Why Village Roadshow Ltd.’s stock is in trading halt?

Trading Halt: Village Roadshow Ltd.’s (ASX: VRL) stock is placed in a trading halt at the request of the company till 11 July, 2018. The company seems to go for capital raising. On the other hand, VRL is selling its wholly owned Wet‘n’Wild Water Park located in Western Sydney to Parques Reunidos, for a consideration of $40 million plus a variable compensation. This variable compensation will depend upon the Park’s revenue performance up to 30th June 2020. The deal is expected to complete in the first quarter of FY 19, after fulfilling customary conditions precedent. VRL will use the net proceeds to reduce its debt levels. The company has leverage ratio below 3x as at 31 December 2017. The transaction will result in a pre-tax loss of approximately $25 million in the FY 18 results. Additionally, VRL’s Wet‘n’Wild Sydney is facing challenges due to an unfavourable weather, that had resulted in some very high attendance days mixed with many low attendance days in the first half 2018. In 1H 2018, Wet‘n’Wild Sydney had posted the EBITDA loss of $1.6 million, down from EBITDA of $3 million in the corresponding period last year. As a result, VRL stock has fallen 31.45% in three months as on July 6th, 2018 and was trading at a very low P/E.


Disclaimer

The advice given by Kalkine Pty Ltd and provided on this website is general information only and it does not take into account your investment objectives, financial situation or needs. You should therefore consider whether the advice is appropriate to your investment objectives, financial situation and needs before acting upon it. You should seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice) as necessary before acting on any advice. Not all investments are appropriate for all people. Kalkine.com.au and associated websites are published by Kalkine Pty Ltd ABN 34 154 808 312 (Australian Financial Services License Number 425376). The information on this website has been prepared from a wide variety of sources, which Kalkine Pty Ltd, to the best of its knowledge and belief, considers accurate. You should make your own enquiries about any investments and we strongly suggest you seek advice before acting upon any recommendation. Kalkine Pty Ltd has made every effort to ensure the reliability of information contained in its newsletters and websites. All information represents our views at the date of publication and may change without notice. To the extent permitted by law, Kalkine Pty Ltd excludes all liability for any loss or damage arising from the use of this website and any information published (including any indirect or consequential loss, any data loss or data corruption). If the law prohibits this exclusion, Kalkine Pty Ltd hereby limits its liability, to the extent permitted by law to the resupply of services. There may be a product disclosure statement or other offer document for the securities and financial products we write about in Kalkine Reports. You should obtain a copy of the product disclosure statement or offer document before making any decision about whether to acquire the security or product. The link to our Terms & Conditions has been provided please go through them and also have a read of the Financial Services Guide. On the date of publishing this report (mentioned on the website), employees and/or associates of Kalkine Pty Ltd do not hold positions in any of the stocks covered on the website. These stocks can change any time and readers of the reports should not consider these stocks as advice or recommendations.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s