The SKYCITY Entertainment Group Limited (ASX: SKC) share price will be one to watch on Thursday following the release of its full year results.
How did SKYCITY perform in FY 2020?
For the 12 months ended 30 June 2020, SKYCITY delivered a 36.8% increase in reported revenue from continuing operations to NZ$1,125 million. Things were even better for its reported profits from continuing operations. They came in 46.3% higher year on year at NZ$235.3 million.
However, this was entirely the result of insurance recoveries following the NZICC fire. SKYCITY recorded a net gain of NZ$268.5m post-tax arising from these impacts. This offset weakness in the rest of the business.
On a normalised basis, it wasn't quite as positive. Normalised revenue fell 24.3% to NZ$779.5 million and normalised net profit fell 59.7% to NZ$66.3 million.
In light of this profit decline, no final dividend was declared for FY 2020.
Outlook.
Management is expecting an improved performance in FY 2021.
It commented: "Assuming there is no adverse change to the current COVID-19 outlook in New Zealand and South Australia, we expect Group normalised EBITDA to be above FY20, but still below pre-COVID-19 and FY19 levels."
"We expect the domestic businesses to continue to perform well when open (although we remain well prepared for the possibility of further closures), but are planning for negligible International Business and international tourism activity due to ongoing international border closures," it added.
Trading update.
The company also provided a trading update, which revealed that its casinos are performing positively.
Its NZ Properties have recovered quicker than expected, with local gaming in Auckland and Hamilton trading ahead of pre-COVID levels. This has led to the segment being materially more profitable than anticipated.
It's a similar story in Adelaide, with local gaming consistent with pre-COVID-19 levels. Its operations are both profitable and cashflow positive.
Finally, despite its casinos returning to relatively normal, its online casino business continues to perform well and is attracting new active customers. It has been EBITDA positive every month since April.
