COVID-19 Pandemic Helps SkyCity Online Casino Profitability
The SkyCity online casino is turning a profit despite only being in operation for 12-months. New Zealand gamblers flocked to the SkyCity online casino during the COVID-19 lockdown and boosted the site’s profitability.
SkyCity online casino launched in August 2019 and operates using a Maltese license. Only customers physically located in New Zealand and who are 20-years-old or over can access the gambling site.
The casino features a mixture of live games, pokies, and table games. Evolution Gaming provides the software and dealers for live dealer games. Several of the world’s biggest pokies developers lay on the various virtual machines.
It’s quite rare for an online casino to turn a substantial profit during its first year operating. SkyCity online casino certainly did that.
The company’s annual financial report showed the SkyCity online casino enjoyed revenues of NZ10.2 million. SkyCity’s share weighed in at NZ$4.5 million ($4.08 million)and earnings of NZ$2.2 million ($1.99 million).
That is a remarkable result and an impressive achievement, especially with the gambling industry being hit hard. An influx of new customers during the time New Zealand was locked down helped SkyCity online casino turn a profit.
Some 35,000 customers registered by the end of August 2020. The three months ending August 31 saw 15,000 of those new registrations. SkyCity online casino showed positive earning for every month since April 2020.
Locked-Down Customers Flock to SkyCity Online Casino
The Australian gambling industry is in dire straits after a series of lockdowns. New Zealand’s gambling industry isn’t faring much better, again, because of COVID-19 lockdown measures.
SkyCity closed its five casinos in Auckland, Hamilton, Queenstown, Wharf Casino, and Adelaide when the COVID-19 pandemic peaked. They partially reopened in May before fully reopening during June. Its Auckland property slammed its doors shut in August after a rise in new COVID-19 cases.
Financial records show the impact of the enforced closures. Revenue for the SkyCity group dropped almost 25% to NZ$779.5 million ($706.75 million). Every other indicator tends to fall when revenue plummets. This was the case here with Net Profit After Tax falling 60% to NZ$66.3 million ($60.11 million).
New Zealand’s casinos report their financials in the same way as their Australian counterparts in that they have some make-believe figures to show investors. These figures pretend nothing unforeseen happened and everything was rosy.
Revenue increase 36.8% to NZ$1.125 billion ($1.02 billion) and net profit after tax leapt 62.8% to NZ$235.4 million ($213.45 million) using the pretend figures. It’s a bizarre reporting system, but one that won’t go away.
Can SkyCity Hope For More Online Casino Gains?
It makes sense for the company to push its online casino but it may not be able to. The New Zealand Department of Internal Affairs (DIA) isn’t happy about SkyCity’s online presence.
The DIA warned SkyCity about its future conduct in July 2020. It issued a formal warning after SkyCity emailed its customer base to promote the site. DIA said the email breached rules against promoting internationally licensed online gambling sites. The warning wouldn’t have happened if the SkyCity online casino was licensed in New Zealand. Rules in the country prevent this from happening, hence obtaining a Maltese license.
SkyCity customers received an email stating land-based casinos were closed but its online casino was operating as usual. DIA took a foul view on the email as it saw it as a blatant promotion of the SkyCity online casino. SkyCity claimed the email informed customers of the company’s COVID-19 situation.
We wouldn’t be surprised to see Australian casinos opening their own online version of themselves. Crown Resorts has a digital division, a DGN Games social gaming unit and a partnership with Betfair Australasia.
COVID-19, and the issues it brings with it, will be with us for the foreseeable future. Those companies that react and adapt will thrive. Those who don’t could fail and do so spectacularly.