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SkyCity's casinos on a run

NZN 9/08/2016

SkyCity Entertainment Group has posted a 13 per cent gain in full-year profit on better trading at its key Auckland casino and record activity from high-roller gamblers.

Net profit rose to $145.7 million in the year ended June 30, from $128.7m a year earlier, the company said on Wednesday.

Revenue increased 9.1 per cent to $1.1 billion.

SkyCity's New Zealand casinos are benefiting from the country's record tourism and migration, and its Auckland complex got a boost from new gaming concessions, including additional gaming machines and cashless payment technology, that it won from the government in return for building a national convention centre.

"The continued momentum at SkyCity Auckland reflects the significant investment in the property over the past few years," interim chief executive John Mortensen said.

Excluding its international business, the company's Auckland unit, which accounts for 85 per cent of the earnings, increased 8.2 per cent to $195.2m.

At its other New Zealand businesses, which include one casino in Hamilton and two in Queenstown, ebit edged up 1 per cent to $16.2m.

In Australia, earnings at the company's Adelaide casino lifted 36 per cent to $9.4m.

However earnings declined 16 per cent to $22.5m at the Darwin business, which has suffered after the number of workers involved in the construction of the INPEX liquid petroleum plant wound down.

Still, SkyCity said its confident with the medium-to-long-term outlook for Darwin, which is in a strategic location close to Asia.

SkyCity's international business, the term it uses for high-roller gamblers, had record activity for the year.

The international business boosted ebit 25 per cent to $37.3m as it benefited from a new gaming salon in Adelaide, and new 'grand horizon' gaming salons in Auckland, which have been popular with Asian VIP customers.

SkyCity shares fell 2.7 per cent to $5 on Wednesday.

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