MERLIN ENTERTAINMENTS LONDON (Reuters) - Merlin Entertainments (>> Merlin Entertainments PLC), which runs tourist attractions such as Madame Tussauds waxworks and Legoland, expects to benefit from the fall in the pound after Britain's vote to leave the European Union, it said on Thursday.
The world's second-biggest visitor attractions group behind Walt Disney (>> Walt Disney Co) said with over 70 percent of its profits generated outside the UK its 2016 results should benefit from a positive translational impact if sterling's weakness since the June 23 Brexit vote versus the dollar and euro persists.
Chief Financial Officer Andrew Carr forecast the translation benefit would be a "mid to high single-digit percentage" boost to reported profit if current rates were maintained.
"The weakening of the pound ... will (also) help UK tourism in terms of making the UK more attractive for foreign visitors and foreign alternatives more expensive for UK residents," Chief Executive Nick Varney said.
Reporting a 1 percent rise in half-year profit, the group said it was confident it would deliver significant year-on-year profit growth, and anticipated full-year earnings per share in line with current expectations - 20.64 pence according to Reuters data, versus 17.8 pence in 2015.
Following the Brexit vote, several surveys have indicated a sharp drop in UK consumer confidence. However, there is little evidence that has translated into lower spending.
Merlin said trading patterns had not changed.
"Recent trading would suggest continuation of the trends experienced year to date, with further recovery within the Resort Theme Park estate and continued growth within Legoland Parks," it said.
Merlin said the trading performance of its Midway Attractions business, which includes Sea Life and The Dungeons, was expected to remain subdued, reflecting its cautious view on any near-term improvement in the London market due to heightened security concerns in the wake of attacks across Europe.
Shares in Merlin, which hit a year high of 484 pence on Tuesday, were down 3.3 percent at 458.2 pence at 0838 GMT, valuing the business at 4.6 billion pounds ($6.1 billion).
The group, which operates more than 100 attractions in 23 countries, reported a profit before tax of 50 million pounds for the 26 weeks to June 25, on revenue up 5.3 percent at 573 million.
Visitor numbers rose 1.1 percent to 28 million, though numbers were lower at the Alton Towers theme park in central England after a rollercoaster crash in June last year seriously injured five people.
The revenue increase reflected a strong contribution from new accommodation and attractions and a positive translational impact from non-sterling earnings, partly offset by a slight decline in like-for-like revenue.
The interim dividend was raised 4.8 percent to 2.2 pence.
($1 = 0.7572 pounds)
(Editing by David Holmes and Dale Hudson)
By James Davey
