Monday, August 25, 2008

Electoral Finance Act continues to stiffle free speech

The failure of the Electoral Finance Act is highlighted once again. The Electoral Commission are not even able to give clear advice on how to exercise the law in the example below-even the best lawyers are confused.

The Act was passed into law late in 2007 and came into effect on Jan 1 2008. It was rushed through with multiple amendments. Even the Minister responsible for it, Annette King, doesn't understand how it works.

It was passed anyway, to stop dissenting opinion against an incumbent Government, in this case the Labour Government.

An Act well engineered to be in place in Mugabe's Zimbabwe, simply because it is anti democratic and anti free speech.


By SUSAN PEPPERELL - Sunday Star Times Sunday, 24 August 2008

Lobby group the Sensible Sentencing Trust is planning to defy the Electoral Finance Act in the lead-up to the general election.


The group has decided on its course of action after receiving conflicting legal advice over whether material it intends to distribute during the election campaign contravenes the act.

Its decision highlights a common problem facing similar groups pre-election and one which has forced Family First to abandon a pamphlet drop to all households outlining the voting record of MPs on what it identifies as "important family-based legislation" such as civil unions, anti-smacking and prostitution law reform.

The groups say the act which limits advertising spending by non-political parties soliciting votes for or against a party unless they register as a third party is anti-democratic and stifling public debate.

continued

Related Political Animal reading

Electoral Finance Act March Mar 9, 2008
Electoral Finance Bill Vote
NZ losses democratic freedom
Mike Moore turns the knife
List of MPs who voted for Act
Cartoon and comment
Auckland Protest against EFBT
The purpose of the Bill is clear

c Political Animal 2008

Sky City Entertainment 2008 Full Year profit results

Chart for Sky City Entertainment Group Li (SKC.NZ)

SKYCITY Entertainment Group 2008 Annual Result Monday 25 August 2008.
2008 Full Year Result Presentation
Media Release
NZX Announcement
Financial Statements
Result Briefing Webcast

FLYR: SKC: Summary full year to 30/06/08 $49.9m ($98.4m) -49.3% 10.5 cps

SUMMARY OF PRELIMINARY FULL YEAR ANNOUNCEMENT

Name of Listed Issuer: SKYCITY Entertainment Group Limited

For full-year ended: 30 June 2008

CONSOLIDATED OPERATING STATEMENT
Current Full Year NZ$'000; Up/Down %; Previous Corresponding Full Year
NZ$'000

Total Revenue:
$818,847; up 0.3%; $816,097

OPERATING SURPLUS BEFORE UNUSUAL ITEMS AND TAX:
$145,782; up 10.8%; $131,555

Unusual items for separate disclosure:
$60,000 Cinemas write-down; $0

OPERATING SURPLUS BEFORE TAX:
$85,782; down 34.8%; $131,555

Less tax on operating profit:
$36,534; up 10.3%; $33,125

OPERATING SURPLUS AFTER TAX ATTRIBUTABLE TO MEMBERS OF LISTED ISSUER:
$49,856; down 49.3%; $98,402

Extraordinary items after tax attributable to Members of the Listed Issuer:
$0; nil%; $0

OPERATING SURPLUS AND EXTRAORDINARY ITEMS AFTER TAX ATTRIBUTABLE TO MEMBERS
OF THE LISTED ISSUER:
$49,856; down 49.3%; $98,402

Earnings per share:
10.8 cps; 22.3 cps

Final distribution:
10.5 cps

Record Date: 12 September 2008. Date Payable: 10 October 2008

Attachments: Appendix 1, 7 and related documents

SKYCITY ENTERTAINMENT GROUP LIMITED

Chief Executive Officer's Review
Year Ended 30 June 2008

The full version of the Chief Executive Officer's presentation of the SKYCITY
result for
2008 is available on the company's website under the Investor Centre at
www.skycityentertainment.co.nz. The full presentation includes comprehensive

information some of which is presented in graphical format which is not able
to be
reproduced for this extract. SKYCITY recommends that the full presentation
be referred
to as it contains useful explanatory information.

