Sky City announces special div, buyback and new hotel

By NZPA

Tuesday 5th November 2002

Shares in casino operator Sky City shot up nearly 4 percent after the company announced a special dividend, share buyback and plans for a new hotel.

Sky said that because of strong earnings and the level of reserves it would pay a special dividend of 20 cents per share.

It would be paid on November 29 with a record date of November 22.

The special dividend was in addition to the 38 cents per share dividend paid to shareholders for the 2002 financial year.

The company also announced a buyback of between $40 million and $60 million of its shares during 2003, depending on market conditions.

The company said it would build a new five-star hotel adjacent to its Auckland gaming and entertainment complex.

The shares rose 27 cents to $7.88 before easing back to $7.86.

The $75 million, 320-room hotel will be developed above Sky City's $60 million convention centre, currently under construction.

It is expected to open in late 2004, and would also target the tourist market. Managing director Evan Davies said construction of the new hotel had been driven by the need to provide convention customers with onsite accommodation.

Sky City's current hotel, within the casino complex, was already at capacity and not expected to be in a position to cater for convention delegates.

Mr Davies said the company expected both new facilities to drive increased revenue and generate new business for Sky City's existing facilities, including the Sky Tower.

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