London terror attacks hit Madame Tussauds owner
The group saw a 17% plunge in visitors to its London attractions.
Merlin Entertainments, the owner of Madame Tussauds and Alton Towers, has laid bare the impact of last summer’s terror attacks in London.
In a trading update covering 2017, the group said it saw a 17% plunge in visitors to its London attractions – which include the London Eye and the London Dungeons – after attacks took place during its critical trading period.
This led to a 5% fall in operating profit at Merlin’s Midway division last year to £152 million, with like-for-like revenue dipping 1.2%.
The group said: “After a strong start to the year, Midway like-for-like revenue growth slowed following the spate of terror attacks in the UK which particularly impacted trading in London.
“The attacks led to a significant and immediate decline in domestic visitation, with international visitation falling from the summer onwards.
“This resulted in an estimated 17% drop in the London visitor attraction market over the key trading period.”
Merlin confirmed that it will now shift investment from Midway, which includes Madame Tussauds and Sea Life.
It will redirect £100 million of investment away from its attractions between 2018 and 2021, putting the cash into developing new hotels instead.
On a group level, the company saw profits rise 4.8% to £271 million in 2017, helped by a record 66 million visits to its attractions around the world.
Revenue grew 11.6% to £1.59 billion, like-for-like sales rose 0.7% and comparable sales at Merlin’s Legoland parks grew 4.7%.
Shares were up 8% in morning trading to 368p.
Boss Nick Varney said: “A year that started well with positive momentum in almost every part of the group was ultimately defined by the unprecedented spate of terror attacks in the UK and poor to extreme weather throughout the summer season in Europe.
“Despite this, thanks to the efforts of our extraordinary team, we have reported overall growth in revenue, profit and cash flow, welcoming 66 million visitors – our highest on record.
“Merlin continues to evolve and, with attractive market fundamentals and the right strategy in place, we remain highly confident in the long-term prospects for the business.”