R3 billion Pretoria Casino gets the go-ahead

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The gaming and leisure giant, Sun International has received the green light from the National Gambling Board of South Africa to develop a 3 billion rand entertainment complex in the capital Pretoria. The gaming and leisure giant, Sun International has received the green light from the National Gambling Board of South Africa to develop a 3 billion rand entertainment complex in the capital Pretoria.

The gaming and leisure giant, Sun International has received the green light from the National Gambling Board of South Africa to develop a 3 billion rand entertainment complex in the capital Pretoria.

Sun said on Thursday, it will shut down another casino in the Pretoria region and will build the entertainment complex which will include a casino, hotel, conference centre and an indoor facility for concerts in an affluent part of the city.

The company also said it would have a management contract and hold an effective 74.9 percent of the development, which it has said could take about 36 months to complete.

In February, Sun reported first-half year profit dropped 21 percent as gambling revenue stagnated and the cost of eliminating jobs rose.

Its diluted earnings dropped 21% to 323c per share. Adjusted HEPS were 18% lower at 348c.

Net income in the six months ended December fell to R302 million from R380 million a year earlier.

Sun said that trading for the period remained challenging‚ particularly in South Africa where casino revenue had remained under pressure and at Monticello‚ in Chile‚ where the effects of the smoking ban persisted.

However‚ the weaker rand boosted the tourism industry and the group’s hospitality revenues.

Revenue for the period was 4% higher at R5.4bn‚ with casino revenue in line with last year‚ while the group experienced strong growth in hospitality revenue‚ with room revenue up 26% and food‚ beverage and other revenue up 10%.

Casino revenue in the group’s South African properties was up 3%‚ following a stronger second quarter where casino revenue was up 4.5%‚ it said.

Earnings before interest‚ tax‚ depreciation and amortisation (ebitda) at R1.5bn‚ was 5% less than last year. Operating profit was down 17% at R880m.

The group said that due to the volatility it was experiencing in the industry and the changes the group itself was going through‚ it did not believe quarterly trading updates currently provided meaningful information on which to base investment decisions or were indicative of trends that it was currently experiencing in the business.

Consequently the board has decided to stop publishing the quarterly updates but would continue to publish the half-yearly profit announcements that gave a better indication of medium- and long-term trends.


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