‘Challenging conditions’ force theme park owner to halt shares
MOVIE World owner Village Roadshow has called a share trading halt as it seeks to raise $50 million to cut debt.
In an ASX statement this morning, Village said it is asking for the trading halt to provide information about a potential capital raising.
Cutting debt has been a priority for Village Roadshow, which, like rival Ardent Leisure, struggled in the wake of the tragedy at Dreamworld in October 2016.
Last week the company announced it was selling Wet'n'Wild Sydney for $40 million to Spain-based Parques Reunidos.
An ASX statement said the sale of Wet'n'Wild Sydney will result in a pre-tax loss of about $25 million in FY18, and be used to reduce debt levels.
That followed a move last year to sell its half-stake in Singapore cinema business Golden Village for $165 million.
It has also sold, for $100 million, 154ha of land at Oxenford, which hosts its Gold Coast theme parks, under a sale and leaseback arrangement.
The company has also pumped money in to its Gold Coast themeparks, recently opening the Top Golf facility after a $35 million investment.
The company said, in an investor presentation earlier this year, that it has drawn down $381 million of its total $450 million finance facility as of December 31, 2017.
The capital raising comes as the Village share price continues to struggle.
It closed on Friday at $2.18, close to half of its value of $4.21 one year ago.
Village Roadshow has issued two profit warnings this year.
The company blamed already weak visitor numbers, compounded by a wet March and competition from the Gold Coast Commonwealth Games.
Village Roadshow expects its FY18 result to be somewhere between break-even and a $10-million loss.