South Africa casino industry still committed despite challenges – survey
The Casino Association of South Africa (CASA) has published its 12th annual survey of the South African casino industry, providing a snapshot of the state of the industry to role players, stakeholders and members of the general public. This year’s survey shows that, for the first time since the inception of the casino industry in South Africa under the new democratic dispensation, there was a decrease (1,8%) in revenue. This decrease can be attributed only in part to the general economic downturn, with illegal gambling eroding substantial revenue from the legal operators. Despite this, the licensed casino industry made a significant contribution towards employment, social responsibility and infrastructure development, and continues to be a vital economic driver.
CASA currently represents 36 of the 38 operational and legal casinos in South Africa. Besides promoting good governance within the industry, CASA also constructively contributes towards policy decisions that encourage growth and investment in both the industry and the country. To this end, CASA has been campaigning for better enforcement regarding illegal gambling operations for some time. The recent forfeiture of R1 million in illegal winnings by the Department of Trade and Industry shows that CASA’s appeals have been heard and, hopefully, marks the beginning of a deliberate and concerted effort by law enforcement authorities. In the face of such challenges, the industry remains committed to its customers and the communities in which they operate.
In the year ended March 2017, CASA members supported over 64 000 quality jobs, distributing R3,5 billion to employees. This represents 21% of the R16,5 billion value generated by the industry, a share second only to the R5,9 billion received by local, provincial and national governments through various taxes and levies (36% of value generated). In addition, CASA members invested R1,96 billion in capital expenditure towards the improvement of their casino complexes during the year under review; an amount equaling 11% of gross gambling revenue. CASA members have always been incredibly committed to Corporate Social Investment (“CSI”) and have, over the past five years, contributed R712 million in focus areas such as education, health, sports, arts and culture, the environment and, of course, responsible gambling. In fact, due to the industry’s backing of the South African Responsible Gambling Foundation NPC, its flagship National Responsible Gambling Programme continues to receive international recognition for its effectiveness in helping problem gamblers.
To access the full Survey of Casino Entertainment in South Africa 2017, visit the Casino Association of South Africa’s website at www.casasa.org.za.
Avani Gaborone gets multi-million rand renovation
Botswana’s Avani Gaborone Resort and Casino, situated in the capital Gaborone, has re-opened after a R103 million renovation. The 150-slot, 9-table casino and hotel resort’s renovation was done to introduce Avani’s signature design hallmarks to 156 guest rooms and public spaces including the main entrance and porte cochere. According to the Avani group, the aim of the renovation is to showcase a new contemporary design and technological enhancements for a modern, functional and relaxing experience. Riaan van Rooyen, newly-appointed General Manager of Avani Gaborone Resort & Casino said Avani Hotels and Resorts was committed to cementing relationships with the communities of Gaborone and Botswana. “Avani Gaborone is now the capital’s leading leisure and business resort. It is situated in the heart of Gaborone’s business district, home to The Botswana Stock Exchange, Debswana Diamond Company, the Southern African Development Community headquarters and financial institutions. Avani Gaborone is ideally located for leisure and business travellers and local residents’ seeking great food and a variety of entertainment options,” he said.
The layout of the guest bedrooms and bathrooms has been redesigned to ensure the best use of space. The design is functional, modern and comfortable. Room features and amenities include free WiFi, dedicated work station with media hub, LCD television with satellite news, sport and movie channels and a rain shower. The conference centre offers an impressive setting for business and social events in Gaborone with a main conference room accommodating up to 500 guests and five private Seminar Rooms will enrich any meeting. “We saw the renovation as an opportunity to upskill staff and expand their capabilities. All staff were encouraged to participate in cross-training across departments in order to provide a seamless service. The service and services offered in a predominantly business hotel differ in significant ways from the priorities in a leisure hotel. “Efficiency and a sense of urgency is very important to a business traveller who is generally on the go from very early in the morning. With this in mind we open breakfast earlier, offer free WiFi everywhere, ensure a quick check-in and check-out service and our concierge staff are adept at providing quick transfers, shopping tips and advice on restaurants in the area,” Van Rooyen added.
Gaming Africa ‘going to be good for Africa’
Peter Mireku, Commissioner for the Gaming Commission of Ghana, believes that October’s Gaming Africa (www.GamingAfrica.za.com) (24 and 25 October, Johannesburg) will help to alter some of the negative perceptions that exist of the industry as well as providing a high profile, professional showcase for gaming on the continent.
Mr Mireku, one of the thought leaders who will be speaking at the two day conference, said: “I think every gaming jurisdiction needs to establish a focal point. Africa comprises 54 countries whose gaming strategies are travelling at different speeds and in some cases in different directions. The coming together of the various interests, both governmental and those from within the industry, offers great opportunity for everyone to share information, experience and insight.
“Many thought leaders believe that gaming suffers from a negative narrative and events such as Gaming Africa provide a platform to demonstrate not only the technology that this industry deploys but it also shines a light on the importance attached to social responsibility and the harm minimisation initiatives that are at the heart of a progressive and sustainable industry.”
