SkyCity’s Online Casino Is Profitable In First Year Of Operation
SkyCity Entertainment Group, a New Zealand-based casino operator, has announced that its online casino is already profitable in just one year of operation. SkyCity attributed the online casino profitability to the COVID-19 pandemic which forced many people to stay at home and seek leisure indoors.
SkyCity released their annual financial report for the 2020 fiscal which started on July 1 2019 and ended on June 30, 2020 which showed that while its online gambling business was profitable, its core business did not do that well.
SkyCity’s online casino which is licensed by the Malta Gaming Authority (MGA) generated revenue of around NZ$4.5 million for the firm, with NZ$2.2 million in earnings. The online casino which is powered by Gaming Innovation Group, welcomed more than 35,000 new players to their platform in August 2020. SkyCity reported that their online venture has been positive in earnings since April.
SkyCity’s online casino remains a small part of their core business of brick and mortar casinos. SkyCity stated that they are currently looking to advance their online casino business and prepare it for integration into its main businesses.
SkyCity opened most of their New Zealand casinos by June 2020, although the Auckland venue remains shuttered due to a COVID-19 spike in the area.
SkyCity’s Core Businesses Suffer Huge Losses
The report revealed that SkyCity generated NZ$1.125 billion in revenue ($761 million) in its last twelve months of operation, a spike of almost 37% from the number generated during fiscal year 2019. Similarly, SkyCity’s earnings spiked by roughly 17% to NZ$348.3 million, with its net profit skyrocketing by 62.8% to NZ$235.4 million.
However, these numbers failed to discount the proceeds from SkyCity’s offloading of SkyCity Auckland’s car park, and a non-cash AU$150 million impairment on their Adelaide license.
Taking these number into account, all four of SkyCity’s casinos failed to generate revenue in fiscal year 2020, with their Adelaide and Auckland locations garnering numbers 18% lower than those garnered in fiscal year 2019. Only SkyCity’s Hamilton property was able to avoid decreasing its earnings by at least 10%.
SkyCity’s VIP gambling sector, catering to high-rollers overseas, reported a 58.6% loss in turnover for 2020 to NZ$5.8 billion from fiscal year 2019’s take. However, the sector’s revenue dropped by a relatively tame 11% to NZ$38 million, due in no small part to SkyCity’s higher than normal win rate (1.47% compared to the theoretical rate of 1.35%) during that period.