DXB Entertainments has put up a "robust performance" for the half year period ended June 30, reporting AED106 million ($28.86 million) in revenues, 596,000 visits and 49 per cent occupancy at its premium Lapita Hotel.   

 

With the successful execution of the 2019 cost efficiency strategy, Q1 2020 adjusted EBITDA was trending towards another profitable quarter, the company said. 

 

However, the impact of Covid-19 resulted in adjusted EBITDA loss of AED 4 million, a 78% improvement quarter-on-quarter, it added.

 

DXB Entertainments said it remained committed towards achieving its strategy of delivering EBITDA breakeven, however, the previously communicated timelines have been impacted due to the Covid-19 pandemic.

 

In the near term we expect the visitation to the parks to be driven by the resident market however we expect international visitation to gradually improve as global travel and tourism industry recovers from the impact of the Covid-19 pandemic. 

  

Due to the unprecedented global pandemic and under government directives, the Parks were temporarily closed from 15 March 2020. Mitigated by the implementation of robust contingency plans, this closure resulted in H1 2020 adjusted EBITDA loss of AED 60 million, a 26% year-on-year improvement 

 

Commenting on the results, CEO and Managing Director Mohamed Almulla said: "We are grateful to the UAE leadership and government entities for their directives and efforts to combat the spread of the coronavirus, and ensure the health and wellbeing of everyone in the country."

 

"I am also very proud of my team’s hard work and support during this unprecedented and difficult time. Our contingency plans were successfully implemented to manage the temporary suspension of operations from March 15th onwards, while simultaneously carrying out the enhancement works to prepare the destination for its reopening on September 23," he stated. 

 

“We had a good start to the year and were on track to deliver another profitable quarter. However, the global pandemic and subsequent temporary closure of our operations from 15 March 2020 adversely impacted our performance for the period. Although Q1 2020 revenue was AED 100 million, 30% lower than the prior year, the adjusted EBITDA loss improved by 78% compared to Q1 2019, driven by a reduction in operating cost of 39% or AED 60 million. 

 

“To mitigate the impact of the temporary closure, further cost savings and contingency plans were implemented which helped deliver cost savings of 52% or AED159 million for the half year period. 

 

“Operationally, we are preparing to welcome back our annual pass holders and guests on September 23rd with additional health and safety measures implemented in preparation for the gradual re-opening of our destination.  Family friendly and record-breaking thrill rides are being added to our destination, while the region’s first ever LEGOLAND Hotel Dubai is scheduled for completion later in the year.”

 

Whilst management believe it is still early to assess the overall valuation of a theme park destination in its initial stages of operation and which is considered a long-term commercial proposition; an impairment loss of AED 393 million has been recognised to reflect the impact of the COVID-19 pandemic.  - TradeArabia News Service