It’s all about the Coast
Village sells NSW water park to focus energy here
VILLAGE Roadshow Theme Parks has delivered a massive vote of confidence in the Gold Coast, selling its Sydney waterpark so it can focus its resources here.
The Movie World and Sea World owner, which opened its new Topgolf attraction at Oxenford last month after a $35 million investment, collected $40 million yesterday from the sale of Wet’n’Wild Sydney.
CEO Clark Kirby said the sale, to Spanish company Parques Reunidos, made perfect sense for Village. “It will free up cash to reinvest and just focus our efforts here on the Gold Coast,” he said.
Mr Kirby said attendance at the compnay’s theme parks during the first days of the school holidays has been encouraging. He said Village has no intention of selling any of its Gold Coast assets.
“We have not given any thought to selling anything on the Gold Coast,” Mr Kirby said
Cutting debt has been a priority for Village Roadshow, which, like rival Ardent Leisure, struggled in the wake of the tragedy at Dreamworld in October 2016.
Last year Village sold its half-stake in Singapore cinema business Golden Village for $165 million.
It also sold, for $100 million, 154ha of land at Oxenford, which hosts most of its Gold Coast theme parks, under a sale and leaseback arrangement.
An ASX statement said the sale of Wet’n’Wild Sydney will result in a pre-tax loss of about $25 million in FY18, and be used to reduce debt levels.
The $40 million sale of Wet’n’Wild Sydney does not include “variable compensation” that will be delivered to Parques Reunidos, depending on the park’s revenue performance up until the end of FY20.
The sale is due to settle in the first quarter of the current financial year.
Parques Reunidos has more than 60 assets around the world.
The Sydney park purchase is said to enable an entry into the Australian theme park market. Wet’n’Wild Sydney’s earnings dropped 66 per cent to $3.1 million in the year to June 30, 2017, from $9 million the preceding year, due to a fall in season pass sales and attendance levels.
Village Roadshow has issued two profit warnings this year.
The company blamed already weak visitor numbers, compounded by a wet March and competition from the Gold Coast Commonwealth Games.
Village Roadshow expects its FY18 result to be some- where between break-even and a $10-million loss.
Shares closed down 4¢, or 1.7 per cent, yesterday at $2.27.