This report does not constitute a rating action. What's new: Asset divestments are repairing SkyCity’s balance sheet. The company will likely receive proceeds of about NZ$295 million, earmarked for debt repayment, by end-2026. This includes NZ$221 million from The Grand Hotel sale. While debt reduction remains crucial for ratings stability, gaming revenues at SkyCity’s key Auckland casino remain subdued due to soft domestic economic conditions, exacerbated by elevated fuel prices. Base case: Reducing the ratio of debt to EBITDA below our rating downside trigger of 3x by end-fiscal 2027 (ending June 30, 2027) hinges on the asset sales. We expect negative operating free cash flow in fiscal 2027 as SkyCity incurs one-off costs from its cost-out program, online gaming ramp-up,