FY08 Group Result

- Reported Net Profit after Tax at $49.9m (after non recurring items
including the Cinemas write down of $58.4m). FY07 NPAT $98.4m.
- NPAT adjusted for non-recurring items (including Cinemas write down) at
$111.9m, up 19% over FY07 ($93.8m)
- Earnings per share adjusted for non-recurring items at 24.2cps, up 14% over
FY07 (21.2cps)
- NPAT adjusted for non-recurring items and international VIP commission
business at theoretical at $102.0m, up 7% over FY07 ($95.4m)
- Normalised earnings per share at 21.9cps, up 1.4% over FY07 (21.6cps)
- Group revenue at $818.8m, up 1.7% over FY07 revenues (adjusted for
non-recurring items) of $805.1m
- EBITDA (before Cinemas and adjusted for non-recurring items) at $306.4m, up
7.7% over FY07 at $284.5m
- EBIT adjusted for non-recurring items up 8.0% at $238.5m (FY07: $221.0m)
- Underlying cash flow of $199.1m, up 15% on FY07 ($173.0m)
- Key financial metrics improved: operating cash flow increased from $268m to
$286m, net debt to EBITDA reduced from 3.4x to 3.3x and interest cover
increased from 3.3x to 3.8x
- Results in line with February guidance of $108m-$110m
- Retirement of $92m of debt ($93.1m in FY07) strengthened the company's
balance sheet, further reinforced by Investment Grade BBB- rating from
Standard and Poor's
- Total FY08 distribution 21.5cps (FY07 21.0cps). Final distribution of
10.5cps to be paid 10 October

Management and Operational Highlights

- Permanent CEO appointed in March 2008
- New management appointments have significantly enhanced operational
expertise
- Reorganisation of company to drive divisional profit focus and reduce
corporate overhead
- Auckland casino refurbishment completed March 2008
- Strong result from International VIP Commission Business in FY09

Outlook

- Business plans budget for growth in FY09
- Satisfactory trading in FY09 year to date (25 August 2008)

- Strong control to be maintained over capital expenditure
- Further debt retirement anticipated in FY09

Distribution to Shareholders

- Distribution payout ratio of 90% reaffirmed
- Total distribution 21.5cps for FY08 (21.0cps FY07)
- Final distribution of 10.5 cents per share (12.0cps FY07)
- Entitlement/record date 12 September. Bonus share Issue/payment date 10
October
- Distribution by way of non-taxable bonus shares with fully-imputed cash
buyback alternative
- Strike price for the bonus share issue for the FY08 final distribution will
be the weighted average SKC price on the NZSX during the 5 day period 15-19
September
- The number of bonus shares to be issued in respect of the FY08 final
distribution will be confirmed to shareholders on 24 September. Shareholder
elections (for the cash/buyback option) due to share registry (Computershare)
by 8 October

Funding Structure

- Very strong liquidity position
- Cash and undrawn facilities of ~$400m
- Debt repayment of $92m in FY08 (FY07 $93m)
- Debt maturity profile: FY10 $124m, FY11 $318m, FY12 $405m, FY15 $90m, FY17
$35m, FY20 $22m
- No maturity events until May 2010. Capital Notes mature in May 2010, but
the securities offer good rollover flexibility with limited refinancing risk

- Significant headroom within existing covenants
- Reflected in Standard and Poor's Investment Grade Rating (BBB-) with Stable
Outlook

FY09 Capex

Maintenance Capex

- FY09 maintenance capex of approximately ~$65m will include significant
reinvestment in core business operations
- Primary use of maintenance capex will be on gaming machine product,
technology and systems
- FY09 depreciation estimated at ~$80m

Project Capex

- Completion of Darwin Stage 1 expansion (FY09 spend A$18m)
- Completion of Manukau Cinema complex in Auckland (FY09 spend $8m)
- No significant capex on Little Mindil resort (Darwin) during FY09
- No plans to proceed with Adelaide carpark

Strategic Priorities for FY09

- The core objective for 2009 is to maximise the potential of the company's
existing assets
- SKYCITY's new management team focused on delivering revenue growth, driving
operational efficiencies and maximising EBITDA, while tightly controlling
capex

