SKYCITY Shareholder Newsletter ISSUE 05 JULY 2006 up with the PLAY SKYCITY: NEW ZEALAND S NUMBER ONE CINEMA EXHIBITION BUSINESS In late May, SKYCITY Entertainment Group announced it would cement its place as New Zealand s number one cinema exhibition business with a $49.5 million purchase from Village Roadshow of its New Zealand and Fijian cinema interests, including the remaining 50% in the Village SKYCITY joint venture. This decision broadens SKYCITY s entertainment footprint, strengthens SKYCITY s competitive position in the cinema a solid revenue stream to the Group. With Village wanting to exit its cinema position in New Zealand, SKYCITY has been able to take advantage of an opportunity to secure a quality asset at a good price and to which SKYCITY is best positioned to add value as 100% owner. Given the prevailing direction of recent trans-tasman corporate activity, it is also pleasing to be growing by purchasing Australian-owned New Zealand assets. Key features of the acquisition are: 50% of Village SKYCITY Cinemas (69 cinema screens in New Zealand) to move to full ownership 25% of Rialto Cinemas (22 cinema screens in New Zealand) to move to 50% ownership 33.3% of Damodar Cinemas (10 cinema screens in Fiji) to move to 66.7% ownership Purchase consideration of $49.5 million, over a 12-month period Acquisition cost to be met from the proceeds of the sale of the SKYCITY Metro Centre in downtown Auckland. Village SKYCITY s regional cinemas are performing well; experience in Auckland and new cinema complexes at Chartwell in Hamilton and Queensgate in Lower Hutt will open later this year. SKYCITY looks forward to continuing to bring exciting and For more information on this acquisition, visit: www.skycitygroup.co.nz to view the media or stock exchange release. THE PURCHASE WILL SEE ALL VILLAGE SKYCITY SCREENS ACROSS NEW ZEALAND RENAMED SKYCITY CINEMAS.
A MESSAGE FROM EVAN DAVIES This year we celebrate 10 years of SKYCITY: 10 years of fun and entertainment, 10 years of strong operational performance, 10 years of community contribution, and 10 years as a leading employer. creation, underpinned by a sense of community responsibility. We have come a long way in 10 years. Since 1996, millions of people have had exciting and memorable SKYCITY experiences in both Australia and New Zealand. Across the decade we have been a solid investment, paying $670 million in dividends, and an important part of the gaming industry which annually contributes nearly $1 billion to the New Zealand Gross Domestic Product and A$6.5 billion to the Australian Gross Domestic Product. Shareholders who have been with SKYCITY since 1998 have seen a 33.8% annual equivalent gross return on their investment This has been a decade of SKYCITY establishing itself as a mature, reliable and responsible participant in all the communities where we operate, on both sides of the Tasman. We are very proud of that achievement and the talented and enthusiastic people who have been a part of it. While we re celebrating 10 years of SKYCITY Entertainment Group, SKYCITY Adelaide has been celebrating 20 years of fun community has joined us in recognising and celebrating. SKYCITY Darwin is also celebrating after two years of SKYCITY ownership. That business has gone from strength to strength, quickly becoming an important element of our position as a In the years ahead, SKYCITY will continue its focus on maximising value for shareholders. Entertainment is one of the fastest-growing and most dynamic business sectors today. Longer term, regardless of the complexities of regulation, the industry winners will be those with excellent management models and a commitment to providing exceptional differentiated experiences to a hungry trans-tasman market that is always seeking something new. After 10 years, SKYCITY is well established and here to stay. We re anticipating the next SKYCITY decade, and beyond, with optimism. Evan Davies MANAGING DIRECTOR SKYCITY ENTERTAINMENT GROUP In this issue of Up with the Play we re inviting shareholders to join in our celebrations. The Experience SKYCITY competition gives shareholders the chance to win a round trip for two to visit SKYCITY in Adelaide, Auckland, Darwin, Hamilton and Queenstown. This is your Complete the competition entry form over the page to be in with a chance to win.
