Darwin VIPs drive growth for SkyCity

Revenues for casino operator SkyCity Entertainment Group Ltd. rose 3 percent to NZ$460.5 million ($369.6 million) in the January-June period from a year earlier. Strong results from the newly launched Horizon VIP areas at SkyCity’s Darwin casino powered growth both for that period and the company’s full fiscal year, which ended June 30. Annual international business revenue in Darwin rose to A$7.5 million ($6.9 million) from A$300,000 as the company drew new players from Indonesia, Malaysia, Singapore, Thailand and China but incurred NZ$400,000 in start up costs.

International business at the company’s flagship casino in Auckland also rose 10.9 percent for the year, contributing to an overall 29.5 percent rise in turnover for the segment for SkyCity to NZ$5.7 billion. However, a higher-than-usual win rate in Auckland was offset by SkyCity’s move to offset the players’ losses with NZ$2 million more than usual in “complementary expenses”. To drive VIP growth further, SkyCity said that Craig Ashton, previously Crown Ltd.’s president for international business development and a veteran of Genting Group and Casinos Austria, would join next month as executive vice president for international business. The company also is setting up a VIP gambling machine area in Auckland that is to open early next year.

A black spot in its VIP results was a provision for doubtful debts of NZ$2.7 million related to a group that visited SkyCity Auckland late last year.  Nigel Morrison, managing director, said a group of 20 Asian gamblers, some of whom were registered as high rollers elsewhere, apparently hit up several casinos in a quick tour, to the same result. “We haven’t experienced this before and we do regard it as a bit of a scam,” he said, indicating surveillance had been upgraded and that the company was still trying to recover its money. Meanwhile, plans to invest NZ$35 million to build a 135-room hotel, which was to open by early 2015, at the SkyCity Hamilton casino have been put on hold amid a drought in the area that had affected visitation. Corporate net profits fell 8.1 percent to NZ$127 million.