The Sky City Casino in Auckland had impressive profits in the first half to December, overshadowing the operator’s Australian properties, according to a financial report from Sky City Entertainment Group. The Auckland casino’s performance was mainly due to an increase in New Zealand tourism, which wasn’t reflected in their Australian market.
According to official numbers, the company generated a net profit of $AUD83.8 million to December 2016, or 18% more than the same period last year, when they hit a record of $71 million. The main contributor to the positive numbers was Sky City Auckland, which saw a 12% growth in the second quarter thanks to record tourism numbers, accounting for nearly 80% of the company’s EBITDA (earnings before interest, tax, depreciation and amortization) in the interim period. The Auckland property is also receiving concessions from the government to build the New Zealand International Conference Center, which is scheduled for opening at the start of 2019.
According to official statements, the casino is expected to continue growing modestly during the second half of the 2017 year thanks to new events, ongoing campaigns to boost visits, and favorable macroeconomic drivers. But at the same time, the company expects its international business to perform weaker during the second half due to a decrease in VIP customers.
International VIP business at the company has dropped down by 39% to $4.4 billion, while the normalized EBITDA was down by 68.6% to $7.1 million. The company prescribes this drop to the lower number of visits from international high-rollers at the casino, but also to the increasing number of fund transfer restrictions which have likewise taken a toll on other Asian markets. The company also noted a 13.5% drop in EBITDA (international business excluded) in their Sky City Darwin casino, which they say is due to an increase in competition and a weakened Australian dollar.