MARC HASENFUSS: After the smoke clears how will Tsogo Sun fare?
Global experience of smoking bans has been an almost immediate 20% drop in casino revenues
Stubbing out profit Gaming and leisure group Tsogo Sun has made it abundantly clear that the opening of Sun International’s Time Square casino in Pretoria’s vibrant suburb of Menlyn is not going to drastically change the odds in the local casino sector. Tsogo’s casinos in the competitive Gauteng market put in a mixed performance, with business at Silverstar and Montecasino crimping but Gold Reef City increasing revenue and profit lines. Perhaps a bigger threat to Tsogo — and the entire gaming sector — is the smoking ban being mooted by the health department. Electus Fund Managers’ Damon Buss says about 60% of gaming revenue is generated in the smoking sections of SA casinos. Citing Australia and Chile, he says the global experience of such smoking bans has been an almost immediate 20% drop in casino revenues, which take 18 to 24 months to recover. But Buss believes the fact that SA already has restricted smoking areas — something none of the countries with a smoking ban had in place...
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