Slide 1: Results Presentation for the Year Ended 30 June 2015
RESULTS PRESENTATION FOR THE YEAR ENDED 30 JUNE 2015
Slide 2: Overview
OVERVIEW 2
Slide 3: Key Indicators
KEY INDICATORS R10 553M R3 171M 30.0% R754M 285 cps GROUP REVENUE GROUP EBITDA EBITDA MARGIN – ADJUSTED HEADLINE DPS CONTINUING OPERATIONS EARNINGS +5.8% +9.9% +1.1% +10.4% +16.3% 1ST HALF +6.6% 1ST HALF +15.3% 2ND HALF +5.1% 2ND HALF +4.8% 3
Slide 4: Strategic Overview
STRATEGIC OVERVIEW 4
Slide 5: Key Strategic Focus Areas
KEY STRATEGIC FOCUS AREAS Improve our Protect and Grow our Our people Governance existing leverage our business into and operations existing asset new areas Sustainability and guest portfolio and products experience EXISTING OPERATIONS GROWTH PEOPLE REPUTATION ASSETS 5
Slide 6: Operations: Improve Existing Operations and Guest Experience
OPERATIONS: IMPROVE EXISTING OPERATIONS AND GUEST EXPERIENCE • Restructure of operations (s 189) completed Restructure costs of R230m Staff reduced by 1 500 Approximate saving of R250m pa • Food and beverage strategy implemented Takeover of HLM, LBS and Fedics completed in Q4 >2 000 new em
Slide 7: Existing Assets: Protect and Leverage Existing Asset Portfolio
EXISTING ASSETS: PROTECT AND LEVERAGE EXISTING ASSET PORTFOLIO GPI/Tsogo transaction F & B concepts being developed for Main hotel Transaction terminated due to delays in regulatory Monticello approvals Acquisition of additional 55% interest – completed Morula relocation to Menlyn Maine
Slide 8: Growth: Grow Our Business into New Areas and Products
GROWTH: GROW OUR BUSINESS INTO NEW AREAS AND PRODUCTS Online gaming and betting: Peermont: No new developments – maintaining watching brief Rationale International VIP and Junket gaming Acquire Emperors at a reasonable price Strategy implemented Increase exposure to Gauteng market
Slide 9: People: Investing in Our People
PEOPLE: INVESTING IN OUR PEOPLE Improve organisational culture: Corporate values developed CE roadshow to communicate strategy and re-engage our people following s189 restructure almost completed SA wage negotiations Currently deadlocked with union (demand for 11% increase) One day strik
Slide 10: Reputation: Governance and Sustainability
REPUTATION: GOVERNANCE AND SUSTAINABILITY Compliance Compliance department strengthened with new experienced resource Comprehensive compliance strategy to be launched Corporate responsibility: Climate change policy finalised Embedding group compliance with specific focus on gaming compli
Slide 11: Financial Review
FINANCIAL REVIEW 11
Slide 12: Income Statement – Management
INCOME STATEMENT – MANAGEMENT Six months ended 31 December Six months ended 30 June Year ended 30 June % % % Rm 2014 change 2013 2015 change 2014 2015 change 2014 Revenue 5 290 6.6 4 963 5 263 5.1 5 007 10 553 5.8 9 970 Casino 4 339 7.2 4 047 4 314 5.5 4 088 8 653 6.4 8 135 Rooms 428 2.1 419 397 (7.
Slide 13: Associates, Joint Ventures and Discontinued Operations
ASSOCIATES, JOINT VENTURES AND DISCONTINUED OPERATIONS Six months ended 31 December Six months ended 30 June Year ended 30 June % % % Rm 2014 change 2013 2015 change 2014 2015 change 2014 GPI Slots – – – 7 100.0 – 7 100.0 – SI Share of profits as associate – – – 7 100.0 – 7 100.0 – Avani Victoria Fa
Slide 14: Revenue by Category
REVENUE BY CATEGORY GROWTH IN REVENUE BY CATEGORY 10 551 F & B and other 87 15 10% (24) Rooms (9%) 8% 246 (9%) 82% 306 (82%) 9 970 (49) Gaming ( ) FY 2014 comparative FY 2014 Translation Gaming: Gaming: Gaming: Rooms F&B& FY 2015 Revenue FX LATAM South Federal Other Revenue OCCUPANCY ADR Africa Pala
Slide 15: Revenue by Geography
REVENUE BY GEOGRAPHY GROWTH IN REVENUE BY LATAM GEOGRAPHY (12) 10 553 17% Nigeria (14%) 351 2% (2%) 292 81% 9 970 (83%) (48) South Africa FY 2014 Translation FX SA LATAM Nigeria FY 2015 Revenue Revenue ( ) FY 2014 comparative • SA contribution to revenue down 2% to 81% • SA revenue up 3.5% with gami
Slide 16: EBITDA
EBITDA GROWTH IN EBITDA BY GEOGRAPHY LATAM (43) 3 171 97 5 Nigeria 11% (11%) 1% (1%) 239 88% 2 886 (89%) (13) South Africa FY 2014 Translation SA Chile Panama Nigeria FY 2015 EBITDA FX EBITDA ( ) FY 2014 comparative • EBITDA up 9.9%, excluding Ocean Sun Casino EBITDA up 11.4% • SA up 9.8% due to the
Slide 17: South Africa
