Skyline board pleased with result

Most of the concern came from the tourism hot spot of Queenstown. Photo: Getty Images
Photo: Getty Images
Queenstown tourism giant Skyline Enterprises says its full-year revenue is "much better than expected" and ahead of budget.

The company has announced preliminary profit before tax for the year ended March 31 of $72.7million from continuing operations, up from $23.7million last year.

Revenue dropped from $196million to $103million.

In an announcement to the USX this week, chairwoman Jan Hunt said the group’s operations around the globe were significantly affected by Covid-19-related border closures, restrictive lockdown protocols and constantly changing operating environments.

In June, a significant restructuring exercise was undertaken across the group.

That followed confirmation in May by chief executive Geoff McDonald that more than half his 1200 staff in New Zealand and overseas would be laid off from the end of June, when the Government’s wage subsidy ended.

Ms Hunt said the board was pleased with the financial result given the unpredictable and constantly changing operating environment.

It was grateful to receive varying levels of wages subsidy from the countries in which it operated, to an accumulative value of $11.4million.

The result was impacted significantly by a non-cash increase in property values.

That was due to a reversal of the conservative property valuations undertaken last year which, at the time, were heavily influenced by the early signs of Covid-19.

That negative sentiment had not translated into a reduction in property values across New Zealand, hence the upward revaluation of the property portfolio.

The unaudited increase in property value was $38.6million, compared with a prior year revaluation loss of $36.4million.

It had been a "very tough year" for Skyline Queenstown, which expected the recent opening of the Australian border to provide a significant lift to visitor numbers over the next financial year.

Progress had been made on groundworks for the new gondola and car park.

Tenders had recently been released for the first stage of construction for the car park and bottom and top gondola terminals, while redevelopment of O’Connells Mall had remained on target throughout the Covid-19 disruption.

Following significant restructuring and cost-cutting, the Christchurch Casino enjoyed good local support and had traded strongly throughout the year.

In South Korea, an early July opening date was planned for its new luge complex in Busan, while construction of a new luge park outside Kuala Lumpur was expected to open in Q1 2023.

Planning work had recommenced on a luge park in Sheffield, England, while discussions and feasibility planning continued for a proposed luge and gondola complex in Swansea.

The sale of the Dunedin Leisure Lodge to the Distinction Hotels Group would be completed in late July and the majority of staff retained by the Distinction Group.

Significant global uncertainty would remain until international borders were fully open and tourism arrived at a "new normal".

"Guidance suggests that it will be early 2022 before we start to see immunisation rates conferring a degree of ‘herd immunity’ around the globe and the flow-on effect into higher levels of international travel," Ms Hunt said.

The board decided payment of a year-end dividend was inappropriate.

Instead, it would consider an interim dividend midway through the upcoming year when emergence from the Covid-19 threat was better understood.

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