Sun International Limited · JSE:SUI
Sun International — H1 2022 Earnings Presentation
39 slides from Sun International's earnings presentation, Aug 28, 2022
Slide 1: Interim Results Presentation for the six months ended 30 June 2022
0a D ee International RESULTS L S NTATION for the six month period ended 30 June 2022
Slide 2: Contents
CONTENTS eS Key Urban Resorts Sun Slots SunBet Financial Outlook and highlights casinos and hotels review strategic focus
Slide 3: Key Highlights
KEY HIGHLIGHTS
Slide 4: Key Highlights
KEY HIGHLIGHTS Gen eee GROUP GROUP GROUP ADJUSTED a INCOME ADJUSTED EBITDA HEADLINE EARNINGS R5.2 billion R1.5 billion R438 million Aa37% a99% 4 >100% from a loss of R7 million 28.5% margin 177 cents per share A. up from 26.8% in 2019 4 >100% from a loss of 3 cents per share STRONG GROUP CASINO SUN
Slide 5: Income Trend
INCOME TREND an R million 1000 932 876 g53 859 800 600 400 200 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul 2020 2021 2022 @ Total income @ Gaming income (includes casino income, Sun Slots and SunBet) Relates to South Afr
Slide 6: Urban Casinos
URBAN CASINOS.. 7 : ee A ers
Slide 7: Urban Casinos | Highlights
URBAN CASINOS | HIGHLIGHTS We continue to right-size our operations and drive margin improvements MARKET POSITION * Gauteng market share increased 0.6% to 27.8% + Eastern Cape increased 4.0% to 80.4% * KwaZulu-Natal increased 3.1% to 38.6% + Western Cape increased 0.5% to 78.1% All comparisons are f
Slide 8: Urban Casinos | Gaming Income
URBAN CASINOS | GAMING INCOME eA Urban casino income has been resilient and is swiftly recovering from the effects of the pandemic R million 3500 3000 EEE 2500 2000 1500 1000 500 2019 2020 2021 2022 a= 2019 benchmark For the six-month periods ended June
Slide 9: Urban Casinos | Property Updates
URBAN CASINOS | PROPERTY UPDATES SS A key priority of the group is to ensure properties are optimised and well maintained to meet the high standards promised to our customers GRANDWEST * Expand GrandWest Hotel from 39 keys to 103 keys * Protect GrandWest exclusivity OTHER: SIBAYA * Refurbish Royal S
Slide 10: Resorts and Hotels
Slide 11: Resorts and Hotels | Highlights
RESORTS AND HOTELS | HIGHLIGHTS Se With the exception of transient business and international travel segments we have experienced a strong recovery es) lil MARKET POSITION FINANCIAL PERFORMANCE FOCUS AREAS * Domestic leisure, conferencing and sports * Income up 63% to R1 123 million * Leveraging our
Slide 12: Resorts and Hotels | Income
RESORTS AND HOTELS | INCOME Can Our resort casino income exceeded 2019 levels, leveraging Sun City Resort and Wild Coast Sun for the enjoyment of our MVG and SunBet customers R million TOTAL INCOME 1500 1200 ...---------gyy --------------------------- += -- 5-5-3 oon - ==: 900 600 300 ll 0 2019 2020
Slide 13: Resorts and Hotels | Property Review
RESORTS AND HOTELS | PROPERTY REVIEW un A key priority of the group is to ensure properties are optimised and well maintained to meet the high standards promised to our customers SUN CITY In progress. . * Palace Hotel refurbishment, spa and gym * Sun City Casino Privé * Vacation Club: 58 four- and t
Slide 14: Sun Slots
Slide 15: Sun Slots | Highlights
SUN SLOTS | HIGHLIGHTS Cen The Sun Slots business proved remarkably resilient, with a strong recovery in trading es) lil MARKET POSITION FINANCIAL PERFORMANCE FOCUS AREAS * 48.5% of GGR market share * Income up 18% to R717 million * Deliver superior service * Active LPMs* up 7% from 4 455 to 4 773 *
