ARDENT SAYS STRUGGLING THEME PARKS ARE NOW AT 'BREAK EVEN'
Written on the 21 November 2017 by Ben Hall
THEME parks and entertainments operator Ardent Leisure (ASX: AAD) says it has stemmed the losses which have hit the company since the Dreamworld tragedy which killed four park goers last year.
Ardent's acting chief executive Geoff Richardson, who took over from Simon Kelly after he dramatically quit as CEO earlier this month, says Dreamworld is now trading above break-even and is confident the Commonwealth Games next year will lift the performance of the struggling theme parks division.
"Despite the challenging year, guest satisfaction and feedback at Dreamworld continue to be excellent, and we look forward to a strong holiday period and hopefully a boost from the 2018 Commonwealth Games to be held on the Gold Coast," Richardson told the company's AGM in Sydney.
The deaths of four people on the Thunder Rapids ride in October 2016 hit Ardent hard financially and its theme parks reported an earnings loss of $3.4 million in FY17 compared to a $34.7 million profit in the previous financial year.
Dreamworld was closed for more than six weeks after the deaths and the incident also affected the adjoining WhiteWater World. Both parks suffered a severe drop in attendances and revenues and it also sent Ardent's share price down.
Much of the attention at Ardent's AGM was on its new chairman, corporate raider Garry Weiss who was invited to join the board in September after months of criticising the way the company was being run from his position as the largest shareholder through his company Ariadne.
He says said he is committed to creating a stable board environment after numerous changes of directors and management during the past year.
Dr Weiss acknowledged the full year 2017 results were "clearly disappointing" but was positive about the outlook for the company.
"Patronage is still subdued but its performance is starting to come back," Dr Weiss says.
"We'd hope to be able to announce the return of some former rides and some attractions and we're very committed to reinvigorating Dreamworld and to making a material investment back into the park to refresh and reinvigorate the offer."
Weiss also hinted that once Ardent steered the company back on track to profitability, it would consider splitting off its US Main Event business and it is also look at what to do with the surplus land around Dreamworld.
Ardent says it will provide a further trading result when it announces its half-year results in February.
Business News Australia
Author: Ben Hall