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| GAMING MARKET IN SOUTH AFRICA |
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| The gaming market in South Africa includes casinos, the national lottery, horse-racing, limited payout machines (LPMs), bingo and sports betting. |
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| South African gaming market revenues |
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For the years ending 31 March |
| Sector |
2007
Actual
Rm |
% |
2006
Actual
Rm |
% |
2005
Actual
Rm |
% |
2004
Actual
Rm |
| Casino |
11 727 |
16 |
10 135 |
15 |
8 788 |
20 |
7 330 |
| Lottery |
2 146 |
<3> |
2 218 |
1 |
2 186 |
<15> |
2 564 |
| Horse racing |
1 318 |
12 |
1 175 |
2 |
1 156 |
34 |
860 |
| LPM |
348 |
>100 |
167 |
>100 |
23 |
>100 |
10 |
| Bingo |
64 |
>100 |
28 |
12 |
25 |
<17> |
30 |
| Total |
15 603 |
14 |
13 723 |
13 |
12 178 |
13 |
10 794 |
| Casino |
75% |
|
74% |
|
72% |
|
68% |
| Lottery |
14% |
|
16% |
|
18% |
|
24% |
| Horse racing |
9% |
|
9% |
|
10% |
|
8% |
| LPM |
2% |
|
1% |
|
– |
|
– |
| Bingo |
– |
|
– |
|
– |
|
– |
| Total |
100% |
|
100% |
|
100% |
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100% |
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| Sources: National & Provincial Gambling Boards, Sun International and Uthingo. |
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Casinos enjoy the largest share of the overall gaming
market at 75%, up from 74% last year and this sector
continues to show very strong growth of 16%, slightly
ahead of the prior year growth of 15%.
Good growth in the horse racing, sports betting and LPM
sectors offset a decline in the national lottery, which was
suspended for the last quarter of the year to 31 March 2007.
Despite this, the overall gaming market grew by 14%, an
improvement of 1% compared to the prior year.
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| SUN INTERNATIONAL'S SHARE OF THE
CASINO GAMING MARKET |
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The group's overall share of the market remained in line
with the previous year in terms of gross gaming revenues although the number of gaming positions operated by the
group changed in most of the provinces. This was evident
in the Eastern Cape, Limpopo and Northern Cape
provinces where the group's casinos increased capacity to
existing footprints. The inclusion of Morula in Gauteng
from 1 April 2006 has consequently reduced the number
of positions in the North West Province and the number of
positions held by the group in the Free State diminished with the opening of a competitor casino in Bethlehem.
The opening of the Golden Valley Casino increased the
number of positions in the Western Cape.
Market shares were affected in the various provinces as a
result of new casinos opening and the relative revenue
growth of competitors. The group increased its share of
the Gauteng market (up four percentage points) as a
result of Morula being incorporated into Gauteng from the North West (down five percentage points). In the Free
State, market share improved three percentage points
with Windmill operational for the full twelve months
compared to nine months last year. In the Western and
Eastern Cape competitor revenues grew faster than those
from the group's operations. GrandWest was hampered
by capacity constraints. |
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| Sun International’s share of South African gaming market |
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By gross gaming revenue
(GGR) to 31 March |
By total gaming
positions at 31 March |
| Province |
2007
% |
2006
% |
2007
% |
2006
% |
| Eastern Cape |
72 |
73 |
76 |
74 |
| Free State |
60 |
57 |
52 |
62 |
| Gauteng |
22 |
18 |
28 |
24 |
| KwaZulu-Natal |
35 |
35 |
30 |
29 |
| Limpopo |
87 |
86 |
71 |
67 |
| Mpumalanga |
– |
– |
– |
– |
| North West |
70 |
75 |
76 |
81 |
| Northern Cape |
88 |
88 |
60 |
58 |
| Western Cape |
81 |
82 |
69 |
66 |
| Total Group |
43 |
43 |
44 |
42 |
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Positions are equivalent to one per slot and six per table. |
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Estimated GGR utilised in respect of the Free State, Limpopo, North West and
Northern Cape. |
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Comparative estimates have been amended to reflect actual results. |
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Sources include: National Gambling Board, provincial gambling boards and Sun International. |
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| CASINO LICENCES |
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The table below shows the current status of the 40 casino
licences in South Africa.
34 of the 40 licences available in South Africa are now
operational and the group holds 13
of these.
Four licences have been allocated: Gauteng (Krugersdorp),
Northern Cape (Kuruman), and Eastern Cape (Queenstown
and Mthatha). Construction of the Krugersdorp casino is well
underway and it is expected to open in December 2007.
Construction of the Kuruman, Queenstown and Mthatha
casinos has not commenced.
There are three unallocated licences. One of these licences
relates to Burgersfort in the Limpopo Province, where the
group and its partner submitted a bid for this licence.
If the application is successful, Sun International will have
a 30% equity interest. Public hearings have taken place
but the preferred bidder has not yet been announced by
the regulator. The other outstanding licence relates to
Mpumalanga and no announcement has been made in
respect of this licence.
There is one more licence to be issued in the Free State.
This licence is currently held by SISA (Naledi Sun) pending allocation of the Sasolburg licence which will result in the
closure of Naledi Sun. The Sasolburg licence is the subject
of a legal action. |
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| Casino licences in South Africa at March 2007 |
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Competitors |
| Province |
Total |
Sun
International |
Licences
trading |
Licences
allocated |
Unallocated |
| Eastern Cape |
5 |
2 |
1 |
2 |
– |
| Free State |
4 |
2 |
2 |
– |
– |
| Gauteng |
7 |
2 |
4 |
1 |
– |
| KwaZulu-Natal |
5 |
1 |
4 |
– |
– |
| Limpopo |
3 |
1 |
1 |
– |
1 |
| Mpumalanga |
4 |
– |
3 |
– |
1 |
| North West |
4 |
2 |
2 |
– |
– |
| Northern Cape |
3 |
1 |
– |
1 |
1 |
| Western Cape |
5 |
2 |
3 |
– |
– |
| Total |
40 |
13 |
20 |
4 |
3 |
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