Merry Hill Closure next Spring 2015

Paragon Entertainment Limited

Paragon Announces Merry Hill Closure next Spring 2015

Paragon Entertainment today announces that it has exercised a break clause in its lease at Merry Hill and will close its Quest Family Entertainment Centre in 6 months' time.

The attractions equipment installed at Merry Hill has been written down to a realisable value of £118,000 which, in the Board's opinion, reasonably represents their fair value, so the Board is not intending to make any further impairment at this stage.

We expect to incur losses at Merry Hill during the 6 month notice period of approximately £110,000 which the Board is satisfied is less than the cost of immediate closure. Losses at Merry Hill at the EBITDA level for the year to 31 October 2014 amounted to £90,000.

CEO of Paragon Entertainment Limited, Mark Pyrah, said

"Sadly, the trading position at Merry Hill, due to the low footfall in the Quest location within the mall is simply not sustainable.

The imminent major redevelopment at the Centre, since it was taken over by Intu Properties in May this year, coincides with a break opportunity in our lease and, for commercial reasons, we have elected to exercise that break.

Quest at Merry Hill has been a valuable test bed for the company and our future relationship with Intu Properties. The board is hugely grateful for the past and continued efforts of the Quest staff and management team, and the loyalty from over 200,000 happy visitors who continue to enjoy great family entertainment at Quest."

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