Friday 30 September 2016

Alton Towers accident hits Merlin sales

Rebecca Burn-Callander

Published 17/09/2015 | 08:30

The Smiler ride at Alton Towers Resort in Staffordshire. Earlier this year sixteen people were involved in a collision between two carriages at Alton Towers amusement park's Smiler attraction. Fabio De Paola/PA Wire
The Smiler ride at Alton Towers Resort in Staffordshire. Earlier this year sixteen people were involved in a collision between two carriages at Alton Towers amusement park's Smiler attraction. Fabio De Paola/PA Wire

Theme park company Merlin Entertainments has said the horrific accident in Alton Towers in June in which two people lost a leg, coupled with wet weather, dampened the company's sales growth over the summer months.

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Like-for-like sales from Merlin's resort theme parks division tumbled 11pc as visitor numbers plummeted following the Alton Towers accident.

However, the company, which also owns Thorpe Park and Chessington World of Adventures, still managed to report a 2.2pc increase in group revenues in the 36 weeks to September 5, while group like-for-like sales inched up 0.3pc.

Legoland remains Merlin's star attraction in the UK and overseas, benefitting from the popularity of last year's summer blockbuster The Lego Movie. The brand's like-for-like sales grew 6.7pc over the 36-week period.

And Merlin's Asian business is also thriving, with the exception of Hong Kong, where travel restrictions imposed by China continue to hit visitor numbers.

So far this year the company has opened seven new attractions around the world, including Legolands in Osaka and Istanbul.

There are also new Legoland parks currently under construction in Japan and South Korea and negotiations for future parks in the US and China remain ongoing, the company said.

However, the weakness of the euro is preventing tourists from the Continent travelling to the UK. As a result, revenues generated at Madame Tussauds and the new DreamWorks Tours - Shrek's Adventure!, which opened this year in London, have been disappointing.

"The performance of our Legoland Parks has remained strong, with very positive guest satisfaction," said chief executive Nick Varney. "However, this has been offset by the impact of reduced visitation across the Resort Theme Parks group, primarily at Alton Towers, and euro weakness impacting visitation at our London attractions."

The Alton Towers accident on June 2 left five people with serious injuries and hit the company just before the peak summer trading season.

Shares in the company plunged after Mr Varney admitted that it could take until 2017 for visitor numbers to recover.

 “In the aftermath of the accident obviously Alton Towers suffered quite a substantial drop in visitation, which is the main driver of revenue," he said in July. "We also had some drop in other parks, particularly Thorpe Park.”

The FTSE 100 company expects between £40m to £50m of underlying profits from the theme park division for the year, down significantly from the £87m it reported in 2014.

After the accident on the Smiler rollercoaster, Merlin closed Alton Towers for five days, temporarily shut other similar rides at Thorpe and Chessington, and stopped marketing, which halted its “momentum” ahead of the school holidays, Mr Varney said. Marketing only began again in July.

Telegraph.co.uk

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