Slide 16: Sun Slots | Key Metrics
SUN SLOTS | KEY METRICS G NUMBER OF LPMs* NUMBER OF SITES* 4652 4773 4040 4328 4481 ; P P P z. L 5 5 A 2017 2018 2019 2020 2021 2022 2017 2018 2019 2020 2021 2022 AVERAGE GROSS GAMING REVENUE / LPM / DAY 800 600 400 200 » 0 Gauteng KwaZulu-Natal Mpumalanga Western Cape National (4 provinces) mProvin
Slide 17: Sun Slots | Other Growth Opportunities
SUN SLOTS | OTHER GROWTH OPPORTUNITIES eA We continue to explore opportunities to expand our operations Independent Site Operators (ISOs) * Allows 100% income participation, as opposed to income split with site owners + Adopted an opportunistic approach, requires regulatory approval ¥ Africa expansi
Slide 18: SunBet
Slide 19: SunBet | Highlights
SUNBET | HIGHLIGHTS G SunBet has continued its strong growth trajectory and remains an exciting prospect for the group a MARKET POSITION FINANCIAL PERFORMANCE FOCUS AREAS * 2021 estimated online market size R5.7 billion * Income up 37% to R125 million + Appointment of Simon Gregory as the new + Esti
Slide 20: SunBet | Market Growth Opportunities
SUNBET | MARKET GROWTH OPPORTUNITIES G We are on a focused journey to grow our current operating market and launch into new markets ENTER NEW GEOGRAPHIES + Acquired the EaziBet group with licenses in Zambia, Kenya and Ghana to launch Africa expansion. + Invested USD 3.2 million directly into the bus
Slide 21: Financial Review
FINANCIAL REVIEW
Slide 22: Financial Review | Segmental Highlights
FINANCIAL REVIEW | SEGMENTAL HIGHLIGHTS SS The first six months to 30 June 2022 reflect strong income growth of 37% and adjusted EBITDA up over 99%, compared to the prior comparative period R million 3143 a va 690 608 717 a a Urban casinos* Resorts and hotels** Sun Slots SunBet m2021 2022 GROUP INCO
Slide 23: Financial Review | Group Debt
FINANCIAL REVIEW | GROUP DEBT We are proud of our ongoing successes in substantially decreasing our debt levels GROUP AND SOUTH AFRICAN DEBT (excluding IFRS 16 lease liabilities) R million 13 327 11,079 7 630 7556 7089 6618 Decrease in group debt between South African debt to adjusted December 2019
Slide 24: Financial Review | Capital Expenditure
FINANCIAL REVIEW | CAPITAL EXPENDITURE eS Investment into several of our strategic priorities is critical in sustaining and growing our business and ultimately maximising shareholder returns ONGOING CAPEX AS A % OF INCOME 7.7% EXPANSIONARY PROJECTS R125 million spent y 5.6% 5.3% 5.4% “ * Boardwalk M
Slide 25: Financial Review | Cash Flow
FINANCIAL REVIEW | CASH FLOW un R million 1598 (36) (244) | ae r 980 (224) (44) 715 (140) a (74) me assy 247 263 Generated Working Tax Capex Free Interest Other Cashflow Dividends Repayrnent_ ~ Movement Cash Cash by operations capital paid cash paid investing priorto tominority of capital in borrowi
Slide 26: ESG
Slide 27: Environmental, Social and Governance
ENVIRONMENTAL, SOCIAL AND GOVERNANCE We ranked 4stin our sector and 17" in the entire JSE for ESG reporting HEALTH, SAFETY AND WELLNESS * Original founder and promoter of responsible gaming program + Initiated several support programs for employee's mental health and wellness + No material health an
Slide 28: Outlook
