- SkyCity benefits from strong rise in tourism
- Net profit boosted by high-roller business
- Early H2 trading looks positive - CEO
(Recasts with comments from CEO and background)
SkyCity Entertainment Group Ltd (SKC) on Thursday posted record turnover from VIP gaming in the first half, thanks largely to growing numbers of Asian high-rollers visiting its New Zealand casinos.
Chief Executive Nigel Morrison was upbeat about the January trading period, saying it "showed a continuation of the trend exhibited during the first-half of 2016".
International high-roller business delivered record activity both in terms of group turnover and normalised revenue. Turnover from its international business was up 51.4 percent to NZ$7.2 billion ($4.81 billion).
"The gaming spaces, the lounges and the restaurants for those players meets their expectations and that's been key," Morrison said.
Additional direct flights between Auckland and Asia boosted the New Zealand company's foreign visitor numbers. Auckland hosts about 53 percent of SkyCity's international business.
Sky City's net profit after tax leapt 30 percent to NZ$71 million in the six months ended in December, at the top end of analysts' expectations. Revenue was up 13.8 percent to NZ$513.7 million, the company said.
Looking ahead, Morrison said February should be particularly strong given the Chinese New Year celebrations. He declined to give specific guidance for the second half.
The biggest challenge going forward would be managing capital expenditure as the company develops a new convention centre and hotel in Auckland and upgrades and expands its Adelaide casino.
Sky City owns and operates casinos, restaurants, hotels and convention centres in Auckland, Hamilton and Queenstown in New Zealand and in Adelaide and Darwin in Australia.
Until recently, dairy was the backbone of New Zealand's economy, representing about 25 percent of exports. But dairy prices have dropped sharply since scaling record highs in 2013, due to China's economic slowdown and global oversupply. Tourism, meanwhile, has continued to grow strongly.
In December annual visitor arrivals reached 3.13 million, a 10 percent rise on the year. ($1 = 1.4968 New Zealand dollars)
