SkyCity Entertainment Group has announced its $700 million-plus international convention centre will not open until the second half of next year, despite having bookings for thousands of delegates before that date.
It has also just been revealed that SkyCity has withheld $39.5m from Fletcher Construction because the centre is so late.
The centre was originally planned to open this month but the half-year NZX announcement out just after 9am announced that it expected "NZICC to open in second half of 2020."
SkyCity said: "NZICC bookings scheduled for 2020 being reviewed due to completion delays."
Many conferences bringing about 10,000 people are already booked throughout next year and depending on the centre to be finished. Those are:
• The tripartite colorectal meeting next February, bringing 1200 delegates;
• The International Association for Prevention of Blindness convention next March and to be attended by about 2000 delegates;
• The Asia Pacific Academy of Ophthalmology is also booked for March with 3500 delegates;
• The World Veterinary Congress is in April for 1200 delegates;
• The World Organisation of Family Doctors Asia Pacific Region is booked for next July, bringing 2000 delegates;
• The World Congress of the International Union of Food Science and Technology is booked for August next year and 2000 delegates will attend that.
SkyCity has declared a normalised net profit after tax for the December half-year of $97 million, up 11.4 per cent on the previous $87m and on target with its forecast last month.
Total revenue excluding GST was up 10.4 per cent to $541m. The results are for the half-year period to December 31, 2018
But a SkyCity spokesman explained discussions with convention centre delegates. Callum Mallett, centre general manager had talked to the delegates, the spokesman said.
"They have all been briefed. Cullum is working with them to either adjust their dates or find them other alternatives so today's announcement is not a surprise to them. They have been extremely gracious and understanding," the spokesman said of the delegates.
It has just also been revealed that SkyCity has withheld paying Fletcher Construction $39.5m because the convention centre, as well as the big new five-star hotel, are late.
SkyCity announced this morning it was "comfortable" with its contractual position on the NZICC and cited "$30m of liquidated damages collected under NZICC contract". As well the "Horizon Hotel contract provides for $9.5m of liquidated damages."
Today's notes to the financial statements said: "Included within the Fletcher Construction Company construction contracts for the New Zealand International
Convention Centre and Horizon Hotel is the right to liquidated damages if certain milestones are not met. To date SkyCity has withheld $30 million from payments to FCC for liquidated damages."