SkyCity Cuts FY26 Forecast Amid Cost Pressures

SkyCity Entertainment Group has lowered its FY26 earnings outlook, citing ongoing macroeconomic pressures, softer consumer spending and rising costs across its operations in New Zealand and Australia. The revised guidance was included in a market update released on May 1.

Revised Guidance

SkyCity now expects underlying EBITDA for FY26 to come in between NZ$180 million and NZ$190 million ($106 million to $112 million). This is below its earlier projection of NZ$190 million to NZ$210 million.

The company has also adjusted its other EBITDA measure to a range of NZ$155 million to NZ$165 million ($91 million to $97 million), compared with the previous forecast of NZ$170.6 million to NZ$190.6 million.

SkyCity said trading conditions and customer activity were impacted in March 2026, particularly in Auckland and Adelaide. It pointed to higher fuel costs as one of the factors affecting customers, alongside broader pressures that reduced discretionary spending.

The group also noted that uncertainty remains around the scale and duration of macroeconomic challenges, warning that a further deterioration could impact future performance.

Cost Response

In response to the weaker environment, SkyCity has already implemented cost-saving initiatives exceeding NZ$10 million in planned savings. The company also said additional measures are being developed with external advisers.

The updated forecast also reflects slightly higher costs due to timing effects and foreign exchange movements, which have added further pressure to expected earnings.

Overall, SkyCity said it is working to offset softer trading conditions through tighter cost management, though weaker demand combined with higher expenses has led to a full-year reset of expectations.

Asset Sales Update

SkyCity also updated its asset monetisation programme, confirming it has entered a non-binding agreement for the possible sale of its 99 Albert Street office building and investment properties on Victoria Street.

The company is also exploring interest in The Grand Hotel. These initiatives are part of efforts to release value from assets while adapting to current market conditions.

Although the agreements are not final, SkyCity said progress is being made, with the programme intended to support financial flexibility amid earnings pressure.

Regulatory Change

SkyCity additionally noted that New Zealand’s online casino gambling legislation came into effect on May 1, with licensing expected to begin in 2027.

The development adds another layer to the operating environment as the company manages weaker earnings expectations and ongoing market challenges, with a continued focus on cost control, performance stability and asset optimisation.