Coast Entertainment Holdings Ltd · ASX:CEH
Coast Entertainment — FY2019 Earnings Presentation
38 slides from Coast Entertainment's earnings presentation, Aug 23, 2019
Slide 1: FY19 Results Presentation
Ardent Leisure Group Limited FY19 Results Presentation August 2019 0
Slide 2: Disclaimer
Disclaimer This information has been prepared for general information purposes only, is not general financial product advice and has been prepared by Ardent Leisure Group Limited (ABN 51 628 881 603) (ALG), without taking into account any potential investors’ personal objectives, financial situation
Slide 3: FY19 Group Overview
FY19 Group Overview 2
Slide 4: Key messages
Key messages ▪ Revenue and EBITDA (before Specific Items) from continuing businesses were up 14.4% and 15.7% respectively over the prior year ▪ Main Event revenue in USD grew 7.9% reflecting contributions from centres opened in FY18 and FY19. Constant centre revenue decreased by 1.0% on a like-for-l
Slide 5: Current vs prior corresponding period
Current vs prior corresponding period Performance vs prior year impacted by sales of businesses, non-cash valuation, impairment charges and tax Consolidated Key factors driving variances: A$m FY192 FY182 Variance ▪ Reduced revenue primarily reflects sale of Marinas (Aug- Revenue 483.3 547.5 (11.7%)
Slide 6: Continuing operations
Continuing operations Main Event and Theme Parks Continuing Operations A$m FY192 FY182 Variance Continuing operations: Revenue ▪ Main Event accounted for over 85% of FY19 revenue Main Event 416.2 355.6 17.0% and grew at 7.9% in US dollar terms (17.0% in Australian Theme Parks 67.1 66.8 0.5% dollars
Slide 7: Specific Items impacting results
Specific Items impacting results Results in both years continued to be impacted by impairment charges in Main Event, one-off costs relating to restructuring and Dreamworld incident FY19 EBITDA from continuing operations (A$m) Specific Items impacting results: ▪ Specific Items which are useful in und
Slide 8: Main Event
Main Event
Slide 9: Overview
Overview Revenue up 7.9% and EBITDA excluding Specific Items grew 4.0% The figures in the table below are in US$ million US$m FY192 FY182 Variance Main Event performance: Revenue 297.3 275.5 7.9% ▪ Sales growth of 7.9% reflects full period contributions from three centres that opened in FY18 and one
Slide 10: Constant centres
Constant centres Constant centre¹ sales down 1.0% for FY19; last two months of FY19 up over 2% Constant Centre¹ Revenue Down in FY19 Constant centre performance: Constant Centre¹ Sales Trend-Like-for-like² ▪ Decline in FY19 constant centre revenue primarily 8.9% driven by fewer promotional activitie
Slide 11: Margin by cohort
Margin by cohort EBITDA margins (excl. Specific Items) down 0.7% driven by FY17-19 centres; partially offset by improvement in Impaired centres and G&A efficiencies Pre-FY17 FY17-19 EBITDA Centres Centres All Centres (excl. (excl. (excl. (excl. Impaired Centre-level Derivative Specific Specific US$m
Slide 12: New centre performance
New centre performance Overall FY18 cohort delivered solid results; only one new centre opened in FY19 in new market Cash-on-Cash Returns2 Initial New centre performance summary: # Centres Spend1 / in Centre ▪ FY18 cohort (four centres all located in new markets) Cohort Cohort (US$m) Year 1 Year 2 Y
Slide 13: Key accomplishments during FY19
Key accomplishments during FY19 Leading to significant improvement across several parts of the business Accomplishments Results Achieved ▪ Built a world-class management team with proven experience ▪ Improved the previous three-year negative traffic trend by 300 in multi-unit brands and site opening
Slide 14: Poised for growth in FY20
Poised for growth in FY20 Focus on brand identity, guest experience & innovation 1H20 ▪ Launch new brand identity, begin rebranding rollout and test enhanced media plan in one market ▪ Virtual reality platform established: ▪ Rollout of VR Rabbids system-wide completed January 2019 ▪ Beat Saber VR at
Slide 15: Poised for growth in FY20
Poised for growth in FY20 Four new centre openings in FY20; 5-8 openings each year thereafter New Centre Development Current Centre Count ▪ Added key leadership and resources to rebuild real estate process ▪ Four centres opening FY20; three are in new markets ▪ Robust pipeline building for FY21 and
Slide 16: Theme Parks
Theme Parks
Slide 17: Overview
Overview Revenue broadly in line with pcp and average per capita spend increases A$m FY192 FY182 Variance Theme Parks performance: Revenue 67.1 66.8 0.5% ▪ Attendance in FY19 was adversely impacted by the Expenses (86.9) (160.6) 45.9% Coronial Inquest hearings held between June and December 2018, al
Slide 18: Key achievements 2H19
Key achievements 2H19 Solid platform re-established – Dreamworld set up for return to profitability in FY20 ▪ A capable and highly experienced leadership team is now in place which includes: ▪ New operations executives with extensive theme park industry experience ▪ Engineering and safety executives
Slide 19: Key achievements 2H19
Key achievements 2H19 Solid platform re-established – Dreamworld set up for return to profitability in FY20 18
Slide 20: Sky Voyager approved
Sky Voyager approved World class flying theatre i-Ride – first of its kind in the Southern Hemisphere ▪ Sky Voyager has been approved by the Queensland regulator and will open to the public on 23 August 2019 ▪ 24 i-Rides launched globally across 14 countries, with a further 19 in construction right
