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In a positive sign for the bounce-back of Gold Coast tourism, theme park operator Ardent Leisure (ASX: ALG) has continued to see strong growth rates for the calendar year to date including "its busiest Easter period for several years", at least when inflation isn't taken into account.
The owner of Dreamworld, WhiteWater World and Skypoint reported a meaningful increase in attendances and per capita revenues in the March quarter compared to the prior corresponding period, with revenue up 47.6 per cent at $22.1 million.
That period was not entirely comparative however as whilst Queensland's borders were technically open, early in 2022 there were requirements to present negative rapid antigen tests (RATs) before entering from NSW, and Western Australia's borders did not open until March. The granting of international tourist visas also started in February of that year, with two months to spare before Easter 2022.
In April 2023 the Sydney-headquartered company brought in sales of $8.1 million, representing an increase of 5.5 per cent year-on-year. Whilst this is lower than the annual inflation rate of 7 per cent as of the March quarter, it aligns with the increase in retail turnover nationally for the same period.
The December half was much more fruitful for Ardent Leisure however, with 136.5 per cent year-on-year growth in revenue to $43.7 million - a figure that was nominally higher than the $38.7 million recorded for the same six months pre-COVID, although up only marginally when considering inflation.
Ardent Leisure's Theme Parks & Attractions business reported EBITDA of $4.3 million excluding specific items for the December half, versus a $4.2 million EBITDA loss for the same period in 2019, and the group notes that earnings momentum has continued.
"Despite emerging cost pressures, the business has continued to deliver a positive EBITDA result (excluding Specific Items) for both the third quarter and April 2023, but at more subdued levels compared with the first half of the year. The group’s corporate costs have remained consistent with 1H23 levels," the company said
"The Group is of the view that the current economic headwinds are episodic and not emblematic of the leisure industry. Further, while international visitation to date remains low compared to historical levels, this is gradually recovering and presents upside potential for both Dreamworld/WhiteWater World and SkyPoint when these markets return to historical levels.
"Management remains highly focussed on effective and disciplined management of all expenses, noting that there are certain safety and engineering priorities which cannot be compromised."
Related story: Ardent Leisure hits the ground running in FY23 with a new CEO and a ‘dream’ focus
The theme park operator, which currently holds cash balances of $145.4 million, is heavily reinvesting in the business and "remains well capitalised to fund the ongoing recovery", focusing on delivering its recently announced pipeline of new attractions.
At Dreamworld this includes a new Wave Swinger, a new kids' area with branding from Play School, Bananas in Pyjamas and The Wiggles, a vintage cars adventure area and the rollercoaster Jungle Rush, as well as a refurbishment of the Giant Drop.
At the time of writing, ALG shares were down 9.26 per cent at 49cps.
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