11 Feb 2016

SkyCity's first half profit up 30%

1:17 pm on 11 February 2016

Gambling and hotel company's SkyCity Entertainment has reported a 30 percent rise in its first half profit driven by higher earnings from rich overseas gamblers and a solid performance of its flagship Auckland casino.

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Photo: 123RF

The casino operator said the first half net profit was $71 million, compared with $54.6m a year ago, and at the top end of the company's guidance given last month.

Total revenue was up 14 percent to $566.1m, with turnover of its international high rollers' business rising 51 percent to $7.2 billion.

The company has four casinos in New Zealand - Auckland, Hamilton and two in Queenstown - and establishments in Adelaide and Darwin.

It is also building the International Convention Centre in Auckland and a five-star hotel, which could cost up to $470m.

The government has extended the Auckland casino licence and allowed it to have more gaming tables and pokie machines for the development.

SkyCity's chief executive Nigel Morrison said 70 percent of the extra gaming product was now on the existing casino floor.

He said while it was early days, results from the extra concessions looked pleasing.

"We had a record week for this property over that Christmas/New Year period and... certainly there's no doubt some of that was due to having more gaming product and having the other concessions rolled out."

Sky City, meanwhile, said trading in January was overall flat, with growth in Auckland and Australia offset by a slowing in the high roller business.

It has started a $A300m upgrade and expansion of its Adelaide casino and has said that it expects to sell the new Auckland hotel to finance the project.

SkyCity increased its interim dividend to 10.5 cents a share from last year's 10 cents per share.