Research Update: SKYCITY Entertainment Group Outlook Revised To Stable On Solid Earnings Recovery; 'BBB-' Ratings Affirmed

SKYCITY Entertainment Group Ltd.'s earnings recovery is progressing quicker than we anticipated. We forecast its adjusted debt-to-EBITDA ratio will remain below 3.0x by the end of fiscal 2021. In our view, SkyCity's capital expenditure peak has likely passed and the company should be able to maintain credit metrics commensurate with the 'BBB-' rating as it continues to navigate through the COVID-19 recovery phase. On April 16, 2021, S&P Global Ratings revised its outlook on SkyCity to stable from negative. At the same time, we affirmed our 'BBB-' long-term issuer credit rating on the New Zealand-based casino operator and our 'BBB-' long-term issue ratings on its debt. The stable outlook reflects our view that SkyCity will maintain its solid earnings recovery

...- SKYCITY Entertainment Group Ltd.'s earnings recovery is progressing quicker than we anticipated. We forecast its adjusted debt-to-EBITDA ratio will remain below 3.0x by the end of fiscal 2021. - In our view, SkyCity's capital expenditure peak has likely passed and the company should be able to maintain credit metrics commensurate with the '###-' rating as it continues to navigate through the COVID-19 recovery phase. - On April 16, 2021, S&P Global Ratings revised its outlook on SkyCity to stable from negative. At the same time, we affirmed our '###-' long-term issuer credit rating on the New Zealand-based casino operator and our '###-' long-term issue ratings on its debt. - The stable outlook reflects our view that SkyCity will maintain its solid earnings recovery through the COVID-19 recovery phase over the next two years, and that the company will appropriately manage its remaining development activity in Auckland within our rating tolerances....

Research Update