Table of Contents
What changed
Revenue rose 54.6% to $855.8m and EBITDA rose 71.1% to $165.9m as trading normalised post-COVID. PBT swung to a $51.7m profit from a $32.8m loss, while reported NPAT of $8.0m was heavily compressed by a $43.8m tax charge (effective rate 84.6%). Operating cash flow more than tripled to $280.1m but capex also stepped up sharply to $254.7m (29.8% of revenue, from 18.1%). The balance sheet improved materially: cash rose to $245.0m from $48.7m, net debt fell to $326.5m from $480.7m, and net debt/EBITDA improved to roughly 2.0x from 5.0x. A 6.0 cps final dividend was declared; no prior-year comparable was supplied.
What matters
- Adelaide deteriorated sharply. The segment result fell to a $94.1m loss from an $11.1m loss despite revenue rising to $241.6m, pointing to genuine operating and regulatory pressure rather than a one-off. This is the single most important negative read-through in the filing.
- Auckland is carrying the group. Auckland segment result of $177.2m (from $17.8m) on $574.8m of revenue implies an EBIT margin near 30.8% and lifted Auckland's share of mix. Group earnings durability depends heavily on this one property.
- A large gap between reported and normalised metrics. Management cites normalised EBITDA of $310.3m (versus reported $165.9m) and normalised NPAT of $138.8m (versus reported $8.0m). The supplied excerpts do not itemise the bridge, so the quality of that $144m EBITDA gap cannot be assessed from this packet.
Expectations
No quantified FY24 guidance or stated financial target was supplied. On shape, HY23 represented 51.1% of full-year revenue but 64.1% of full-year EBITDA and 286.5% of full-year NPAT, implying H2 revenue of $418.7m, H2 EBITDA of $59.6m, and an H2 NPAT loss of approximately $14.9m. The year was therefore not second-half weighted; exit-run EBITDA is materially below the full-year run rate, and any read that annualises HY23 would overstate current earnings power.
Quality of result
Cash conversion looks strong at a headline level — OCF/EBITDA of 168.8% and positive pre-lease FCF of $25.4m — but the ratio is flattered by non-cash and working-capital effects against a thin EBITDA base; working capital released only $1.8m. With capex running at 29.8% of revenue, the 6.0 cps dividend is not covered by pre-lease FCF (payout ratio 171.6% of pre-lease FCF, 545.5% of reported NPAT). PBT growth of 257.9% is the cleaner operating read given the 84.6% effective tax rate distorts NPAT; FY22's tax charge was also atypically low at a 2.5% effective rate, so both ends of the NPAT comparison are tax-noisy. The gap between reported and normalised earnings, combined with the H2 swing to loss and Adelaide's widening drag, makes the headline recovery less durable than the top-line growth suggests.
Unresolved
- What drove the $144.4m gap between reported and normalised EBITDA, and how recurring are the items being excluded?
- What are the specific drivers of the Adelaide loss widening to $94.1m, and what is the trajectory into FY24?
- Is the elevated effective tax rate of 84.6% a one-year event (e.g. non-deductible items, Adelaide losses) or structural?
- What is the forward capex profile once the NZ International Convention Centre completes, and how does that reconcile with dividend sustainability?
- No FY24 guidance, no forward-work or bookings metric, no customer concentration disclosure, and no quantified AUD exposure were supplied.
This briefing cannot assess the normalisation bridge, forward guidance, or regulatory/AML remediation costs because the supplied excerpts do not itemise them.
Key metrics
| Metric | FY23 | FY22 | Change |
|---|---|---|---|
| Revenue | $855.8m | $553.5m | +54.6% ↑ |
| EBITDA | $165.9m | $96.9m | +71.1% ↑ |
| Net profit after tax | $8.0m | −$33.6m | +123.7% ↑ |
| Net cash inflow from operating activities | $280.1m | $91.1m | +207.4% ↑ |
| Final dividend per share | 6.0c | — | — |
| Operating profit | $75.2m | $2.3m | +3205.2% ↑ |
| Profit before tax | $51.7m | −$32.8m | +257.9% ↑ |
| Cash and cash equivalents | $245.0m | $48.7m | +403.1% ↑ |
| Total assets | $2863.5m | $2743.7m | +4.4% ↑ |
Reference: annolyse.ai/briefings/skc-fy23
Segment breakdown
| Segment | Current revenue | Prior revenue | Current result | Mix shift |
|---|---|---|---|---|
| SKYCITY AUCKLAND | $574.8m | $360.1m | $177.2m | +5.5pp |
| OTHER OPERATIONS | $92.6m | $75.9m | $45.3m | -1.9pp |
| SKYCITY ADELAIDE | $241.6m | $183.7m | −$94.1m | -2.7pp |
| SKYCITY INTERNATIONAL BUSINESS | $22.7m | $19.4m | −$3.7m | -0.6pp |
| CORPORATE /GROUP | $1.5m | $3.7m | −$49.4m | -0.4pp |
Reference: annolyse.ai/briefings/skc-fy23
Analytical metrics
| Metric | FY23 | FY22 | Context |
|---|---|---|---|
| Effective tax rate | 84.6% | n/m (loss period) | prior loss period |
| OCF / EBITDA (cash conversion) | 168.8% | 94.0% | stable |
| FCF pre-lease | $25.4m | −$8.9m | +$34.3m |
| FCF / NPAT | 318.0% | 26.6% | complementary conversion metric |
| Capex % revenue | 29.8% | 18.1% | — |
| Capex | −$254.7m | $100.1m | −$354.8m |
| Debtor days | 3.4 | 7.1 | -3.7 days |
| Inventory days | 3.7 | 5.0 | -1.3 days |
| Operating working capital | $16.6m | $18.4m | −$1.8m absorbed |
| Trade debtors | $8.0m | $10.8m | −$2.8m |
| Net debt | $326.5m | $480.7m | −$154.2m |
| Net debt / EBITDA | 2.00x | 5.00x | Strengthening |
| Gross borrowings | $571.5m | $529.4m | +$42.1m |
| Payout ratio vs NPAT | 545.5% | — | — |
| Payout ratio vs FCF pre-lease | 171.6% | — | not covered |
| ROE (annualised) | 0.5% | -2.1% | Strengthening |
| HY23 share of FY23 revenue | 51.1% | — | Other half was 48.9% |
| HY23 share of FY23 EBITDA | 64.1% | — | Other half was 35.9% |
| HY23 share of FY23 NPAT | 286.5% | — | Other half was -186.5% |
Reference: annolyse.ai/briefings/skc-fy23
This analysis was generated using Annolyse, an AI-powered tool that extracts and analyses NZX company announcements. The underlying data is extracted from official company filings and verified against source documents. This is general information only and does not constitute financial advice. The analysis may contain errors. Always read the original company filings and consult a licensed financial adviser before making investment decisions.