This report does not constitute a rating action. MELBOURNE (S&P Global Ratings) Feb. 23, 2024--New Zealand-based SKYCITY Entertainment Group Ltd. (SkyCity) has credit rating buffer to withstand weak consumer demand in 2024. Cost-of-living pressures and economic uncertainty are taking a toll on consumer spending at the company's casinos. In addition, heightened regulatory scrutiny on gaming will continue to weigh on SkyCity (BBB-/Stable/--) in the near term. Weakening consumer demand drove a 9.6% decline in underlying EBITDA for the six months ending Dec. 31, 2023 (first half of fiscal 2024), despite increased customer visitation across SkyCity?s properties. We expect weaker demand to persist in the second half. Lower demand, together with increased compliance costs and wage inflation, more than offset strong
