Despite a difficult trading environment, Gold Reef Resorts reported on Friday that headline earnings per share for the 9 months ended September had increased by 5% to 86c from 81.8c for the previous comparative period. The group saw increases in both revenue and earnings before interest, tax, depreciation, amortisation and rentals (Ebitdar). Revenue grew 3% to R1.6-bn compared to the same period last year with market share improvement in Gauteng. Ebitdar increased 5% to R633-mn.
The company continued its active focus on cost control, growing the Ebitdar margin to 38.5%. Employee cost pressures were offset somewhat by headcount reductions through natural attrition and operating costs were well managed in spite of substantial increases in electricity costs in the second half of the financial year, the company said in a trading statement. On developments within the company, Gold Reef said the major refurbishment undertaken at Golden Horse Casino, which included the gaming floor, food and beverage facilities and conferencing, was substantially completed and included the successful implementation of smartcard gaming. The refurbishment at Garden Route Casino is currently underway with smartcard gaming having been successfully launched at this property too. The renovation of the Theme Park hotel is also progressing well with construction of the main hotel building anticipated to be completed this year. The balance of the renovation is expected to be completed in the 1st half of 2010.
Looking ahead, the company said the tough trading conditions are expected to persist into the 4th quarter of the financial year with consumer activity likely to remain relatively subdued. "Notwithstanding this, Gold Reef remains well positioned to benefit from an improvement in economic conditions and strengthening of consumer confidence. "Focus on costs will remain a priority and the Company will continue to pursue development initiatives of its casino portfolio," Gold Reef added.
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