Shares in Sun International jumped more than 7% in early morning trading on Monday after the group flagged an expected surge in headline earnings.
The Sun City owner said in a trading statement that it expected headline earnings per share (HEPS) to be between 298c and 307c for the six months to end-June, up 56.8%-61.6% from a year ago.
The stronger earnings allowed the group to cut its debt by R200m to R5bn in the first six months of the year.
The group has benefited from steady growth in SA’s online gaming industry. Sun International’s online betting platform, Sunbet, was the standout performer in its annual results for the year to end-December, when Sunbet’s revenue grew 60.6% year on year, contributing more than 60% of gross gambling revenue.
Despite the surge in headline earnings, the company expects to report adjusted headline earnings’ growth of only 5.6%-7.4%, after marking down the estimated redemption value of a R197m SunWest put option liability.
In addition, it reported R11m in transaction costs related to the unsuccessful acquisition of Peermont Holdings. In July, Sun announced that it would no longer pursue its R7.3bn acquisition of the rival casino group after the Competition Commission recommended that the deal be prohibited in October 2024.
The regulator cited concerns about anticompetitive effects in the national and Gauteng casino gambling markets.
At 10.15am on the JSE Sun International’s shares were up 6.4% at R49.70, after earlier touching an intraday high of R50.03.
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