2014 was remarkable for Merlin Entertainments (MERL), and not just because it was the group's first year as a listed company. Boosted by the release of The Lego Movie, the entertainment giant's Legoland attractions reported a 13 per cent jump in like-for-like sales and a 19 per cent increase in underlying cash profit. Resort theme parks also saw ticket sales grow well ahead of average historic rates, said chief executive Nick Varney.
By contrast, the traditionally stronger attractions in Merlin's Midway division, such as Madame Tussauds, had a softer year. Management blamed that largely on external factors, including civil unrest in Bangkok and the US polar vortex.
Group-wide, underlying sales were up 7 per cent and cash profits at constant exchange rates 11 per cent higher - well ahead of consensus expectations. Mr Varney reckons like-for-like sales growth in 2015 will be more in line with the historical average of around 4 per cent, as Legoland faces tough comparatives and the Midway attractions rebound.
However, new projects should attract more punters and a debt refinancing package will slash borrowing costs by £15m. Accordingly, Shore Capital analyst Martin Brown has upgraded his EPS forecasts by more than 5 per cent to 20p for 2015.
| MERLIN ENTERTAINMENTS (MERL) | ||||
|---|---|---|---|---|
| ORD PRICE: | 419p | MARKET VALUE: | £4.3bn | |
| TOUCH: | 418-419p | 12-MONTH HIGH: | 428p | LOW: 327 |
| DIVIDEND YIELD: | 1.5% | PE RATIO: | 26 | |
| NET ASSET VALUE: | 104p* | NET DEBT: | 88% | |
| Year to 27 Dec | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2010** | 0.80 | 26 | -2.9 | nil |
| 2011** | 0.95 | 96 | 49.1 | nil |
| 2012** | 1.07 | 98 | 8.0 | nil |
| 2013 | 1.19 | 172 | 15.1 | nil |
| 2014 | 1.25 | 226 | 16.0 | 6.2 |
| % change | +5 | +31 | +6 | - |
Ex-div: 30 Apr Payment: 5 Jun *Includes intangible assets of £942m, or 92p a share **Pre IPO figures | ||||
