Shares in Dreamworld owner Ardent Leisure surge after losses narrow

Shares in Dreamworld owner Ardent Leisure have shot up after the group revealed it had narrowed its losses in the past financial year. FULL DETAILS >>>

SHARES in Dreamworld owner Ardent Leisure shot up by more than 25 per cent, reaching an 18-month high, after the group revealed it had narrowed its losses in the past financial year.

Ardent’s net loss of $86.9m, was 36.1 per cent better than FY20’s $136.1m loss, with recovery in its United States-based Main Event business, cushioning the blow from lower visitation to Australian theme parks.

Revenue for the group dipped 1.9 per cent to $390.7m, with pandemic-induced border closures continuing to smash earnings at Dreamworld, Wet n Wild and Sky Point.

Revenue for the theme parks dropped 33.9 per cent to $36m for the year, mainly due to the pandemic.

Shares in the company, which started the day at $1.045, closed at $1.265 after tipping a high of $1.325 during the day’s trading.

WHEN NEW DREAMWORLD ROLLERCOASTER WILL OPEN

Theme Parks CEO Greg Yong praised his team for their performance during “one of the most challenging business environments in our history”.

“As we outlined at the half-year, Covid-19 outbreaks, associated lockdowns and restrictions continue to hamper consumer sentiment and induce traveller hesitancy,” he said.

“We expect this to persist until the vaccination rate in Australia increases materially.

“Accordingly, we continue to maintain a disciplined approach to costs and cash preservation, particularly in light of significant restrictions on the eastern seaboard through July and August 2021.

“We are however buoyed by the strong performances seen throughout the leisure sector in the US and are focused on ensuring the business is appropriately positioned to capitalise in anticipation of a similar rebound in Australia as conditions improve.”

The business was bolstered by $15.3m in government support during the financial year, primarily through JobKeeper.

A $69.9 million financial assistance package, comprising a $63.7 million loan and grants of $6.2 million, obtained from the Queensland Treasury Corporation in August, will enable the business to fund working capital and projects like the new Steel Taipan rollercoaster.

The group will not pay a final dividend for the year.

PLANS REVEALED FOR DREAMWORLD HOTEL RESORT

Ardent say annual pass sales have been strong at Dreamworld. Picture: Tertius Pickard

Ardent chairman Gary Weiss said the theme parks had been supported by the local drive market, with annual pass sales strong.

“Our outlook for the business remains positive, underpinned by the rollout of vaccinations, the expected opening of the new world-class Steel Taipan rollercoaster and pent-up demand in local and interstate markets,” Dr Weiss said.

“Having secured funding for the businesses via the Redbird partnership and the Queensland Government assistance package, the group’s financial position is now significantly strengthened.

“We have continued to maintain a disciplined approach to capital and expense management across the Group throughout the year and the group’s liquidity remains strong at balance date. “Our priority continues to be on ensuring the health and safety of our guests and team members, with robust safety protocols and Covid-safe plans in place in both businesses. “While we expect uncertainty from the pandemic to continue for the remainder of this calendar year, we believe that Ardent is well positioned for future growth once market conditions begin to improve.”

Follow @Kathleenskene