SkyCity seeks $240 million from investors as it announces $29.2m after-tax profit

Thursday, 21 August 2025

SkyCity investors have suffered a string of disappointments since 2019, hammering its share price.

Casino and entertainment company SkyCity is to raise $240 million as part of a turnaround plan.

SkyCity, which owns casinos in Auckland, Hamilton, Queenstown and Adelaide, went into trading halt on the NZX on Tuesday as it readied itself for the capital raise.

The troubled casino and entertainment also announced an after-tax profit of $29.2m, an improvement on the loss of $143m in the previous year.

SkyCity has had a torrid time in recent years following the fire at its nearly-completed international convention centre in Auckland in 2019.

However, SkyCity also contributed to its own struggles through anti-money laundering and problem gambling supervision failures that prompted regulators to take action in Australia and New Zealand. A threat still hangs over its Adelaide casino.

The casino operator has seen its share price fall from over $3 in late-2021 to around $1.

Inside the SkyCity convention centre, one year on from the devastating fire.

Chief executive Jason Walbridge said the company also planned to sell $200m of assets, including is Auckland carpark concession, and an office building to build resilience in its balance sheet.

It warned investors not to expect the resumption of dividend payments in the current financial year.

SkyCity hopes to open the doors on its much-delayed international convention centre early next year, delays for which it seeks $330m in compensation from Fletcher Building.

The company blames Fletcher Building for losses sustained after lengthy delays to the convention centre opening.

Walbridge said: “We are looking forward to opening the doors to the NZICC in February.

Black smoke filled the air as the huge fire at SkyCity's convention centre burnt in 2019.

“This will be a major catalyst for SkyCity and wider Auckland, with an estimated 500,000 extra visitations annually expected when operating at full capacity.”

Walbridge said the company expected trading to continue to be challenging, though SkyCity had been boosted by the opening of its Horizons hotel.

“We expect overall market conditions will continue to be challenging in the short term,” he said.

“This continues to be a challenge for us as the ongoing delay in the economic recovery in New Zealand comes at the same time as elevated costs related to upgrading our regulatory systems and B3 programme, pre-opening costs for the New Zealand International Convention Centre in February and the expected launch of regulated online casino gaming in winter 2026.”

SkyCity chief executive Jason Walbridge says, ‘Over the last couple of years, our board has overseen a number of key changes to bring in new skills and new capabilities that are positioning us for the future.’

The news of SkyCity’s capital raise, and a detailed breakdown of SkyCity’s turnaround plan, the company saw financial strength ratings agency S&P Global Ratings slightly trimmed its rating on the company.

The ratings agency said the equity raise aligned with the group's financial policies and supported its 'BBB-' rating, but it said SkyCity's debt to earnings ratio was likely to remain elevated over the next 12 to 18 months due to cyclically weak earnings and sizable cash outflows from regulatory fines and other costs.

S&P revised its rating outlook on SkyCity to “negative” from “stable”, saying the company’s debt could remain elevated due to prolonged weak economic conditions in New Zealand and ongoing regulatory effects.

Walbridge said: “hen this economy in New Zealand turns is we’re expecting customers to come in and enjoy our services and our offerings more.”