SKC - Sky City

[King1212]

Oz crown is in the deep sheet...facing money laundering. Will see fundies coming to SKC shortly

[Waltzing]

You may not see 3 dollars again any time soon but you never know... Topped up a few months back in the high 2's

[Filthy]

You may not see 3 dollars again any time soon but you never know... Topped up a few months back in the high 2's

under $3 now and down through the 90MA
next stop, $2.80, then $2.40 if that doesn't hold

[Biscuit]

under $3 now and down through the 90MA
next stop, $2.80, then $2.40 if that doesn't hold

I took a bit of profit off the table back in May around $2.40 after buying in the big dip. I'd be surprised if it went back there now though, surely the end of tunnel is in sight?

[Norwest]

under $3 now and down through the 90MA
next stop, $2.80, then $2.40 if that doesn't hold

Can you care to explain why you say $2.80 and $2.40?

I could see it bouncing down to $2.72 temporarily which would be a good buying opportunity but highly doubt it will go back to $2.40

[Filthy]

Can you care to explain why you say $2.80 and $2.40?

just based on TA. $2.80 would need to break first to get to $2.40; so I wouldn't stress too much.

[Waltzing]

possibly responding to the round 3 of virus in europe the world..

3 was probably getting a bit carried away and 3.20 was sale able...

we have this down as the last stock to revalue in the NZX after all others revalue.

we though perhaps the sharie people would prop it up... i appears they are running out of spare cash in summer...

GFC share price .

[tango]

I don't think Sharesies people understand that SKC is building its online income and can do well out of local high rollers in the VIP section. Obviously it's not going to do as well without tourists but it's a well run company

[Filthy]

EPS: 10.4cps: down from 49.3cps - Ouch!
https://www.nzx.com/announcements/367765

[Norwest]

It was interesting listening to Michael deliver for the first time, he was quite nervous in his delivery and potentially out of his depth to a degree, I thought he was quite lucky to have someone else who was much, much more confident sitting with him (It wasn’t Rob, I’m not sure who it was) to interject and save him a few times during questions. Also the call quality was pretty bad which didn’t help.

Questions: Forsyth Barr
Q: Coming back to Adelaide, trying to understand the profile from here.
A: Domestic Trading activity only (obviously), its early days, over the period the consistency has been good with plenty of upside from the hotels.
Q: From the group level, you've been taking costs out, have you put costs back (read: operational).
A: Some costs have come back as activity has recovered, more marketing and more hires to support gaming. We are being pretty cautious, but don't expect to add back all the costs that we've taken out moving forward.
Q: So you'll be able to sustain these cost decreases?
A: Yes we think it’s sustainable, but it’s very difficult to see a clean margin but in reality we are seeing a higher underlying margin in the market.
Q: Re: Hamilton, currently you are hitting it out the park. Interested in how you think of this sustainably?
A: Happy with Hamilton, significant changes made and the product, pricing and outlook is very positive and it’s a sustainable level of earnings this is not just a one off. Once international boarders open up, you will see people in the Waikato wanting to head to Aussie, Overseas etc and this may impact FY22 results.

Questions from Goldman Sachs
Q: Slide 10 can you give us info on performance on Jan-Mid Feb.
A: It's been pretty consistent, it’s a progression over time in performance, getting more confident over time. January very similar to December, it’s been consistent across each category.
Q: Full year guidance has been re-iterated, FY21 above FY20, but below FY19. Is there a degree of conservatism baked into this?
A: We just don't know. Increased lockdowns may have impact on EBITDA. Level 2 operation is half of what Level 1 is. We've been deliberately cautious, last week has shown how this can change so quickly.

Questions from Macquarie
Q: When can you structurally expand margin?
A: If you look at Hamilton it is dominated by EGM, good table performance, margins up significantly. Stronger gaming performance which is our higher margin performance. We're not looking to add costs back in where we don't need to. Auckland is different due to wider array of outlets e.g. food, beverage and hotels are relatively weak. Significant adverse effect on this property, but gaming margins are equivalent if not slightly up. If we are back to normal revenue activity in Auckland, we would expect to see margins slightly up. Re: Adelaide, the growth we are expecting will be higher margin for our business, hopefully we can see that flow in to improvement on our current 15-18% EBIDTA as we further open up.
Q: With IB, do you think NZ will ban "Junket Tours"
A: We haven't had any communications from this around DIA. This has been major focus on NSW obviously. The key thing is border opening. Our business in the international side has been operated much more conservatively than our peers. Look at FY19, 15% of IB turnover was junkets.
Q: Are you getting a benefit because of being ahead of any reform changes?
A: I don't think that’s beneficial even though we are ahead.

Questions from UBS (Marcus was quite frustrating in his line of questioning around the crown casino issues).
Q: On Adelaide, could you give us hard numbers since it’s opened?
A: It's difficult to put numbers here, I wouldn't be comfortable doing that. We're not in a habit of giving out monthly results and we aren't about to start.
Q: Is the right working assumption moving forward, is that you want be involved in junket play?
A: Borders are closed for 12months, so it’s not relevant at this time.
Q: When do you think you'll announce this?
A: There is a review underway, however our reliance on these junkets are a lot smaller as I've reiterated earlier.
Q: The issues crown has run into, would these equally apply to yourselves or could you manage the junket operators in an appropriate way?
A: We don't want to get into the crown casino issues, we've operated our business successfully since inception so these issues don't apply to Skycity.

Questions from Evans & Partners
Q: Can you give us EBITDA figures for Auckland for the December quarter.
A: We don't put out quarterly EBITDA numbers.
Q: Re: your comment of costs coming back into your business, how much headcount did you remove, and how much did you add back?
A: ~900 were made redundant, ~150 have come back, mainly casual and part time. Equivalent additional FTE is around 20. I would say we are not sure about outlook on when the business will recover and we're taking a cautious approach.
Q: What is the long-term guidance on Adelaide
A: $60M EBITDA target
Q: How soon do you expect to get up to 1500 slots at Adelaide, do you need this to hit $60m.
A: We don't need this to hit the target (anytime soon). It's a nice option to have to grow. There is some capacity, there are space in the facility to convert non-gaming to gaming depending on future demand.

Questions from Jarden
Q: Re: Slide 45, would it be normal to think this EBITDA contribution without using jobkeeper?
A: If you take this out, July-Nov was pretty close to PCP during this period, despite the constraints around construction and covid. December was obviously a much better month. Clearly out expectations for Adelaide in our second half will be better.
Q: Would you expect Adelaide to be higher EBITDA in second half?
A: Jobkeeper does impact first half, we don't expect to be below this in second half. No jobkeeper flowing into second half.
Q: Would you expect full year profits to flow into the dividend, or just the second half? e.g. a catchup dividend.
A: It will be half of full year. It won't be a catchup dividend, it will be sustainable consistent with the new policy. Our performance doesn't justify a catchup dividend.

It was also interesting to note that Michael shut down call quite abruptly at the end.