SkyCity Entertainment Group, a leading name in New Zealand’s entertainment sector, has reported a significant financial downturn, with a net loss after tax of NZ$143.3 million (US$88.3 million) for the fiscal year ending 30 June 2024. This loss was primarily driven by a substantial AU$86.2 million (US$57.5 million) impairment on its Adelaide assets and a NZ$129.6 million (US$78.4 million) hit following adjustments to New Zealand’s tax legislation.
Despite these challenges, the company’s core operations remained relatively stable. The underlying group-wide revenue saw a slight increase of 0.3% year-on-year, reaching NZ$959.6 million (US$591 million), while underlying EBITDA decreased by 8% to NZ$277.8 million (US$171 million). The reported revenue echoed the trend of slight growth, increasing to NZ$928.5 million (US$572 million), though reported EBITDA saw a sharper decline of 16.7%, landing at NZ$138.2 million (US$85.1 million).
SkyCity CEO Jason Walbridge, cited by Inside Asian Gaming, commented on the results, noting: “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.”
Addressing the Challenges of a Tough Economic Environment
Walbridge highlighted the difficulties of the past financial year, which included navigating a soft economy and cost-of-living pressures that affected consumer spending in both New Zealand and Adelaide. “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 said.
In response, SkyCity is focusing on creating new and innovative experiences to ensure it remains a top entertainment destination. This strategy aims to adapt to changing consumer behaviors and economic conditions, reinforcing the company’s resilience in challenging times.
Regulatory Challenges and Compliance Efforts
The past year also saw SkyCity reaching settlements regarding historic non-compliance with anti-money laundering and counter-financing of terrorism laws. These settlements were made with Australia’s AML watchdog AUSTRAC and New Zealand’s Department of Internal Affairs (DIA), although the DIA settlement is still pending final court approval.
Further regulatory reviews and compliance measures are ongoing, with an independent review of SkyCity Adelaide set to conclude in December. Additionally, SkyCity Auckland will temporarily close its gaming areas for five days in September as part of its agreement with the DIA.
Walbridge remains optimistic about the progress in regulatory matters, stating: “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.”
Looking ahead, SkyCity is implementing significant transformation programs aimed at enhancing compliance and customer care. A notable initiative set to launch next year is the introduction of 100% carded play across its New Zealand casinos by July 2025 and at the SkyCity Adelaide casino by early 2026. This system will require all gaming to be conducted through a carded system, which will help monitor gaming activity and promote responsible gambling practices.
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