DXB Entertainments, the Dubai-listed company behind Dubai Parks and Resorts, reported on Tuesday Dh484.8 million in losses in 2016, more than four-fold the Dh111 million losses recorded in 2015.
The rise in losses comes amid a jump in costs, with general, marketing, and selling expenses up by more than fourfold in 2016 to reach Dh589 million, as the company was the in the midst of promoting and opening different phases of its theme parks
In a statement posted to the Dubai bourse, the company said the losses reflect pre-opening expenses, and that by the end of 2017, DXB Entertainments will be in a “good position to deliver stable revenue and visitor numbers”.
“The last quarter of 2016 was a challenging one as the company shifted focus from construction to operations. The last elements of the destination were in the final stages of delivery with various milestones overlapping and small slippages causing impact on targets,” Raed Al Nuaimi, DXB Entertainments chief executive officer, said in a statement.
He said that the figures for 2016 were reflective of the “ramp-up of the business,” with the next quarters expected to be “more reflective of attendance levels and in-park spending habits”.
Revenues in 2016 reached Dh75.9 million, of which Dh63.4 million were from theme parks, the company said. It pointed that the theme park revenue only covers LegoLand Dubai in November and December, and a few weeks for Bollywood Parks Dubai and Motiongate Dubai.
In terms of operational performance, the company said construction of Six Flags Dubai commenced in July 2016, with the theme park on track to open in late 2019.
In a separate statement on Tuesday, DXB Entertainments said it is working with Merlin Entertainments Group to bring the first LegoLand Hotel to the Middle East. The 250-room hotel will open at Dubai Parks and Resorts and will be the second hotel there.
The company’s share prices rose 2.75 per cent on Tuesday to reach Dh1.12.