Firm eager to re-engage with Government once Auditor-General reports
SkyCity Entertainment wants to "re-engage" with the Government when the Auditor-General reports on its controversial $350 million international convention and exhibition centre.
Nigel Morrison, chief executive, told 700 shareholders at yesterday's annual meeting that the document was due and SkyCity hoped to reignite the project and start work.
"Following completion of this report, we hope to re-engage with Government and see if we can conclude these negotiations. We have spent around $40 million as at the end of September acquiring a valuable land bank adjacent to our Auckland site between Hobson and Nelson streets," he said.
The land will be used by SkyCity for other purposes if the bid failed.
"If we didn't get it, I don't think we would just sell it. We might joint venture it and look at some sympathetic development like hotels and entertainment," he said of the land spanning the two blocks beside TVNZ.
"It's a shame for this major piece of tourism infrastructure to be delayed. We kept aside $350 million to be able to do this thing and there's a cost. We have a very valuable land bank and we will make sure we make good of use of that, no matter what," Morrison said.
Chairman Rod McGeoch said SkyCity critics "conveniently overlook" how the business employs 6620 people, 800 to 1000 Aucklanders register their CVs monthly, 111,000 people are on its database, and 3000 to 3500 job applications flowed in monthly in Auckland.
Mark Warminger of Milford Asset Management asked for a 2013 net after-tax profit guidance update but Morrison refused, saying the business was still only in its first quarter and the outlook was not clear in New Zealand "let alone Australia. We gave guidance about this time last year and we probably got a little enthusiastic and there was a softening in the latter part of the year".
Professional analysts' consensus forecasts for the year are $147 million NPAT yet SkyCity has previously given expectations of $140 million.
Warminger said after the meeting that the company appeared to be giving a guidance they could beat, a better outcome than having to revise profit forecasts down.
Shareholder Coralie van Camp criticised SkyCity's lack of entertainment offering, saying other major international centres offered more and better live shows and the business needed more than gaming machines to draw crowds, but Morrison said the business was already the heart of Auckland's entertainment zone and referred to sport, live music and comedy offerings.
The meeting started with a video made for Air New Zealand flights arriving at Auckland International Airport, featuring The Grill's Sean Connolly giving a guided tour of Federal St restaurants, showing Al Brown at The Depot and other dining spots.
Chris Moller became chairman yesterday but McGeoch will remain on the board as a director which Warminger said this was a positive sign because he was Australian-based and had good relations with key people there.
Warminger said he had no ethical issues owning shares in the business.
"In terms of addressing addictive gaming behaviour, SkyCity is one of the leading casinos in the world."
SkyCity shares closed up 2c yesterday at $3.97.
SkyCity's new projects:
• Another Al Brown restaurant, following The Depot.
• Peter Gordon of Dine to open new restaurant in SkyTower.
• Nic Watt to open new Japanese restaurant MASU.
• Federal St to be single-vehicle shared-space.
•Area to be paved and new street furniture installed.
• New 135-room Hamilton hotel above casino planned.
• $7m-$8m Darwin VIP area to be redeveloped.
• Adelaide expansion and redevelopment planned.
[Source: SkyCity Entertainment group]