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Shares of DXB Entertainments (DXBE) dropped on Monday, after the company announced prelimnary results showing a net loss of one billion dirhams for 2018, which was 11 percent lower than the 1.12 billion dirhams loss declared for 2017.
The company recorded a fourth quarter (Q4) 2018 net loss of 268 million dirhams, a 5.1 percent year-on-year increase on the net loss of 255 million dirhams for Q4 2017.
“(The) company continues to struggle with achieving meaningful growth in park arrivals, as well as visitor spending,’ Ayub Ansari, senior analyst at Bahrain-based bank SICO told Zawya by email.
Theme park spend per visit amounted to 123 dirhams, which was “weak and disappointing,” according to SICO’s Ansari, dropping 11 percent year-on-year and missing SICO’s estimate of 136 dirhams by 10 percent.
Revenues in Q4 2018 stood at 149 million dirhams, down 5 percent year-on-year and below SICO’s estimate of 165 million dirhams. Ansari said that the miss to its estimate was “primarily on lower park footfall, which came in at 819,000 for 4Q18, against our estimate of 875,000.”
For the whole of 2018, visits were close to 2.8 million, increasing by almost 22 percent year-on-year, while overall operating expenses amounted to 728 million dirhams, compared to 925 million dirhams in 2017 and translating into a 21 percent year on year saving.
The company’s shares dropped 2 percent on Monday, while Dubai’s index closed mainly flat. So far in 2019, DXBE’s shares have added 4.72 percent since the start of the year, while the company’s stock dropped 63.65 percent during the year 2018.
DXBE said in the first week of February 2019 that plans to build the Six Flags theme park in Dubai had been put on hold as the financing for the project was no longer available. (Read more here).
In its results statement to the Dubai Financial Market on Monday, the company said that losses incurred in the provisional results "do not reflect any potential financial impact with regard to the Six Flags Dubai project, now any material post balance sheet updates, if any".
According to data from Eikon, one analyst gave a ‘strong buy’ rating on the company’s stock, and four analysts gave a ‘hold’ rating.
Elsewhere in the region, Abu Dhabi’s index dropped 0.58 percent on Monday, Saudi Arabia’s index edged 0.28 percent lower while Qatar, Bahrain, Oman and Kuwait’s premier market indices ended the day mainly flat.
(Reporting by Gerard Aoun; Editing by Michael Fahy)
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© ZAWYA 2019
