Paragon Entertainment Limited Trading Update (7220V)
November 07 2017 - 1:00AM
UK Regulatory
TIDMPEL
RNS Number : 7220V
Paragon Entertainment Limited
07 November 2017
Date: 7 November 2017
On behalf Paragon Entertainment Limited ("Paragon",
of: the "Company" or the "Group")
Paragon Entertainment Limited
Trading Update
Paragon Entertainment Limited (AIM: PEL), the attractions
design, production and fit-out business, wishes to announce that it
expects to complete the 2017 financial year with sales broadly in
line with the Board's expectations at GBP15.0m.
At the EBITDA level however, second half performance has been
notably impacted with the result that EBITDA for the full year to
31 December 2017 will be significantly lower than previous
expectations at approximately GBP0.7m. The primary reasons for the
change in expectations are as follows:
-- Notwithstanding solid growth in our Product business, two
major projects with high margins which were forecast for 2017 have
been deferred to 2018;
-- Delays and cost overruns on certain projects resulted in less
gross margin than was previously expected;
-- Group overheads had been increased in expectation of improved
revenue growth in H2 (and into 2018); in the absence of this growth
and incremental margin the Board is now taking steps to rationalise
costs, manage spare capacity while ensuring that the Group is
adequately resourced for the future.
We continue to work hard to improve operational delivery at
Paragon; both our contracting and finance teams are now under new
leadership and have improved processes to tighten our contract
discipline. However there has been management distraction, in terms
of prolonged contract discussions and staffing issues during the
second half which has certainly diverted attention away from
several key projects which we had intended to execute on this year.
These projects are intended to streamline and improve further our
design methodology, procurement operations and management
reporting, as well as improve operational flexibility and
ultimately margins. The impact of these programmes will now likely
only become apparent in 2018.
The day to day operation of our finance function is now under
the control of an experienced full time interim group head of
finance, David McCabe. The Board intends to make a full time
appointment of a Group CFO and a suitable candidate is being
actively sought.
We continue to pursue the re-location of Paragon to a single
site so as to improve efficiencies and reduce property costs and we
are making sound progress in this regard.
Mark Taylor, Chairman, said:
"Our enormous growth in recent years necessitates that we take a
breath and consolidate. While we are disappointed with the way 2017
has unfolded we remain satisfied that the longer term plan for
Paragon is sound and our aspirational objective of achieving
revenues of GBP20 million in 2020 remains an appropriate medium
term goal for the business with a focus on high quality earnings
rather than growth for growth's sake."
This announcement contains inside information for the purposes
of Article 7 of Regulation (EU) No 596/2014 ("MAR").
For further information:
Paragon Entertainment Limited
John Dobson (Chief Executive)
Mark Taylor (Non-Executive
Chairman)
01904 608020
finnCap Ltd
Julian Blunt / Simon Hicks
(corporate finance)
Alice Lane (corporate broking) 020 7220 0500
About Paragon
Paragon Entertainment Limited (AIM:PEL) is an award winning
provider of attraction services from initial design production and
consulting through to the fit out and installation of themed
attractions, heritage exhibits, museums, aquariums and water parks,
inter alia. Paragon Entertainment is the holding company for
Paragon Creative Limited.
The Group's projects have included:
-- The build of Rolling Stones Exhibitionism at the Saatchi Gallery, London;
-- The design and build of Kidzania, London;
-- The design and build of galleries at the Olympic Museum for
the IOC in Lausanne, Switzerland;
-- The design and build of the galleries at The National Museum of Kazakhstan;
-- The design and build of Titanic Belfast; and
-- The thematic build of the Wallace and Gromit ride at Blackpool Pleasure Beach.
The Group listed on AIM in 2011. Further information can be
found at http://www.paragonent.com.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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