THE RISE OF POKER (PLUS SOME TIPS FROM THE EXPERT) Poker is popular, and not just with SKYCITY s customers. In the last issue of Up with the Play there was a short story on poker and shareholders told us that this is the kind of information you re interested in reading more about. So in this issue, poker expert Lee Nelson provides some insight into his success and comments on why poker is one of the fastest-growing games worldwide. According to Lee, reading people s faces is what poker is all about. Lee should know he is Australasia s leading poker player after winning $1.4 million in a Melbourne tournament earlier this year. It s about picking up small bits of information during a tournament and using them, says Lee, who carefully observes others and spends time preparing to ensure he can handle the pressure of the tournaments, which sometimes last for up to 14 hours. Lee prepares physically and mentally by walking 5km and meditating for 90 minutes a day, as well as practising his poker face in the mirror. It s crucial that I practise my look enough so that I feel I can use it comfortably in a stressful tournament environment. off by helping his mum improve her hand while she took a break from her game to cook dinner. The funds from Lee s poker-playing success put him through medical school. Now a retired doctor, Lee moved from California to New Zealand in 1994 and plans to stay. Originally, Lee came to visit New Zealand on holiday. The pristine environment, the gorgeous, diverse land and seascapes, and the friendly, co-operative people convinced me to stay. Lee spent time at SKYCITY Auckland recently to promote the game and his book, Kill Phil, about the fast track to success in poker tournaments, which is now available in New Zealand. Poker has taken off worldwide with an estimated 50 million regular players in the United States alone. Recently, it has caught on in New Zealand as a mainstream entertainment option, and poker tournaments are proving to be popular with entertainment seekers. Look out for Lee at future SKYCITY tournaments. For SKYCITY, poker is proving hugely popular with all sites holding sell-out tournaments in the past few months. Scottish-born Aucklander James Anderson and Adelaide SKYCITY Auckland and SKYCITY Adelaide, to scoop top cash prizes and the ultimate reward of entry into the World Series of Poker Championship to be held in Las Vegas this month. Poker tournaments are attracting global interest, with an enquiry for the SKYCITY Auckland tournament coming from as far away as Dubai. Due to customer demand, a tournament to launch another popular version of poker, Omaha, was held at SKYCITY Auckland last month. Information on how to play poker is available from the SKYCITY Auckland website: www.skycityauckland.co.nz
SKYCITY CELEBRATES Whether you re celebrating 23 years in Darwin, 20 years in Adelaide, 10 years in Auckland, five years in Queenstown or three years in Hamilton, now is a great time to be sharing in SKYCITY s success. A decade on from its beginnings as a construction site in central Auckland, SKYCITY has become a New Zealand top 10 and Australian top 100 company, with over 20,000 New Zealand retail shareholders, 5000 staff in Australia and New Zealand and a long series of awards for its leadership as a tourism attraction, community supporter, wealth creator and provider of exciting and memorable experiences. as a thank-you to the people of the city where the SKYCITY story began SKYCITY is celebrating its decade of existence throughout 2006. Shareholders are invited to join in the celebrations with the Experience SKYCITY competition in this issue of Up with the Play. Enter now for the chance to win a round trip for two to all SKYCITY ADELAIDE LEADING THE WAY When the Adelaide Casino opened its doors in 1985, crowds stretched around the corner of the building and it was undoubtedly the place to be seen. Not much has changed as the business celebrates 20 years of fun and entertainment this year. SKYCITY purchased the business in 2000 with the aim of developing it to include a broad range of entertainment attractions. It is now South Australia s leading gaming and entertainment destination, attracting over two million visitors each year. The business was recently rewarded for its commitment to tourism with a Tourism Award of Distinction for Best New Tourism Development at the South Australian Tourism Awards. In April this year, SKYCITY Adelaide held special events and exhibitions to thank the community for its support over the past 20 years. The celebrations are just one way of publicly acknowledging Adelaide s part in the growth and development of the business over the past 20 years, says Michael Silberling, General Manager of SKYCITY s Australian Operations. SKYCITY