How much money South Africa’s biggest casinos lost over the past year

Sun International, the hotel chain and casino group says that the Covid-19 pandemic had a significant impact on its business for the year ended December 2020, with group adjusted headline earnings down from R763 million to a loss of R1.1 billion, and an adjusted headline loss of 633 cents per share.

Income from continuing operations declined by 49% from R11.8 billion to R6.1 billion and continuing adjusted EBITDA reduced by 72% from R3.2 billion to R897 million, it said.

For the first six months of the year in South Africa, income declined by 55% to R2.5 billion compared to the prior corresponding period, with adjusted EBITDA down by 95% to R80 million.

With the resumption of trading of most operations from 1 July 2020, income and adjusted EBITDA improved steadily throughout the remaining six months until the move to an adjusted level 3 lockdown, the imposition of the 8pm curfew and alcohol sales ban in mid-December 2020.

This led to a significant drop in activity and cancellation of bookings for the second half of December 2020 and into January 2021, the group said.

Overall income from the South African operations declined by 48% from the prior year to R6 billion with adjusted EBITDA down by 70% to R984 million.

As a result of the extended lockdown and anticipated slow recovery, Sun International incurred impairment charges of R1.3 billion – being Sun City (R900 million), Boardwalk (R180 million), The Maslow Sandton (R96 million), intangible assets of R72 million, and other individual assets of R9 million.

For South Africa, casino income slumped to R4 billion, down 50% from 2019, while rooms revenue declined 38% to R368 million, and food and beverage revenue dropped 37% to R335 million.

The group said that despite the extensive restrictions on trading, South African casino income showed a positive trend in the second half of the year and increased as a percentage of 2019 from 52% in the third quarter to 71% in the last quarter of 2020.

“Our casino market share since the lifting of the lockdown in the competitive Gauteng and KZN markets increased to 28.4% and 39.6% respectively which was 2.5% and 2.0% higher compared to the prior corresponding period in 2019.”(…)

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