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Bumper Halloween puts Legoland owner on track for 'good profit growth'

Published 29/11/2016

Merlin Entertainments' Legoland parks continued to build on 'two years of exceptional growth' (Legoland/PA)
Merlin Entertainments' Legoland parks continued to build on 'two years of exceptional growth' (Legoland/PA)

Legoland owner Merlin Entertainments has said it is on track to book "good profit growth" after its theme parks enjoyed a bumper Halloween.

The group said its resort theme parks division, which includes Alton Towers, Thorpe Park and Chessington World of Adventures, saw an uptick in trading at the end of October thanks to "favourable weather" conditions.

Its Legoland parks continued to build on "two years of exceptional growth" in the 47 weeks to the end of November 19, but the firm warned that its Florida site remained under pressure from challenging market conditions.

On an underlying basis, trading at its Midway Attractions business, including Madame Tussauds waxworks and the Sealife aquariums, was consistent with its update for the nine months to September 17 when l ike-for-like revenues fell 0.4%.

Shares were up under 1% as the firm said it looked set to report good profit growth in 2016 in line with expectations.

The update comes after the group warned in September that recent terrorist attacks across Europe had hit demand for its London attractions and said there had been no boost so far from the Brexit-hit pound on the tourism trade.

It also said visitor numbers were still being affected by last year's Smiler rollercoaster crash.

Merlin was fined £5 million earlier this year after admitting health and safety breaches in relation to the incident in which five people were seriously injured, including two teenagers who each lost a leg.

Judge Michael Chambers QC, passing sentence at Stafford Crown Court, called the accident a "catastrophic failure" by the company involving basic health and safety measures.

Alton Towers made up to 70 staff redundant following a review of the business in the aftermath of the crash.

Nicholas Hyett, equity analyst at Hargreaves Lansdown, said sterling's slump was failing "to cast a spell over Merlin's London attractions".

The pound's fall against the dollar, the euro and all other major currencies since the June 23 vote to quit the European Union has led to an anticipation of a rise in tourist spending.

He added: " Lower visitor numbers to attractions in the capital, such as Madame Tussauds and the London Dungeons, impacted performance over the summer. The trend seems to be continuing in the run-up to Christmas.

"Fortunately, Merlin's long-term future isn't based on its historic London footprint.

"The roll-out of attractions around the world continues, and while increased security concerns may be dampening city centre demand at the moment, we don't think it alters the long-term appetite for what Merlin has to offer."

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