Durban - THE uShaka Marine World theme park has asked for a R66.9million direct financial injection from eThekwini Municipality, saying the entity has been hard hit by Covid-19 regulations.
However, the city’s executive committee yesterday declined the request and offered the entity a R15m bailout instead. Councillors also rejected claims that the troubles at the park were due to the lockdown.
In a report tabled before exco members yesterday, the park said in light of the pandemic, it had not been fully operational as the lockdown restrictions limit gatherings, which impacted on footfall and hammered their revenue.
The report said that since it reopened, its operations had not generated much revenue. It was surviving on its reserves and was desperate for financial support.
The report said the cost containment and reduction initiatives were not enough to negate the losses currently being incurred.
“As of September 24, the entire park commenced operations, with the last two areas of the water park and Kids World opening. Sea World, retail shopping, food and beverage outlets were opened on August 28 for menial operations,” it said.
The report detailed the theme park’s plan to stay afloat, including a cash-flow injection by the municipality before the end of October and financial assistance for the period of July 2020 to June 2021 of R66.9m.
It requested to repurpose R15m in grants that were approved for capital projects, a R6.9m grant that was payable to the South African Association for Marine Biological research, to be utilised to meet cash shortfalls.
It also asked the council to approve a R10m overdraft from a bank and to allow it to suspend utility payments until the entity’s cash flow improved.
The municipality said while it recognised that the theme park was of strategic importance, it (the municipality) was also facing financial challenges and had not budgeted for such an eventuality.
It said it had received an amount of R15m from outside organisations and this money could be made available to the theme park.
It approved the entity’s request to repurpose the R15m grant funding for capital projects and to use the R6.9m from the South African Association for Marine Biological Research until the cash flow situation improved.
It also agreed to suspend the utility payments of about R23m.
DA councillor Yogis Govender said the problem in the organisation pre-dated Covid.
“The problems is that the space is not getting the right target market and it is concerning that there is no turnaround plan for this entity.” she said.
Mayor Mxolisi Kaunda said the chief executive of the entity should present a turnaround plan to the council.
The Mercury