitda) figure of $NZ183 million.

Gaming revenues were up 10 percent, food and beverage revenues were up 9 percent to $NZ28 million, hotel and conference revenues were up 9 percent at $NZ19 million and Sky Tower revenues were up 6 percent at $NZ7 million. Sky City carparking and Sky City Theatre also contributed greater revenues.

Across the Tasman, Sky City Adelaide increased revenues by 15 percent to $A95 million ($NZ111.67 million), with gaming revenue up 14 percent and food and beverage up 13 percent at $A12.5 million. Ebitda for the period was $A19.7 million, an increase of 26 percent.

The company's trouble cinema division Force Corp increased ebitda to $NZ10.1 million from $NZ300,000 a year earlier. Force had a 22 percent increase in cinema revenues to $NZ31 million and a net surplus after tax (before non-recurring items) of $NZ2.9 million.

Mr Davies said Sky City's Canbet and Sky Alpine investments were also making solid progress. Canbet turnover was up 44 percent at $A410 million. Sky Alpine was working hard to position itself in the Queenstown market.

Looking ahead, the company's new Sky Riverside casino in Hamilton is set to open next month. In Auckland, construction has begun on a new convention centre, which will be completed near the end of next year, and Force will open a new 10-screen cinema complex at Westfield's St Lukes Shopping Centre in mid-2003.

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