- To deliver an improved customer experience across all properties, focusing
on customer service, effective marketing and enhanced entertainment
experiences
- To significantly enhance IT and systems capabilities and reinvest in new
gaming technology and core operating systems, positioning the business for
growth
- To grow and diversify International VIP commission-based play business
- To improve employee engagement and employee advocacy across all business
operations

FY09 Outlook

- Results and progress achieved in FY08 provide a solid platform for FY09
- Business plans budget for growth in FY09
- SKYCITY's most recent revenue indicators suggest it is trading
satisfactorily in the current economic environment
- The new management team is focused on delivering revenue growth, increasing
operating efficiency and maximising EBITDA, whilst retaining tight control
over capex
- Further debt reduction anticipated in FY09

BUSINESS UNIT RESULTS
Auckland

- Sound result in challenging economic environment
- Revenue up 1.0% at $402.3m (+$3.8m)
- EBITDA down 0.1% at $208.3m (-$0.3m)
- EBIT down 0.3% at $174.4m (-$0.5m)
- New Auckland management team has strong focus on core business with
strategic concentration on product, mix, pricing, presentation, customer
service, marketing and loyalty
- Main gaming floor renovation completed March 2008
- renovation disruption impacted FY08 result
- improvements in casino revenues are evident
- positive feedback from customers and staff
- refurbishment completion provides platform for FY09
- New gaming product and relayout of main floor tables and machines will
further enhance customer experience during FY09
- Recent highlights indicate management strategies are gaining traction:
- 08/08/08 was biggest gaming day in Auckland in over four years
- $1m SKYCITY Auckland Festival of Poker tournament announced for
October
- SKYCITY Grand Hotel topped Auckland's occupancy levels in August
- record Auckland convention revenues in August

Adelaide

- Solid result given impact from smoking ban (from 1 November 2007)
- revenue impact less significant than anticipated
- minimal impact on table gaming revenues given partial smoking bans already
applied to tables
- Positive cost reductions achieved, holding EBITDA steady with FY07
- Revenue down 4.4% at A$118.2m (-A$5.5m)

- EBITDA down 1.0% at A$20.7m (-A$0.2m)
- EBIT down 3.6% at A$10.6m (-A$0.4m)
- Maintenance capex will be maintained to underpin revenue growth
- No plans to proceed with Adelaide carpark (costs relating to the project
have been written off)

Darwin

- Solid growth achieved in Darwin
- Regional economic momentum continues
- Revenue up 7.7% at A$100.8m (+A$7.2m)
- EBITDA up 13.9% at A$40.1m (+A$4.9m)
- EBIT up 14.7% at A$32.7m (+A$4.2m)
Stage 1 expansion (A$30m) commenced October 2007. Scheduled for opening by
March 2009. Includes increased gaming floor area (~20%) and new/upgraded
gaming, bars, restaurants and service facilities Darwin's proximity to the
Asian market is key to the International VIP Commission Business development
strategy
The Little Mindil site and associated resort development will support the
International VIP Commission Business growth strategy but no significant
capex will be incurred on this project in FY09

International VIP Commission Business
- Strong result from International VIP Commission Business (turnover $1.4bn)

- Revenue up 4.6% at $34.0m (+$1.5m)
- EBITDA up 267% at $17.2m (+$10.6m)
- Revenue assisted by favourable actual to theoretical win rate. FY08 win
rate of 2.63% vs theoretical win rate of 1.33% (FY07 actual win rate 1.24%)
- Core management focus for International Business is to increase
international VIP gaming turnover, to build sustainable revenue, and reduce
volatility

Hamilton

- Steady performance in FY08
- Revenue down marginally at $39.0m (-$0.7m)
- EBITDA down 5.1% at $18.5m (-$1.0m)
- EBIT down 4.8% at $14.0m (-$0.7m)
- New management team with significant additional casino and gaming
experience
- Current focus on increased utilisation/performance of the existing assets
and on the core gaming customers
- New machine introductions during FY09 expected to refresh customer interest

