SkyCity Entertainment Group has revised its full-year earnings outlook downward after a difficult first half, with declines in revenue, underlying EBITDA, and net profit. The New Zealand-based casino and entertainment company reported a 4.7% dip in revenue for the six months ending December 31, 2024, highlighting ongoing challenges in consumer spending.
Revenue Drops Across Key Segments
SkyCity’s revenue for H1 stood at NZ$422 million (£191.7 million/€231.7 million/US$241.7 million), a decrease from the previous year. This decline was felt across various business segments, including its gaming operations, non-gaming revenue streams, and its online platform.
CEO Jason Walbridge acknowledged the difficult market conditions, noting that subdued consumer confidence has affected performance. However, visitor numbers were a bright spot, with a 5.9% increase year-on-year, reaching 5.4 million across SkyCity properties.
SkyCity’s online business also took a significant hit, with revenue plunging 62.5% to just $2.1 million. The company attributed this to regulatory uncertainty and increased investment in preparing for future online expansion.
Auckland’s Performance Takes a Hit
Auckland, the company’s largest revenue driver, saw total underlying revenue fall to NZ$258.3 million from NZ$280.6 million in the previous year. The decline was only partially offset by gains in the Horizon Hotel, parking revenues, and higher contributions from the Sky Tower.
The company remains optimistic about the upcoming New Zealand International Convention Centre (NZICC), set to open in February 2026. SkyCity expects the facility to add around 500,000 visitor days per year to Auckland’s economy, which could boost future revenue.
Hamilton and Queenstown properties also saw slight revenue declines, despite increased visitor numbers in both gaming and non-gaming sectors. However, there was better news in Adelaide, where H1 revenue climbed 5.5% to $123.2 million, thanks to an uptick in customer visits.
Online Gaming Faces Regulatory Uncertainty
SkyCity’s online division has been a weak spot, struggling with an unpredictable regulatory environment. The company remains committed to expanding its digital operations but acknowledges the current hurdles.
- Online gaming revenue dropped by 62.5% to $2.1 million.
- Corporate revenue plunged 90.9%, adding to the company’s overall struggles.
- Investment in online team capabilities increased as SkyCity prepares for future expansion.
SkyCity is actively working with the New Zealand government as it sets regulations for the country’s online casino market, expected to launch in 2026. The company is one of several interested parties, alongside industry names like 888, Bet365, and Betway.
Earnings Guidance Lowered for Full Year
With the first half of the year showing weaker-than-expected results, SkyCity has now revised its full-year EBITDA expectations. The group’s underlying EBITDA is projected to be between $225 million and $245 million, down from its previous estimate of $245 million to $265 million.
Walbridge cited ongoing economic challenges as the key reason for the downward adjustment. The company also reaffirmed that no dividend is expected for the 2025 financial year.
SkyCity remains hopeful that upcoming projects, including the NZICC launch and possible online expansion, will help stabilize earnings in the long run. But for now, the company is bracing for continued headwinds in the months ahead.
