Gambling industry keeps on cashing in despite rate hikes
September 14, 2007
By Donwald Pressly
Cape Town - Total gambling revenue more than doubled from R6.2 billion in 2001/02 to R13.5 billion in 2006/07, as gambling companies took advan¬tage of good market conditions, ac¬cording to the annual report of the National Gambling Board.
This figure excludes revenue of the national lottery, which falls under the National Lotteries Board.
The report, tabled by board chair¬man Chris Fismer and acting chief executive Themba Marasha, notes a capital investment of R46.3 billion on 40 casinos around the country. These involve about 20 000 slot machines and nearly 1 000 tables.
Gambling's total tax contribution in 2006/07 came to about R1.3 billion.
Casinos make up 86.2 percent of gambling spend, betting 10.8 percent and other forms of gambling, includ¬ing bingo, about 3 percent.
Gauteng contributed 41 percent to gambling revenue, followed by the Western Cape at 18 percent and KwaZulu-Natal at 17 percent, with the remaining six provinces making up the rest.
The provincial contributions to the tax cake was 41 percent for Gaut¬eng, 22 percent for the Western Cape and 21 percent for KwaZulu Natal.
The report notes that Fismer's pay package of R740 000 in 2006/07 (R719 000 in 2005/06) included a R25 292 monthly payment for the use of his premises and facilities to per¬form his duties.The package of the chief executive - who was then chief operations officer - rose from R571 000 to R702 000 in the year.
The gaming industry did well over¬all in the past year and executives said they expected this performance to continue despite the interest rate rise.
Sun International, the largest player with operations all over the country, lifted gaming revenue by 18 percent to R5.4 billion. Its revenue from slot machines was up by 20 per¬cent and that from tables by 8 percent.
The Grand West casino in Cape Town was the largest single casino contributor, lifting revenue to R1.6 bil¬lion from R1.4 billion the previous year. It outstripped Sun City, which achieved revenue of R1.05 billion.
Sibaya in KwaZulu-Natal achieved revenue of R684 million.
Gold Reef Resorts said in its re¬sults for the six months to June that upbeat market conditions and new developments boosted revenue by 17.9 percent to R839.2 million.
Earnings before interest, tax de¬preciation and amortisation of R358.1 million were up by 22.9 percent and represented a 42.7 percent mar¬gin on revenue.
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