Wrap Text
Profit and dividend announcement for the six months ended 31 December 2012
Sun International Limited
Registration Number:1967/007528/06
Share Code: SUI
ISIN: ZAE 000097580
Profit and dividend announcement for the six months ended 31 December 2012
Highlights
REVENUE +10%
EBITDA +20%
ADJUSTED HEPS +39%
INTERIM GROSS DIVIDEND OF 110 CENTS PER SHARE +22%
Condensed group statements of comprehensive income
Six months ended Year ended
31 December 30 June
2012 % 2011 2012
R million UNAUDITED CHANGE UNAUDITED AUDITED
Revenue
Casino 4 208 10 3 809 7 645
Rooms 444 (1) 448 838
Food, beverage and other 569 12 509 1 011
5 221 10 4 766 9 494
Benefit fund surplus - 24 24
Consumables and services (551) (533) (1 076)
Depreciation and amortisation (412) (388) (818)
Employee costs (1 100) (1 044) (2 103)
Levies and VAT on casino revenue (989) (883) (1 774)
Promotional and marketing costs (389) (384) (698)
Property and equipment rental (54) (28) (95)
Property costs (261) (246) (485)
Other operational costs (409) (379) (759)
Operating profit 1 056 17 905 1 710
Foreign exchange profits 10 69 79
Interest income 15 16 37
Interest expense (255) (237) (521)
Profit before tax 826 753 1 305
Tax (288) (308) (434)
Profit for the period 538 21 445 871
Other comprehensive income:
Net loss on cash flow hedges (3) - -
Tax on net loss on cash flow hedges 1 - -
Transfer of hedging reserve to statements of comprehensive income 2 1 2
Tax on transfer of hedging reserve to statements of comprehensive
income (1) - -
Currency translation reserve 104 181 233
Total comprehensive income
for the period 641 627 1 106
Profit for the period attributable to:
Minorities 158 145 239
Ordinary shareholders 380 300 632
538 445 871
Total comprehensive income
for the period attributable to:
Minorities 193 199 317
Ordinary shareholders 448 5 428 789
641 627 1 106
CENTS % CENTS CENTS
PER SHARE CHANGE PER SHARE PER SHARE
Earnings per share
basic 396 319 669
diluted 393 24 317 664
Dividends per share 110 90 240
Condensed group statements of cash flows
Six months ended Year ended
31 December 30 June
2012 2011 2012
R million UNAUDITED UNAUDITED AUDITED
Cash generated by operations before: 1 581 1 332 2 749
Working capital changes 15 (153) (15)
Cash generated by operations 1 596 1 179 2 734
Tax paid (307) (238) (531)
Cash generated by operating activities 1 289 941 2 203
Cash utilised in investing activities (744) (597) (1 160)
Cash realised from investing activities 6 47 68
Net cash outflow from financing activities (391) (283) (1 158)
Effect of exchange rates upon cash and cash equivalents 10 50 57
Increase in cash and cash equivalents 170 158 10
Cash and cash equivalents at beginning of the year 752 742 742
Cash and cash equivalents at end of the period 922 900 752
Condensed group statements of financial position
Six months ended Year ended
31 December 30 June
2012 2011 2012
R million UNAUDITED UNAUDITED AUDITED
ASSETS
Non current assets
Property, plant and equipment 10 036 9 428 9 595
Intangible assets 490 446 479
Available-for-sale investment 48 48 48
Loans and receivables 17 11 23
Pension fund asset 38 35 38
Deferred tax 175 143 148
10 804 10 111 10 331
Current assets
Loans and receivables 48 25 38
Tax 42 63 57
Accounts receivable and other 518 518 543
Cash and cash equivalents 922 900 752
1 530 1 506 1 390
Total assets 12 334 11 617 11 721
