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New Zealand-Sky City reports upbeat results

By - 25 April 2012

Gaming remains upbeat in New Zealand where half-year profits for leading operator SkyCity Entertainment rose to NZ$78.8m (US$66m) for the six months to December 31, showing an increase of 17.4 per cent.
Reinvesting in new VIP facilities has been key to the growth driving the international business in Auckland up by 31 per cent to over $20m.
Overall revenues at the property grew to $18.6m on a normalised basis with Adelaide also seeing increases of 6.9 per cent and Hamilton, 13.7 per cent.
Nigel Morrison, CEO of SkyCity, which owns or has interests in five of the country’s six casinos, said it was pleasing that the momentum which commenced in January 2011 has continued through the first half of the 2012 Financial Year and through into January and February 2012.
“The 2012 Financial Year has started well for SkyCity with the first six months revenues up $46.3m or 10.3 per cent, over last year. This is mainly due to strong fundamentals in our Auckland gaming businesses, much of which is attributable to the recent $50m revitalisation of the Auckland property and the continued growth in our international business following the opening of our Horizon suites and salons in July 2011.”
Stuart Wing, Auckland’s Chief Operating Officer added: “Our revenues have been particularly strong over the period, reflecting not only the value of the capital investment made in the property’s product offering but also the investment that is being made in the customer experience and the renewed emphasis being placed on our marketing execution and customer segmentation.”
The company revealed that since December it had been working closely with the South Australian casino taskforce concerning the future regulatory framework for the Adelaide casino.
“The outcome of these discussions will allow us to determine whether to proceed or not with progressing our plans for the transformation of the Adelaide casino,” SkyCity said. “While we are excited about the outstanding growth opportunity this transformational project potentially represents for SkyCity, shareholders should be assured that this project will only proceed if we can be confident of achieving an acceptable return on the potential investment.”
Optimism throughout the company remains high for 2012 though. “Given the strong first half results, the continued momentum we have experienced in January and February, including a strong Chinese New Year, the strong demand for our Horizon suites and salons and the success of our CapEx programme in Auckland, we expect our Normalised Net Profit for the full year to be at the top end of our previous guidance range – in the high $140m, up from $130.9m last year,” Mr. Morrison added.

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