OUTLOOK SS We continue to prioritise increasing free cashflows and disciplined capital allocation to maximise stakeholder value within a set of fundamental capital allocation principles URBAN CASINOS * Grow market share and improve margins * Achieve 2019 revenue levels * Deliver EBITDA growth * Inve
Slide 29: Thank You
ee International THANK YOU OnHOOR www.suninternational.com 2022 © Sun International
Slide 30: Supplementary Information
SUPPLEMENTARY INFORMATION “ ay
Slide 31: Financial Overview
FINANCIAL OVERVIEW R 2022 % Income 5168 37 Adjusted EBITDA 1474 99 Adjusted EBITDA margin 28.5% 45 Depreciation and amortisation (441) 2 Adjusted operating profit 1033 >100 Foreign exchange losses (4) 33 Net interest (229) 2 Adjusted profit before tax 800 >100 Tax (243) <(100) Adjusted profit after
Slide 32: Segmental Review
SEGMENTAL REVIEW Urban casinos 3143 35 2 328 1141 70 672 (275) 6 (292) 866 >100 380 GrandWest 877 38 635 299 56 192 (60) 2 (61) 239 82 131 Time Square 650 35 481 222 73 128 (95) 10 (105) 127 >100 23 Sibaya 629 43 440 228 61 142 (26) - (26) 202 74 116 Carnival City 420 31 321 107 70 63 (31) (7) (29)
Slide 33: Earnings Reconciliation
EARNINGS RECONCILIATION aad R million Cents per share Profit/(loss) attributable to ordinary shareholders 232 (80) Earnings/(loss) per share Net (profit)/loss on disposal of property, plant and equipment (1) 7 Basic (32) Net profit on derecognition of eSwatini 2 (12) Diluted (32) Tax relief on above
Slide 34: Group Effective Tax Rate
GROUP EFFECTIVE TAX RATE Un Nigeria Rmi South Africa and other col Profit/(loss) before tax continuing operations 613 (18) 595 Depreciation on non-qualifying buildings 32 - 32 Other non-deductible expenditure (Note 1) 66 - 66 Movement in put liabilities 222 - 222 Exempt income - other (16) - (16) Ta
Slide 35: Borrowings
BORROWINGS wow GROUP DEBT (excluding IFRS 16 lease liabilities) R million 13327 South Africa 5904 837 6741 1321 5420 11,079 Nigeria 714 a 714 362 352 Total debt as at 30 June 2022 6618 837 7.455 1683 5772 7630 7556 7089 618 South Africa 6389 869 7258 1286 5972 Nigeria 700 - 700 354 346 Total debt as
Slide 36: Capital Expenditure
CAPITAL EXPENDITURE 30 Jun 30 Jun 30 Jun 30Jun 31 Dec 2022 R million 2019 2020 2021 2022 Forecast South African operations Expansionary = = = 125 300 GrandWest - - - = 27 GROUP CAPEX Sun City 7 ~ 7 71 Capex as a percentage of income to June Sun Slots - - - 68 94 Boardwalk Mall - = - 57 108 17% Major
Slide 37: Group Structure
GROUP STRUCTURE Economic interest R million % Slots Tables Gauteng Carnival City 91.2 1100 37 The Maslow Sandton 100 - - Time Square 82.3 1550 55 Western Cape GrandWest 61.6 2 320 50 The Table Bay Hotel 61.6 - - Golden Valley 61.4 190 4 SunBet 100 - - - KwaZulu-Natal Sibaya 87.2 1213 50 154 Limpopo
Slide 38: Analysis of Minority Shareholders
ANALYSIS OF MINORITY SHAREHOLDERS Profit after tax % Shareholding South Africa 580 48 (127) (34) SunWest 165 65 61.6 616 (63) (26) Sibaya 141 77 87.2 87.2 (18) (11) Carnival City 44 i 91.2 91.2 (4) (2) Boardwalk 3) (19) 81.6 81.6 ()) 3 Wild Coast Sun 13 (5) 50.1 70.0 (7) 3 Meropa 24 12 67.6 67.6 (8)
Slide 39: Time Square | Acquisition of Minorities and Disposal of Surplus Land
TIME SQUARE | ACQUISITION OF MINORITIES AND DISPOSAL OF SURPLUS LAND BACKGROUND * At inception Time Square acquired the land, on which it is currently located, from Vastway. The purchase consideration for the land was settled by way of cash and a 14.25% interest in Time Square EQUITY AND PROPERTY TR