Merlin Entertainments (LON:MERL) has updated investors on its recent trading this morning.
Highlights from Merlin's statement:
Year to date revenue growth of 10.6% reflects the continued strong contribution from new accommodation and attractions and the positive translational impact from non-Sterling revenue due to the Group's strong international footprint. Like for like revenue growth in the period was 1.3% reflecting the emerging recovery in Resort Theme Parks offset by difficult trading conditions in several key markets across the estate.
· Year to date revenue growth of 10.6% (3.7% at constant currency) despite challenging conditions in a number of our markets
· Evidence of recovery in the Resort Theme Parks Operating Group
· Continued growth in LEGOLAND Parks, despite tough comparatives
· Ongoing difficult trading in certain key markets within the Midway Attractions Operating Group
· Strong accommodation performance supporting the resort positioning strategy
· Announcement of potential new Midway brand: 'Little Big City'
Nick Varney, Merlin Entertainments Chief Executive Officer, said:
"Merlin continues to deliver overall revenue growth despite challenging trading conditions in certain key markets, testament to a diversified portfolio and a strong new business development strategy across all three Operating Groups.
Trading across the existing estate has been mixed. Our Resort Theme Parks Operating Group is now showing year on year revenue growth, reflecting the ongoing recovery in trading at Alton Towers. In Midway Attractions, London in particular continues to suppress overall trading performance as we are yet to see any significant benefit from the depreciation of Sterling, while the growth in LEGOLAND Parks reflects a tough comparative period in 2015 and a more challenging market in Florida.
On Tuesday we were fined £5 million for a breach of the Health and Safety at Work Act related to 'The Smiler' incident at Alton Towers in June 2015. From the beginning the Company has accepted full responsibility for the accident and strived to support all those injured in every way possible. We have learned every lesson from what happened last year and made a number of technical and procedural improvements to make sure that an accident like this cannot happen again. Both the Judge and the Health and Safety Executive acknowledge we have a good overall track record in safety and we remain committed to achieving the highest standards in this area.
In February of this year, we set out our New Business Development milestones for 2020. As previously stated, we continue to make good progress against these in terms of both new openings and pipeline development.
Accordingly, we are excited to announce today the pilot of a new, internally developed brand: 'Little Big City' - an imaginative recasting of the ever popular miniature world attraction format. Launching first in Berlin in 2017, 'Little Big City' will be the new and interactive way to experience a city's history, culture and individuality, using a unique combination of traditional and modern special effects, storytelling and model cityscapes. The successful launch of this new brand will create further optionality within the Midway roll out programme to support the delivery of our 2020 strategic milestone of opening an additional 40 Midway attractions."
We remain pleased with progress in LEGOLAND Parks and Resort Theme Parks and expect continued growth in these two Operating Groups, reflecting strong product momentum and the ongoing recovery at Alton Towers.
Despite specific headwinds in the Midway Attractions Operating Group, we remain positive on the medium term outlook, reflecting the strength of the brands, diversity of the portfolio and confidence in the strategy.