South African entertainment company Sun International announced Monday it will pay its first dividend in six years after the group’s gaming income rose 30% in the first six months of the year.
As reported by Bloomberg, the decision to declare an interim dividend of 88 cents ($0.05) per share came after the owner of casinos and hotels, including the Sun City resort northwest of Pretoria, reported a first-half profit after two years of losses, and reduced its overall debt by ZAR 500 million ($29 million) to ZAR 6.6 billion ($390 million).
The hotel and casino operator was forced to temporarily close its properties in March 2020 amid lockdown measures due to COVID-19, resulting in a loss for that financial year.
Even though the group has benefitted from the resumption of travel and tourism activities, including hospitality, gambling turned out to be the triumph card. It was gaming income from casinos, Sun Slots and online platform SunBet -which make up 82% of group income- that strengthened its financial position.
“Casino income has proven resilient and is swiftly recovering from the effects of the pandemic. Income generated from Sun Slots recovered to exceed pre-pandemic levels and SunBet generated record income during the period under review,” the group stated.
Sun International shares were 1% lower in Johannesburg, as the broader South African benchmark index fell 1.7% as of 9:30 am, Monday.
“Our operations improved significantly during the first six months of 2022, due to the last pandemic-related restrictions having been lifted and we anticipate that this trend will continue for the remainder of the year,” the company noted. “With our ongoing focus on costs and efficiencies, we anticipate a significant improvement in the second half of the year compared to the prior comparative period and consequently strong growth in adjusted EBITDA and earnings per share.”
