SkyCity share price falls amid COVID-19 fears

SkyCity Entertainment’s share price has been tumbling amid widespread falls on the New Zealand and international stock markets as fears about the impact of COVID-19 spread.

The company’s share price fell from its one year peak of $4.13 on January 15 to close at $3.20 on Friday, a fall of 22.5 percent, one of the sharpest declines on the New Zealand exchange and a two year low for the company.

The NZ market has fallen 3.6 percent in the last month, in contrast to larger falls elsewhere.

According to a table supplied by broker Craigs Investment Partners, the MSCI World Index has fallen 9.8 percent in the last month, with the Dow Jones down 11.5 percent, and the Hang Seng index down 6.5 percent.

On a monthly comparative basis, SkyCity’s decline ranks seventh among the NZSX top 50 shares.

By comparison, hotel group CDL, which manages the Millennium and Copthorne brands are down 12.5 percent.

Air New Zealand’s share price is down 20.8 percent after having cut capacity to China and it now suspended all flights to China and reduced capacity on other Asian routes including Korea, Taiwan, and Singapore.

Tourism operator Tourism Holdings which supplies campervans and operates several attractions is down 11.1 percent.

Auckland International Airport is down 8.0 percent and Synlait, a milk formula producer with major markets in Asia is down 32.5 percent making it the biggest decliner. 

In the food industry Scales and Seeka who both export apples, kiwifruit and other horticultural products to many markets including China and Asia generally are down 9.2 percent and 8 percent respectively.

Announcing its half-year results to the end of December on Feb13 SkyCity acknowledged that it was starting to feel the impact of the coronavirus, although other factors were also affecting its international business, a market segment vital to its business success.

The company said then it was reducing its expected turnover in IB for the year from a forecast NZ$14 billion ($8.5 billion) to NZ$10 billion ($6.1 billion) which equates to a $25 million drop in EBITDA.

SkyCity’s share price is down 15.8 percent from the same date a year ago and its shares opened this morning at $3.20 unchanged from Friday’s close.