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We estimate that the group’s share of the Santiago casino gaming market
for the seven-month period ending February 2010 was 81% of casino
revenue and 49% of gaming positions.
Competitor activity
Enjoy Santiago opened a temporary casino in Rinconada not far north of
Santiago in August 2009. This casino had 200 slot machines, 200 bingo
seats and 13 tables. The permanent casino opened in September 2010
with 904 slot machines, 200 bingo seats and 50 tables. The hotel and
conferencing facilities are expected to open by December 2010.
Swaziland
The Happy Valley casino opened in September 2009 with 112 slots and
15 tables and was operational for the period under review. It is located
some seven kilometres from the group’s Royal Swazi casino where overall
gaming revenue has declined by 20% and local market share by 40%.
The courts have been approached for relief against the opening of this
casino, no resolution to this is anticipated in the current financial period.
There is an increase in gaming levies mooted by government from the
current 4.5% to 15%. This has not been promulgated as yet, but has
been circulated in government by the Minister of Finance.
Botswana
Peermont Global completed the refurbishment of the Grand Palm
property, including the casino and the hotel which was upgraded to five
stars. This significantly impacted table revenue at Gaborone Sun and as a
consequence the group’s share of the Gaborone casino gaming market
declined from 56% last year to 47% for the period under review. Slot
revenue was also affected, but not as much as tables revenue.
A new casino at the City Centre development is planned to open at the
end of this year or early in 2011. This casino, operated by Gold Reef
Resorts, is expected to have 135 slot machines and 10 tables. The group
anticipates that there will be a further impact on gaming revenue at
Gaborone Sun following the opening of this casino.
Namibia
In March 2011 Hilton Hotels will open a new hotel and casino adjacent
to the Kalahari Sands in Windhoek. This casino will have around 100 slots
and 8 tables and will have a significant impact on gaming revenue at the
group’s Kalahari Sands casino.
Plans are also under way to open a 150 slot machine, 8 table casino at
the Safari Hotel in Windhoek, however this is not expected to come online
until the end of 2012 or later.
Lesotho
There are no competitor casinos in Lesotho.
Nigeria
The group’s Federal Palace casino is the only licensed casino in Lagos State
although the existing casinos in Lagos, which do not have formal licences,
continue to operate.
JOINT REPORT OF THE CHIEF EXECUTIVE AND CHIEF FINANCIAL OFFICER continued
PROTECT AND GROW OUR BRAND
2. PROTECT OUR BUSINESS
Two years into our new brand promise ‘A Million Thrills. One Destination’,
our Brand Development and Customer Management strategies are well
entrenched in our corporate psyche.
Support for the Sun International brand continued throughout the year
on TV, in magazines and out-door. Judging by the feedback from the
public and the industry, the evolved campaign’s look and feel is working.
The South African public’s connection with our brand ambassador,
Charlize Theron, was strengthened following her third placing in the
‘favourite’ personality in the Business-to-Business category of the 2009
Sunday Times Top Brands survey. By association, the goodwill attached to
this award adds more lustre to our brand.
Research conducted in the second quarter of 2009 showed that steady
progress was made on our objectives of improving brand salience,
differentiation in the market from competitors plus the forging of
stronger links between the Sun International ‘mother’ brand and the
individual property brands.
The above-the-line campaign with Charlize runs until the end of April
2011 and planning for the next cycle is well advanced.
During the World Cup period, the campaign was amended to reflect
this exciting period of South Africa’s history via the theme ‘Where The
World Comes To Win’ across all our properties. This theme continued to
September 2010.
DELIVER AND ENHANCE OUR BRAND PROMISE
Key to the success of the brand campaign is the commitment of our
people to deliver on the promise, ‘A Million Thrills. One Destination’ and
in 2008 we launched an internal brand campaign, the One Sun project,
as part of our Customer Management strategy. Following the completion
of the project in 2009, the focus shifted to group-wide initiatives to support
and sustain the investment made in engaging our people.
As part of this engagement we commissioned an internal Sun International
song, ‘Light Up Their Lives’. A number of our properties used this initiative
to create fun and excitement for employees and guests.
This project was further reinforced through our internal magazine, ‘One
Sun’. Since its launch in September 2008, the magazine has gone from
strength to strength with the number of pages increasing from 26 to 84 and
the print order up from 6 000 to 20 000. A monthly World Cup newsletter
was also produced from March 2010 until the end of the competition to
keep employees up to date with the tournament and Sun International’s
involvement and commitment to it.
SIGNIFICANT FOCUS ON COSTS
Trading conditions in the countries where we operate are expected to
remain difficult in the year ahead, although we do expect a slight recovery
over the year. As a result, we will manage costs tightly in all of our
operations.
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