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Reduction in interest costs lifts profit for SKC


The repayment of US debt from the proceeds of last year’s equity raising has paid dividends for SKYCITY Entertainment Group (SKC) and its shareholders in 1H10.

CEO, Nigel Morrison said that while earnings from New Zealand businesses were flat, Australian businesses delivered 7% earnings growth. “It was pleasing that we were able to deliver earnings per share growth for shareholders after our equity raising last year and that we have been able to declare an interim dividend of 8cps, fully imputed, representing approximately 65% of our NPAT for this half.”

SKC announced first half NPAT of $71m for the six months ended 31.12.09, up $16.2m, or 29.6% on 1H09’s NPAT of $54.8m. Underlying NPAT (normalised for international results and non recurring items) of $68.4m, was up $12.8m, or 23% on the $55.6m for 1H09.

Revenues for the half year were $447m, up 5.9% from $422.1m, with EBITDA of $160.1m, up 7.8% from $148.5m for 1H09.

Morrison said contributing significantly to the result was the reduction in net interest cost, down by $11.1m (29%), to $27m from $38.1m, following the $177m buybacks of US Private Placement debt in July and August 2009, from the proceeds raised from the share placement in April 2009.

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