- New and upgraded facilities in place (including new bars and restaurants)

Christchurch

- Solid performance from Christchurch Casino in FY08. Earnings up marginally
at $5.7m, from $5.6m in FY07
- New management appointed
- Phased refurbishment initiated to renew/refresh the overall property,
self-funded from cash flows
- Crowne Plaza Hotel interest sold and Intercontinental Hotel Group's shares
in the casino acquired. As a result SKYCITY and Skyline have each increased
their ownership interest in Christchurch Casino by 5.2%, from 40.5% to 45.7%

Queenstown

- Increased revenues for FY08 lifted operating earnings
- Revenue up 9.4% at $7.0m (+$0.6m)
- EBITDA at $0.5m (+$0.2m)
- New management appointed
- Good progress at Queenstown during FY08, although result not material to
the overall Group result
- New machine introductions during FY09 expected to refresh customer interest

Cinemas

- Cinema's result for FY08 very disappointing
- New management team appointed and focused on growing core revenues
- Revenue (adjusted for non-recurring items) down 2.1% at $66.2m (-$1.4m)
- EBITDA (adjusted for non-recurring items) down significantly from $8.7m in
FY07 to $4.8m in FY08
- Cinemas' performance suffered as a consequence of unusually good weather
during FY08 summer and management distraction from the sale process
- Management team focus on greater customer value, increased facility
utilisation, and greater diversity of product aligned to demographics
- 55% market share in Auckland and 38% across all of New Zealand
- New cinema complexes improve SKYCITY's penetration in the important
Auckland market: Albany (10 screens) opened April 2008, and Manukau (10
screens) opens September 2008

Summary Profit and Loss for FY08 and Balance Sheet (and Notes) as at 30 June
2008
- A summary of revenue and earnings performance by site (FY08 and FY07) is
attached to this presentation
- Balance sheet positions as at 30 June 2007 and 2008, and explanatory notes,
are also attached.

Presentation Format

As referred earlier, the full CEO FY08 result presentation is available from
the company's website. Information presented in graphical format is
reproduced in this narrative format (as required by NZX) but a full and
detailed explanation of the result is set out in the website presentation
version.

Nigel Morrison
Chief Executive Officer
25 August 2008



Sky City Entertainment Group @ Share Investor

Sky City Entertainment Group Ltd: Never mind the width feel the volume
Sky City Annual Meeting & 2011 - 2012 Profit Forecast
Stock of the Week: Sky City Entertainment Group Ltd
Sky City set to lose National Convention Centre bid
Sky City Entertainment Group: Australian Acquisition on the Cards?
Sky City Entertainment Group Ltd: 2010 Full Year Profit Analysis
Sky City Entertainment Group 2010 Full Year Profit Preview
Chart of the Week: Sky City Entertainment Group Ltd
Share Investor discusses Convention Centre proposal with CEO Nigel Morrison
Share Investor Q & A: Sky City CEO, Nigel Morrison
Sky City Entertainment: CEO Nigel Morrison discusses 2010 HY
Sky City Convention Centre Expansion a Money Loser: Part Two
Sky City Convention Centre Expansion a Money loser
Sky City Entertainment Group Ltd: Download full Company analysis
Sky City 2010 full year profit looking good
Long Term View: Sky City Entertainment Group Ltd
Sky City Entertainment: CEO Nigel Morrison discusses 2010 Half Year
Sky City Entertainment Group 2010 Interim Profit Review
Sky City to focus on Gaming
Sky City debts levels now more manageable
Insider Trading on Sky City shares
Sky City Profit Upgrade: Always on the Cards
Sky City's Current Cinema "Boom" a Horror Story in Disguise
Stock of the Week: Sky City Entertainment Group
Are Insiders selling Sky City Stock?
Sky City Entertainment 2009 Interim Result Preamble
2008 Sky City profit analysis
Sky City share offer confusing and unfair for smaller shareholders
Sky City Entertainment 2008 Full Year profit results , NZX release, 2008 full year presentation, result briefing webcast, financial statements
Sky City 2008 profit preamble
Sky City outlines a clear future plan
As recession bites Sky City bites back
Sky City Assets: Buy, sell and hold
Why did you buy that stock? [Sky City Entertainment]
Sky City Share Volumes set tongues wagging
Sky City half year exceptional on cost cutting
NZX Press release: Sky City profit to HY end Dec 2007
Sky City Cinemas no Blockbuster
Sky City Entertainment share price drop
New Broom set to sweep
Sky City Management: Blind, deaf and numb
Sky City sale could be off
Opposition to takeover
Premium for control
Sky City receives takeover bid
Sky City Casino Full Year Profit to June 30 2007
Setting the record straight
Sky City CEO resigns
Sky City Casino: Under performing
Sky City Casino 2007 HY Profit(analysis)
Sky City Casino 2007 HY Profit

