Ardent Leisure cuts losses as Dreamworld improves
Written on the 26 February 2018 by David Simmons
Entertainment company Ardent Leisure (ASX: AAD) has narrowed its first-half loss as audience numbers at Dreamworld continue to climb.
Ardent, which also manages brands including White Water World, AMF Bowling and Main Event, booked a net loss of $15.6 million for the first-half of FY18.
While significant, the figure shows improvement from 1H17 where the company recorded a grim net loss of $49.3 million.
This demonstrates a turnaround for the company which continues to suffer from the ride tragedy which claimed the lives of four at Dreamworld in October 2016.
The 1H18 net loss includes $22.8 million in impairment charges relating to the embattled theme park.
Overall, the group's revenue was down 16.3 per cent to $265.6 million, and the company declared a distribution of two cents per security, in line with the prior corresponding period.
Revenue in the Main Event and bowling and entertainment businesses grew at 25.4 per cent and 16.6 per cent respectively, while the theme parks business experienced a contraction in revenue.
Main Event, the group's US based leisure and entertainment business, was the big earner for the company. Growth in this part was driven by the opening of new centres, including the new Knoxville, Tennessee location.
Dreamworld remains in recovery mode as the group's theme park business achieved a revenue of $37.2 million, down 11 per cent on the prior corresponding period.
The company says trading at Dreamworld continues to improve, with attendances up 32.6 per cent and revenue up 55.6 per cent for the period.
The groups says recovery has been slower than anticipated, which resulted in the group taking an impairment charge of $22.8 million. Despite the results the company is optimistic about the future of Dreamworld.
"The tiger cubs born late January 2018 and the completion of Corroboree Stage II are expected to bolster visitation in the lead up to the Commonwealth Games," says Ardent.
The group's Bowling and Entertainment business saw a boost in the first half, with revenue up 16.6 per cent to $75 million.
In December 2017 the group announced its decision to sell the Bowling and Entertainment business to The Education and Entertainment Group for $160 million, with the sale of the business expected to complete during the first quarter of 2018.
Shares in Ardent Leisure Group are up 1.33 per cent to $1.91 per share at 10.35am AEDT.
Business News Australia
Author: David Simmons