EQUITY AND LIABILITIES
Capital and reserves
Ordinary shareholders equity 1 825 1 129 1 496
Minorities interests 1 343 1 209 1 227
3 168 2 338 2 723
Non current liabilities
Deferred tax 423 509 423
Borrowings 3 693 2 922 4 257
Other non current liabilities 591 354 506
4 707 3 785 5 186
Current liabilities
Tax 88 191 101
Accounts payable and other 1 240 1 124 1 289
Borrowings 3 131 4 179 2 422
4 459 5 494 3 812
Total liabilities 9 166 9 279 8 998
Total equity and liabilities 12 334 11 617 11 721
Group statements of changes in equity
SHARE TREASURE FOREIGN SHARE RESERVE ORDINARY
CAPITAL SHARES CURRENCY BASED AVAILABLE- FOR NON- SHARE-
AND AND SHARE TRANSLATION PAYMENT FOR-SALE CONTROLLING HEDGING RETAINED HOLDERS MINORITIES TOTAL
R million PREMIUM OPTIONS RESERVE RESERVE RESERVE RESERVE RESERVE EARNINGS EQUITY INTERESTS EQUITY
Unaudited
FOR THE SIX MONTHS ENDED 31 DECEMBER 2012
Balance at 30 June 2012 277 (1 600) 228 161 4 (2 206) (2) 4 634 1 496 1 227 2 723
Total comprehensive income for the period - - 69 - - - (1) 380 448 193 641
Treasury share options purchased - (8) - - - - - - (8) - (8)
Deemed treasury shares purchased - (3) - - - - - - (3) - (3)
Vested shares - 14 - (14) - - - - - - -
Employee share based payments - - - 27 - - - - 27 - 27
Release of share based payment reserve - - - (7) - - - 7 - -
Release of SFIR equity option reserve - - - (38) - - - 38 - - -
Delivery of share awards - - - - - - - (4) (4) - (4)
Acquisition of minorities interests - - - - - 15 - - 15 64 79
Dividends paid - - - - - - - (146) (146) (141) (287)
Balance at 31 December 2012 277 (1 597) 297 129 4 (2 191) (3) 4 909 1 825 1 343 3 168
Unaudited
FOR THE SIX MONTHS ENDED 31 DECEMBER 2011
Balance at 30 June 2011 146 (1 613) 71 193 4 (1 470) (2) 4 188 1 517 1 300 2 817
Total comprehensive income for the period - - 128 - - - - 300 428 199 627
Treasury share options purchased - (9) - - - - - - (9) - (9)
Vested shares - 44 - (44) - - - - - - -
Employee share based payments - - - 33 - - - - 33 - 33
Release of share based payment reserve - - - (10) - - - 10 - - -
Delivery of share awards - - - - - - - (8) (8) - (8)
Acquisition of minorities interests - - - - - (718) - - (718) (79) (797)
Dividends paid - - - - - - - (114) (114) (211) (325)
Balance at 31 December 2011 146 (1 578) 199 172 4 (2 188) (2) 4 376 1 129 1 209 2 338
Audited
FOR THE YEAR ENDED 30 JUNE 2012
Balance at 30 June 2011 146 (1 613) 71 193 4 (1 470) (2) 4 188 1 517 1 300 2 817
Total comprehensive income for the year - - 157 - - - - 632 789 317 1 106
Treasury share options purchased - (20) - - - - - - (20) - (20)
Treasury share options exercised - 61 - - - - - - 61 - 61
Shares issued 131 - - - - - - - 131 - 131
Deemed treasury shares purchased - (72) - - - - - - (72) - (72)
Vested shares - 44 - (44) - - - - - - -
Employee share based payments - - - 33 - - - - 33 - 33
Release of share based payment reserve - - - (21) - - - 21 - - -
Delivery of share awards - - - - - - - (8) (8) - (8)
Acquisition of minorities interests - - - - - (736) - - (736) (82) (818)
Dividends paid - - - - - - - (199) (199) (308) (507)
Balance at 30 June 2012 277 (1 600) 228 161 4 (2 206) (2) 4 634 1 496 1 227 2 723
Supplementary information
Six months ended Year ended
31 December 30 June
2012 % 2011 2012
R million UNAUDITED CHANGE UNAUDITED AUDITED
EBITDA RECONCILIATION
