Tourism

Experience Co. predicts “unpredictable level of volatility” in FY21 following $51.4m loss

Huntley Mitchell

Huntley Mitchell

ASX-listed adventure travel company Experience Co. has warned shareholders to brace for an “unpredictable” FY21 after posting a $51.4m loss for the last financial year.

Experience Co. pinned the loss on unprecedented adverse trading conditions, asset impairments of $35.7 million, the impact of discontinued operations, and one-off restructuring costs associated with the company’s all-but-completed strategic review.

Overall revenue from continuing operations fell 32.8 per cent to $87.4 million during FY20, while earnings before interest, taxes, depreciation and amortisation dropped 67.9 per cent to $5.2 million.

On a more positive note, Experience Co. managed to reduce its net debt from $29.4 million in FY19 to $9 million in FY20, driven by the divestment of non-core assets such as its helicopter, canyoning and ballooning businesses.

The company said its cost-saving program and rapid response to pandemic mitigated the impact of the extreme adverse conditions in the period, which included the suspension of all operations from 23 March 2020 until late May/early June.

Experience Co. also noted “encouraging” signs from July 2020 trading, with underlying earnings breakeven for the first time since recommencement of operations, aided by support via JobKeeper and from landlords.

“With operations suspended in March 2020 we had to stand down over 90 per cent of our workforce,” CEO John O’Sullivan said.

“The group is thankful for the efforts of governments at all levels in both Australia and New Zealand in providing us with assistance, in particular the JobKeeper and NZ Wage Subsidy programs, mitigating what was potentially a catastrophic impact on the company and the livelihoods of our team members.”

However, with international borders closed for the foreseeable future and the uncertainty around unrestricted travel in Australia, Experience Co. expects trading conditions to continue to be subject to an “unpredictable level of volatility” during FY21.


Featured image source: Facebook/Skydive Australia

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