Oct 2010 Financial News

Dolphin Cove to go public. Owners seek to raise equity financing for expansion

Oct 20, 2010

Owners of the tourism attraction, Dolphin Cove, plans to raise equity financing through the Junior Market of the Jamaica Stock Exchange (JSE) to expand the company in line with the anticipated growth in cruise tourism.

Yesterday, Stafford Burrowes, president of Dolphin Cove, made the announcement at Pan Caribbean Financial Services Breakfast held at the Terra Nova Hotel in Kingston.

"The future of the industry is extremely exciting and Dolphin Cove wishes to participate and benefit from the opportunities being offered," sad Burrowes. "We wish to raise additional equity and are planning in the near future to list on the Junior Market of the Jamaica Stock Exchange. This we feel is the most advantageous route to go."

Pan Caribbean will act as the advisor and lead broker to the listing. So far, all six listings on the Junior Market were led by Mayberry Investments Limited.

Burrowes did not say how much he is seeking in the initial public offer, but said the company is planning a $40 million expansion in additional attractions including a zip line, waterslide, expanding the beach and building an interactive free flying aviary.

Expansion plans also include the purchase of additional land to expand parking facilities in Ocho Rios.

"Dolphin Cove had anticipated growth in the industry, both cruise ship based and land based and with our expansions we had planned to increase our capacity. Our Dolphin Lagoon in Ocho Rios is capable without any change to take twice as many people as we are now taking," Burrowes said.

The just completed Dolphin Cove facility in Hanover, called Dolphin Cove Negril is the largest in the world, boasted Burrowes. "It is larger than sea world in Australia and we know with the growth that I am expecting to see come to Jamaica to the tourist industry both land based and sea based, we are going to need the space," he said. That development cost a reported $500 million.

Burrowes said despite estimates of a million passengers per year through the Falmouth Port, he is projecting a conservative 600,000 visitors that would need additional sources of entertainment and attraction. With the expansions planned, employment will be created for another 40 to 50 new people at Dolphin Cove alone.

"Six hundred thousand people in the port is very, very significant. It will create significant increases, not just to my park put to other attractions," Burrowes said. According to Burrowes, this is another positive sign for the growth of the business.

"We are very fortunate in Jamaica we have a very naturally beautiful island and the opportunity to have the nicest attractions in the nicest attraction in the Caribbean."

he added that with the opening up of the Cuba tourism market, additional opportunities for 'twinning' the tourism products of both destinations will be created.

"Cuba hasn't opened yet but we are seeing some significant positive effects. We have been asked to provide tours for two new ships, one is the 'Tropicana' and the 'Pullman'. They will be calling on us weekly on a cruise that takes in Cuba and Jamaica," Burrowes said. "We think that when Cuba opens up there will be a certain amount of twinning. We are so close together and cruise ships don't like to travel long distances."

Burrowes noted that the Dolphin Cove investment will be a good buy given its operating model.

"Our business also has a fixed operating cost and therefore an increase in numbers coming to the park is going to result in an increase in revenue. Because we have this fixed operating cost most of that revenue will flow to the bottom line"

"There is tremendous potential for growth in the tourism sector, said Burrowes. "We have an opportunity in Jamaica to develop our destination as the Orlando of the Caribbean."


Source:
Alicia Roache
roachea@jamaicaobserver.com
Busines reporter
Jamaica Observer
Wednesday October 20, 2010

http://www.jamaicaobserver.com/business/Dolphin-Cove-to-go-public_8071976