Operating profit 1 056 17 905 1 710
Expropriation of land - Monticello* - - 6
Depreciation and amortisation 412 388 818
Property and equipment rental 36 28 71
Pre-opening Maslow lease rentals* 18 - 24
Benefit fund surplus recognition* - (24) (24)
Net loss on disposal of property,
plant and equipment* 1 1 1
Pre-opening expenses* 29 1 3
Retrenchment costs* - - 9
Reversal of Employee Share Trusts consolidation* 18 12 24
EBITDA 1 570 20 1 311 2 642
EBITDA margin (%) 30 28 28
HEADLINE EARNINGS AND ADJUSTED HEADLINE EARNINGS RECONCILIATION
Profit attributable to ordinary shareholders 380 27 300 632
Headline earnings adjustments 1 1 1
Net loss on disposal of property, plant and equipment 1 1 1
Minorities interests on the above items (1) (1) -
Headline earnings 380 27 300 633
Adjusted headline earnings adjustments 45 (57) (27)
Pre-opening expenses 29 1 3
Expropriation of land - Monticello - - 6
Benefit surplus recognition - (24) (24)
Retrenchment costs - - 9
Pre-opening Maslow lease rentals 18 - 24
Foreign exchange profits on intercompany loans (2) (34) (45)
Tax on the above items (14) 16 8
CGT - - (46)
Tax on termination of management contract - (22) (22)
Minorities interests on the above items 1 52 49
Reversal of Employee Share Trusts consolidation(i) 11 9 21
Adjusted headline earnings 423 42 298 616
Number of shares (000)
- in issue 96 002 94 341 95 903
- for EPS calculation 95 900 93 955 94 437
- for diluted EPS calculation 96 654 94 735 95 207
- for adjusted headline EPS calculation(i) 102 938 100 546 100 941
- for diluted adjusted headline EPS calculation(i) 103 691 101 326 101 711
Earnings per share (cents)
- basic earnings per share 396 24 319 669
- headline earnings per share 396 24 319 670
- adjusted headline earnings per share 411 39 296 610
- diluted basic earnings per share 393 24 317 664
- diluted headline earnings per share 393 24 317 665
- diluted adjusted headline earnings per share 408 39 294 606
Tax rate reconciliation (%)
Effective tax rate 35 41 33
Preference share dividends (3) (3) (4)
STC - (7) (5)
Prior year (under)/over-provisions (2) (1) 2
Foreign taxes 1 1 1
Release of CGT on share premium distributions - - 4
Capital allowances and disallowed expenditure (3) (3) (3)
SA corporate tax rate 28 28 28
EBITDA to interest (times) 6.3 5.8 5.3
Annualised borrowings to EBITDA (times) 2.35 2.74 2.53
Net asset value per share (Rand) 19.01 11.97 15.60
Capital expenditure 704 597 1 150
Capital commitments
- contracted 230 425 625
- authorised but not contracted 751 722 1 021
981 1 147 1 646
* Items identified above are included as other expenses and other income in the segmental analysis.
(i) The consolidation of the Employee Share Trust is reversed in the calculation of adjusted headline earnings as the group does not receive the economic benefits
of the trust.
ACCOUNTING POLICIES
The condensed consolidated financial information for the six months ended 31 December 2012 has been prepared in accordance with the recognition and
measurement criteria of International Financial Reporting Standards (IFRS), the presentation and disclosure requirements of IAS 34 - Interim Financial Reporting,
the Companies Act no. 71 of 2008 and AC 500 standards issued by the Accounting Practices Board. The accounting policies applied are consistent with those
adopted in the financial statements for the year ended 30 June 2012.
