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Cinema chain and tourism and leisure group Amalgamated Holdings said
yesterday it was now monitoring ``on an active basis" its investments in the
Village Roadshow Group, after warning that Village's decision to suspend
dividends had hurt this year's profits.
In the first four months of 2002-03, Amalgamated had produced a net profit
before tax of $11.1 million on a like-for-like basis, down from $15 million in
the previous corresponding period, the annual meeting heard.
The weaker result is largely due to a disappointing performance by the German
cinema venture, flooding, concern about prices after the introduction of the
Euro and the depressed German economy.
But Amalgamated has also been hurt by Village Roadshow, a rival in which
Amalgamated has a significant investment, suspending dividends on ordinary
shares.
In response to a shareholder question raising concern about Village's
treatment of minority investors, chairman Alan Rydge said he ``sympathised"
with that view and Amalgamated was ``on the case" in extracting better results
from its relationship with Village Roadshow.
Amalgamated has a direct 2.8 per cent stake in the listed Village Roadshow
Ltd, one-third of Village Roadshow Corporation (the 47.7 per cent shareholder in
Village Roadshow Ltd) and a half share in movie distributor Roadshow
Distributors.
Mr Rydge said it was not appropriate for him to comment on the way Village
was run but Amalgamated had made clear its views as an investor in the group.
Profits had also been hurt by the financial difficulties of cinema
advertising group Val Morgan, which Amalgamated and Village are taking over in
exchange for the release of contractual obligations and to ensure the survival
of cinema advertising.
However, Amalgamated expects to benefit from popular releases over the
Christmas period.
Despite opposition from the Australian Shareholders Association, investors
voted through the issue of 500,000 options to managing director David Seargeant.
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