Village Roadshow’s top brass have agreed to a 25 per cent pay cut after the entertainment group wrote down the value of its Gold Coast theme parks.
The company will write down the value of its Gold Coast theme parks by $95 million due to the struggle to attract customers following the fatal accident at rival Ardent Leisure’s Dreamworld in 2016.
Village Roadshow on Tuesday said it expects to book total full-year impairments of $166 million due to factors including lower earnings at its Gold Coast parks and an accounting hit from the sale and lease bank of land on the sunshine coast.
The operator of Movie World and Seaworld has flagged $9 million of restructuring costs and expects a full-year loss, excluding significant items, of between $6 million and $10 million.
In response, Village Roadshow has flagged costs savings of more than $10 million in 2018/19, in addition to cost savings of $2 million in the financial year just ended.
All directors have agreed to a 25 per cent cut in fees from July 1, and the group’s co-chair and chief executive have accepted a 25 per cent reduction in fixed remuneration.
Co-chief executive and co-chairman Graham Burke said the group is focused on improving the operating performance of its core businesses, cutting costs, limiting capital expenditure and “potentially selling some remaining non-core assets”.
“Achievement of this objective would enhance VRL’s financial flexibility to recommence the payment of dividends and execute on strategic initiatives,” Mr Burke said in a statement.
The company expects core ticket sales to rise substantially in 2018/19 as more expensive annual passes are sold and discount resellers are removed from the market.
Village Roadshow shares have been halted since Monday morning to allow the company to raise $51 million via a share offer at $1.65 a share.
The stock closed 2.7 per cent lower at $2.18 on Friday.
The share offer and proceeds from the recent sale of Wet’n’Wild water park in Western Sydney will be used to help pay down Village Roadshow’s $425 million debt.