EARNINGS AND DIVIDEND
The results for the six months ended 31 December 2012 reflect satisfactory growth in revenue as well as margin improvements resulting in excellent growth in
EBITDA.
Revenue for the period was 10% ahead of the 6 months ended 31 December 2011 (last year) at R5.2 billion. EBITDA of R1.6 billion was 20% higher, with the
EBITDA margin increasing 2.6 percentage points (pp) to 30.1%.
Levies and VAT on casino revenue increased by 12% due to the higher revenue and increases in certain provincial gaming levy rates. Property and equipment
rentals include the pre-opening rentals for the Maslow hotel of R18 million.
The foreign exchange profit of R10 million was below last year (R69 million) mainly due to the Rand depreciating by 2% against the US Dollar in the current
period compared to a depreciation of 21% last year.
Net interest paid increased to R240 million (+9%) as a result of the debt funding raised for the GPI and RAH transactions that were concluded in December 2011,
and the completion of the Boardwalk and Wild Coast capital expenditure.
The tax charge of R288 million decreased by 6% due mainly to the abolition of STC from 1 April 2012. The effective tax rate, however, excluding non-deductible
preference share dividends, STC, CGT and prior year under provisions, remained unchanged at 30%.
Adjusted headline earnings of R423 million and diluted adjusted headline earnings per share of 408 cents were 42% and 39% above last year, respectively.
Excluding the impact of foreign currency movements and STC, adjusted headline earnings per share increased by 35%.
The board has declared an interim dividend of 110 cents (90 cents) per share.
SEGMENTAL ANALYSIS
REVENUE* EBITDA EBITDA MARGIN (%) OPERATING PROFIT
Year Year Year Year
Six months to ended Six months to ended Six months to ended Six months to ended
31 December 30 June 31 December 30 June 31 December 30 June 31 December 30 June
R million 2012 2011 2012 2012 2011 2012 2012 2011 2012 2012 2011 2012
GrandWest 928 882 1 779 387 367 746 41.7 41.6 41.9 333 310 607
Monticello 807 618 1 270 195 127 262 24.2 20.6 20.6 115 57 120
Sun City 653 636 1 230 89 79 116 13.6 12.4 9.4 30 22 (2)
Carnival City 554 502 1 017 173 141 298 31.2 28.1 29.3 132 99 219
Sibaya 524 482 980 178 165 343 34.0 34.2 35.0 144 132 277
Boardwalk 236 226 451 71 80 147 30.1 35.4 32.6 41 61 99
Wild Coast Sun 195 151 308 33 17 32 16.9 11.3 10.4 13 3 (4)
Carousel 166 158 312 36 31 60 21.7 19.6 19.2 24 19 37
Meropa 156 137 274 63 55 108 40.4 40.1 39.4 53 45 88
Windmill 134 119 238 50 40 84 37.3 33.6 35.3 42 32 68
Morula 124 128 248 18 22 35 14.5 17.2 14.1 10 14 18
Federal Palace 101 86 173 15 6 11 14.9 7.0 6.4 2 (7) (14)
Botswana 89 86 170 22 26 48 24.7 30.2 28.2 17 20 36
Zambia 87 85 167 18 20 36 20.7 23.5 21.6 11 12 28
Swaziland 84 83 149 5 (5) (13) 6.0 (6.0) (8.7) 1 (9) (20)
Flamingo 79 76 146 24 22 40 30.4 28.9 27.4 18 16 21
Table Bay 77 69 153 6 (1) 7 7.8 (1.4) 4.6 (3) (10) (14)
Golden Valley 66 64 128 15 15 33 22.7 23.4 25.8 6 6 16
Lesotho 60 53 106 9 7 12 15.0 13.2 11.3 2 - (1)
Kalahari Sands 55 54 108 8 6 12 14.5 11.1 11.1 (4) (6) (12)
Other operating segments 22 20 34 (8) (11) (19) (36.4) (55.0) (55.9) (10) (12) (22)
Management activities 323 292 590 164 122 260 50.8 41.8 44.1 145 115 233
Total operating segments 5 520 5 007 10 031 1 571 1 331 2 658 28.5 26.6 26.5 1 122 919 1 778
Central office and other eliminations (299) (241) (537) (1) (20) (16) - - - - (24) (25)
Other income(ii) - - - - - - - 24 24
Other expenses(ii) - - - - - - (66) (14) (67)
5 221 4 766 9 494 1 570 1 311 2 642 30.1 27.5 27.8 1 056 905 1 710
* December 2011 revenues have been adjusted to exclude internal promotional allowances which were previously included in revenue.
