Entertainment business expects losses to further deepen

York-based entertainment design, production and fit-out business Paragon Entertainment has again reduced its revenue expectations and said pre-tax losses will further deepen for the year ending 31 December 2018.

The AIM-listed firm this morning issued a trading update in which it said it now expected to report pre-tax losses of £3m. It is the second time the firm has revised its financial year expectations for 2018 – further deepening from the bracket of between £2.5m and £2.7m it stated in March; before which it said it expected the figure to be £2.4m.

Its EBITDA losses are expected to amount to £2.7m; revised from the £2.3m to £2.5m bracket it previously published.

This morning, the firm said its revenue would now likely be £9m for the year. In March, the business said it expected to report revenues of between £8.8m and £9.2m; reduced from the range of between £9.5m and £9.8m it previously announced.

Paragon Entertainment said: “During the Audit of the FY 2018 financial statements it has become apparent that following the adoption of IFRS 15, some revenue (and therefore the profits associated with that revenue) that was previously expected to be recognisable in FY 2018 will now be recognised in FY 2019.

“This mainly relates to a shift in the programme and therefore revenue/profit recognition regarding the Company’s Kidzania Abu Dhabi project.”

Paragon Entertainment added that as a result of the shift in revenue and profit, the Board now expects revenue for H1 2019 to be between £6.5 and 7m with similar revenue expected in H2 2019. EBITDA for H1 2019 is expected to be £300,000.

The firm added: “The Board continues to look at opportunities to reduce the cost base of the Company with a view to reducing long term overheads and to increase future profitability.” 

Click here to sign up to receive our new South West business news...
Close