The SkyCity Entertainment Group Ltd (ASX: SKC) share price is in focus after the company reported underlying revenue of $822.7 million, nearly flat year on year, and underlying NPAT dropping to $38 million.
What did SkyCity Entertainment Group report?
- Underlying revenue: $822.7 million, down 0.3% on FY25
- Underlying EBITDA: $181.6 million, down 22.3%
- Underlying NPAT: $38 million, down 46.9%
- Reported NPAT: $18.2 million, down 37.6%
- Net debt: $591 million (net debt/EBITDA of 3.1x)
- No final dividend declared for FY26
What else do investors need to know?
SkyCity completed the sale of two Auckland properties for $74.5 million, with settlement due in September 2026. This forms part of an asset monetisation program expected to deliver up to $300 million in gross proceeds by December, with proceeds earmarked for debt reduction.
The NZICC opened in February 2026 and hosted 141 events in its first months, attracting around 100,000 visitors. A strong events pipeline is in place for FY27, with a projected 350,000 visitations.
A cost-out program is underway, expected to deliver $30 million in annual benefits in FY27 and $70 million by FY28. The program includes a restructure and operational reset, affecting predominantly New Zealand-based corporate roles.
What did SkyCity Entertainment Group management say?
Jason Walbridge, Chief Executive Officer, said:
In FY26, we implemented carded play across our New Zealand casinos, opened the NZICC, advanced our asset monetisation, exceeded our cost-out targets, continued preparing for the regulated New Zealand online gambling market, and settled in principle the outstanding major regulatory issues in Adelaide.
What’s next for SkyCity Entertainment Group?
No earnings guidance has been provided for FY27 given continuing macro uncertainty. However, the company expects $30 million in cost savings for the year ahead, partly offset by higher online costs as the New Zealand regulated online casino market opens in 2027. Capital expenditure is forecast between $80 million and $100 million, excluding potential online licence costs.
Management is focused on completing asset sales, lowering net debt, and delivering its cost-out and digital priorities. When positive cash flow returns, the company intends to reinstate dividends to shareholders.
SkyCity Entertainment Group share price snapshot
Over the past 12 months, the SkyCity Entertainment Group share price has underperformed both the S&P/ASX 200 index (ASX: XJO) and the wider travel and leisure sector, reflecting earnings pressure and regulatory challenges.
The post SkyCity shares on watch as FY26 profit falls but cost-out strategy advances appeared first on The Motley Fool Australia.
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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips. This article was prepared with the assistance of Large Language Model (LLM) tools for the initial summary of the company announcement. Any content assisted by AI is subject to our robust human-in-the-loop quality control framework, involving thorough review, substantial editing, and fact-checking by our experienced writers and editors holding appropriate credentials. The Motley Fool Australia stands behind the work of our editorial team and takes ultimate responsibility for the content published by The Motley Fool Australia.