Madame Tussauds heads to Beijing as Merlin expands

LONDON Thu Feb 27, 2014 8:20am EST

Visitors pose for photographs next to Madame Tussauds' wax figures of Britain's Prince William (2nd R) and his wife Catherine (2nd L), Duchess of Cambridge, in front of the Yellow Crane Tower during a promotional event in Wuhan, Hubei province August 13, 2013. REUTERS/Stringer

Visitors pose for photographs next to Madame Tussauds' wax figures of Britain's Prince William (2nd R) and his wife Catherine (2nd L), Duchess of Cambridge, in front of the Yellow Crane Tower during a promotional event in Wuhan, Hubei province August 13, 2013.

Credit: Reuters/Stringer

LONDON (Reuters) - Madame Tussauds waxworks is coming to Beijing while Dubai will get a Legoland theme park under an international expansion drive by Britain's Merlin Entertainments, which announced its maiden results as a listed company on Thursday.

Merlin, the world's second-biggest operator of visitor attractions behind Walt Disney, currently makes over 60 percent of its revenue in Britain and continental Europe.

It wants to change that to a third for each of Europe, the Americas and the Asia Pacific over the longer term, by filling what it believes is a gap in the market in North America and tapping the growing middle-classes of emerging markets.

"The future will see us putting disproportionately more effort into Asia and North America because we see huge opportunity," Merlin Chief Executive Nick Varney said, pointing to global leisure spending growth of about 5 percent a year.

"In North America the market for our type of product is pretty unexploited - nobody else has Legoland and nobody else does midway (smaller-scale) attractions," Varney said. "In Asia, there is a fast emerging middle class who have leisure time and money and want to spend it on location-based entertainment."

Merlin, which floated on the London Stock Exchange in November, posted a 12.8 percent rise in core earnings for 2013 to 390 million pounds ($649 million), slightly ahead of analysts' average forecast of 386 million pounds.

Group sales rose 10.9 percent to 1.19 billion pounds and 6.7 percent on a like-for-like basis.

Merlin, with 100 attractions across four continents, added it was confident of more growth in 2014, but warned the strength of sterling "may result in an adverse translational impact" as earnings in local currencies are converted into British pounds.

The group will open six new attractions this year in Asia and the United States, including a Madame Tussauds next door to Beijing's Tiananmen Square and its first North American Dungeon in San Francisco.

Eight more sites will open in 2015, including a trio of attractions in Orlando in the United States, and the first of six "Shrek" attractions, following Monday's announcement that Merlin had tied-up with Dreamworks Animation's to launch six sites based on the movie franchise.

Merlin did not say how much it would invest in total in its expansion drive. A short stay attraction, such as Madame Tussauds or a Sea Life centre, costs between 5 and 8 million pounds to open, it said.

Varney told reporters the firm was considering moves into Latin America and India in the longer term, and that it hoped to buy the Singapore Flyer, a huge observation wheel, out of administration in the next two months.

New Legoland theme park sites are set for Dubai in 2016 and in South Korea and Japan in the following three years.

Shares in Merlin were down 1.4 percent to 365.5 pence at 1138 GMT, still 16 percent above its 315 pence flotation price.

(Editing by Guy Faulconbridge and Mark Potter)

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