Over-budget £60m Victoria Palace redevelopment halves Cameron Mackintosh’s profits
Last year’s profits for Cameron Mackintosh’s theatre operations company were hit by the “astronomical” cost of redeveloping the Victoria Palace Theatre, financial records reveal.
The annual report for Delfont Mackintosh Ltd, which runs from March 2017 to March 2018, states that turnover, which includes box office income and bar sales, increased by 14% from the previous year to £50 million. This is attributed to the reopening of the Victoria Palace Theatre with hit musical Hamilton in December 2017.
However, overall profits across the company were down by 57% in 2017/18 compared to the previous year, falling from £12 million to £5 million.
The report, on Companies House, says this was due to “the cost of extensive restoration work at the Victoria Palace”.
Mackintosh spent more than £60 million on the refurbishment, significantly more than the £35 million he had originally planned.
At an event in October, Mackintosh described the cost as “astronomical”, and cast doubt on long-held plans to redevelop the Ambassadors Theatre in the West End.
The producer’s deal to purchase the Ambassadors subsequently fell through, and the theatre was purchased by Ambassador Theatre Group in a deal understood to have been around £12 million.
Responding to the financial report, a spokesman for Delfont Mackintosh said the company was “as robust as ever and growing rapidly”.
He said: “The decisions to increase the already considerable budgeted expenditure [on the Victoria Palace] were carefully taken in stages as the project developed, as the scope and scale of the restoration and new work increased and as certain structural surprises were revealed during excavation and construction.
“Given that this was a one-off opportunity to create a great stage, backstage, front of house and auditorium to rival any in the world, the increased expenditure was considered a prudent investment and the success of Hamilton has proved that to be the case.”
He added: “As a result, next year [2018/19] looks like being a record-breaking one for the company financially.”
The report comes as Mackintosh announced that he is to replace the original production of Les Miserables at the Queen’s Theatre in the West End with a newer touring production when the venue reopens following a refurbishment.
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