Effect of lockdown seen in SkyCity results

AUCKLAND: Casino operator SkyCity Entertainment Group has met dampened expectations, reporting a $33.6 million loss for 2022 on the back of an extended lockdown in Auckland where its flagship facility is based.

In results for the year to June, the company reported revenues of $639m for the year, down nearly a third from 2021. No dividend was announced, but the company hopes payments to shareholders can resume next year.

The company’s Auckland headquarters, whose extensive complex of entertainment venues accounts for the majority of earnings, saw revenues slump 32.3% to $330.6m and its contribution to ebitda drop by half to $100.9m.

Auckland experienced an extensive Covidrelated lockdown in the second half of 2021. The company said lockdowns had led to its Auckland facility being closed for 107 days during the period.

SkyCity’s casino in Adelaide — which last month became the subject of inquiry by South Australian state authorities into compliance with antimoney laundering laws — fared better during the period but still posted revenues of $184.5m. down 6.3% for the year.

Shocks of the past few years had seen waivers to cover breaches of banking covenants sought and granted, with results flagging these extended out to December. The company said it expected to meet covenant restrictions by the end of the year which would put it in a position to be able to resume

dividend payments.

The troubled International Convention Centre and hotel project, whose construction site was ravaged by a major fire in 2019, was said to be on track to open in 2025.

Normalised ebitda of $137.1m was in line with the company’s updated earnings guidance provided to market in June.

Its shares closed yesterday down 1.35% at $2.92. The stock is down about 10% compared with a year ago. —