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Mon 27th Jul 2015 - Merlin – Alton Towers accident has had an adverse impact
Merlin – Alton Towers accident has had an adverse impact: Merlin Entertainments has reported that, whilst first half results, which will be published on 30 July 2015, are expected to be in line with analyst estimates, the serious accident at Alton Towers on 2 June has had an adverse impact on trading at the start of the critical summer period and on the board’s expectations for the financial performance of the group for the full year. The company stated: “The accident at the Alton Towers Resort resulted in the temporary closure of the park, the suspension of UK theme park marketing and temporary ride closures at two of our other UK theme parks. The combination of these factors has significantly reduced volumes at Alton Towers Resort and, to a lesser extent, the UK Resort Theme Parks estate. Action is being taken to rebuild momentum and re-engage with our customers. However, based on most recent trading and our assessment of the likely trajectory over the key summer trading period, the 2015 Ebitda for the Resort Theme Parks Operating Group is now expected to be in the range £40 to £50 million (2014: £87 million). The magnitude of the financial impact is the result of both a significant reduction in revenue and the requirement to maintain an appropriate investment in customer service and marketing through peak season. Although difficult to assess at this stage, we believe that there may be some continued adverse impact on the Resort Theme Parks Operating Group profitability in 2016. The lower expectations for the Resort Theme Parks Operating Group in 2015 will be partially offset by better than expected financing costs, now expected to be between £40 and £45 million, central cost savings and trading in the wider group. Therefore, we would expect 2015 underlying profit before tax to be broadly in line with the prior year (2014: £249 million). We have committed to support those injured as best we can and implemented additional safety protocols to be sure that a similar accident will never happen again.” Nick Varney, chief executive, said: “The accident at Alton Towers in June was a devastating event, for which we have accepted responsibility and are deeply sorry. We have been humbled by the grace and fortitude of those who were injured, and their families, and will continue to do whatever we can to support them. As a result of the accident, we took the immediate decision to close the park and temporarily suspend a number of rides across the UK Resort Theme Parks estate. We firmly believe that this was the right course of action reflecting the seriousness of the incident, the impact on our staff, and to allow the team to focus on supporting all those affected and on the implementation of the new safety protocols, where necessary. In addition, we felt it appropriate to significantly reduce UK theme park marketing activity, in what is a critical period in the run up to the peak summer season. Alton Towers Resort was reopened on 8 June 2015, but as a result of the material loss of momentum, trading at the park and, to a lesser extent, the broader UK Resort Theme Parks estate has been adversely impacted. Alton Towers has a proud track record as the #1 theme park in the UK, a position endorsed by its consistently high customer satisfaction scores and the recent recognition as Trip Advisor’s best UK theme park. The resort continues to offer world class family entertainment provided by its amazing staff and I am confident that it will rebuild its position as the nation’s favourite theme park. Elsewhere in the estate, there have been strong performances from new attractions and accommodation, and the Legloand Parks Operating Group has maintained its strong momentum. There have been specific challenges within the Midway estate, particularly in London where a weaker Euro has impacted the relative attractiveness of the city as a tourist destination. However, our strong brands and diversified portfolio continue to support a robust Group performance and provide confidence in the medium and long term outlook.”

Fever-Tree reports sales up 62%: Fever-Tree, the supplier of premium carbonated mixers for alcoholic spirits, has reported sales rose 62% to £24.1m in the year to 24 June. Adjusted Ebitda was up 68% to £7.2m (H1 2014: £4.3m). Tim Warrillow, chief executive of Fever-Tree said: “We are delighted to report that the Group’s strong performance throughout 2014 has continued into the first half of 2015. We achieved a 62% increase in revenue with all four of our territories continuing to perform strongly and the results were underpinned by solidly maintained margins and a strong balance sheet. The Group remains ideally positioned to benefit from the ongoing global trend to greater premiumisation and look to the future with confidence as we continue to deepen our penetration in our existing markets whilst exploring new market opportunities.”

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