Despite the challenging economic environment SkyCity Entertainment Group has announced a relatively resilient performance from New Zealand and a solid performance from Australian casinos. Yesterday the company announced an underlying net profit of $55.6 million for the half year ended 31 December 2008, slightly down from $55.9 million for the first half last year. The Group will now be focusing on prudent capital and debt management and in future the distribution payout ratio will be eased to 60%-70% to retain capital for debt retirement.

Chief Executive Officer Nigel Morrison said: “Overall we view this as a satisfactory result. However, like others we’re cautious in our outlook in relation to the economies of both New Zealand and Australia, and our future performance will be influenced by how these economies unfold.” He added, “There is no doubt that the economic environment in New Zealand is challenging. Focusing on revenue growth, we’re satisfied with the results achieved in Auckland particularly in the second quarter.”

The Australian casinos, in Adelaide and Darwin, have seen revenue growth even though a smoking ban came into force in November 2007 and the Darwin property had been undergoing extensive expansion. In New Zealand the Auckland casino saw improvement to second quarter gaming revenues after a significant re-layout and re-design of gaming machine product and focus on enhanced customer service. Other casinos in Hamilton, Christchurch and Queenstown, where the Group has an interest, performed steadily.

According to Nigel Morrison, the company is cautious about the balance of the 2009 financial year and future performance will be influenced by how the New Zealand and Australian economies unfold. “However our core operations objective for 2009 remains unchanged, that being to maximise the potential of our existing assets. Success for us lies in generating even more reasons to visit and our central focus for the six months ahead and beyond will be to ensure that we’re the entertainment destinations of choice in the cities in which we operate.” (E-02.24.09)

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