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Tough conditions drag on SkyCity Q3 revenue

SkyCity Entertainment Group posted a 4 percent decline in revenue for the three months ended March 31. The group said it was dealing with flat gaming revenue at its flagship casino in Auckland, and tough operating conditions at its Australian operations in Darwin and Adelaide.

Group revenue fell to $258.1 million from $268.9 million a year earlier, with its Auckland casino reporting a 1.5 percent dip in revenue excluding international business to $141.8 million.

On a like-for-like basis, SkyCity said Auckland's sales were up 1.2 percent with modest growth in its non-gaming revenue and flat gaming revenue.

Sales for the Adelaide casino fell 1.8 percent to A$36 million ($26.8 million), while the Darwin operation reported a 5 percent drop in revenue to A$23.2 million ($17.3 million) in the face of tough trading conditions and competitive pressures.

Revenue from its international high-roller business rose 5.1 percent to $38.2 million ($28.5 million) on a normalized basis, adjusted for a theoretical win rate of 1.35 percent against an actual win rate of 1.27 percent, due to strong activity over the Chinese new year holiday. In actual terms, revenue from the international business was down 2.3 percent.

In February, the company posted an 18 percent rise in first-half profit to $83.8 million ($62.2 million), and said it expected the Auckland unit to achieve "modest earnings growth" in the second half.

SkyCity shares have gained 14 percent so far this year.

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