Bucking a trend witnessed across the ASX that has seen retailers suffering from a decline in discretionary spending amid the cost-of-living squeeze, Australians have no issue spending on holidays to the Gold Coast with Coast Entertainment (ASX: CEH) reporting its highest ticket sales since 2016 for its theme parks that include Dreamworld and WhiteWater World.
In its preliminary update for FY24 (52 weeks ended 25 June 2024), Coast Entertainment revealed a 3.1% increase in ticket sales compared to the previous year, and a substantial 42.1% rise above pre-COVID levels in FY19. The growth was primarily driven by aggressive promotional activities and the introduction of new attractions in December 2023, such as Kenny & Belinda’s Dreamland precinct, Dreamworld Flyer, and the Wiggles Big Red Boat Coaster.
For some Australian families, December 2023 was the first time they were able to take interstate holidays since Australia’s State borders were fully opened up in 2022.
Coast Entertainment’s unaudited revenue for FY24 stood at $87.0 million with the Company confirming it achieved its highest aggregate ticket sales since FY16, when tickets were cheaper. Making the result even more impressive was the fact Dreamworld and WhiteWater World were closed for 3 days due to storms while the park was adversely affected with limited operations around those days.
The Company did however receive a $0.7 million in interim insurance payments related to the storm damages, with further compensation claims in progress.
Coast Entertainment’s strategic focus on annual passes and new attractions has not only boosted ticket sales but also increased total visitation by 14.3% over the previous year. The ongoing recovery in international visitation has further bolstered the performance of SkyPoint, contributing to its best revenue and EBITDA figures on record.
Additionally, the company has lodged a Preliminary Development Application with Gold Coast City Council to expand the range of uses for its theme parks and surrounding land, with a decision expected in the coming months.
As of 25 June 2024, Coast Entertainment holds $89.2 million in cash. The company’s share buyback program, which commenced in September 2023, has seen 38.7 million shares repurchased at a cost of $18.0 million.
Coast Entertainment was previously known as Ardent Leisure but underwent a rebrand in 2023 following the divestment of their US-based Main Entertainment business.
Development work at Dreamworld is currently taking shape on its Rivertown attraction which will offer an immersive jungle experience for holiday-goers. The new Jungle Rish family roller coaster will be the largest ride investment ever made at Dreamworld with an inclined turntable and ability to run both forward and backwards. It is anticipated to open around December 2024.
Alfred Chan is a Business Reporter at The Sentiment specialising in ASX-listed small cap companies, a bloodstock enthusiast and former equities analyst.
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1 Comment
Shraddha13
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