'Lucky' baccarat gamblers dent casino giant's profits by millions
SkyCity says it made $NZ144.6 million ($137m) in profit in 12 months to June 30, down 14.7 per cent from a year ago, following the sale of its Darwin property and as international gamblers got lucky on baccarat.
The Kiwi casino and entertainment company said the high stakes gamblers who bet $14.1 billion at SkyCity casinos had a good year, resulting in a house "win rate" of just one per cent and costing SkyCity $NZ27.8 million ($26.4m) in profit over the year.
Baccarat has a theoretical "win rate," or house advantage, of 1.35 per cent - meaning that for every $100 bet, the casino retains $1.35.
In the nine years before last SkyCity's win rate has averaged 1.33 per cent, and was 1.32 per cent in fiscal 2018, but it has been below one per cent before.
"Bet size and frequency of play can vary and cause win rate to deviate from the theoretical over discrete periods," the company said.
SkyCity said that stripping away the impact of its unlucky win rate, the $188 million sale of SkyCity Darwin to Delaware North in April and the sale of a carpark in Auckland, its normalised net profit after tax was up 1.9 per cent to $NZ173 million ($164.4m).
Its revenue was up 0.8 per cent to $NZ822.3 million ($781.6m), or in normalised terms up 1.6 per cent to $NZ1.12 billion ($1.1b).
SkyCity kept its dividend unchanged; ASX shareholders will be paid 11.7647 NZ cents per share, unfranked.
SkyCity said its international convention centre and five-star hotel project in Auckland was progressing more slowly than hoped, but its $330 million expansion of its Adelaide casino was on-time and on-budget, and expected to open in October 2020, in time for the T20 Cricket World Cup.
The development will include a 123-room luxury hotel, a wellness centre and more restaurants and bars.
SkyCity's new bar and restaurant, the Guardsman, is set to open in the Adelaide Railway Station in November.
At 12.16pm (AEST) SkyCity shares were down six cents, or 1.6 per cent, to $3.77.
* Full-year profit down 14.7 per cent to $NZ144.6m ($137m)
* Revenue up 0.8 per cent to $NZ822.3m ($781.6m).
* Dividend unchanged at 10 NZ cents, with ASX shareholders receiving the equivalent of 11.764706 NZ cents in Australian currency.
© AAP 2019