Sun International achieves growth despite weak economy
JOHANNESBURG - Resort hotel chain and casino group Sun International said on Wednesday its operations achieved growth in gaming revenue and a satisfactory earnings before interest, taxes, depreciation and amortization (EBITDA) performance in the year to December despite an increase in value-added tax last April and weakness in the South African economy.
In a business update and trading statement, Sun International said its subsidiary Sun Slots produced strong results while Time Square, which became fully operational following the opening of the hotel in April 2018, continued to increase its market share in the Gauteng province gaming market.
Its Sun City resort in the North West province however reported weaker results than anticipated as a result of the current economic environment and the cancellation of a few large conferences, although this was expected to improve during the second half of 2019 based on the rate of forward bookings.
The group's Latin America operations recorded strong performances during the second half of 2018, both from a revenue and EBITDA perspective led by Monticello in Chile, which showed a strong recovery following a shooting incident in 2017.
During the period under review Sun International said it managed to reduce its borrowings from R15 billion at the end of 2017 to R14.7 billion at 31 December 2018.
"Given the strong cash generation of the group and the completion of Time Square, the group is comfortable that it will continue to reduce its debt levels. The group continues to trade within the debt covenant levels agreed with its lenders," it said.
Sun International said it expected headline earnings per share for the financial year ended 31 December 2018 of between 190 and 225 cents per share, compared with the prior headline loss of 180 cents per share, an increase of more than 100 percent.
- African News Agency (ANA)