Skycity Entertainment Group produced a full-year profit in line with expectations, but did not provide market guidance for next year, remaining cautious about the outlook.
The group, which runs casinos in New Zealand and Australia and cinemas in New Zealand, reported earnings before interest, tax, depreciation and amortisation (ebitda) of $300.5 million for the year ended June, up 2% on the previous year.
The profit after tax more than doubled to $115.3 million, although last year's profit was hit with an abnormal items charge of $58.3 million relating to the writedown in the value of the cinema chain.
Total revenue was up 4% at $846.5 million, with the Adelaide casino's revenue up 17% and Darwin's up 14%.
Auckland was up 1% and Hamilton was flat.
Cinemas' revenue improved 16%.
Interest costs fell 11% to $67.4 million.
A final dividend of 6.5c per share is being paid, compared with 10.5cps last year.
SkyCity said that, as with last year, management was budgeting for growth across all business units in both revenue and ebitda.
Forsyth Barr broker Suzanne Kinnaird said the Australian casinos remained the standout for the group, although the key Auckland casino made a 2.4% gain in second-half revenue compared with a poor first-half performance.
Gaming machines in Auckland were disappointing and that remained a key area of focus and potential for further uplift.
"SkyCity has not provided any full-year 2010 guidance and remained cautious about the outlook, given the unemployment outlook.
But it noted that the economic environment appears to have stabilised."
SkyCity, like others, did not have a clear picture of the future and did not want to lead the market in one direction or another, she said.
Forsyth Barr was reviewing its earnings forecast and its valuation.
Currently, Forsyth Barr valued SkyCity at $3.54 a share.
It last traded at $3.50.
SkyCity chief financial officer Alistair Ryan said capital raising that had been carried out and the subsequent debt buyback would reduce net funding costs in 2010.
"In 2009 we delivered double-digit underlying net profit after tax growth.
"While our objective is to deliver double-digit earnings growth again in 2010, we recognise this will be challenging in the current economic environment, both in Australia and New Zealand."
Second-half performance was strong, with all business units (except International, because of high win rate in the 2008 financial year) delivering increased earnings in the second half compared to a year earlier, he said.