Sky City Convention Centre @ Share Investor

Share Investor discusses Convention Centre proposal with CEO Nigel Morrison
Sky City Convention Centre Expansion a Money Loser: Part Two
Sky City Convention Centre Expansion a Money loser
SKC Convention Centre power-point slide illustrations & SKC submission to Auckland City Council

Discuss SKC @ Share Investor Forum
Download SKC Company Reports

Recommended Fishpond Reading

Crisis: One Central Bank Governor and the Global Financial Collapse

Buy The Intelligent Investor & more @ Fishpond.co.nz

Fishpond


c Share Investor 2008

Sunday, August 24, 2008

Fraudulent Emissions Trading Bill

The most contentious, dangerous and economically disastrous legislation in New Zealand's history is set to be rammed through by the Labour Party and its lapdog support parties over the next two weeks.

The Emissions Trading Bill, to allow the trading of "Carbon Credits" has had 1000 corrections, little critical input and is based on the well known fraud that man is "warming the planet".

If you want to voice your opinion to Helen Clark and her fraudulent legislation contact her office at pm@ministers.govt.nz or fax or phone: Fax : 64 04 473-3579Phone : 64 04 471 9998.

Ask John Key from The National Party to ditch their own intention to pass a similar bill should they take office after the 2008 Election contact him at the following.

Email: john.key@national.org.nzWebsite: www.johnkey.co.nzPhone: (04)4719307 (Parliament)Phone: (09)4122496 (Electorate)

Lets try and stop this garbage.


Related Political Animal reading

Kyoto critic comes to town
Global warming: Power to the people
Carbon Credit trading puts markets at extreme risk
Global Warning: Tax iceberg ahead
Unstoppable global warming
Earth Day: Turn on, tune out, buy some candles
TIME magazine slips inconvenient truth past its readers
The Great Global Warming Swindle
PRIME TV PRESENTS: The Great Global Warming Swindle
Kristen Byrnes-Ponder the Maunder
Helen Clark and Jeanette Fitzsimmons in conflict with business
Of tulip bulbs and tooth fairies

c Political Animal 2008

Sky City 2008 profit preamble

It is going to be Sky City Entertainment [SKC.NZ] 'tastic at the Share Investor Blog over the next few days as I take a look at the company, analyze and comment on tomorrow's profit announcement live webcast (10.00am Monday 25 Aug 2008-NZ time) and generally rip management a new one if I don't like what I hear.

The casino company is my largest holding and I have been a shareholder since 2002.

Its NZ$3.43c closing on August 22 2008 is lower than the $8.05c (pre 2:1 share split) it was on Jan 1 2003 and it had a profit of $107.2 million on $556 million in revenue.

2004 saw Sky City post a record $121.1 million profit (before abnormals) on revenues of $590 million and the 2007 year saw the company post a $98.4 million profit on record revenue of $798.6 million.

Sky City’s guidance
(PDF) for the full year 2008 year to June 30 is for a net tax-paid profit of $108-110 million, excluding the $60 million write down of its cinema business.

These figures do not make pleasant reading for any investor. Rising revenues but patchy, stagnant and poor profit results.

There are a number of reasons for this.

Management under the previous CEO made some bad decisions.

