Aussie adventure tourism on the rise as Experience Co weathers the Queensland storms

Adventure tourism is on the rise for trans-Tasman operator Experience Co (ASX: EXP) despite a slump in Queensland attractions due to Cyclone Alfred during the March quarter.

In the latest quarterly update released today, the Sydney-based Experience Co has reported a solid increase in unaudited underlying EBITDA to $19 million for the year to date, up from $13.6 million this time last year.

The group, which operates skydiving, treetop walks and reef diving adventures, says positive April trading had led to all of its business units recording profitable trading for the month. Unaudited underlying EBITDA of $3.1 million for April was almost double the $1.6 million recorded a year earlier.

Experience Co says 2025 started strongly in January but a low-pressure weather system off the Far North Queensland coast in January, followed by Cyclone Alfred impacting the rest of the state in February and March, took its toll on broader tourism demand and sentiment in the state.

However, growth in its skydiving division helped offset some of the weather-impacted trading recorded by its Adventure Experiences division in Queensland. The most affected business was Great Barrier Reef operator Reef Unlimited which suffered a fall of 17 per cent in trading volumes compared with a year earlier.

Experience Co was founded in 1999 as a tandem skydiving operation in Wollongong but has since grown to become a diversified adventure tourism business comprising skydiving, dive and snorkel, premium and family adventure experiences.

The group’s experiences are largely located on Australia’s eastern seaboard from the Great Ocean Road to Cape Tribulation, as well as Perth.

The group also has tandem skydive drop zones at Queenstown and Wanaka in New Zealand, as well as luxury lodging and walking experiences in some of Australia's premier wilderness areas, such as Kakadu, Flinders Ranges and Maria Island.

Experience Co says volume and revenue growth was “more pronounced in New Zealand than Australia which experienced more weather disruption across its network”.

But the group notes that strong year-to-date (YTD) growth across its operations “reflect ongoing recovery of inbound tourism and underlying demand for adventure tourism experiences”.

“Management continued focus on free cash flow generation with the business recording positive free cash flow for the YTD period,” says the company.

 Experience Co says it is encouraged by a return of demand for its Skydive Australia business with only weather offsets impacting the group’s overall performance.

“May and June are traditionally shoulder season months ahead of July school holiday period,” says the company. “Management will focus on ensuring business is ‘holiday ready’.”

Experience Co notes that feedback it has received from Australian Tourism Exchange and the New Zealand equivalent TRENZ, is that “both markets have an opportunity to capitalise on sentiment generated by recent US trade tariff changes”.

Experience Co posted underlying EBITDA of $14.4 million in FY24, up from $11.3 million the previous year, as revenue rose 17 per cent to $127 million.

Last year the company said that FY24 represented the strongest trading conditions since the onset of the pandemic, largely off the back of continued improvements in the Skydive segment.