Skycity - Multi-Million Adelaide Investment

MEDIA RELEASE
2 DECEMBER 2003

Skycity Announces Multi-Million Dollar Investment In Adelaide

ADELAIDE, South Australia: SKYCITY Entertainment Group today announced the A$20 million first stage of a potential A$70 million redevelopment plan which will showcase SKYCITY Adelaide's position as a key landmark in Adelaide and the "jewel' in South Australia's entertainment crown.

The first stage of the plan, proposed over three years, involves the development of street-front food and beverage outlets, a new bistro-style restaurant, a cocktail bar featuring live entertainment, an upmarket North Terrace bar, private function facilities, and new gaming areas.

Stages two and three of the proposal involve a potential further investment of A$50 million. Final decisions regarding the extent of investment are conditional on a range of factors including customer response to stage one, economic conditions and developments in what remains an uncertain regulatory environment.

The additional stages, if fully implemented, will include a new underground carpark - providing 450 spaces and improving accessibility to the Riverbank precinct and other major city attractions - a dedicated entertainment facility for premium concerts and special events, redevelopment of the main gaming areas, and a major upgrade of Station Road.

At a special launch event in Adelaide today, addressed by S.A. Tourism Minister Hon. Jane Lomax-Smith, General Manager Operations for SKYCITY Adelaide Greg Hawkins said the investment was further proof of the company's commitment to South Australia and its belief in the State's economic momentum and growing tourism industry.

"We expect the redevelopment to establish SKYCITY as a premier landmark in Adelaide and to attract a new wave of customers - not just from interstate and overseas, but local people drawn by the broad range of entertainment we will be able to offer," he said.

"SKYCITY is a key attraction in the tourism offering of Adelaide city and the SKYCITY Group is fully supportive of the State government's efforts in growing South Australia's profile as an international and inter-State destination.

"Our international sales team is travelling constantly, marketing the region to the rest of the world, and we are confident that our contribution to the marketing of South Australia's unique combination of the best of city life and natural attractions, will assist the State in achieving its economic objectives," said Mr Hawkins.

Since purchasing the former Adelaide Casino from the South Australia's government in 2000, SKYCITY has already invested more than A$20m in upgrading the property's facilities. Today's announcement brings with it a promise of lifting the entertainment complex to another level as a destination for the people of Adelaide and the State's visitors.

Should the full three-year investment proceed, it would provide a major boost to employment in South Australia, creating 480 direct jobs during the construction phase and adding more than 235 permanent staff to the SKYCITY payroll.

It will also utilise areas of the building that have remained vacant for more than 18 years, adding approximately 20 percent extra space for a range of customer uses.

Mr Hawkins said the redevelopment would reflect and enhance the magnificent heritage of the old railway station building in which SKYCITY is housed.

"The redevelopment will first and foremost remain sympathetic to the heritage building we occupy. Original features will be retained and restored and modernised classical elements will be introduced throughout the new restaurant, bars gaming and entertainment areas we will construct," said Mr Hawkins.

"Locals will recall the chandeliers that once adorned the gaming floor. These have been in storage since we began initial renovations of the property and they will undergo careful cleaning and repair before being refitted to enhance our revitalised new interior. We also recognise that the broad-based range of entertainment experiences we offer means that we have a similarly broad range of customers, so the redevelopment will offer many "destinations' within a single destination to meet those needs," he said.

Managing Director of SKYCITY Entertainment Group, Evan Davies, said today that the company has a vision to return the business to its former prominence as a key landmark within the city.

"When it opened in 1985, the casino was the entertainment hub within the city. It is a magnificent building, in a superb location and the people of Adelaide are beginning to embrace the reinvigorated atmosphere we are developing within the complex, through our commitment to providing the best live entertainment and gaming experiences in South Australia.

"SKYCITY is committed to taking our investment in South Australia to another level. We're confident that the first stage of this redevelopment is one which we, our customers, Adelaide city and the State will be very proud, and we certainly hope that the additional stages of the development will be possible," said Mr Davies.

Construction of stage one of the redevelopment is scheduled to begin in December 2003 and be fully operational by December 2004.

Ends

ADDITIONAL FACTS:

SKYCITY ADELAIDE:

- The business opened as the "Adelaide Casino' in 1985.

- Previously owned by the South Australian Government, it was purchased by NZX/ASX-listed company, SKYCITY Entertainment Group Limited in June 2000.

- The property was re-branded SKYCITY Adelaide in April 2001.

- Since acquiring the property, SKYCITY has invested more than $20m in refurbishment, repairs, technology and equipment improvements to enhance the customer experience.

- SKYCITY currently offers 4 bars, 3 restaurants, 72 gaming tables and around 850+ gaming machines.

- SKYCITY currently employs 1040 staff. The proposed three-year redevelopment will add 235+ new staff to the payroll by 2006.

THE NEW DEVELOPMENT:

- The new North Terrace Bar and Restaurant development will comprise:

o New bistro-style restaurant, catering for 300 people, with indoor and outdoor seating

o Mezzanine level cocktail bar featuring live entertainment

o North Terrace street level pub/bar incorporating unique railway ticket windows.

- New gaming areas (with the facility for 20 table games; 120 gaming machines approved under SKYCITY's existing licence).

PROPOSED FUTURE DEVELOPMENTS:

Further developments proposed by SKYCITY include:

- Carpark development - construction of a 450 space underground carpark adjacent to property.

- Redevelopment and landscaping of Station Road

- Redevelopment of existing gaming floor

- Redevelopment of existing level one gaming floor

- Renovation of existing food and beverage offerings

- An entertainment facility comprising:

o Entertainment space for live shows and performances, corporate functions, quiz night or special events

o Guest reception area

o Showroom

o "Green' rooms for performers

o Dedicated back-of-house areas for food and beverage preparation

- The project will include local contracts for design, construction, interior fit-out and purchase of equipment.

- During the construction phase the overall three-year redevelopment program would create 480 direct jobs, and 1,150 jobs if indirect and flow-on effects are considered.

- The overall project is estimated to boost State output by around $150m.

SKYCITY ENTERTAINMENT GROUP LIMITED:

- SKYCITY Entertainment Group Ltd is a gaming and entertainment group based in Auckland, New Zealand and listed on the Australian and New Zealand Stock Exchanges. The company operates gaming and entertainment complexes in Auckland, Hamilton and Queenstown in New Zealand and in Adelaide, South Australia.

- SKYCITY Entertainment Group Ltd is a 50.2% shareholder in listed New Zealand cinema exhibition business SKYCITY Leisure Ltd and holds a 32.6% shareholder in ASX-listed, on-line wagering business Canbet Limited.

- The SKYCITY vision to "create fun and entertainment' is evident through the broad-based, locally relevant entertainment offerings the company aims to deliver at each of its properties.

- SKYCITY is committed to host responsibility and operates a dedicated Host Responsibility department. Its Group-wide problem gambling and alcohol management training programmes and customer initiatives are widely recognised as industry leading.

- SKYCITY commenced operations in 1996 and has delivered six consecutive years of profit performance and earnings growth. It recorded an FY03 annual result (August 2003) net tax paid surplus of NZ$107.2 million.

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