SOUTH AFRICA SA revenue and EBITDA Revenue Casino revenue Rooms revenue F & B and other EBITDA Rm 2015 % 2014 2015 % 2014 2015 % 2014 2015 % 2014 2015 % 2014 Total 8 574 4 8 267 6 983 4 6 738 757 (1) 764 834 9 765 2 563 10 2 334 GrandWest 2 152 7 2 020 2 114 6 1 991 2 – 2 36 33 27 915 10 833 Sun Cit
Slide 18: South Africa – H1 vs H2
SOUTH AFRICA – H1 vs H2 Six months ended 31 Dec Six months ended 30 June Year ended 30 June 2014 % 2013 2015 % 2014 2015 % 2014 Casino Revenue 3 552 5% 3 371 3 432 2% 3 367 6 984 4 6 738 GrandWest 1 088 11 984 1 026 2 1 007 2 114 6 1 991 Sun City 263 (1) 265 309 22 254 572 10 519 Sibaya 552 2 541 55
Slide 19: Monticello
MONTICELLO 1 597 Revenue CLPm 26 8,000 5 7,000 6,000 174 5,000 1 443 4,000 (51) 3,000 Jan Feb Mar Apr May Jun EBITDA FY 2014 Translation Gaming Rooms F&B FY 2015 CLPm Revenue FX and Revenue other 2,000 Performance in local currency 1,500 • Revenue up 14.3% • Casino revenue up 13.4% 1,000 • EBITDA in
Slide 20: Operating Expenditure (Continuing Operations)
OPERATING EXPENDITURE (CONTINUING OPERATIONS) Operating expenditure split Operating expenses as a percentage of revenue 10% 12% Consumables and services 30.0% Depreciation and amortisation EBITDA margin 28.9% 7% Employee costs 2% 11% Impairment of assets Levies and VAT on casino revenue 10.2% Consum
Slide 21: Reconciliation to Management Accounts Taxable Income
RECONCILIATION TO MANAGEMENT ACCOUNTS TAXABLE INCOME South Africa Nigeria Chile Panama Colombia Group Profit before tax 1 451 (126) 184 (92) (2) 1 415 Preference share funding 92 92 Depreciation on non-qualifying buildings 82 82 Non-deductible expenditure 6 3 9 Tax Incentives (10) (10) Foreign Monet
Slide 22: Reconciliation to Statutory Accounts Taxable Income
RECONCILIATION TO STATUTORY ACCOUNTS TAXABLE INCOME South Nigeria Chile Panama Colombia Group Africa Profit before tax 1 561 (179) 163 (120) (25) 1 400 Preference share funding 137 137 Depreciation on non-qualifying buildings 86 86 Impairment of assets 79 79 Non-deductible expenditure 51 3 54 Tax In
Slide 23: Group Statement of Financial Position
GROUP STATEMENT OF FINANCIAL POSITION R million FY 2015 FY 2014 Movement ASSETS Property, plant and equipment 11 244 11 380 (136) Intangible assets 738 721 17 Investment in associates 390 – 390 Investment in joint ventures 201 – 201 Accounts receivable and other 802 656 146 Cash and cash equivalents
Slide 24: Capex
CAPEX Projects and refurbishments Still to be spent CAPEX 30 June Project Spend R million budget to date 2016 2017 4% 18% Sun Nao Casino, Colombia Projects US$ million 30 17 10 41% IT R million 331 206 125 Refurbishments 15% Sun City Slots Cabanas 130 45 85 Ongoing 14% 8% Entertainment Centre 300 –
Slide 25: Capital Funding
CAPITAL FUNDING Group net finance cost 30 June 2015 30 June 2014 % R million Interest expense 581 507 14.6 Less: Interest income 51 22 131.8 530 485 9.3 Average cost of debt 6.1 6.9 (11.6) Net financing cost: EBITDA (cover) 6.0 5.9 0.6 R million Fixed interest bearing debt 2 104 1 295 62.5 Floating
Slide 26: Outlook
OUTLOOK 26
Slide 27: Outlook
OUTLOOK • Weak SA and Chilean • Food and beverage • Focus on staff • Ocean Sun Casino economies insourcing scheduling to match and Nao Sun Casino • Improved systems, • Visas and birth demand • Interest in GPI slots business intelligence certificates • ERP rollout increased from 25.1% and marketing •
Slide 28: Annexure
ANNEXURE 28
Slide 29: Income Statement – Statutory
INCOME STATEMENT – STATUTORY (incl Adjusted headline earnings adjustments) Six months ended 31 December Six months ended 30 June Year ended 30 June % % % Rm 2014 change 2013 2015 change 2014 2015 change 2014 Revenue 5 290 6.6 4 963 5 263 5.1 5 007 10 553 5.8 9 970 Casino 4 339 7.2 4 047 4 314 5.5 4
Slide 30: Adjusted Headline Earnings and Minorities
ADJUSTED HEADLINE EARNINGS AND MINORITIES For the year ended 30 June R million 2015 2014 Adjusted headline earnings Adjusted headline earnings PAT (Stat) Adj HE adj Total Minorities Group PAT (Stat) Adj HE adj Total Minorities Group South African operations 843 182 1 025 (283) 742 811 130 941 (263)
Slide 31: (“Sun International” or “the group” or “the company”) REGISTRATION NUMBER 1967/007528/06 SHARECODE: SUI ISIN:
(“Sun International” or “the group” or “the company”) REGISTRATION NUMBER 1967/007528/06 SHARECODE: SUI ISIN: ZAE 000097580 www.suninternational.com