Skycity Entertainment Group Limited · NZX:SKC
Skycity Entertainment — FY2023 Earnings Presentation
32 slides from Skycity Entertainment's earnings presentation, Aug 23, 2023
Slide 1: FY23 Results Investor Presentation
‘|| FY23 RESU c SIN.) 2, INVESTOR PRESENTATION © exreRtainnent orour
Slide 2: Important Notice
Important Notice * Allinformation included in this presentation is provided as at 23 August 2023. This disclaimer applies to this document and the verbal or written comments of any person presenting it * The information in this presentation has been prepared by SkyCity with due care and attention, h
Slide 3: Contents
Contents 1 Key Messages PS 2 Operational Performance Pll 3 Capital Allocation P25 4 Business Update and Outlook P28 5 Appendix P30 FY23 RESULTS INVESTOR PRESENTATION
Slide 4: FY23 results highlights
REVENUE M& 449% YoY $926.2 million Reported $ My 53.1% YoY 966.7 million Normalised! EBITDA $ T11% YoY 165.9 million Reported $ 10 125.0% YoY 3 3 million Normalised! 1. Refer to appendices for normalisation detail idend of 6 Ocps, payable on NPAT $8.0 million ” Reported $138.8 on. Normalised! EARNIN
Slide 5: FY23 Key Messages
FY23 Key Messages Strong performance delivering improved financial results while prioritising compliance matters ©) Performance Strong rebound in FY23 earnings - now ahead of FY19 levels on a like-for-like basis NZ operations robust with EGM growth, non- gaming benefiting from tourism recovery Table
Slide 6: Regulatory Environment and Compliance
Regulatory Environment and Compliance SkyCity Adelaide (SCA) continues to manage heightened regulatory activity while advancing comprehensive uplifts Australian Regulatory Environment SkyCity Adelaide (SCA) Compliance and Enhancement Programmes AUSTRAC Australian federal regulator of AML/CTF * Worki
Slide 7: Regulatory Environment and Compliance
Regulatory Environment and Compliance SkyCity New Zealand continues to uplift compliance activities while working constructively with the regulators New Zealand Regulatory Environment SkyCity New Zealand Compliance and Enhancement Programmes Department of Internal Affairs (DIA) AML/CTF NZ gambling a
Slide 8: Risk & Compliance Investment
Risk & Compliance Investment SkyCity has invested significantly in its AML, financial Group Compliance Costs Trend crime and host responsibility enhancements ongoing BAU costs One Off Costs $18m * Significant investment in both people and technology to support the uplift in AML/CTF and Host Responsi
Slide 9: SkyCity contributed $4.5m to its NZ Community Trusts
In FY23, SkyCity contributed $4.5m to its NZ Community Trusts, enabling a record $5.3m of grants to be distributed to 122 community organisations -— total of $72m awarded since 1996 SkyCity contributed to communities impacted by Cyclone Gabrielle and by Auckland's extreme weather events SkyCity cont
Slide 10: Employee engagement survey (MyVoice) and workforce
SkyCity’s biennial employee engagement survey (MyVoice) concluded in May 2023 with an 84% participation rate by permanent employees — Overall engagement score of 78% in a challenging year = 89% feel safe when they are at work — 82% were proud to work for SkyCity — 79% would recommend SkyCity as a gr
Slide 11: Performance
win —— w HMM TIL 7, * nce Performance — FY23 RESULTS INVESTOR PRESENTATION SS ~ i
Slide 12: FY23 Group Summary Profit & Loss
FY23 Group Summary Profit & Loss A year of re-emerging performance combined with significant one-off adjustments * Strong Group operating earnings, exceeding like-for-like trading performance $m FY23. FY22.) Movement in FY19 with compositional differences driving stronger margins . . . GROUP REVENUE
Slide 13: FY23 Group Normalised Profit & Loss
FY23 Group Normalised Profit & Loss Strong growth from prior financial year, with EGM revenue contribution dominating Gaming Machines contributed c50% of the total Group revenue, predominantly from the Main Gaming Floor — This compares to 38% in FY19, demonstrating the structural change in the group
Slide 14: SkyCity
LL] ® Seeeeney NTATION xe) Cc & = O = | < > if) FY23 RESULTS INVESTOR PR’ SkyC
Slide 15: FY23 SkyCity Auckland
FY23 SkyCity Auckland Strong local gaming coupled with tourism ramp up delivering significant earnings $m FY23 FY22 Movement * Strong EGM performance led by mass market visitation Gaming Machines Revenue 3053 185.5 646% * Uplift in Food & Beverage contribution in FY23, with Table Games Revenue 139.6