Adelaide is now a South Australian institution and one of which we can all be proud. SKYCITY ADELAIDE CELEBRATES 20 YEARS WITH PERFORMERS FROM THE DECADES. SKY TOWER FIREWORKS LIGHT UP THE AUCKLAND NIGHT SKY. SOME OF SKYCITY S RECENT ACHIEVEMENTS Consumers voted SKYCITY Auckland Hotel as one of New Zealand s top three hotels and SKYCITY Darwin as one of the Northern Territory s top three hotels in the recent HotelClub Australia and New Zealand Awards SKYCITY Auckland Convention Centre was named overall winner of The Corporate Events Guide 2006 Auckland Convention Centres Award SKYCITY Darwin received two awards at the Australian Hotels Association (AHA) Awards, one for Best Superior Accommodation and the other for Best In-House Restaurant for Evoo Restaurant
EXCITING NEW ONLINE SERVICE FOR SHAREHOLDERS SKYCITY is pleased to launch a new online service for shareholders, as part of a continued focus on improving shareholder communications. The new service on SKYCITY s corporate website allows you to choose how you would like to receive information about SKYCITY. IMPORTANT DATES You can access the new service by visiting the Investor Centre on www.skycitygroup.co.nz then clicking on Shareholder Information. From here you will need to enter your holder account number and FIN for the following options: report, interim report and shareholder newsletter by email or post. If you have previously submitted your email address to SKYCITY or Computershare, you will receive a copy of this newsletter by email, with a link through to the new service on SKYCITY s website. If you wish to receive future communications by email, regardless of whether you have previously submitted your email address, you will need to either: Complete the attached form (and enter the Experience SKYCITY competition at the same time); or Log in to the online service in the Investor Centre at www.skycitygroup.co.nz to win a round trip for two to visit all of SKYCITY s Queenstown! Just enter your details, your preference for receiving communications and your preferred email address (if relevant), then submit your entry form before 10 August. Good luck. Note: The online service is currently only available for New Zealand shareholders. OPENING OF SKYCITY CINEMAS QUEENSGATE, LOWER HUTT SKYCITY CINEMAS Wednesday 9 August 2006 ANNUAL RESULT ANNOUNCEMENT SKYCITY ENTERTAINMENT GROUP Monday 21 August 2006 ANNUAL REPORT MAILED TO SHAREHOLDERS SKYCITY ENTERTAINMENT GROUP Tuesday 26 September 2006 2006 ANNUAL MEETING SKYCITY ENTERTAINMENT GROUP Friday 27 October 2006 EVAN DAVIES MEETS WITH A SHAREHOLDER AT THE 2005 ANNUAL MEETING.
Update 150 DAYS OF SUNSET AND STARS AT SKYCITY DARWIN glass of award-winning Australian wine in your hand, and the most spectacular sunset you ve ever seen. opportunity to take part in an evening of entertainment on The Lawns, SKYCITY s unique outdoor venue set amidst 18 acres of tropical beachside gardens. SKYCITY Darwin has an outstanding line-up of entertainment for this year s Dry Season, which runs from May to September. Jazz groups including John Morrison s All Stars will be popular, as will be the Winemaker s Dinner series, where wines are introduced by a prestigious Australian winemaker who then joins guests to experience the wines with expertly matched cuisine prepared by SKYCITY s chefs. REACHING OUT TO YOUTH Radio is a powerful medium. It s challenging and exciting and with the help of SKYCITY Hamilton Community Trust, Community Radio Hamilton is giving more young people the chance to have their voices heard. One group already hitting the airwaves are the Canteeners. Featuring interviews with teenagers living with cancer, the show provides information about the realities of the disease. The funding from SKYCITY Hamilton Community Trust is a big help towards our search for new exciting youth shows, says Phil Grey, Community Radio Hamilton s General Manager. It has enabled us to make contact with schools and students, and to create advertising and information packs. As a result, we re looking forward to hearing lots of new young voices on the radio talking about what really matters to them. NEW GENERAL MANAGERS IN HAMILTON AND QUEENSTOWN SKYCITY has appointed new general managers at SKYCITY Hamilton and SKYCITY Queenstown Casino. SKYCITY Hamilton s new general manager, Geoff Hogg, is one of SKYCITY s original employees, having worked for the company since experience and knowledge about the gaming industry and SKYCITY s operations. GEOFF HOGG MARY WHELAN SKYCITY Queenstown Casino s new general manager, Mary Whelan, commenced her career in the gaming industry in her homeland of offerings to provide a broad range of gaming and entertainment options to both the domestic market and tourism trade in Queenstown.
