SkyCity shareholders warned 2026 could be ‘trough year’, no dividends until 2027

Friday, 31 October 2025

The SkyCity tradition of another year, another apology continued at today’s annual meeting and, given 2026 would be a “trough year” for earnings, said chief executive Jason Walbridge, it seems the next AGM could feature a similar mea culpa.

Trading in the first three months of the 2026 financial year had not yet shown improvement despite a slight lift in the New Zealand economy, and there was no fresh earnings news for shareholders.

However, Walbridge said: “We remain positive about the outlook for full year 2027.”

Following a horror run which started with the 2019 fire at the then nearly completed international conference centre at its Auckland casino, hotel and entertainment complex, shareholders have seen the value of their shares fall from just over $3.70 to just over 70 cents.

Chairperson Julian Cook didn’t sugar-coat how poor the past year had been, with revenue down 5.2% due in part to depressed economic conditions in New Zealand, but he presented SkyCity as a company with an ongoing reset plan, thanking shareholders for their patience.

“The board appreciates that financial results for shareholders have been poor,” he said.

However, SkyCity, which owns casinos in Auckland, Hamilton, Queenstown and Adelaide, posted a modest profit in the 2025 financial year after a $143 million loss in the 2024 financial year.

But shareholders haven’t yet seen the resumption of dividends, and they have had to stomach a discounted $240m capital raise to shore up the casino company’s balance sheet and bolster its credit rating.

Cook signalled dividends would not resume until SkyCity had got its credit rating from BBB- to BBB, through the sale of about $200 million in property assets.

“We have a programme which will achieve that over the next 12 to 18 months,” he said.

“Once that money is received, and has been applied to debt reduction, we think, provided earnings are stable to growing, the credit position of the business will stabilised, and we should be in a position after that to recommend dividends.”

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

Cook told shareholders there was still considerable work to be done before SkyCity could be confident its compliance systems fully met legal requirements, but Walbridge looked forward to closing the last host responsibility and anti-money laundering gaps during the current financial year.

An independent review into its failures at its Adelaide casino had concluded that SkyCity was now deemed suitable to hold a casino licence in the city, however, it awaited the South Australian regulator’s decision on what action to take against the company for historic failures.

The regulator’s decision was likely to be known before its half-year results early next year, and Walbridge said that created significant uncertainty for shareholders.

Responding to a question about why SkyCity didn’t just sell its Adelaide casino, Cook acknowledged returns from the casino in Adelaide had been poor, but the company was focused on improving it, rather than selling it.

Its casino licence in Queenstown needs to be renewed in 2027, while its Hamilton casino licence needs to be renewed in 2026.

Walbridge was excited about the upcoming opening of its International Conference Centre in Auckland.

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.

“We did not take this step lightly, but it is necessary to achieve an outcome on this matter,” Walbridge said.

The convention centre would be a cornerstone of its growth strategy.

Walbridge said he also looked forward to the launch of a regulated online casino market, with the Government planning to have legislation in place next year aimed at regulating the roughly $700m gambling by New Zealanders in unregulated overseas-based online casinos.

SkyCity wanted to become “the local hero” of online casino gaming, Walbridge said.