Slide 16: FY23 SkyCity Auckland
FY23 SkyCity Auckland Change in 2H 23 momentum across the different activities * Gaming Machine revenue impacted in 2H23 with re-opening of Table Game capacity, adverse weather impacts and normal seasonality * Tables Games recovered in Q4 23 due to increased opening hours (weekly opening hours up by
Slide 17: Update on NZICC/Horizon Hotel
Update on NZICC/Horizon Hotel Look forward to Horizon Hotel opening in 2024 and NZICC in 2025 * Significant investment in future of Auckland: project secured exclusive casino licence for key Auckland property out to 2048 and other gambling concessions * The NZICC project is almost back to the point
Slide 18: SkyCity Hamilton & Queenstown
Slide 19: FY23 SkyCity Hamilton & Queenstown
FY23 SkyCity Hamilton & Queenstown Record earnings for both properties, with strong margin growth a key feature * Hamilton Gaming Machine Revenue Hamilton Queenstown 22% above FY19 levels driven by continued investment in product and | $™ FY23 | FY22 | Movement FY23 | FY22 | Movement a strong local
Slide 20: SkyCity Adelaide
Slide 21: FY23 SkyCity Adelaide
FY23 SkyCity Adelaide A complex and challenging year with changes made to focus on local and domestic customers A$m FY23 FY22 Movement * Strong Gaming Machine Revenue performance Gaming Machines Revenue 100.5 749 34.2% capitalising on market growth Table Games Revenue 70.3 64.9 8.4% * Table Games pe
Slide 22: FY23 SkyCity Adelaide
FY23 SkyCity Adelaide Key 2H revenue and earnings trends * Gaming Machine revenues slightly softer in H2 23, reflecting market impact from cost- of-living pressures and lower consumer spending plus normal seasonality * Table Games revenue decline in H2 23, reflecting market conditions and impact of
Slide 23: • • • • • 14,000 12,000 10,000 8,000 6,000 4,000 2,000
• • • • • 14,000 12,000 10,000 8,000 6,000 4,000 2,000 0
Slide 24: FY23 International Business
FY23 International Business International Business largely Australian interstate VIP play » FY23 revenue reflects limited hosting of international patrons * International Business operating model was restructured at end of FY23 — Consolidation of Premium VIP into Adelaide and Auckland property opera
Slide 25: Capital Allocation
‘api Allocatic ( Jf? FY23 RESULTS INVESTOR PRESENTATION 25
Slide 26: FY23 Capital Projects
FY23 Capital Projects Prudent Group capital spend in FY23, with return to normal annual spend levels from FY24 $24.2m AUCKLAND: $13.9m CORPORATE $0.5m FY23 JUEENSTOWN ° CAPEX by $2.3m iT HAMILTON location $6.9m ‘ADELAIDE $2m MISCELLANEOUS $16m GAMING PRODUCT $16m PROPERTY/FACILITIES $14m SYSTEMS/HAR
Slide 27: Borrowings, liquidity and debt gearing
• Total Group Borrowings Total Liquidity Headroom Debt Gearing Ratio 1,200 4.5 • 4.0 1,000 3.5 Net debt to EBITDA ratio 800 3.0 2.5 $m 600 2.0 • 400 1.5 1.0 200 0.5 0 0.0 FY19 FY20 FY21 FY22 FY23 • USPP Debt NZ Retail Bond Bank Revolving Credit Facility 1,000 900 800 700 600 $m 500 400 300 200 100 0
Slide 28: FY23 Results
INVESTOR PRESENTATION FY23 RESULTS
Slide 29: FY24 Outlook
FY24 Outlook Expect FY24 to build on the momentum achieved in FY23 and deliver modest growth in normalised earnings * SkyCity remains cautiously optimistic about the FY24 outlook, with the Group's revised operating model providing flexibility to manage variable operating conditions * Planned and rec
Slide 30: Appendix
FY23 RESULTS INVESTOR PRESENTATION
Slide 31: Normalisation of Group Results
Normalisation of Group Results Guide to understanding basis of normalisation The Group's objective in preparing normalised financial information is to enable the investment community to better understand the Group's underlying operational performance The Group achieves this objective by providing in
Slide 32: Normalisation of Group Results
Normalisation of Group Results sn Revenue EBITDA EBIT NPAT Revenue EBITDA EBIT NPAT Reported 926.2 165.9 75.2 8.0 639.0 96.9 2.3 (33.6) IB Revenue Adjustment 7.0 - - - 3.8 - - - Gaming GST 87.5 - - - 57.1 - - - IB Theoretical Win Rate 9.6 8.5 8.5 6.0 (5.2) (3.8) (3.8) (2.7) NZICC Fire Impact (63.6)
SkyCity Entertainment Group — FY2023 Earnings Presentation on 6ix