Village Roadshow owner records $36 million loss in last financial year

Village Roadshow’s owner has advised that the ongoing viability of the entertainment and theme park group is contingent on the Omicron wave not resulting in new restrictions on its operations.

Recording a net loss of $35.8 million in the 2020/21 financial year, according to accounts lodged with the Australian Securities Investments Commission on 20th December, VRG Holdco, the entity that owns the cinemas and theme park business, acknowledged that it had struggled with COVID-19 restrictions and global movie release delays.

VRG Holdco group’s financial report to the corporate regulator for the 12 months to 30th June 2021, advised that lockdown restrictions resulted in the “intermittent closures of the group’s cinema operations, and disruptions to global release dates of major film titles.”

The company’s net loss from material items after tax of $22.1 million was mainly due to restructuring costs of the Village Roadshow business, including redundancy costs.

The year saw VRG Holdco report earnings before interest, tax, depreciation and amortisation (EBITDA) of $36.9 million, excluding material items and discontinued operations. Before its acquisition by BGH in August 2020, the company reported a net loss of $117.4 million for the 2019/20 financial year - its last as a public company.

That loss included $92.1 million in impairments to Village’s Topgolf assets, Australian Outback Spectacular, Wet‘n’Wild Las Vegas, cinemas, film distribution royalties, marketing and film distribution businesses.

The business’ theme parks division - consisting of Warner Bros. Movie World, Wet‘n’Wild, the Australian Outback Spectacular, Sea World and Topgolf - reported an EBITDA of $23.5 million, posting a net loss of $4.1 million.

The cinema division posted earnings of $10.8 million and a net loss of $1.49 million, while the business’ film distribution division reported earnings of $10.3 million, with a net profit of $4.9 million.

Both divisions were affected by COVID-19 restrictions and border closures, with the cinema business improving in the second half of fiscal 2021 as global release dates of major films started to stabilise.

The group implemented cost-reduction strategies during the pandemic including standing down front-line employees, a group-wide restructuring, deferring all non-essential capital expenditure and working with landlords for rent relief.

Images: Australia’s tallest waterpark slide opened at Wet’n’Wild on the Gold Coast in the lead up to Christmas (top) and the concept for Sea World's soon-to-open New Atlantis precinct (below).