Grow our business into new areas and products

During 2018, we grew our Latam business through two strategic acquisitions, and we continue to seek opportunities to offer new products in Latam. We continue to strengthen our balance sheet.

HIGHLIGHTS

• Finalised the Thunderbird Resorts acquisition in Peru
• Concluded the Park Hyatt Hotel, Casino & Spa in Mendoza, Argentina
• Increased our interest in Sun Dreams to 65%.

CHALLENGES

• Delivering investment returns and growing our business in a challenging economic environment

FOCUS AREAS

OVERVIEW

We focus on bedding down our significant investments and achievements over the past five years. This is to ensure we deliver a return on investment and grow the business in the eight countries where we operate.

4 040 active LPMs

19 869 total slot machines

The group finalised its 50% acquisition of EDS,  approximately 20% shareholding in Sun Dreams, increasing its interest in Sun Dreams to approximately 65%. The other minority, Pacifico,  acquired the balance, which increased its interest to approximately 35%. The acquisition of EDS’s interest was funded through an available cash resources and a 10-year bond of R1.5 billion.

In June 2018, Sun Dreams acquired a 100% interest in the Park Hyatt Hotel, Casino & Spa in Mendoza, Argentina for R333 million (US$25 million). The Park Hyatt Hotel, Casino & Spa comprises 186 rooms, 695 slot machines and 19 tables. The casino licence is valid for a 20-year period.

Sun Dreams concluded the acquisition of Thunderbird Resorts and Casinos Peruanos S.A. (Thunderbird Resorts) in April 2018. Thunderbird Resorts includes four gambling operations. The purchase consideration of R317 million (US$26 million) includes net assets of R192 million, intangible assets of R118 million and goodwill recognised of R7 million.

The online sports betting market is rapidly increasing as customers prefer the convenience of using their mobile devices. The group continues to investigate online gaming and sports betting opportunities in Latam.

SunSlots is part of the group’s alternate gaming strategy. Sun Slots holds six licences in four provinces: Gauteng, KwaZulu-Natal, Mpumalanga and the Western Cape. It has over 4 000 LPMs across 840 sites. In 2018, Sun Slots increased its GGR  by 10% to R1.16 billion (2017: R1.06 billion). The average GGR per machine per day of R833 was up 8% (2017: R772), largely due to product improvements at existing outlets and additional revenue from new sites. During 2018, we submitted over 400 machine licence applications to the gaming boards for approval across our various Sun Slots units. Encouragingly type B licences were secured for the first time in KwaZulu-Natal, which will allow for the rollout of up to 40 LPMs and fill the demand for additional game play and improve LPM revenues. Grandslots, our LPM operator in the Western Cape, reached full capacity of 1 000 LPMs and Sun Slots engaged with the gaming board for issuing additional licences.