SkyCity secures debt covenant waivers

SkyCity started operating with no capacity limits on April 14.
SkyCity started operating with no capacity limits on April 14.

SkyCity has secured further covenant relief to cover potential disruption of the near-term operating environment due to the Covid-19 pandemic.

New Zealand.- SkyCity has said it had secured waivers from its banking syndicate and US Private Placement holders for the June 30 2022 testing period, and an amendment to debt covenants for the December 31 2022 testing period. 

Despite the recent improvement in performance, SkyCity has secured this covenant relief as a precautionary measure to provide the group with a contingency should the Covid-19 pandemic cause another major disruption to the short-term operating environment.

The casino operator stated: “During the extended wavier period, SkyCity is unable to make distributions to shareholders or secure new debt facilities. SkyCity remains committed to its dividend policy and to resuming distributions as soon as possible.”

The company said it was not yet able to provide detailed FY22 earnings guidance despite recent improvements in trading performance. However, it said it remains optimistic about the group’s medium-term outlook, including a return to the financial year 2019 results when the business is fully operational and growing from there.

SkyCity resumed operations with no capacity limits or physical distancing requirements on April 14 after authorities in New Zealand dropped the country’s Covid-19 alert level to “Orange” under its Covid-19 Protection Framework. there was a steady increase in visitor numbers at properties in New Zealand, particularly in Auckland and Hamilton, in late March and early April.

SkyCity’s chief operating officer, Callum Mallet, said the company expected to hire “hundreds of staff” as New Zealand prepared to reopen its borders for fully vaccinated foreign visitors after two years of insulation due to the Covid-19 pandemic.

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