(ii) Refer to EBITDA reconciliation denoted*
GAMING DIVISION
Gaming revenue was 11% ahead of last year at R3.9 billion with slots and tables revenue 11% and 9% up respectively. Excluding Monticello, gaming revenue was 7% ahead of last year. A review of the
larger properties follows:
GrandWest revenue and EBITDA were 5% ahead of last year at R928 million and R387 million respectively. Despite the relatively low increase in revenue, good cost control resulted in the EBITDA margin
being maintained.
Monticello revenue increased 31% to R807 million driven by strong slots performance. EBITDA increased 54% to R195 million as a result of higher revenues and cost containment improving the EBITDA
margin by 3.6pp to 24.2%. In local currency, revenue and EBITDA increased by 15% and 36% respectively. Monticellos competitor for the Santiago market continues to establish itself, resulting in our
share of the Santiago market declining 2.2pp to 67.5%. New anti-smoking legislation is to be introduced in Chile and is anticipated to have a negative impact on gaming revenue in the short term.
Carnival Citys revenue of R554 million was 10% ahead of last year driven mainly by strong performance in tables. The strong revenue growth, efficiency improvements and good cost control resulted in
the EBITDA margin increasing 3.1pp to 31.2% and EBITDA increasing 23% to R173 million. The groups share (Carnival City and Morula) of the Gauteng gaming market declined marginally by 0.3pp to
19.6%, as a consequence of a large jackpot won at Carnival City during the period.
Sibaya revenue at R524 million was up 9% and EBITDA grew 8% to R178 million. The EBITDA margin of 34% was 0.2pp below last year mainly due to the increase in gaming levy rates in the current year
and additional promotional spend during the period under review. The gaming levies changed in November resulting in a R0.7 million increase in gaming levies and VAT (the effective rate changed from
23% to 24%). Sibayas share of the KwaZulu-Natal market (35.3%) was marginally lower than last year (35.5%).
Boardwalk revenue increased 4% to R236 million but EBITDA declined 11% to R71 million. The new hotel and conference centre opened during December and the refurbishment of the existing gaming
floor and the ancillary facilities were completed during the period, resulting in some disruption. The economic environment in Port Elizabeth remains tough and with the larger gaming floor and new
facilities, costs have increased placing further pressure on the EBITDA margin which declined 5.3pp to 30.1%. We are confident that the new facilities will position the property for future growth.
HOTELS AND RESORTS
In an environment that continues to be challenging, the Hotels and Resorts division achieved revenue of R1.3 billion, 6% up on last year, with an occupancy of
61.3%, 2.0pp below last year (due to the additional room nights available at Wild Coast Sun). The ADR increased by 6% to R1 258.
South African Hotels
In South Africa, the hotel and resort portfolio (Sun City, Wild Coast Sun and The Table Bay), grew revenues over last year by 8% to R925 million. Room nights
sold improved by 2.5% in number but, given the higher number of rooms available in the year, occupancy declined by 3pp to 62%. The ADR improved marginally
to R1 192.