“Events like this are as much about listening as anything else. There will be some extremely smart minds in attendance, not just from Africa, but from much further afield, representing commercial organisations who want to conduct business on the continent and it would be foolish not to listen and to establish best practice. The challenge we face is achieving the balance between social responsibility and a successful, thriving industry.”
Peter Mireku concluded: “I also look forward to being part of a professionally run event. I am very aware of the excellent reputation that the organisers, Clarion Gaming, enjoy in the industry, not least as a result of ICE Totally Gaming, the London event that in 2017 attracted over 30,000 visitors from 151 nations. Whilst Gaming Africa is not in that league – for the moment at least – I know that the same attention to detail and professionalism will be in evidence. This is going to be good for Africa.”
Gaming Africa is the new two day free-to-attend conference taking place across 24 and 25 October in Johannesburg. Created and staged by the team responsible for ICE, Gaming Africa has learning and training at its core. Featuring learning modules covering the economy, payment methods, social responsibility, anti-money laundering, investment, public relations, regional roundtables and two master classes from the Totally Gaming Academy, entitled ‘Casino Marketing Academy’ and ‘Online Sports Betting Master Class’, Gaming Africa has raised the bar in terms of delivering an event dedicated to meet the specific gaming needs of the continent.
To download the agenda for Gaming Africa and to register, visit: www.GamingAfrica.za.com.
AfroMillions goes live in Nigeria
AfroMillionsLotto, the Nigerian Professional Football League’s (NPFL) exciting new lotto, has gone live, with locals able to buy tickets online for the jackpot draw. The first jackpot was drawn on Wednesday 18th October. Starting at N1 billion, the twice-weekly draw features bigger jackpots than all the lotteries in Nigeria combined and is said to be the largest jackpot on offer anywhere in Africa. If the jackpot rolls over, it increases by N100 million with each draw up to a maximum of over N2 billion. The website also offers instant win games, which can be played for fun or to win cash prizes of up to N12 million. Each NPFL club has their own lotto website so football fans can support their favourite team. For every ticket sold, that club will receive a percentage of the revenue to help fund player development, contribute to stadium and pitch improvements and support community-based projects.
Sun International seeks to cut its debt after massive investing
JSE-listed hotel and gaming group Sun International plans to pare down its debt and boost its balance sheet in the year ahead after having made a number of significant investments and acquisitions in recent years to diversify its global portfolio. At the end of June Sun International’s borrowings were at R15.1billion with R11.4bn attributed to the South African balance sheet. The group said that the increase in debt of R600 million in the first six months since the year started was primarily attributable to the capital investment at Time Square.
The group has stakes in casino gaming in Chile, and it developed the Ocean Sun Casino in Panama and the Sun Nao casino in Colombia to bulk-up international operations. These developments have come at a huge cost for the company. “All of the above investments and acquisitions were funded with debt resulting in a significant increase in the group’s gearing levels,” the group said as it released its results yesterday. “The group’s balance sheet remains resilient and the operations continue to generate strong cash flows. “Following negotiations with the group’s lenders during the review period, the debt covenant levels were adjusted and the group continues to trade within these levels,” the group said.
Its chief executive, Anthony Leeming, agreed that the debt would receive the company’s attention as they want to keep it under control. “We want to strengthen the balance sheet and deal with the debt as we focus on the year ahead,” Lemming said. Even though the group wants to have a tight control in its finances, it has not lost appetite for new acquisitions.
In Peru Sun Dreams is finalising an acquisition of Thunderbird Resorts for $27million (R365.73m) comprising of four gambling operations. The group said the acquisition presented an opportunity for Sun Dreams to strengthen its position in the Peru market and diversify its asset base in Latam. In the results for the six months to end June, group revenue increased by 19% to R7.6bn, up from R6.4bn, with the growth attributable to the inclusion of Sun Dreams and Sun Slots in June last year and Time Square in April this year.
However, revenue generated by the South African operations, excluding alternative gaming, international business, Time Square and Morula, declinedby 1.9% with consumers affected by a slowdown in the economy. The group said Sibaya, Sun City, Sun Slots and Table Bay produced encouraging results with solid growth in revenue and earnings before interest, tax, depreciation and amortisation (Ebitda). Group Ebitda increased by 15% to R1.9bn, while Ebitda generated by the South African operations declined by 9%.
The group had some positives in the period with some of its South Africa operations performing well. Sun City revenue was up 6% and Ebitda increased by 25%, while Sibaya reported 6% growth in revenue and Ebitda up 8%. The Nigerian environment has continued to deteriorate and as a result revenue decreased by 28% with an Ebitda loss of R1m. In Chile trading has improved at most of the properties other than Iquique and Monticello. Iquique has been affected by strike action in the mining industry, while Monticello continues to be impacted due to the relocation of the toll road. The Panama and Colombia operations continue to struggle and plans are in place to downscale these properties. The group did not declare a dividend for the period as it wants to reduce its debt levels. Sun International shares rose 1.78% to close at R52.15 on the JSE upon release of the report.