27th Jul 2015 06:20
LONDON (Alliance News) - Merlin Entertainments PLC on Monday said it expects its full-year results to be below its previous forecasts due to the roller-coaster crash at its Alton Towers theme park in June.
Merlin's Alton Towers theme park was shuttered back in June after a serious accident occurred on the Smiler ride. People on the Smiler ride were trapped 25 feet up at a 45 degree angle for up to four-and-a-half hours after two carriages collided, resulting in 16 people being injured, including four seriously.
FTSE 100-listed Merlin said that while it still anticipates its results for the first half of 2015 will be in line with its previous expectations, its results for the full year in its theme parks business are set to take a hit from the temporary closure of the park, the suspension of UK theme park marketing, and temporary ride closures.
Merlin said its 2015 earnings before interest, taxation, depreciation and amortisation for its Resort Theme Parks division is now expected to be around GBP40 million to GBP50 million, down from the GBP57 million it posted a year earlier. The impact has been caused by the significant reduction in revenue the company suffered and the need to maintain a investment in customer service and marketing during the peak season, it said.
Though tough to assess, Merlin added that the problems also could drag on its 2016 results.
Merlin said, however, that lower profit should be partially offset by a fall in costs for the theme parks business and said it does expect underlying pretax profit for the full year to be broadly in line with its previous forecasts.
By Sam Unsted; [email protected]; @SamUAtAlliance
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