Sky City splits shares

By Phil Boeyen, ShareChat Business News Editor

Tuesday 30th October 2001

Auckland-based casino operator Sky City (NZSE: SKC) has announced a much speculated share split on the back of a bullish annual general meeting.

The company says it ordinary shares will be subdivided into two ordinary shares with a record date of November 16th, which will double the number of shares on issue.

At the company's AGM Tuesday chairman, Jon Hartley, told shareholders that the business has built a track record of superior returns to shareholders and that will continue.

"Since listing on the New Zealand sharemarket in 1996 and up to last Friday, pretax return to shareholders has averaged 21.3% per annum, well in excess of the NZSE average during the same period of 4.8%.

"In the 12 months since the 2000 annual meeting and up until close on Friday, Sky City shareholders have enjoyed a 78% pretax return on their investments.

"We are confident that at next year's meeting we will again be talking about increased financial performance, continuing the pattern we have become familiar with, of consistently higher revenues and earnings."

Mr Hartley says one of the most important highlights of the 2001 year has been the continued increase in revenues at the Auckland site and growth there continues to be a primary focus.

New features for the company in the coming year include expanding the Sky Tower franchise to include a Sky Jump controlled free fall attraction, the chance for visitors to climb the Sky Tower mast, and a new restaurant on the tower's observation deck.

"The new activities on Sky Tower reflect a number of the key features of our strategy; being to grow and develop the business, to heighten the company's profile as an innovative provider of a wide range of entertainment experiences, and to increase revenues and earnings through additional activities which relate to the core businesses of the company," says Mr Hartley.

"Apart from enhancing Sky Tower as a destination, the opening of The Observatory restaurant will continue our ongoing efforts to enhance the food and beverage experience for visitors to Sky City."

Mr Hartley says although the company is achieving increased revenue at its Adelaide operation it is keeping an eye on costs and has also restructured operating hours at Sky Alpine in Queenstown to improve performance there.

The company is also confident that its investment in entertainment company, Force (NZSE: FOR) will prove a winner.

"Once the necessary capital restructuring of Force has been completed, we are confident the results of Force and the synergies we anticipate for Sky City will demonstrate the validity of this investment initiative."

Mr Hartley says the company's business has shown resilience through the various economic cycles - both in New Zealand and internationally - and is extremely well positioned to benefit from growth in gaming and entertainment spending in our markets.

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