It will be school holidays like none before with the coronavirus national emergency prompting Ardent Leisure (ASX: ALG) to shut their theme parks which include Dreamworld and Whitewater World.
The decision comes after Ardent had endured significantly difficult trading conditions prior to the global outbreak of COVID-19 following the death of four patrons in 2016 at Dreamworld. It also continues the horror freefall of Ardent Leisure’s shares which closed at $1.41 on 21 February 2020 after releasing their H1 earnings, and closed at $0.195 on 20 March 2020 – an 86% decline over a month.
But with social distancing and mass gathering laws in place, theme parks had always been considered non-essential, which means Ardent will close Dreamworld and Whitewater World until at least 31 May, and ultimately put further pressure on unemployment lines.
“The decision to close our parks is a direct result of the COVID-19 outbreak. We are deeply aware that the decision to close our parks will create a great deal of uncertainty for our team members, their families and the broader community,” said Ardent Leisure Chairman, Dr Gary Weiss.
“The health and safety of our team members and guests is the Board’s number one priority.”
The decision follows a similar one made by Ardent in the United States where its Main Event children’s entertainment business – its most profitable business – closed all venues nationally until further notice.
It came just weeks after Ardent had confirmed they had engaged Goldman Sachs to negotiate a sale of Ardent’s only profitable business in the half year ending 31 December, 2019.
Ardent’s main competitor, Village Roadshow (ASX: VRL) this morning also announced the closure of their Gold Coast theme parks Warner Brothers Movie World, Sea World, Wet’n’Wild and Paradise Country.
Village Roadshow had also been in discussions about a corporate takeover and had received a non-binding proposal on 24 January 2020 from BHG Capital for $4.00 per share.
Shares in Village Roadshow closed at $1.34 on 20 March 2020, heavily impacted by the coronavirus outbreak which saw a major hit to Village’s cinemas business.