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Sun International H1 diluted HEPS down 20% to 325c

Posted On Monday, 24 February 2014 17:06 Published by
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Sun International reports a 20% decline in diluted HEPS to 325c for the 6 months ended December 2013 from 408c a year ago.

Sun International hotel

Hotels‚ gaming and resorts group Sun International has reported a 20% decline in diluted headline earnings per share (HEPS) to 325c for the six months ended December 2013 from 408c a year ago

Adjusted HEPS were 18% lower at 348c.

The company said on Monday 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.

The group was further restructuring and recently announced a consultation process in terms of the Labour Relations Act.

Looking ahead‚ it said it had made significant progress with its strategic objectives in the past six months.

The objectives included revenue growth and cost-cutting initiatives‚ the benefit of which were beginning to show in the group’s results.

The full benefit of these initiatives and the wider group restructure would only fully reflect in the 2015 financial year.

The trading environment was expected to remain subdued‚ but given the initiatives already implemented and the recent improvement in the performance of Monticello the group was optimistic that it would achieve growth in both ebitda and adjusted headline earnings in comparison with the second half of the 2013 financial year‚ it said.

Last modified on Monday, 24 February 2014 21:09
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