SKYCITY Limited today announced an after tax surplus of $70.1 million (before non-recurring items) for the year ended 30 June 2001, a 16% increase over the $60.3 million net surplus recorded in the previous financial year. Non-recurring items reduced the net surplus marginally to $68.3 million.

A final dividend of 35 cents per share is declared making the total dividend for the year 63 cents per share, a 12.5% increase over the previous year. The payment date for the dividend is 5 October with the entitlement date being 21 September.

SKYCITY has paid a total of $236 million in dividends since its establishment in February 1996.

SKYCITY Managing Director, Evan Davies, said earnings growth was achieved in tandem with the Groupâ??s expansion. During the year SKYCITY assumed ownership of SkyCity Adelaide; opened its third property - Sky Alpine Queenstown Casino; entered into a joint venture to open New Zealandâ??s first Hard Rock Café, also in Queenstown; commenced construction of the Riverside gaming and entertainment complex in Hamilton and made new investments in Force Corporation Limited and Canbet Limited.

"We have been successful in growing revenues and earnings while also expanding the business. We expect the benefits of SKYCITYâ??s expansion to be realised this financial year and beyond as we begin to generate additional revenues and earnings from businesses like SkyCity Adelaide, which completed a major renovation in April this year," Mr Davies said.

Total revenue increased by 49% during the year to $437 million, $318 million of which was attributable to SKYCITY Auckland, which increased revenues by 8% over the previous year.

The SKYCITY group continues to be one of the most efficient businesses in its sector in converting revenue to profit as measured by its EBITDA* ratio of 44%. For SKYCITY Auckland this measure was 54%.

EBITDA for SKYCITY Auckland increased by 23% to $172 million, from $140 million. Total EBITDA for the group was $192 million, the majority of the balance being contributed by SkyCity Adelaide. Group earnings before interest and tax (EBIT) increased by 34% to $152 million.

Mr Davies said SKYCITY Aucklandâ??s strong result underpinned the Groupâ??s performance. Revenues from table games increased by 14% while machine revenues grew by 8%. Food and beverage operations also had a good year, with revenue increasing by 6% to $25.4 million, while SKYCITY Hotel achieved its best ever occupancy of 83% despite a soft Auckland market, with revenue decreasing by 3%, to $17 million as a consequence of lower average room rates during 2001. Sky Tower, SKYCITY Theatre and the SKYCITY car park also increased revenues during the year.

SKYCITY assumed ownership of SkyCity Adelaide on 30 June last year and immediately embarked on a nine month refurbishment programme which included both gaming floors, food and beverage facilities and many essential support systems and procedures. This project was completed in April. The cost implications of the renovation and re-launch contributed to a 32% decline in EBITDA to A$15.6 million despite revenue increasing by 4% to A$82.5 million. Since the re-launch in late April revenues have increased by 12% with a correspondingly strong increase in visitation.

Sky Alpine Queenstown Casino generated revenues of $3 million in seven months of trading. Hard Rock Café (50% owned by SKYCITY) located on the mezzanine level of the Queenstown complex, opened in May this year, and completes the food and beverage and entertainment package of the SKYCITY Queenstown operation.

The Riverside gaming and entertainment complex is currently under construction and due to open in mid 2002. At a cost of $53 million, Riverside will employ approximately 250 staff when completed.

Both Force Corporation and Canbet are trading to expectations. While Force took the prudent decision to provision asset values, primarily due to uncertainty over its Argentinean investment, its New Zealand cinema business is trading well. A capital reconstruction of that company is underway and it is proposed that it will be supported by SKYCITY as its major shareholder.

Canbet experienced a 220% increase in turnover to A$285 million demonstrating the robust global demand for internet sports wagering. Canbetâ??s regulatory environment has now been clarified with legislation of the internet betting sector in Australia not having any significant impact on Canbet.

Mr Davies said, "The focus of the current financial year is one of consolidation. Restructuring and integrating Force Corporation into the SKYCITY group; completing construction of our fourth property in Hamilton; commencing construction of the conference centre and additional gaming facilities at Sky City Auckland; and, continuing to upgrade SkyCity Adelaide's product and service offerings are all key priorities for our management team.

"In addition, we will be launching two new products at SKYCITY Auckland, Sky Jump and To The Top, targeting the adventure tourism market. The former product comprises a 192 metre jump from Sky Tower in a controlled free fall while the latter allows thrill seekers to climb the Sky Tower mast some 275 metres above downtown Auckland.

"Achieving our â??fun and entertainmentâ?? vision means we will continue to enhance our products and services and provide great customer service to ensure our guests enjoy their experience at SKYCITY each and every time they visit."

For further information please contact:

Sonya Haggie, SKYCITY Limited

Mobile: 021 797 009

Editors Notes

SKYCITY Limited is an Australasian gaming and entertainment group based in Auckland, New Zealand and listed on the New Zealand and Australian Stock Exchanges. The company operates gaming and entertainment complexes in Auckland and Queenstown in New Zealand and in Adelaide, South Australia. The companyâ??s fourth property opens next year in Hamilton, New Zealand. SKYCITY is a 50.2% shareholder in listed New Zealand cinema business Force Corporation and a 21.6% shareholder in ASX listed on-line wagering business Canbet Limited.

* EBITDA â?? earnings before interest, taxation, depreciation and amortisation.