BESIEGED tourism operator Living and Leisure Australia Group’s future is in doubt after the group posted a loss of $11.9 million for the first half of FY08.
Formerly MFS Living and Leisure, LLA attributed the loss to one-off items including an impairment write down of $15.7 million in relation to the ski fields and expenses incurred in relation to the unsuccessful takeover bid for Tourism Holdings Limited of $8.8 million.
Last Friday, LLA’s acting chief executive John Schryver warned, that there are “significant uncertainty as to whether group will be able to continue in the future.
Schryver said LLA believes it will continue to satisfy the senior secured lender and the unsecured lender, for at least the short term, to provide ongoing financial support to the group until June 30.
“The directors have also concluded that there are reasonable grounds to believe that the group can realise certain assets or businesses or refinance or recapitalise the group and settle its obligations to the senior secured lender and the unsecured lender.
“However, there remains significant uncertainty surrounding the ability of the group to successfully complete the negotiations referred to above and to continue to satisfy the senior secured lender and the unsecured lender,” he continued.
“Consequently there is significant uncertainty as to whether the group will be able to continue as a going concern, and therefore whether it will realise its assets and extinguish its liabilities in the normal course of business,’ Schryver said.
During the period, the group’s revenue rose marginally to $80.2 million. The ski fields delivered a strong result contributing $17.1 million to EBITDA, but the aquariums business delivered a marginally weaker result contributing $8.2 million to EBITDA and the Treetop Walks business contributed $0.6 million to EBITDA.
Meanwhile, LLA”s finance costs totalled $8.4 million in the period, compared to $6.2 million in the previous corresponding period.
During the 6 month period, net assets reduced from $169.8 million to $154.3 million at December 31 2007.
Schryver said no interim distribution will be paid in respect of the six month period to December.
LLA’s securities have remained in voluntary suspension whilst the group reviews its financial position and the proposals received for asset sales and the refinancing or recapitalisation.
Schryver said the board currently expects that it will be in a position to make an announcement by April 18 and would expect that following such announcement, LLA’s securities will recommence trading.
Australian Property Journal
