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Dreamworld’s nightmare ends: Ardent shares surge on first profit since 2017

Shares in Ardent Leisure have rocketed to a six-year high after the theme park operator posted its first positive earnings result since 2017.

Feb 24, 2023, updated Feb 24, 2023
Sentences against Ardent Leisure will be handed down today. Photo: ABC

Sentences against Ardent Leisure will be handed down today. Photo: ABC

 

The group, which owns Gold Coast attractions Dreamworld and WhiteWater World, reported $300,000 in underlying earnings for the half on Friday, up from a $16 million loss the previous period.

Revenue jumped 137 per cent to $25.2 million, driven by the return of attendees to theme parks following the easing of pandemic restrictions. Net profit came in at $669m, up from a loss of $36.8m – a remarkable 1921 per cent turnaround.

Ardent Leisure shares surged 5.8 per cent to 72.5c by 2pm, their highest price since December 2016.

Chairman Gary Weiss lauded the long-awaited return to profitability.

“In what has been a long recovery journey for Ardent, exacerbated by the COVID-19 pandemic, the significantly improved trading performance demonstrates the resilience of our theme parks and attractions business, particularly during the recent challenging times,” he said.

In a symbolic boost for the company, the Queensland regulator awarded Dreamworld and WhiteWater World new licences in August, as part of a revamped safety regime following the deaths of four people on Dreamworld’s Thunder River Rapids Ride in 2016.

Theme park operating revenue surged 137 per cent to $43.7m, the highest in over six years, as total attendance grew 67 per cent.

“A return to positive earnings before interest, tax, depreciation and amortisation in the half for the first time in six years is a meaningful milestone in the recovery of this iconic business,” chief executive Greg Young said.

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Ardent’s $1.1b sale of its US-based Main Event business, which operates 44 entertainment centres featuring bowling alleys, arcades and restaurants, enabled the company to erase all its debts and raise investment funds and declare a 95c per share dividend distribution.

The company said it was focused on using its new-found capital to fund growth.

It will spend more than $50m developing new attractions at Dreamworld, including a wave swinger ride, and a $35m rollercoaster to feature the world’s first inclined turntable.

“Our strategy to focus on safety, be disciplined on costs to fund our priorities and to deliver an exceptional guest experience through brilliance at basics and providing memorable in-park interactions is yielding results,” Mr Young said.

“Economic headwinds remain front of mind and it is prudent for us to regularly contemplate how to appropriately position the business to deal with these challenges.”

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