Fortunes rise for Adelaide Casino owner SkyCity JULY'S gambling reforms have paved the way for SkyCity to kick off its $350 million Riverbank expansion on the back of an improved financial result at the Adelaide Casino in the 12 months to June. The Auckland-based group reported flat full-year revenue of $160.4 million from its Adelaide operations but cost-cutting measures helped deliver a 3 per cent improvement in EBITDA to $37.9 million. While international business revenue rose by 52.5 per cent to $9.3 million, gaming machine revenue fell almost 8 per cent to $59.9 million. Chief executive Nigel Morrison blamed the fall on the implementation of the Bally gaming system, reduced visitation resulting from the closure of the Adelaide railway station and subdued economic conditions in the state. "Adelaide pleasingly continued to grow its EBITDA margin and although it's a challenging economy, particularly in the state of South Australia right now, with our focus on costs and some good growth of the international business into Adelaide, over the last six months our EBITDA margin firmed to 23.6 per cent," he said. It wasn't that long ago when the margin was only the high teens. Last month, the South Australian Parliament passed an amendment to the Casino Act, ensuring a new licensing agreement and tax regime for SkyCity. The agreement delivers the casino operator a 20-year extension to its exclusivity period to 2035, lower tax rates for VIP gaming revenue, approval for 505 additional gaming machines and allows for the introduction of cashless gaming. Mr Morrison said new premium gaming areas within the existing casino would be completed by the middle of next year before a new 6-star hotel and major expansion is completed during the 2017 financial year. "In Adelaide, with the passing of the enabling legislation in July, we expect to conclude agreements with the SA Government over the next couple of months and commence interim capex works to activate VIP product and tax rate concessions in the second half of financial year 2014," he said. Despite a slight increase in full-year revenue to NZ$947.8 million, SkyCity's total net profit fell 8.1 per cent in 2013 to NZ$127.3 million. The company said the $80 million sale of its 50 per cent interest in the Christchurch Casino in December and the Rugby World Cup, which provided a NZ$4.7 million benefit in 2012, were two of the main reasons behind the fall. The appreciation of the New Zealand dollar during the second half of the year offset much of the improved performance of the company's Australian operations. Australian shareholders on the company's share register on September 20 will be paid an unfranked dividend of NZ10c on October 4. SkyCity shares fell 4.4 per cent at $3.44 yesterday.