Merlin hit in the pocket by Alton Towers stay-aways

LEISURE sector giant Merlin Entertainments has seen its finances take a hit as people continue to shun North Staffordshire theme park Alton Towers following the rollercoaster accident there in June which left four people seriously injured.

In a trading update for the 36 weeks ended September 5, the company said that while it has seen growth in many areas, revenues in its Resort Theme Parks Operating Group have declined by 11.4% year on year.

Merlin – which also owns the Sea Life Centre in Birmingham – says it has traded in line with revised expectations over the summer period, bringing year to date constant currency revenue growth to 3.8% and like for like revenue growth to 0.3%.

But it said Alton Towers Resort, and to a lesser extent the UK Resort Theme Parks estate, has seen “significantly reduced visitation” following the accident at Alton Towers on 2 June. 

“As anticipated, this has continued over the summer peak season, exacerbated by relatively poor weather in the UK in August, resulting in like for like revenues in the Resort Theme Parks Operating Group declining by 11.4% year on year,” it said.

Nick Varney, Merlin Entertainments chief executive officer, said: “The trends we reported at the half year have continued throughout the summer. The performance of our LEGOLAND Parks Operating Group has remained strong, with very positive guest satisfaction. 

“However, this has been offset by the impact of reduced visitation across the Resort Theme Parks Operating Group, primarily at Alton Towers Resort, and Euro weakness impacting visitation at our London attractions.

“While near term challenges remain, the Group is making good overall progress on its growth strategy. We have significant new investments planned across the estate and are well placed to deliver these in 2016 and beyond.”

In July Merlin said the continuing fallout from the accident is likely to wipe between £37m and £47m off its profits.

Today it said that, although it is difficult to assess at this stage, it continues to believe that there may be an on-going adverse impact on the Resort Theme Parks Operating Group profitability in 2016.

The accident on the Smiler ride left four people seriously injured. Two young women had to have legs amputated.