The purchase and subsequent write off of NZ $20 million on Canbet, the Australian online betting company.

The purchase and write off of more than NZ $100 million on Force Corp's cinema business, now operating as Sky City Cinemas and barely breaking even.

Overpaying for the Adelaide Casino in 2000, even after 70 million of "refurbishing" it still earns less than $10 million annually.

Not a good record and that is understating it.

All this has been done in a regulatory environment that has had a huge negative impact on the bottom line.

The Labour Government banned smoking in bars and restaurants in December 2004 and that had a marked impact on gambler behaviour. Coupled with the limiting of slot acceptors to $20 from the previous $100 in 2005, that period was the beginning of a slow down in profit growth-minus management induced write downs.

So alot of the deleterious effects on profit were from influences out of management's control but the greatest negative impact has clearly been from bad management decisions and mis-management of largely good assets.

Revenue has tripled from 1999's $ 264 million to 2007's record $798.6 million but profit has less than doubled from $46.9 million to last years $98.4 million.

The bad decisions and government legislation has led to increased borrowing and debt servicing charges and had a subsequent impact on the bottom line after tax profit.

All is not lost though.

With that tripling of revenue comes an opportunity for the current new management to cut out the fat and increase that bottom line.

New CEO Nigel Morrison has hired his own team, who have already cut costs by slimming down middle management and minimising floor staff wages-so much so that some union staff are striking . There is easily more to trim.

At a possible NZ$110 million profit for 2008, Morrison clearly has the scope to increase profit-based on high historical revenues and cost cutting- by at least another $10 million for FY 2009 and beyond that, without even factoring in an increase in revenue from 2007's $798.4 million.

I would expect something between $125-130 million for 2010-barring Kerry Packer winning a baccarat hand or two.

The Auckland Casino historically has been the jewel in the crown for the company It has been stagnant in growth over the last few years but good management of that asset will positively affect revenue growth.

The future star, in my opinion is Sky Citys Darwin Casino. Situated in Australia's fastest growing region.

The Darwin casino has increased revenue from $62 million in its first full year after it was purchased in 2004 to $54.9 million in the half year to December 31 2007. It looks set to keep delivering in the future as a $30 million expansion of the gaming complex is on track to be finished at the end of this year.

The casino operates under a a more relaxed Government regulated gaming regime and is the only casino in the Southern hemisphere to continue to allow smoking. A must for gamblers who like to enjoy a drink and a fag when spending their hard earned.

Tomorrow's announcement
will be interesting to see. It will be Nigel Morrisons first six months and his report will reflect somewhat how he has done and where he will take the company in the future.

I will look forward to seeing some positive direction from Morrison; what he is going to do and how he is going to achieve it.

I want to hear it described clearly, concisely and without the business gobbledygook Evan Davies was well known for.

I wait with unabated, and slightly restrained, enthusiasm.

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Sky City @ Share Investor

Sky City outlines a clear future plan
As recession bites Sky City bites back
Sky City Assets: Buy, sell and hold
Why did you buy that stock? [Sky City Entertainment]
Sky City Share Volumes set tongues wagging
Sky City half year exceptional on cost cutting
NZX Press release: Sky City profit to HY end Dec 2007
Sky City Cinemas no Blockbuster
Sky City Entertainment share price drop
New Broom set to sweep
Sky City Management: Blind, deaf and numb
Sky City sale could be off
Opposition to takeover
Premium for control
Sky City receives takeover bid
Sky City Casino Full Year Profit to June 30 2007
Setting the record straight
Sky City CEO resigns
Sky City Casino: Underperforming
Sky City Casino 2007 HY Profit(analysis)
Sky City Casino 2007 HY Profit

Share Investor Forum-Discuss this topic

Related Links

Sky City Entertainment Investor Centre


2008 Annual Result
SKYCITY Entertainment Group 2008 Annual Result will be announced on 10.am Monday 25 August 2008.
Result Briefing Webcast

2008 Interim Result
2008 Interim Report
2008 Interim Result Presentation
Media Release
NZX Announcement
Financial Statements
Results: Briefing webcast


c Share Investor 2008