AUSSIES took shelter at the movies during one of the wettest summers in living memory, taking its toll on Village Roadshow's (ASX:VRL) theme park earnings and its full-year profit.
The Melbourne-based owner of theme parks on the Gold Coast, Sydney and the US has reported a 4 per cent fall in group net profit to $43.9 million.
The fall in theme park earnings was offset by a 24 per cent lift in pre-tax earnings of the cinema exhibition division to $53.3 million, with American Sniper, 50 Shades of Grey, Mad Max: Fury Road and San Andreas among the best performing flicks.
"Our cinema exhibition division had an all-time record year," says co-CEO Graham Burke. "We expect this trading to continue for the foreseeable future with some truly outstanding film product in the pipeline."
However, poor weather in the Gold Coast and Sydney markets saw Village Roadshow's theme park visitor numbers fall 1 per cent and pre-tax profit for the company's key business division fall 16.6 per cent to $27.6 million.
EBITDA for theme parks fell 4 per cent to $92.5 million despite a solid second-half performance, with the Gold Coast result down 2.2 per cent to $79.1 million and Wet 'n' Wild Sydney managing a 9.9 per cent rise to $10 million.
"With especially poor weather conditions during the peak trading period in December and January, and continued softness in the core market, the Gold Coast experienced overall static ticket sales over the year resulting in an overall financial performance for FY15 only slightly below the prior year," says Village Roadshow.
However, the company says it achieved "significant savings" by undertaking back-of-house cost reductions during the year.
The shining light on the Gold Coast was the performance of the Sea World Resort and Water Park, which experienced a 4.6 per cent lift in revenue and an 8.8 per cent lift in operating profit.
"The overall performance of the resort has been outstanding, with an average occupancy rate of 87.8 per cent during FY15," says the company.
"The stellar performance is expected to be sustained with the opening in July of the new 800-seat conference centre at the resort, which is enjoying solid attendances, and forward bookings are well ahead of expectations."
Cost reductions achieved over FY15 are expected to benefit the theme park division's bottom line in the current financial year, along with a new pre-season ticket sales campaign which will bring record deferred revenue carried through to the current year.
"With the successful execution of re-investment initiatives, and hopefully a more normal weather pattern in the coming year, plus exciting new rides planned for Warner Bros Movie World, management expects to see an increase in attendance and frequency of visitation."
Meanwhile, Village Roadshow says it is still chasing development opportunities for theme parks in China and it remains "optimistic of being rewarded in the medium term".
Village this year signed a joint-venture agreement with CITIC Trust Co to establish a funds management business to invest in theme parks, entertainment facilities throughout Asia.
Co-CEO Robert Kirby describes the theme park division as one of the company's "key growth engines for the future".
"The signing in March of the joint venture between CITIC and VRL is a major milestone and a strategic building block for us to confidently progress our initiatives in China," he says.
Village Roadshow's group revenue topped $1 billion, a rise of 4 per cent on FY14.
A steady 14c per share fully franked final dividend has been declared, bringing the full-year payout to 28c.
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