Six months ended 31 December
2012 2011
Occupancy 62.2% (5pp) 67.3%
Sun City ADR R1 582 6% R1 489
Occupancy 76.1% (7pp) 83.1%
Wild Coast Sun ADR R638 26% R507
Occupancy 44.5% 3pp 41.7%
The Table Bay Hotel ADR R2 082 5% R1 988
Sun Citys revenue improved by 3% over the prior year to R653 million. International room nights sold improved by 10%, in line with the international arrivals
growth reported by SA Tourism. However, the local conference and meetings business has been disappointing with a decline of 27% in room nights sold to these
segments resulting in the overall decline in occupancies. The ADR was ahead of last year due to better room rate yields and an improved accommodation mix.
Through cost control and process improvements Sun City achieved an EBITDA growth of 13% to R89 million.
Wild Coast Sun improved its revenue 29% to R195 million and EBITDA 94% to R33 million. The Wild Coast Sun development was completed by June 2012
increasing the rooms to 396 from 258. Room nights sold increased 40% from 39 510 to 55 419.
Table Bay Hotel improved its performance in the context of another difficult six months as a result of the oversupply of inventory in the Cape Town market. ADR
increased as a result of additional international traveller room nights sold and the growth in the local corporate market. Revenue of R77 million was 12% ahead
of last year resulting in EBITDA of R6 million (2011:R1 million loss).
African Hotels
In the rest of Africa, the hotel and resort portfolio (Zambia, Nigeria, Botswana, Swaziland and Namibia) grew revenues over last year by 6% to R416 million. A
decline in occupancy of 1pp to 60% was offset by the ADR which improved by 9% to R987. Casino revenues at R169 million reflected growth of 8% over last
year.
Six months ended 31 December
2012 2011
Royal Livingstone Occupancy 40.1% (6pp) 46.1%
and Zambezi Sun ADR R1 823 15% R1 590
Occupancy 78.3% (1pp) 79.0%
Gaborone Sun ADR R744 9% R685
Occupancy 60.9% (4pp) 65.2%
The Federal Palace ADR R2 035 5% R1 931
The Royal Livingstone and Zambezi Sun have been adversely affected by the introduction of a yellow fever vaccination requirement by South Africa for all
travellers to and from this destination. This barrier (along with the associated cost) as well as the generally high cost of this destination (visas, park fees and taxes)
is impacting on the competitiveness of Zambia. The increased ADR is a result of exchange rate movements. Excluding the impact of exchange rates, the ADR
would be 4% higher than last year.
Gaborone Sun and the other Botswana operations achieved revenue of R89 million (+4%). EBITDA was 15% lower than last year at R22 million with margins
negatively impacted by legal fees incurred relating to the successful appeal of the awarding of a fourth casino licence, as well as increased utility and marketing
costs.
In Nigeria, The Federal Palace generated revenue of R101 million, 17% above last year. The increased revenue was generated by the casino which achieved
encouraging revenue growth of 45%. Occupancies declined as a result of the closure of the mainland bridge for three months restricting access to Victoria Island.
EBITDA at R15 million was 150% ahead of last year, with the EBITDA margin of 14.9%, 7.9pp higher than last year.
MANAGEMENT ACTIVITIES
Management fees and related income of R323 million was 11% ahead of last year. EBITDA of R164 million was up 34% due to lower costs incurred on new
project development and certain one-off employee related costs incurred last year.
FINANCIAL POSITION
The groups borrowings at 31 December 2012 increased marginally from 30 June 2012, by R0.1 billion to R6.8 billion. Strong cash flows generated by operations
have offset the debt required for the Boardwalk and Maslow expansions.
