Gold Coast theme parks sweating on cash injection from state government

Desperate Gold Coast theme park bosses are sweating on a cash injection from the State Government as they continue to burn through millions each month.

MOVIE WORLD’S owner is sweating on the State Government doing “what they said” to clinch an 11th-hour funding deal to save the city’s vital theme park industry.

The theme parks owned by Village Roadshow and rival Ardent Leisure need a cash injection if they are to survive the coronavirus pandemic. They are burning through up to $15 million and $10 million cash respectively each month.

The two operators, which employ thousands of Gold Coasters and pump millions each month into the economy, are understood to be running desperately low on cash.

Village CEO Clark Kirby, who oversees Movie World and Sea World, last night said urgent talks with the State Government had been “productive” and progress was being made.

“We’re expecting the Government to be there for us and come through with the funds this week,” he said.

“We’ve had productive discussions but still need to make sure they do what they said.”

The empty car park at Movie World. Picture: AAP.

The State Government announced in March a $2.5 billion funding package to support jobs and businesses and in May a $50 million package for animal and theme parks.

However, the Bulletin revealed on Tuesday that the parks were yet to receive a penny.

Yesterday, the Bulletin reported that Ardent Leisure, the owner of Dreamworld, had been forced to keep its new $32 million multi-launch rollercoaster in the carpark because it lacks the money to build it.

The State Government has said it was still finalising negotiations with the theme parks on a funding package, part of which is understood to include $25 million of the $50 million set aside in May.

Both Ardent and Village have submitted COVID-safe plans to the State Government, which are still being ­assessed.

Village Roadshow CEO Clark Kirby. Picture: Adam Head.

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A spokeswoman for industry body Australian Amusement, Leisure and Recreation Association Inc said COVID-19 had been “devastating” for the sector.

“It is vital to get some injection of funds into the theme parks, to keep the rides running, to keep people in jobs, to keep the animals well and fed, and essentially bring back some fun to the community, in a safe, measured and well-managed environment,” she said.

Leading stockbroking firm Citi has issued a bullish report on Village’s prospects despite the park owner’s monthly cash burn.

Analyst Sam Teeger upgraded the firm’s rating from “neutral” to “buy”.

“We see Village’s outlook, primarily in theme parks, likely to improve later in CY20 from a strong resurgence in domestic tourism and new ride investment at Sea World,” he said.

Village would likely require funding “soon” because of the cash burn.

Mr Teeger said this could come from increased debt facilities, equity capital or State Government funding.

Mr Teeger wrote that BGH’s revised takeover offer last month likely undervalued the company and was “opportunistic”.