Merlin Entertainments reports robust results

Merlin Entertainments has posted its trading performance for the 40 weeks ended 6 October 2018, including the key summer trading period of July and August.

The firm saw a rise of 4.7% in organic revenue growth year to date (2.6% growth at reported currency), driven primarily by New Business Development, with like-for-like revenue growth of 1.4%.

Resort Theme Parks showed organic revenue growth of 9% with particularly strong like-for-like trading due to successful product investment and favourable weather.

Legoland Parks organic revenue rose by 6.4%, driven by the full year contribution of Legoland Japan and the continued successful accommodation roll out, offset by flat like for like growth.

Midway Attractions organic revenue growth was flat reflecting the expected decline in like-for-like revenue, with the new openings schedule phased towards the end of the year;

Accommodation revenue grew by 27.7% on a constant currency basis reflecting the continued success of the resort positioning strategy.

During the period, the group launched two new brands - Peppa Pig World of Play in Shanghai, and The Bear Grylls Adventure in Birmingham, UK.

CEO Nick Varney said, 'Group trading has been in line with expectations, with variances by Operating Group reflecting the diversified nature of the portfolio.

'We have opened a record 644 rooms, and six new Midway attractions which has resulted in organic revenue growth of 4.7%. Continued strong guest demand for our themed accommodation offering and the ongoing trend towards short breaks has driven 27.7% growth in accommodation revenue.

'The impact of terror attacks which adversely affected performance from early 2017 has started to abate and we have seen early signs of recovery in the London tourism market over the summer.'

Varney continued, 'We are excited by the recent launch of our two new Midway brands - The Bear Grylls Adventure in Birmingham, UK, and Peppa Pig World of Play in Shanghai. It is too early to comment on their commercial success, which as for all new brands could take time to build, but the attractions look fantastic and we are pleased with early guest feedback.

'The cost environment remains challenging, with tighter labour markets in many parts of the world adding to the pressures resulting from legislative changes such as the National Living Wage in the UK. Our Productivity Agenda remains a key area of focus, and it is testament to our teams that, despite these cost pressures, we have continued to deliver excellent levels of guest satisfaction overall.'

Varney concluded, 'The underlying fundamentals of our markets are strong and we remain excited by the global opportunities that Merlin enjoys.'