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Sim Leisure Group sees 2018 profit more than quadruple to RM6.1m

CATALIST-listed Sim Leisure Group posted a more than fourfold rise in net profit for fiscal 2018 to RM6.1 million (S$2.0 million) from RM1.3 million  a year ago, thanks to a surge in revenue from its two Penang theme parks, the company announced before market open on Friday.

Revenue for the year ended Dec 31, 2018, came in at RM21.2 million, more than doubling from RM9.7 million the year before, driven by the full year contribution from Escape Waterplay, the group’s second theme park in Penang which opened in November 2017 and which contributed only one month of takings in 2017. The group's other theme park, Escape Adventureplay, is an outdoor attraction with eco-friendly features and design elements reminiscent of traditional villages in Malaysia.

Together the two theme parks drew 185,000 visitors last year, a 65 per cent increase from 2017. Also boosting revenue was higher ticket prices, said the company.

Finance costs rose to RM1.5 million from around RM190,000 a year ago, mainly due to the interest incurred on redeemable convertible preference shares (RCPS) of RM1.54 million. The shares were issued in 2016 to fund the development of Escape Waterplay and have been fully redeemed.

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"Following this redemption, the group no longer has any debt on its balance sheet other than hire purchase borrowings of less than RM0.10 million, and will be able to enjoy savings in finance costs in this current financial year," said Sim Leisure.

Earnings per share for 2018 jumped to 5.64 sen from 1.20 sen the year before. Sim Leisure Group shares last traded unchanged at S$0.225 apiece on Thursday.

The company's net asset value per share came in at 31.80 sen, up from 19.99 sen a year ago.

No dividend will be given out for the full year, unchanged from the previous year.

Looking ahead, Sim Leisure said it intends to expand into new geographical locations such as China and other Asean cities. The company made its first foray outside of Malaysia with the inking of a non-binding memorandum of understanding with Fei County Wonder Stone Characteristic Town Development Co on Sept 1, 2018, to undertake the design and operation of a theme park in Linyi, China. In addition, the group expects to open its third theme park in Penang, Escape Gravityplay, by the first half of this year.

Said CEO Sim Choo Kheng: “This is just the beginning of our global aspirations. Backed by my years of experience in the theme park industry, we will continue to scale this proven and successful business model into new markets across the region that is awaiting a new genre of affordable and healthy family entertainment.”

Mr Sim has been in the theme park development and operating business since 1993. He has worked on the Egypt and Jurassic Park zones of Universal Studios Singapore, and DreamWorks zone at Motiongate theme park in Dubai.