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Casino in black but no JobKeeper repayment

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SkyCity Adelaide Casino’s New Zealand-based owners say they have no plans to repay $23 million in JobKeeper payments received for Adelaide staff, despite reporting a $73.1 million profit for the first half of the 2021 financial year.

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InDaily reported yesterday that revenue from the Adelaide arm of the multinational was $89.5 million in the six months to December 31, a 15.8 per cent increase on the $77.4 million it generated in the same period the previous year.

Of the revenue generated, $15.4 million came from the Federal Government’s JobKeeper payments in the period from June 30 to January 3. The company received a further $7.8 million in JobKeeper payments for the previous period.

However, the Adelaide casino’s NZ parent company announced to the Australian Stock Exchange it had a 37 per cent fall in revenue for H1 FY21 period to $420 million. This was a 76 per cent drop in net profit after tax to $73.1 million, down from $306 million in the final six months of 2019.

The company was among thousands of businesses that received the JobKeeper stimulus, introduced as an emergency economic measure after the pandemic hit and caused national lockdowns and industry shutdowns.

The payments went to companies that were able to demonstrate a significant drop in quarterly or monthly turnover and was first expected to end in September but has been extended until March 28.

A spokeperson for SkyCity said that while the Adelaide operation had been “performing steadily” since the completion of its $330 million casino expansion in December, the business had been “significantly impacted by closure” and that it continued “to trade in an uncertain operating environment”.

“We do not have plans to return the JobKeeper payment in the near term, but we continue to monitor our operating environment closely, with a firm focus on keeping South Australians employed,” the spokesperson said.

“We are also not paying an interim dividend for the half year to Shareholders.”

South Australia’s largest company Santos yesterday reported a $460 million loss for 2020 but said shareholders would still receive a dividend of about 6.4 cents per share fully-franked, in line with the previous year’s final dividend.

Santos also repaid about $4 million in JobKeeper wage subsidies to the Australian government, saying it was not as hard-hit by COVID-19 as first expected.

Federal Treasurer Josh Frydenberg has previously said while the government welcomed any business that decided to repay its JobKeeper payments, the government wouldn’t try to recoup lawful subsidies from companies that reported profits because it was “never the legislated purpose of the program”.

“The purpose of the program was designed to stem that tide of hundreds of thousands of our fellow Australians lining up outside Centrelink,” he told ABC’s Insiders last month.

“And it was to end that fear we saw across the community at the height of the pandemic.”

State Treasurer Rob Lucas said while any decisions relating to JobKeeper were matters for the Federal Government, the stimulus payment had not only enabled some of the nation’s biggest companies to turn a profit but also small and medium businesses.

“This issue of businesses who lawfully got JobKeeper for a period of time and then ended up making a profit isn’t something that just relates to big businesses or big gaming businesses, it traverses small, medium and big businesses as well,” he said.

“There were a number of smaller businesses who, in the first round of JobKeeper, basically you had to show for one month in 2020 you were down more than 30 per cent than in the one month in 2019.

“If you’re … a business where you were able to significantly turn things around for five months, you still qualified for that first six months of JobKeeper.”

Lucas said ultimately JobKeeper had saved “thousands and thousands of jobs” and that he would not be “part of the group that goes back now, with the benefit of hindsight and says: ‘Well, you should have done this or you should have done that’”.

“Understandably they acted quickly and they saved thousands and thousands of businesses.”

The South Australian Council of Social Services CEO Ross Womersley welcomed the decision by companies that returned JobKeeper payments where they weren’t required for the company to be profitable.

“It was absolutely right and proper that our government institute a scheme to maintain jobs and JobKeeper certainly successfully has done that,” he said.

“But the intent really was to support those people in employment and in industries and in regions that were directly and substantially affected by COVID restrictions, and of course the profits that have been reported tend to suggest that that disruption hasn’t taken place for SkyCity.”

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