Ardent Leisure Reports First-Half Loss Of $49M; Main Event Posts Revenue Of $101.1M, But Sales Slump

Posted On: 3/10/2017

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TAGS: Ardent Leisure first-half 2017, Ardent financial report, Ardent Leisure Group, Dreamworld Tragedy, Thunder River Rapids, Main Event Entertainment

MILSONS POINT, Australia -- In the first half of its 2017 fiscal year, ended Dec. 31, Australia's Ardent Leisure Group reported a loss of $49.4 million, attributed to the October 2016 tragedy that killed four people at one of its theme parks. Ardent is the operator of the Gold Coast's Dreamworld, where the Thunder River Rapids ride malfunctioned, killing two men and two women.

The company said costs related to the tragedy totaled $95.2 million. Dreamworld was shut down for 45 days between Oct. 25 and Dec. 10, and suffered a significant reduction in attendance when it reopened. Ardent's theme park division, which includes a second park, WhiteWater World, recorded total revenue of $41.8 million.

Dreamworld's losses were partially offset by the sale of Ardent's health club division for $260 million. The sale closed on Oct. 25 for a $45 million profit.

Ardent also owns Main Event Entertainment, a U.S.-based family entertainment and bowling chain that's headquartered in Dallas. During the first half of its FY2017, Main Event recorded revenue of $101.1 million, increasing 35.2% over the previous period. EBITDA of $18.2 million was posted for the period, a 20.6% increase.

Main Event now operates 32 family entertainment centers in 12 states. The company opened 11 new FECs since November 2015. Four new centers opened during the recent first half, another followed in February and six openings are scheduled during Ardent's second half. The expansion will bring the first stores to Indiana and Pennsylvania. New centers are making a 30%-plus average EBITDA return on investment, the company said. In FY2018, it will open at least 11 new centers, including its first location inside a shopping mall. The company says the overall U.S. Main Event rollout opportunity is about 200 stores.

First-half sales at Main Event declined 2.9%, however. Ardent cited a combination of factors, including weaker corporate and casual dining spending in the U.S., and competitive intrusion in mature markets where the FEC operates. Post-presidential election trading in December had a positive impact on spending, the company noted.

Ardent's other divisions (and first-half revenues) are bowling ($64.3 million); marinas ($11.6 million); and health clubs ($62.7 million, between Jul. 1 and Oct. 25). The company is expected to complete the sale of its marinas division for $126 million before June 30.