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SUN INTERNATIONAL ANNUAL REPORT ’10 Operational overview – Hotels and resorts Occupancies at the group’s hotels and resorts declined significantly to 67%, six percentage points below last year, mainly as a result of the extreme pressure on local disposable income and the on-going international recessionary environment. The EBITDA margin, excluding the Federal Palace, declined 4.9 percentage points to 16.8% due to lower occupancies and increased property costs. Sun City’s room occupancy was 5 percentage points lower than last year at 69% while the average room rate was 7% higher than the previous year at R1 334. EBITDA declined by 16% to R173 million. The lower EBITDA was primarily the result of the lower occupancy achieved and increased property and energy costs. The Table Bay achieved an occupancy of 53% compared to 67% in the prior year and the average room rate increased by 5% in the current year to R2 033 resulting in an EBITDA decline of 46% from last year to R35 million. 24 Revenue Rm EBITDA Rm EBITDA margin % 2010 2009 2010 2009 2010 2009 Sun City 1 160 1 146 173 207 14.9 18.1 Wild Coast Sun 287 302 48 56 16.7 18.5 Table Bay 167 199 35 65 21.0 32.7 Swaziland 166 177 7 23 4.2 13.0 Botswana 156 181 48 68 30.8 37.6 Zambia 149 217 26 55 17.4 25.3 Kalahari Sands 123 128 34 36 27.6 28.1 Hotels and resorts – southern Africa 2 208 2 350 371 510 16.8 21.7 Federal Palace – Nigeria 11 – 4 – 36.4 – 2 219 2 350 375 510 16.9 21.7 The Botswana operations achieved revenue of R156 million and EBITDA of R48 million, which was 14% and 29% below last year respectively. The decline was exacerbated by the 10% strengthening of the Rand against the Botswana Pula. The Royal Livingstone and Zambezi Sun achieved an aggregate occupancy of 49% compared to 60% last year at an average room rate of US$189, a 12% decline against last year. In US dollars, EBITDA was 45% below last year. Our share of the associate loss for the Federal Palace of R3 million was incurred for the nine months from September to May 2010. The casino opened in December 2009 and steady progress has been made in attracting gaming customers to the property. Demand for accommodation in Lagos was subdued for the year with consequent pressure on occupancy and rates resulting in an aggregate occupancy of 36% at an average room rate of US$320.
GrandWest JOINT REPORT OF THE CHIEF EXECUTIVE AND CHIEF FINANCIAL OFFICER continued 1. SHAREHOLDER DELIVERY WORLD CUP The group took full advantage of the opportunities the tournament presented to attract MVGs, tourists and soccer fans to our properties to watch the matches and enjoy the gaming, food and beverages on offer. The MVGs were particularly supportive and turned out in large numbers to watch the key games. We established viewing facilities at all casinos and our big arenas – Grand Arena at GrandWest, the Big Top at Carnival City and the Sun City Superbowl – were converted into dedicated viewing areas. There was, however, no significant positive impact on gaming revenue. While occupancies during the June/July World Cup period were satisfactory at Sun City, they were not as buoyant as originally expected. The late cancellation of a large number of bookings by FIFA’s associate, MATCH, impacted considerably on our other properties, particularly those outside South Africa. Our employees played a key role in the run-up to and during the tournament. Each employee was given a specially designed Sun International shirt to be worn as part of the uniform on match days and all properties arranged soccer promotions, with employees watching the games in the canteens. Revenue for the period 11 June to 10 July 2010 was up 7% on the previous year, mainly due to an 84% increase in rooms revenue based on an increase in the average room rate and slightly reduced rooms sold. Gaming revenue for this period was 2% down. For the majority of our casinos, the focus was on the local market and existing customers. All properties were ‘dressed’ in the themes of ‘Where the World Comes to Win’ or ‘Where the World Comes to Play’. GrandWest was one of the main sponsors of Cape Town’s official FIFA Fanfest and brought in guests on shuttle buses from the city to the property. Because of the Boardwalk’s product mix and location it was the main centre and entertainment destination for visiting supporters in Port Elizabeth. Longer term the very successful tournament and the positive publicity that was generated should have the effect of improving inbound tourism to South Africa. 25
Page 1 and 2: ANNUAL REPORT 2010
Page 3 and 4: ABOUT THE INTEGRATED REPORT This re
Page 5 and 6: Carnival City AFRISUN GAUTENG 85% 8
Page 7 and 8: Monticello
Page 9 and 10: KEY STRATEGIC IMPERATIVES 3. OUR CU
Page 11 and 12: Energy management Communities Publi
Page 13 and 14: Non-Executive Directors MP (MIKE) E
Page 15 and 16: KH (Kele) Mazwai (41) / GROUP HUMAN
Page 17 and 18: INTRODUCTION This past year has onc
Page 19 and 20: Morula APPRECIATION On behalf of th
Page 21 and 22: AT A GLANCE FINANCIAL HIGHLIGHTS Wi
Page 23 and 24: TRADING AND GROUP OPERATING PERFORM
Page 25: Operational overview - Casinos and
Page 29 and 30: Gaming taxes by province and countr
Page 31 and 32: DIVIDENDS 1. SHAREHOLDER DELIVERY T
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Page 35 and 36: The Royal Livingstone 33
Page 37 and 38: AT A GLANCE 2. PROTECT OUR BUSINESS
Page 39 and 40: By the end of February, the number
Page 41 and 42: WILD COAST SUN The local community
Page 43 and 44: Our market share South Africa Gamin
Page 45 and 46: We estimate that the group’s shar
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Page 49 and 50: OUR OBJECTIVES IN THIS SECTION: JOI