Slide 21: Coronial Inquest
Coronial Inquest Coroner’s report expected towards the end of 2019 Coroner’s Report ▪ Coroner’s report expected towards end of 2019 ▪ As previously stated, the Board is committed to implementing the Coroner’s recommendations in consultation with Workplace Health and Safety Queensland (WHSQ) and the
Slide 22: Industry opportunity
Industry opportunity Prize is up for grabs – template for success ▪ Attendance has reduced by approximately 1.6 million people across Gold Coast theme parks since FY16. This equates to a loss of revenue to the industry estimated to be in the order of $130 million based on increased yields that are b
Slide 23: Our plan to restore value for shareholders
Our plan to restore value for shareholders ‘Game changer’ – new Roller Coaster for Dreamworld ▪ Construction to commence in Q1 FY20 ▪ We have chosen to work with MACK Rides who is a Tier 1 ride manufacturer from Germany with over 230 years experience ▪ The design is based on the highly successful MA
Slide 24: Our plan to restore value for shareholders
Our plan to restore value for shareholders WhiteWater World to undergo a major transformation ▪ Works have commenced on the refurbishment and expansion of WhiteWater World including: ▪ The construction of a new water slide complex incorporating six body slides attached to a 13 metre tower. The new s
Slide 25: Our plan to restore value for shareholders
Our plan to restore value for shareholders Other key projects planned for implementation in FY20 ▪ Implementation of ‘Safety Case’ and further enhancement of safety systems ▪ The staging of special events and entertainment every school holidays including two major annual events (one being Winterfest
Slide 26: Group – Corporate Costs & Capital Management
Group – Corporate Costs & Capital Management 25
Slide 27: Net debt and cash flow
Net debt and cash flow A$m FY19 As at 26 June 2018 A$m Net debt at 26 June 2018 (11.3) Debt (27.8) Operating cash inflows 32.5 Cash 16.5 Capital expenditure (cash outflow) (76.1) Net debt (11.3) Proceeds from sale of plant and equipment 0.2 Insurance recoveries relating to damaged assets 2.0 Sale of
Slide 28: Capital structure and funding
Capital structure and funding The Group has sufficient headroom to fund future capex and business operations ▪ On 5 April 2019, the Group successfully completed the refinancing of its debt with US lenders ▪ Under the new arrangements, Main Event Entertainment Inc is now the borrower of the Group and
Slide 29: Corporate costs
Corporate costs ▪ Gradual reduction in recurring corporate costs ▪ FY19 impacted by one-off costs associated with destapling and corporatisation, consulting and employee related costs Corporate costs (A$m) 19.2 2.7 15.1 15.5 15.1 3.5 5.1 16.5 15.1 12.0 10.0 FY16 FY17 FY18 FY19 Recurring Coporate Cos
Slide 30: Lease accounting and capital management
Lease accounting and capital management New lease accounting standard ▪ The Group has adopted the new lease accounting standard (AASB 16) from 26 June 2019, utilising the modified retrospective approach (comparative amounts will not be restated) ▪ While the implementation of AASB 16 will significant
Slide 31: Outlook
Outlook Main Event ▪ Constant centre revenue increase of 1-2% ▪ Four new centres in FY20 adding approximately 60 additional operating weeks ▪ Average prototype centre net capex of US$8.5 million ▪ Anticipate to open 5-8 new centres a year from FY21 and thereafter ▪ Targeting 20% EBITDA margins (excl
Slide 32: Appendices
Appendices 31
Slide 33: Specific Items by business unit – FY19
Specific Items by business unit – FY19 Consolidated Main Theme Continuing Discontinued A$m Event Parks Corporate Operations Operations Total Statutory EBITDA 47.2 (19.8) (15.1) 12.3 (0.6) 11.7 Specific Items impacting EBITDA: Impairment of property, plant and equipment (17.6) (17.6) (17.6) Provision
Slide 34: Specific Items by business unit – FY18
Specific Items by business unit – FY18 Consolidated Main Theme Continuing Discontinued A$m Event Parks Corporate Operations Operations Total Statutory EBITDA 14.1 (93.8) (15.5) (95.2) 41.2 (54.0) Specific Items impacting EBITDA: Valuation loss - property, plant and equipment and investment held at f
Slide 35: Capital expenditure and pre-opening expenses
Capital expenditure and pre-opening expenses FY19 Routine Other Special Development Pre-opening A$m Capex Projects Capex1 Expenses Main Event 7.1 16.8 24.2 2.8 Theme Parks 9.2 - 19.9 - Total 16.3 16.8 44.1 2.8 1 Net of developer proceeds and tenant improvement allowances 34
Slide 36: Defined Terms
Defined Terms 35
Slide 37: Defined terms
Defined terms Defined Terms Description Bowling & Entertainment Comprised of AMF, Kingpin and Playtime Cash-on-cash return The ratio of annual before-tax cash flow to the total amount of cash invested EBITDA Earnings before Interest, Tax, Depreciation and Amortisation EBRITDA Earnings before Propert
Slide 38: Defined terms
Defined terms Defined Terms Description PCP Prior corresponding period PP&E Property, plant and equipment Pre-opening costs Costs that are expensed as incurred prior to a centre opening for business ROI Return on investment Significant non-trading income or expense items which are non-cash or non-re
Coast Entertainment Holdings — FY2019 Earnings Presentation on 6ix