SkyCity in multimillion-dollar raise as profits return
Enhanced anti-money laundering measures at SkyCity’s Adelaide casino have resulted in VIP “churn”, said the company, which today announced a return to profitability and a major equity raise.
SkyCity profit was AUD$26.2 million in a year defined by heightened regulatory pressure.
The company, which recently was determined to be “suitable” to hold Adelaide’s only casino licence, copped a $67 million penalty in June last year.
In that financial year, the company (also the operator of a casino in Auckland) reported a NZD$143.3 million loss after tax.
But profits have returned to the company, which said it would have generated AUD$64.7 million in NPAT (net profit after tax) if not for the impact of the South Australian casino duty settlement and costs associated with its ‘building a better business’ (B3) program; the company’s attempt at cleaning up its act.
In October, the High Court ruled on the interpretation of how South Australia’s casino pays taxes to the state government, with SkyCity made to pay additional casino duty of approximately $13 million. It later came to an agreement with the South Australian Treasurer to pay additional interest of $24.8 million and $200,000 of the state’s legal costs.
Full year earnings to 30 June 2025 were AUD$195.7 million – a 56.4 per cent lift on the prior year – while group revenue was 5 per cent lower than the prior period.
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It is now set to raise AUD$217 million, which it said would “provide balance sheet resilience alongside asset monetisation over the next 12-18 months”.
The raise will be at a fixed price of 70 cents per new share, which is a 30 per cent discount to the company’s last traded price.
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But it comes as influential market analysts S&P Global Ratings revised SkyCity’s rating outlook to negative from stable today.
S&P Global Ratings said the raise “should help to ease pressure on the group’s credit quality”.
“The pressure stems from cyclically weak demand, regulatory fines and costs, and other regulatory effects, such as the introduction of carded play,” the analysts said.
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“However, we have revised the outlook to negative to reflect our view that despite the equity raising, the timing and extent of a material earnings recovery remains uncertain.
“We expect monopolistic positions in SkyCity’s key land-based gaming markets will continue to underpin its business strength. The company holds long-term exclusive casino licenses in its key markets – Auckland, New Zealand, and Adelaide, Australia – that create high barriers to entry for competitors.
“Additionally, the company benefits from high-quality gaming venues and hotels, supported by ongoing reinvestment and effective management. We believe the outcome of the regulatory review of SkyCity Adelaide has materially reduced regulatory uncertainty. It should support SkyCity’s ability to pursue its operating strategy over the next 12-18 months.”
CEO Jason Walbridge said the financial results reflected “the difficult operating environment we’ve navigated in FY25”.
“Despite this we are making progress with significant milestones achieved in Carded Play now live across our New Zealand sites, a positive suitability outcome from the Independent Review of SkyCity Adelaide and the opening of New Zealand International Convention Centre in February 2026.”
In Adelaide, the company said it experienced “higher levels of customer churn” in the VIP segment “due to enhanced AML and host responsibility initiatives, particularly in the second half which impacted gaming revenue”.
Those initiatives – part of the company’s B3 program – follow an Independent Review into SkyCity Adelaide, which recently found the company could continue to hold the casino licence.
“We acknowledge Mr Martin’s findings and the Commissioner’s comments that we still have work to do,” Walbridge said
“We remain committed to our B3 programme and constructive engagement with all our regulators.”
Underlying earnings are expected to be within the range of AUD$172 million to AUD$190 million in FY26, impacted by ongoing investment, the expected impact of carded play and ongoing player churn.
No dividends are expected to be paid next financial year.
“Looking to FY27, we expect earnings to improve with NZICC expected to be breakeven on a stand-alone basis and the regulated online gaming business targeted to deliver breakeven in the first year of operation in FY27,” Walbridge said.