EXPERIENCE SKYCITY! Win a once-in-a-lifetime round trip for two to visit SKYCITY s properties in Adelaide, Auckland, Darwin, Hamilton and Queenstown! accommodation for 10 nights, NZ$3000 spending money, departure taxes and airport transfers. The winner and a friend will visit: SKYCITY Adelaide South Australia s leading gaming restaurants, regular live bands and concerts, and numerous exciting gaming options. SKYCITY Auckland offering a wide variety of entertainment and leisure options including 17 bars and restaurants, four casinos, a state-ofthe-art live theatre, the largest purpose-built convention facility in New Zealand, two hotels and the award-winning Sky Tower. SKYCITY Darwin located beachside amidst an 18-acre tropical garden with 5-star accommodation, world-class gaming facilities, premier dining and luxury amenities, as well as superior entertainment and leisure facilities. SKYCITY Hamilton an unparalleled entertainment destination within the Waikato region offering restaurants, bars, and even a tenpin bowling alley. SKYCITY Queenstown Casino a boutique gaming, entertainment and dining venue located in the heart of Queenstown. HOW TO ENTER To enter, complete the form below choosing your preferences for receiving information from SKYCITY, then detach along the perforated line. Fold where indicated then staple or seal with tape. If posting from within New Zealand, post at any New Zealand postbox (no stamp required) If posting from outside New Zealand, place the form in the country of mailing Mail to: SKYCITY Entertainment Group Experience SKYCITY Competition PO Box 6443 Wellesley Street Auckland FLYING ON QANTAS AIRWAYS Submit your entry before 10 August to be in to win. Please tick your preference for receiving information from SKYCITY: Annual report Post Email COMPETITION ENTRY FORM SKYCITY has developed a new online service to enable you to choose how you would like to receive information about SKYCITY. This is your chance to choose to receive SKYCITY s annual and interim reports, and the shareholder newsletter, by email. There are two ways you can do this, either by visiting the Investor Centre at www.skycitygroup.co.nz or by submitting your preferences as part of this competition entry form. NAME: HOLDER ACCOUNT NUMBER: POSTAL ADDRESS: Interim report Post Email Shareholder newsletter Up with the Play Post Email Regular email updates Email Please clearly write your email address here: If your email address is not clear, SKYCITY may contact you to verify the correct address. Do you have any feedback on SKYCITY shareholder communications? CONTACT PHONE NUMBER: SKYCITY s Privacy Policy is available on www.skycitygroup.co.nz at the bottom of the screen. Please be assured that any information provided above will be used by SKYCITY for the purposes described above.
TERMS AND CONDITIONS All entries must be from a SKYCITY shareholder (on record at 30 June 2006) who is 20 years or over. To enter the competition, applicants must complete only one competition form, in its entirety; including accepting these terms and conditions, and submitting the application form as instructed. In order to qualify for the prize, your entry must be received by the closing date stated in the competition details (10 August 2006). The winner will be randomly selected from the group of entries after 10 August 2006. reserves the right to select an alternative winner. The prize is not transferable and cannot be substituted for a cash alternative. No compensation will be payable if the winner is unable to use the prize as stated. Bookings must be made at least two months prior to departure. Winner s preferred travel dates will be subject to availability and SKYCITY reserves the right to decide what travel route the winner and their guest must take. the responsibility of the winner. SKYCITY will provide the winner with NZ$3000 as a bank deposit or cheque. The winner and their guest must both have a valid passport for international travel. SKYCITY reserves the right to disqualify any applicant if it has reasonable grounds to believe the applicant has breached any of these terms and conditions. should be selected. In this event, any further applicant will be selected on the same criteria as the original applicant and will be subjected to these terms and conditions. The winner may be requested to make themselves available for promotion or publicity of SKYCITY and shall make themselves reasonably available for such purposes. Hotel accommodation will be one twin share or double room and is subject to availability. Travel insurance is the choice and responsibility of the winner. SKYCITY accepts no responsibility for loss, damage or injury that may befall the winner or their guest during this holiday. The winner and their guest must have no exclusions or trespass notices from SKYCITY. FOLD HERE FreePost Authority Number 2888 SKYCITY Entertainment Group Experience SKYCITY Competition PO Box 6443 Wellesley Street Auckland