Sand Hills losses top $9M

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This article was published 04/04/2019 (2579 days ago), so information in it may no longer be current.

The Sand Hills Casino has posted four straight years of deficits since it first opened, with total losses surpassing more than $9 million as of last year.

The casino’s audited financial statements show the gaming facility made $11.3 million in revenue as of March 31, 2018, including $9.4 million in gaming revenue, but ran a net loss of $2.3 million once expenses, interest, depreciation and amortization were factored in.

The loss is lower than the casino’s $2.5-million deficit in 2017, but is greater than the net $1.92-million and $1.3-million losses in 2016 and 2015.

Overall, the Sand Hills Casino’s accumulated loss has totalled nearly $9.4 million.

Swan Lake First Nation Chief Francine Meeches noted that the casino has common ownership among First Nations.

“However, in how business is managed and how the whole operation is, yes it’s taking a loss, yes there are some casinos that may be profitable in the first year, and it may increase or improve throughout for years to come, but it’s in this situation,” she said.

“You know, the study was done about whether it was feasible to have a casino in southwestern Manitoba and so if there was wrong information provided during that time maybe people were led falsely, so I don’t know.”

Sand Hills Casino is located on Swan Lake First Nation land on Highway 5, south of Carberry.

The casino is run by the Sand Hills Casino Resort Limited Partnership, which includes Sand Hills Casino Resort Inc. as a partner.

A study done prior to construction of the casino suggested there would be approximately 126,000 visits from Brandon, but visitation in the first two years of the casino has been much lower than expected.

Meeches, who serves as secretary of the Sand Hills Casino Resort Inc., said they will continue to operate the facility, adding that it provides jobs for Manitobans.

But in order to improve business, Meeches said there was talk about building a hotel and that the current managers have shared ideas on how to increase the number of people visiting the site.

“It’s all business. You just have to figure out how to function and how to operate to try and find the best way possible to bring customers.”

The Sun did not receive responses from either the Assembly of Manitoba Chiefs or Sand Hills Casino. Documents from the Manitoba Companies Office list the Assembly of Manitoba Chiefs Secretariat Inc. as a shareholder in Sand Hills Casino Resort Inc.

The casino’s long-term debt, as of the last available fiscal year, includes three term loans to Hemisphere Gaming of Manitoba Inc. — which manages the casino on behalf of the partnership — worth $6 million, $1.25 million and $7.5 million, respectively, as well as a $68,506 term loan to Manitoba Hydro.

On top of the long-term debt, the partnership also owes more than $9 million in fees and interest to Hemisphere.

Of that amount, $3.9 million is to be paid back at a 13.5 per cent interest rate once there is “sufficient cash available,” while the rest has no interest attached.

In January, an online survey was circulated asking respondents for their thoughts on relocating the casino closer to Brandon, but Meeches has said the intent has been to keep the casino where it is.

And while she and everyone in the partnership is concerned about the losses, she said it doesn’t mean it’s time to “throw the towel in.”

Instead, she put the onus on the investors and managers to find the best possible attractions for the site.

“Like I said, we’ve got people here that are employed, and how many jobs are going to be out if we ever close the doors?”

The AMC is currently suing the Manitoba government and Manitoba Liquor and Lotteries Corp. over the Sand Hills Casino for alleged breach of contract and misrepresenting the state of the Winnipeg gaming market prior to opening the downtown Shark Club, among other accusations.

» mlee@brandonsun.com

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