New Zealand’s leading entertainment company, SKYCITY Entertainment Group Limited (ASX: SKC) is planning to offer online casino gaming through international iGaming company, Gaming Innovation Group Inc.
In an announcement made on 22nd May 2019, the company has advised that its Maltese subsidiary company, SKYCITY Malta Limited, will partner with international iGaming company, Gaming Innovation Group Inc (GiG) to provide New Zealanders with an online casino gaming platform. As per the company’s Chief Executive, Graeme Stephens, this initiative should be seen more as a strategic entry into a space that is having a long-term relevance.
New Zealand already has an established online casino market. Currently, New Zealanders are spending huge amounts on the online casino platforms, which are provided by the offshore operators.
It is expected that proposed ‘skycitycasino’ online gaming site will be launched in mid-2019, and it is going to offer best-in-class host responsibility with a brand name that New Zealanders can trust.
The company has spent a considerable amount of time evaluating and selecting a suitable partner, and it believes that GiG is providing the right balance of experience, coupled with a new software platform relevant to the future and access to high-quality content for online gaming customers.
In the initial stage of this initiative, the company is not expecting to make money, however, in the longer run, the company envisions this as an exciting opportunity to grow and diversify its earnings via the provision of a multichannel offering to gaming customers both online and at its land-based casinos in New Zealand.
Furthermore, SKC released its Investor Presentation on 1st May 2019, showcasing operational and financial performance for FY18. The group revenue by business activity for FY18 stood at $1,097 million, comprising of 38% from EGMs, 25% from Tables and 15% IB among others. Additionally, hotels and F&B comprised of 5% and 16%, respectively.
The company anticipates witnessing a rise of ~2% in normalised EBITDA for FY19 and normalised NPAT for the group to be slightly down in comparison to pcp, which reflects an increase in the effective tax rate.
In another update, SKC Limited announced the acquisition of ordinary shares with respect to the buy-back program announced by the company to the market on 13th Feb 2019. The company acquired 1,055,000 ordinary shares at a consideration of $3.8487 per share, which reflects 0.1554% of the total class of financial products acquired.
Furthermore, in a recent update, the company reported to have inked binding agreement to sell a long-term concession for its Auckland Car Parks.
On the price-performance front, at market close on May 22, 2019, the stock of SKYCITY Entertainment Group Limited was trading at $3.620, up 0.277% during the day’s trade with a market capitalisation of $2.45 billion. The stock has yielded a YTD return of 11.76% and exhibited returns of -4.50% and -6.96% over the past three months and one-month period, respectively. Its 52-week high price stands at $3.970 and 52-week low price stands at $3.210, with an average trading volume of 462,552.
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