Third party borrowings
31 December 30 June
31 December 2012
2011 2012
INTERGROUP THIRD PARTY THIRD PARTY THIRD PARTY
R million BORROWINGS BORROWINGS BORROWINGS BORROWINGS BORROWINGS
SunWest International (Pty) Ltd 726 - 726 787 723
Emfuleni Resorts (Pty) Ltd 704 - 704 319 461
SFI Resorts SA (Monticello) 651 (90) 561 639 627
Afrisun Gauteng (Pty) Ltd 492 - 492 485 461
Afrisun KZN (Pty) Ltd 344 - 344 354 304
Transkei Sun International Limited 341 (12) 329 338 343
The Tourist Company of Nigeria Plc (TCN) 413 (144) 269 247 257
Mangaung Sun (Pty) Ltd 143 - 143 102 124
Worcester Casino (Pty) Ltd 136 - 136 148 142
Meropa Leisure and Entertainment (Pty) Ltd 115 - 115 118 110
Teemane (Pty) Ltd 70 - 70 73 71
Swazispa Holdings Limited 19 - 19 2 24
Lesotho Sun (Pty) Ltd 21 (17) 4 6 6
Sun International Botswana (Pty) Ltd 2 - 2 3 3
Sands Hotels (Pty) Ltd 21 (19) 2 2 2
Central office 2 392 282 2 674 3 259 2 791
6 590 - 6 590 6 882 6 449
Employee Share Trusts 234 - 234 219 230
6 824 - 6 824 7 101 6 679
Capital expenditure incurred during the six months
R million
Expansionary:
Boardwalk 253
Maslow 187
Monticello* 26
466
Refurbishment:
Zambia 14
Sun City 12
Carousel 4
Wild Coast 2
Lesotho 1
33
Other ongoing asset replacement 205
Total capital expenditure 704
* The Monticello expansionary capex relates to the purchase of land adjacent to the property for future expansion.
DEVELOPMENTS
The Maslow Hotel
The 281 room 4 star Maslow hotel refurbishment in Sandton was completed on schedule in mid December at a cost of R254 million. The Maslow opened to the
public on 7 January 2013 and has been well received. Trading to date has been encouraging and the group is optimistic that the hotel will become the preferred
choice in Sandton for business and leisure travellers.
Boardwalk
The 140 room 5 star hotel, conference centre, parkade, retail complex and musical water extravaganza were all completed during the period under review. The
hotel opened on schedule on 14 December 2012 and has positioned the property as the most desired destination in the Eastern Cape offering premier
conferencing facilities.
The total project expenditure remains within R1 billion. To date R850 million has been spent on the project with the balance to be spent by 30 June 2013.
GRANDWEST EXCLUSIVITY
In January 2013 the Western Cape Provincial Treasury released to industry participants a redacted version of the 2010 report of the Bureau of Economic research
(BER) of Stellenbosch University. This was accompanied by the re-issuing of the invitation to GrandWest (and other interested parties) to provide updated
information and comment on the BER report. We continue to pro-actively engage with the authorities in this regard.
PANAMA
As announced on SENS on 29 November 2012 the group will acquire on a freehold basis, the casino component, the penthouse level (to be used as a Salon
Privé), and certain apartments in the Trump Ocean Club International Hotel and Tower in Panama City, Panama.
The group is planning to fit out and equip the casino with approximately 600 slots and 32 tables allocated between the casino component located on the ground
floor and the Privé situated on the top floor overlooking the canal and the city. Both facilities will have entertainment and food and beverage offerings.
The acquisition is subject to the countrys regulator approving an application by the group for a casino licence. The licensing process is expected to take six
months and will entail the completion of standard probity investigations. Should the licence application be approved, the group will acquire the various
components for a consideration of US$45.5 million where after it will fit out the casino and related facilities at an estimated cost of US$60 million over an
approximate nine month period.
This opportunity is in line with the groups strategic intent to focus on the Latam region and build on our track record in Chile. It will create greater brand
awareness and should significantly enhance our ability to access other opportunities in the region.
Sun International has issued a $10 million bank guarantee to the seller which will be released once the objective criteria required to obtain a gaming licence in
Panama has been met, which is expected to be before the end of the financial year.
