Sun International Limited (JSE:SUI) News - 2021 Audited summary group financial results announcement for the year ended 31 December 2021

SUN INTERNATIONAL LIMITED
(Incorporated in the Republic of South Africa)
Registration number: 1967/007528/06
Share code: SUI
ISIN: ZAE 000097580
LEI: 378900835F180983C60
("Sun International" or "the group")

2021 Audited summary group financial results announcement
for the year ended 31 December 2021


KEY HIGHLIGHTS

GROUP INCOME
up 29%
to R7.8 billion


GROUP BASIC EARNINGS
up +100%
to 105 cents earnings

GROUP HEADLINE EARNINGS
up +100%
to 106 cents earnings

GROUP ADJUSTED HEADLINE EARNINGS
up +100%
to 44 cents earnings


INTRODUCTION

Sun International achieved exceptional results during 2021, with strong growth in revenue and adjusted EBITDA and a significant reduction in group
debt, despite the significant impact of Covid-19 related restrictions on operations.

Income from continuing operations increased by 29% from R6,054 million to R7,812 million. Sustainable cost savings of over R650 million contributed
to continuing adjusted EBITDA being up by 80% to R1,685 million. Our total group headline earnings improved from a loss of R409 million to earnings
of R265 million, equivalent to headline earnings of 106 cents per share from a loss of 234 cents per share, in the prior year.


KEY STRATEGIC THEMES

Sun International's unique omni-channel offering across casinos, online gaming, sports betting, resorts and hotels provides an integrated premium
gaming and leisure customer proposition which supported the resilience and recovery of revenue for the group during 2021.

Casino operations and alternate gaming, which make up 80% of group revenue, showed a significant recovery as lockdown restrictions eased. The
group was able to successfully defend or grow market share at most urban casinos, while income generated from Sun Slots rebounded to pre-Covid-19
levels. SunBet generated record income during the year and is rapidly scaling up its premium sports and online betting offering.

The R650 million in recurring cost savings embedded during 2020 resulted in margin resilience, even at reduced levels of operation. During 2021, casino
operations delivered an adjusted EBITDA margin of over 30% despite the restricted trading conditions. Operational restructuring at our resorts and
hotels resulted in R180 million in annualised cost savings at Sun City alone. The various cost optimisation initiatives identified and implemented over the
last two years, imply an adjusted EBITDA margin improvement on the 2019 South African results from 28% to 34%.

Balance sheet de-gearing from operational cashflow accelerated in 2021, with a net debt of R541 million repaid during the financial year. The group's
capital allocation priorities remain focused on reducing leverage to create capacity for the re-instatement of dividends over the short to medium term
and retaining flexibility for disciplined investment in high return opportunities.


OPERATIONAL HIGHLIGHTS

URBAN CASINO OPERATIONS

Casino income increased by 22% compared to the 2020 year. Since the easing of the lockdown restrictions our market share in the competitive
Gauteng market increased from 25.47% in 2019 to 27.32% in 2021 while in KwaZulu-Natal it remained in line with the prior year.

Overall, casino operations generated adjusted EBITDA of R1,433 million for the year. The effects of the achieved cost saving initiatives, reduced salaries
and efficiencies were clearly evident. Despite casino income being 37% below levels achieved in 2019, the group achieved 56% of the 2019 adjusted
EBITDA at a margin of over 30%.


SUN SLOTS

Sun Slots income increased from R886 million to R1,242 million with adjusted EBITDA up from R202 million to R313 million for the year under review.

The slots business proved remarkably resilient, with a strong recovery in trading following the easing of the alcohol ban and relaxation of curfew hours
in the last week of January 2021. The group swiftly reactivated closed sites, resulting in 4,652 of the machines being made available for play during the
period under review.

In Mpumalanga, the regulator has commenced with a consultation process involving route operators on the submission of Type B licences. This is a
positive development in addressing the roll out backlog in the province and will also see the converting of licence applications into live sites. Similarly,
the KwaZulu-Natal Gambling and Betting Board's recent decision to accept new licence applications where Limited Pay-out Machines (LPM) quotas
have been exceeded, will result in more Type B licences being processed.


SUNBET

SunBet has continued its strong growth trajectory in 2021 and remains an exciting prospect for the group. Our active players continue to grow and with
additional games being offered, the overall player experience has been enhanced. At the end of the year under review, we achieved a substantial
improvement in our key performance indicators which included:

- new player acquisitions up by 41% against 2020 and 88% compared to 2019;
- turnover up 78% against 2020 and 66% against 2019; and
- gaming income up to R182 million which represents an increase of 33% against 2020 and 30% against 2019.

We believe that SunBet offers the group significant and exciting growth potential, and with this in mind we continue to invest in people and marketing
in order to significantly increase our share of the fast growing online gaming market. With the introduction of live games (live dealer casino games) and
potentially slot style games in the near future, the group is well placed to capitalise on this opportunity. Overall income at SunBet was up 33% for the
year while a small adjusted EBITDA loss was incurred as we increased our marketing effort and addressed the staffing structures.

The opportunity for SunBet to develop synergies with the group's casino and hotel portfolio offering adds value to SunBet players and positions this unit
for significant organic growth. Priority investment in the right people, continued operational and technology improvements and focused marketing will
allow SunBet to gain market share in this exciting industry.


RESORTS AND HOTELS

Total resorts and hotels income was up 39% in 2021 to R1,559 million from R1,123 million in 2020. However income remained 39% below 2019 levels.
Overall, our resorts and hotels incurred an adjusted EBITDA loss of R56 million for the year under review, significantly improved from an adjusted
EBITDA loss of R158 million during 2020.

