SkyCity Entertainment Group announced a deficit of NZ$33.7 million (US$22.3 million/£16.5 million/€19.7 million) for the initial six months of 2021, ending on December 31st. This financial downturn was attributed to the ongoing effects of COVID-19 restrictions in both Australia and New Zealand.
The organization, which oversees and operates five gambling establishments in New Zealand and Australia, reported earnings of NZ$216.8 million for the period ending December 31st, 2021. This represents a decrease of 31.4% compared to the same timeframe in 2020.
During this period, its primary Auckland SkyCity hotel was temporarily closed for 107 days. The period was also affected by restrictions on-site, with tourism-related enterprises experiencing negative impacts due to the closure of international borders.
Total revenue generated from gambling activities amounted to NZ$160 million, a 37.0% decline year-over-year. Nearly half of this revenue originated from its flagship Auckland SkyCity hotel.
Revenue derived from non-gambling activities reached NZ$48 million, compared to NZ$53.8 million in 2020. Of this amount, NZ$52.5 million was received from insurance proceeds related to the fire that occurred at the New Zealand International Convention Centre, which was under construction in 2019.
SkyCity’s online casino revenue amounted to NZ$9.3 million, representing a 24.0% increase compared to the same period in 2020.
In terms of expenditures, SkyCity paid NZ$215.7 million to suppliers and staff, of which NZ$123.3 million was allocated to wages, a reduction from the corresponding period in the previous year.
Throughout this timeframe, SkyCity Group obtained a $17.2 million compensation for wages from the New Zealand administration while their Auckland and Hamilton locations were shut down.
Marketing and communication expenditures reduced to $6.6 million, while sponsorship and other community spending was minimized by almost half, declining to $3.8 million.
Profits before interest, taxes, depreciation, and amortization (EBITDA) plummeted by 69.2% to $20.4 million.
The organization declared a loss of $33.7 million for the period, in comparison to a profit of $77.9 million in the equivalent period of 2020.
SkyCity CEO Michael Ahearne stated, “The COVID-19 pandemic continued to significantly affect SkyCity’s enterprise and operations at all properties during the initial half of this fiscal year.
“Government-enforced closures resulted in SkyCity Auckland being closed for 107 days, SkyCity Hamilton for 65 days, SkyCity Queenstown for 22 days, and SkyCity Adelaide for 8 days.
“After being permitted to reopen, these properties functioned under substantial restrictions due to requirements for large gatherings and social distancing. I am extremely proud of how the SkyCity team has adjusted to these difficulties.”
He added, “SkyCity’s online casino venture was a standout feature of the period, once again exceeding expectations with substantial increases in revenue, EBITDA, and customer numbers.”
SkyCity Adelaide recently announced that all venues will require evidence of COVID-19 vaccination for entry beginning this month.
Beginning on February 10th, all individuals entering Adelaide’s SkyCity, encompassing both staff and guests, will be required to present evidence of complete vaccination or a valid medical waiver. This mandate extends to the casino, lodging facilities, pubs, and eateries within South Australia. These establishments already enforce the use of face coverings, physical distancing, and registration via QR codes.
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