DIRECTORATE
As previously announced on SENS, Peter Bacon has joined the board as a non-executive director and with effect from 1 February 2013, the appointment of
Graeme Stephens as Chief Executive became effective. He replaces Garth Collins who has been Acting Chief Executive since November 2011. The Chairman and
Board of Directors extends its appreciation to Mr Collins for his service to the Sun International group during his 46 year long career and for his contribution to
the board during his appointment as Acting Chief Executive. Mr Collins will remain with Sun International until 30 June 2013 to assist with the handover of his
responsibilities.
Further to the above changes and as communicated on SENS on 18 February 2013, Rob Becker will, by way of mutual agreement with the Company, step down
as Chief Financial Officer and executive director of Sun International with effect from 28 February 2013. The Chairman and Board of Directors extend their
appreciation to Mr Becker for his dedicated and outstanding contribution to the Sun International group during his tenure and wish him well in his future career.
In accordance with the Companys executive succession plan, Mr Anthony Leeming, BComm, BAcc, CA (SA) will be succeeding Mr Becker and will be appointed
as the Chief Financial Officer and an executive director of Sun International with effect from 1 March 2013. Mr Leeming has over 13 years experience in the
hotels, resorts and gaming industries having joined Sun International in 1999 as the Group Financial Manager. He was appointed as a Director of Sun
International Management Limited on 1 July 2009, with responsibility for the groups corporate finance and debt funding and has been integrally involved in all
aspects of the groups financial affairs.
OUTLOOK
Further gradual improvement in the trading environment is anticipated in the second half of the year.
Higher capital charges and rentals from the Maslow and Boardwalk expansions, together with the deferred tax credits raised in the prior year will likely result in
the growth in adjusted headline earnings per share being lower than that experienced in the first half of the year.
The outlook has not been reviewed or reported on by the companys auditors.
For and on behalf of the board
MV Moosa (Chairman)
GE Stephens (Chief Executive)
Registered office:
27 Fredman Drive, Sandown, Sandton 2196
Sponsor:
Investec Bank Limited
Transfer secretaries:
Computershare Investor Services (Pty) Ltd, 70 Marshall Street, Johannesburg 2001.
The profit announcement was prepared under the supervision of the CFO, RP Becker CA(SA) MBA.
Directors:
MV Moosa (Chairman), IN Matthews (Lead Independent Director), G Stephens (Chief Executive)*, PD Bacon, ZBM Bassa, RP Becker (Chief Financial Officer)*,
PL Campher, Dr NN Gwagwa, BLM Makgabo-Fiskerstrand, KH Mazwai*, B Modise, LM Mojela, GR Rosenthal *Executive
Group Secretary:
CA Reddiar
22 February 2013
DECLARATION OF INTERIM DIVIDEND
Notice is hereby given that a gross interim dividend of 110 cents per share for the half year ended 31 December 2012 has been declared, payable to shareholders
recorded in the register of the company at the close of business on the record date appearing below. This dividend has been declared out of income reserves.
The number of ordinary shares in issue at the date of this declaration is 113 487 165. The company has limited STC to be utilised to the value of 24.04809 cents
per share resulting in a net dividend of 97.10721 cents per share for those shareholders who are not exempt from dividend tax.
The salient dates applicable to the interim dividend are as follows:
2013
Last day to trade cum interim dividend Thursday, 14 March
First day to trade ex interim dividend Friday, 15 March
Record date Friday, 22 March
Payment date Monday, 25 March
No share certificates may be dematerialised or rematerialised between Friday, 15 March and Friday, 22 March both days inclusive. Dividend cheques will be posted
and electronic payments made, where applicable, to certificated shareholders on the payment date. Dematerialised shareholders will have their accounts with
their Central Securities Depository Participant or broker credited on the payment date.
Sun International Limiteds tax reference number is: 9875/186/71/1.
By order of the board
CA Reddiar (Group Secretary)
22 February 2013
www.suninternational.com
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