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Page 55 and 56: AT A GLANCE WHAT WE ACHIEVED Final
Page 57 and 58: CAPITAL COMMITMENTS Capital commitm
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Page 61 and 62: CONCESSIONAIRES Our concessionaires
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Page 65 and 66: In line with global trends for lead
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Page 69 and 70: Beneficiaries of training 2010 Bene
Page 71 and 72: Training investment model JOINT REP
Page 73 and 74: JOB PROFILING Also forming part of
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OUR OBJECTIVES JOINT REPORT OF THE
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The table below sets out the direct
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MANAGEMENT JOINT REPORT OF THE CHIE
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JOINT REPORT OF THE CHIEF EXECUTIVE
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GOLDEN VALLEY CASINO & LODGE’S EN
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INCIDENTS JOINT REPORT OF THE CHIEF
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Efforts to establish the Nedbank Go
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Our property ratings Rm 2010 2009 2
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JOINT REPORT OF THE CHIEF EXECUTIVE
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AT A GLANCE JOINT REPORT OF THE CHI
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SHAWCO - This student-run NGO at th
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REGULATORY COMPLIANCE The South Afr
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OUR COMMITMENT CORPORATE GOVERNANCE
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Principle Action Outcome Independen
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The group’s governance is facilit
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The chief executive is mandated and
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Board meetings A minimum of four bo
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The audit committee is primarily re
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The committee has adopted a written
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The key risks that are identified,
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Internal control The board of direc
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The group has continued to actively
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Group 2010 2009 2008 2007 2006 2005
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Group statistics 2010 2009 2008 200
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Types of shareholders at 30 June 20
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principles of inclusivity, material
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The board and the remuneration comm
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Prior to the commencement of the re
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the travel and leisure sector that
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Share plan Date of grant Grant pric
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Emoluments Executive directors’ r
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for the year ended 30 June NOTES TO
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The annual financial statements whi
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TO THE MEMBERS OF SUN INTERNATIONAL
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HOLDING COMPANY The company has no
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which the entity operates (the func
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elating to certain firm commitments
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expenditure represents the total co
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government and other government rel
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GROUP STATEMENTS OF FINANCIAL POSIT
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Notes GROUP STATEMENTS OF CHANGES I
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for the year ended 30 June Operatin
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14. PROPERTY, PLANT AND EQUIPMENT (
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15. INTANGIBLE ASSETS (continued) S
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for the year ended 30 June 18. RETI
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for the year ended 30 June 27. PROV
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for the year ended 30 June 28. CASH
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29. FINANCIAL INSTRUMENTS (continue
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32. RELATED PARTY TRANSACTIONS Key
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32. RELATED PARTY TRANSACTIONS (con
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NOTES TO THE GROUP FINANCIAL STATEM
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COMPANY STATEMENTS OF FINANCIAL POS
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COMPANY STATEMENTS OF CHANGES IN EQ
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NOTES TO THE COMPANY FINANCIAL STAT
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Notice is hereby given that the twe
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Litigation statement The directors
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SUN INTERNATIONAL LIMITED (Incorpor
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SUN INTERNATIONAL LIMITED Incorpora
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