The easing of lockdown restrictions to Alert Level 1 in March 2021 increased domestic leisure travel demand into our resort destinations such as Sun
City and the Wild Coast Sun. However midweek demand from the corporate and Meetings, Incentives, Conventions and Exhibitions (MICE) segments
remained weak. Food and beverage revenue remained well below 2019 levels due to lower occupancies, with certain outlets being closed and costs
managed appropriately.

Sun City Vacation Club proved remarkably resilient throughout the lockdown period with R185 million in cash generated in time share sales during 2020
and 2021.


DEBT

Overall group debt (excluding IFRS 16 lease liabilities) reduced from R7,630 million to R7,089 million. Our debt to adjusted EBITDA and interest cover of
4.03 times and 2.67 times respectively, was well within our lenders covenants of 6.0 times and 1.75 times respectively. Our balance sheet is in a strong
position and we will continue to prioritise deleveraging as well as focus on increasing free cashflows and disciplined capital allocation to maximise
shareholder value.

With the significantly lower debt levels and as the business returns to pre-Covid-19 levels we anticipate that our debt to adjusted EBITDA ratio will
improve rapidly. This will enable the group to consider resuming the payment of dividends and/ or return capital to shareholders through share
buybacks.


STANDARDS IMPLEMENTED

A number of new standards became effective from 1 January 2021 although they do not have a material effect on the group's financial statements.


OUTLOOK

South African gaming income in January and February 2022, was in line with 2019 and EBITDA is well up on 2019, which demonstrates we are entering
a more normalised trading environment. Group adjusted EBITDA for this year was up due to embedded cost savings across gaming and resorts and
hotels.

Online gaming and sports betting continues to grow exponentially driven by increased internet, smart phone and mobile money penetration. SunBet is
rapidly scaling up revenues from mid to high-end customers while building a reputation for excellence through our omni-channel offering with Sun
International's premium hotel and casino portfolio and integrated MVG programme.

Implementation of Playtech's Neon casino management system in both our land-based casinos as well as our online SunBet platform is a key
component to this strategy which will allow our MVG customers to enjoy a seamless interaction with the group as they transition between online
gaming and our land-based casinos. We anticipate SunBet will contribute meaningfully to group profitability within three years and are investing in
critical resources and skills to capture this transformational opportunity.

We expect to accelerate further de-gearing of the balance sheet to create capacity for disciplined capital allocation towards high return opportunities
while targeting the re-instatement of dividends over the short to medium term, with a focus on maximising total shareholder return.


DIVIDENDS
The board has resolved not to declare a dividend for the year ended 31 December 2021.


FINANCIAL OVERVIEW

                                                                                     SOUTH AFRICA                             TOTAL GROUP*
R million                                                                   2021              %        2020          2021              %        2020
Income                                                                     7 702             28       6 003         7 812             29       6 054
Adjusted EBITDA                                                            1 688             72         984         1 685             80         936
Depreciation and amortisation                                               (846)             6        (902)         (863)             6        (921)
Adjusted operating profit                                                    842         +100            82           822          +100            15
Foreign exchange loss                                                           3           (73)         11             (2)           97          (58)
Net interest                                                                (564)            38        (908)         (564)            40        (939)
Adjusted profit/(loss) before tax                                            281         +100          (815)          256          +100         (982)
Tax                                                                           (50)       -(100)          33            (66)        -(100)          (7)
Adjusted profit/(loss) after tax                                             231         +100          (782)          190          +100         (989)
Minorities                                                                   (93)        -(100)          57            (73)        -(100)        170
Attributable profit/(loss)                                                   138         +100          (725)          117          +100         (819)
Share of associates                                                             -         (100)           2              -          (100)           2
Continuing group adjusted headline earnings/(loss)                           138         +100          (723)          117          +100         (817)
Discontinued headline loss                                                                                              (7)           98        (289)
 Group headline earnings/(loss)                                                                                       110          +100       (1 106)
 Group adjusted headline earnings/(loss)                                                                              265          +100         (409)
 Group basic headline earnings/(loss)                                                                                 263          +100       (1 829)
 Basic earnings/(loss) cents per share                                                                                105          +100       (1 045)
 Headline earnings/(loss) cents per share                                                                             106          +100         (234)
 Adjusted headline earnings/(loss) cents per share                                                                     44          +100         (633)
Dividends                                                                                                               -             -            -
* Group comprises South Africa, Nigeria and Sun Chile.


FURTHER INFORMATION

This short-form announcement is the responsibility of the directors and is only a summary of the information contained in the full announcement. Any
investment decision should be based on the full announcement published on Sun International's website and on the SENS link below. Only the short
form announcement will be available on SENS. The full announcement will be available on the link www.suninternational.com/investors or through this
link https://senspdf.jse.co.za/documents/2022/jse/isse/SUI/FY2021.pdf

While this report, in itself, is not audited, the group audited consolidated annual financial statements from which the audited summary group financial
results were derived have been audited by the group's auditors, PwC. The company's external auditor has not reviewed or reported on any forecasts
included in these summary group financial statements. Their unmodified audit report, including key audit matters, along with the audited consolidated
annual financial statements are available for inspection at the Company's registered office and also available on Sun International's website at
www.suninternational.com/investors.

www.suninternational.com

Sponsor: Investec Bank Limited

14 March 2022

Date: 14-03-2022 08:00:00
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