Improving Economic Conditions in New Zealand Should Allow a Return to Earnings Growth for SkyCity

We expect SkyCity to return to earnings growth over the next decade, buoyed by the recovery from cyclical lows and solid performance from its core assets in Auckland and Adelaide. SkyCity is the monopoly operator in both jurisdictions, with long-dated licences (exclusive licence for Auckland expires in 2048, and Adelaide licence expires in 2085 with exclusivity guaranteed until 2035). We expect Auckland in particular to perform strongly, thanks to SkyCity's solid record of reinvestment, resulting in high property quality, stable visitor growth, and earnings resilience.