SkyCity Entertainment Group, which operates five casinos in Australia and New Zealand, has reported a 5.8 percent decline in revenues for the second half of 2016 on the back of a huge fall in Chinese VIP visitation.
VIP turnover fell a whopping 38.7 percent for the half to NZ$4.4 billion, with VIP earnings margins down from 23.6 percent to just 12 percent due to “fixed costs.” The company had previously stated that it expected the arrests of 18 Crown Resorts employees to impact all local operators.
Despite the fall in VIP revenues, SkyCity Entertainment Group posted an overall 18 percent growth in profits for the half to NZ$83.8 million, with revenue of NZ$533 million, due to a favorable comparison with the previous six month period. The Group’s flagship property, SkyCity Auckland, saw revenue rise by 4 percent to NZ$284 million thanks to a strong final quarter.
SkyCity’s Australian properties in Adelaide and Darwin were the worst performers of the half with revenue down 2.8 percent and earnings 9.5 percent.
