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SkyCity Entertainment Group Limited has released their FY24 update report that shows a steady financial performance for the fiscal year ending June 30, 2024.
Despite a flat revenue year-on-year, the group achieved primary revenue of $959.6 million, marking a modest 0.3% increase. However, EBITDA (earnings before interest, taxes, depreciation and amortization) saw a reduction of 8%, landing at $277.8 million, primarily due to a shift in the revenue mix and continued investment in key areas of the business.
In the release, chief executive officer Jason Walbridge highlighted the complexities faced over the past year. “The earnings we have announced today are a solid result despite the economic circumstances. I am confident SkyCity is set up to build on our amazing business, with a number of important and exciting milestones coming down the pipeline in the next 12 months.” he says.
One of the most significant impacts on the group’s financials was the considerable accounting adjustments that led to a reported net loss of $143.3 million, and a notable 1,897.4% decrease from the previous year. This figure was heavily influenced by a $94.3 million impairment on SkyCity Adelaide’s assets and a $129.6 million tax adjustment following changes in New Zealand’s tax legislation. Despite these setbacks, SkyCity remain optimistic about their direction.
Jason says “SkyCity is coming off a very challenging financial year, with the combination of the soft economy, cost-of-living pressures in both New Zealand and Adelaide, and responding to various regulatory matters.”
The company also announced a successful early refinance August 2024, extending selected debt section develop in 2025 and 2026. This included a new issue of US$150 million in USPP notes with a seven-year holding and an extension of $217.5 million in syndicated bank facilities.
As for visitor numbers, Jason says “While we are continuing to see good visitation numbers across our properties as a whole, the spend per customer has decreased, reflecting the harder economic times everyone is facing.” He added that SkyCity is focusing on offering “new and innovative experiences so that customers see SkyCity as an attractive entertainment destination that delivers great outcomes.”
Regulatory progress has also been a focal point for the company this year. Settlements have been reached with both AUSTRAC in Australia and the Department of Internal Affairs in New Zealand regarding historic non-compliance issues, with the latter settlement still awaiting court approval. In addition, SkyCity agreed to temporarily close its Auckland gaming areas for five days in September 2024 as part of its compliance efforts.
Jason says “Progressing the various regulatory matters this year has been a positive step forward for us. That said, there is still more work for us to do as we have not met our own expectations to date. He also emphasised that the company’s uplift programmes are now a priority, with a significant Transformation Programme underway focused on enhancing compliance capabilities.
In the report, Jason outlined two key projects that SkyCity is progressing: the New Zealand International Convention Centre (NZICC) and preparations for the regulation of online casino gambling in New Zealand.
“It was a pleasure to open Horizon by SkyCity last month. It really showed what a treat we are in for with the New Zealand International Convention Centre”, Jason says, adding that the NZICC will be a landmark that showcases NZ to the world.
With regard to online casino gambling regulation he says “We need to be mindful about the regulation of online casino gambling. Allowing too many providers could lead to an overwhelming level of gambling advertising in New Zealand. We want to see providers who have skin in the game in New Zealand and are committed to the public health-based approach we take to gambling.”
“There is a lot going on over the next 12 months. It is going to be all about continuing to build our business, both metaphorically and literally.” says Jason.
