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South Africa – Sun International poised for more growth following post-pandemic rebound

By - 14 March 2023

Sun International has released its full-year results, showing strong growth in revenue and adjusted EBITDA and a significant reduction in group debt with SunBet now operating at a record high.

For the year ended December 31, 2022, Sun revealed that due to consumers going out more and gambling more, adjusted headline earnings increased from R110m to R1.1bn. EBIDTA surged by 96 per cent to R3.3bn

Sun International Chief Executive Anthony Leeming said: “We are particularly pleased by the significant progress we are making with our online strategy, with SunBet showing strong growth in all key indicators. Gaming income from casinos, Sun Slots and SunBet showed a significant recovery, with income up 36 per cent.”

Sun Slots successfully reactivated several shuttered locations, giving a total of 5,160 Limited Payout Machines (LPMs) in operation during the year, and an increase of 508 machines compared to 2021.

“We continue to engage with the regulators to increase the rollout of LPMs to the 6,500 LPM positions that have been allocated,” the operator said.

Sun Slots’ income increased 20 per cent, from R1 242m to R1 491m. SunBet income increased by 86 per cent in the same period in 2021, with a growth of 135 per cent in the second half of the financial year. Indeed it confirmed that SunBet was achieving record numbers in terms of revenue with more growth expected going into 2023. Active players increased by 50 per cent; sports turnover grew by 23 per cent; and deposits surged by 130 per cent.

“Active players on our rapidly expanding online sports betting and gaming platform continued to grow, with additional games being offered and the overall player experience being enhanced,” the group said.

Resort and hotel revenue increased by 65 per cent to more than R2.5bn whilst urban casino operations generated adjusted Ebitda of R2 445m, up 71 per cent from R1 433m in 2021.

Sun International is planning to expand into new markets, with a 70 per cent investment in SunBet Africa Holdings, for a consideration of $3.2m (roughly R58m).

“The company has online sports betting and casino licenses to operate in Ghana, Zambia and Kenya. We are in the early stages of rolling out the SunBet operating model and brand in these markets, which have attractive long-term growth potential,” Mr. Leeming said. “Our resort and hotel properties have continued to perform exceptionally well, and we anticipate another good year from them in 2023,” the group said.

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