Thank you for standing by, and welcome to the Ardent Leisure Group Ltd. FY 2022 financial results conference call. All participants are in a listen-only mode. There will be a presentation followed by a question-and-answer session. If you wish to ask a question, please press the star key followed by the number one on your telephone keypad. I'd now like to hand the conference over to Dr. Gary Weiss, Chairman of Ardent Leisure Group . Please go ahead.
Thank you, and good morning, everyone, and thank you for joining our call today. I'm joined today in the presentation by Greg Yong and José de Sacadura. I'm pleased to announce today that we've appointed Greg as Chief Executive of Ardent Leisure Group and José assumes the position of Acting Chief Financial Officer. FY 2022 results conclude an important chapter in the history of Ardent Leisure Group. As is well known, the results released today reflect the final contribution of Main Event to Ardent Leisure. The FY 2022 results reflect a significant turnaround at Main Event, which has taken place over the last four years, with Main Event recording an EBITDA contribution, excluding specific items, of $106 million, up nearly 175% on prior year.
Over the last few years, following an extended period of relatively stagnant EBITDA contribution, the Main Event business was repositioned and revitalized, leading to a doubling of EBITDA over the period. We are proud of the substantial turnaround achieved at Main Event over this period, and I particularly wish to call out and acknowledge the outstanding contribution of Chris Morris, Darin Harper, and all our former colleagues at Main Event, to the Ardent Leisure Group. The sale of our interest at Main Event was completed post balance date, and this has transformed the Ardent balance sheet. I particularly wish to point to slide eight of the presentation released to the ASX today, which produces a simplified balance sheet of Ardent moving forward.
As will be observed, Ardent is now in a very strong financial position to continue to invest in and support the recovery of our theme parks business. Greg will take you through the performance of that business during the period. Suffice to acknowledge at this stage that there are some very positive signs that the recovery of Dreamworld is well underway with encouraging prospects for the future. I will now ask José to deal with the group review.
Thank you, Gary, and good morning, everyone. I'll provide a bit of an overview of the group's superb performance for FY 2022, starting with slide three. As Gary mentioned, FY 2022 has been another significant year in the Ardent Leisure journey, with the group achieving a solid trading performance despite some ongoing impacts associated with COVID-19. The group's reported revenue from operations of AUD 637.6 million represented a significant improvement on the prior year revenue of AUD 390.7 million, and was also AUD 154 million or almost 32% above FY 2019 pre-COVID levels.
As the slide shows, this turnaround was driven by a solid performance in the Main Event business throughout the year, and also a marked improvement in momentum within the theme parks and attractions business, particularly in the second half of the year once restrictions had eased. The group's EBITDA, excluding specific items for FY 2022, was AUD 123.6 million, up AUD 90 million on prior year and up AUD 69 million versus FY 2019 pre-COVID performance. At the bottom line, the group reported a statutory net loss after tax for the year of AUD 97.4 million. However, it's important to note that this result has been impacted by a number of one-off specific items, including some significant expenses associated with the sale of Main Event, which I'll cover shortly.
As at the reporting date of 28th of June, the group had net debt of AUD 152.7 million. However, all debt facilities have since been repaid following the sale of Main Event. Turning now to slide four. As mentioned, Main Event achieved a solid result for the period. Its revenue of $426.2 million was up almost 60% on prior year, and its EBITDA, excluding specific items of $106.5 million, was up almost 175%. This performance was driven by a combination of strong constant center revenue growth and the contribution of seven new centers, including four new builds and three new centers acquired as part of The Summit business acquisition in March 2022.
Main Event's constant currency revenues grew 41% on prior year and 23.5% on pre-pandemic levels. In the theme parks and attractions business, revenue of AUD 49.5 million was up 37% on the prior year, with visitation levels 18% higher and ticket sales and yields significantly improved. While the theme park's EBITDA loss, excluding specific items of AUD 15 million, was slightly higher than the prior year loss of AUD 10.3 million, this result is distorted by a net benefit of AUD 10.5 million in government grants and subsidies received in the prior year, compared to only AUD 2 million received in FY 2022. If we strip out the impact of these grants and subsidies, theme parks EBITDA excluding specific items improved AUD 3.8 million or 18% on prior year.
It's also worth pointing out that of this loss, AUD 12.2 million was incurred in the first half compared to a much improved AUD 2.8 million loss in the second half, demonstrating a turnaround in performance trends of the business as Greg Yong will explain in further detail. Of course, in December 2021, the business successfully launched its new Steel Taipan roller coaster. I'm pleased to say that this new attraction has proved to be very, very popular with our guests. Slide five provides a summary of the group's consolidated income statement for FY 2022. As previously mentioned, the group's consolidated revenue and EBITDA improved considerably compared to the prior year. The Main Event performance was further aided by favorable foreign exchange movements in the year, with its revenues growing 65.8% in Australian dollar terms.
The group's statutory EBITDA of AUD 45.5 million was after AUD 131 million of costs associated with the Main Event sale. These costs are largely timing related, being recognized in FY 2022 ahead of the sale, which completed in early FY 2023. EBITDA was also impacted by a number of other non-recurring specific items. Excluding these items, EBITDA of AUD 123.6 million was up AUD 90 million versus the prior year. The group's corporate costs for FY 2022 amounted to AUD 8.1 million, representing an increase of AUD 2.2 million in the year. This increase was predominantly driven by increased insurance costs, and I'll be providing some further color on corporate costs towards the end of this presentation. Lastly, the group's depreciation and amortization expenses reduced by almost AUD 15 million in the year.
This was mostly due to an accounting standard requirement to cease all depreciation on Main Event's assets once that business became classified as held for sale. This change in classification occurred upon signing of the sale agreement with Dave & Buster's on the 6th of April this year, and therefore the group's result reflects nine months of Main Event depreciation in FY 2022. Further segmentation of the results between continuing and discontinued operations is presented in Appendix 1 to this presentation. Turning to slide six. As mentioned, the group's result this year has been impacted by several one-off specific items, and here we show further detail regarding these items. As a reminder, a further breakdown by business unit is provided in Appendix 2 of the presentation. I'll now call out a few of the more material line items.
Firstly, as a consequence of the significant appreciation in equity value of Main Event, the group's valuation of the Main Event LTI plan and RedBird option liabilities materially increased in FY 2022. This resulted in incremental expenses in the year of $83.4 million and $7.5 million, respectively. The group also recorded expenses of $7.3 million for a portion of the Main Event sale costs, which had been committed and incurred in FY 2022. In addition, there was $32.9 million of unrealized derivative valuation losses recognized relating to forward foreign exchange contracts, which the group had put in place to hedge its exposure on the Main Event sale proceeds. Due to weakening of the Australian dollar against the US dollar, the mark-to-market value of these hedges was a liability at the reporting date.
Finally, the income tax allowance reflects 15.4 million dollars of tax losses and deductible temporary differences, which had not been recognized as deferred tax assets during the period. Notwithstanding this accounting treatment, the economic benefits of these unrecorded assets remains. I'd now like to turn our attention to the sale of Main Event on slide seven. As announced to the market a few weeks ago, the group completed the sale of Main Event to Dave & Buster's on the 13th of June for $835 million on a cash-free, debt-free basis, representing a valuation of 8.9x December 2021 trailing 12-month adjusted EBITDA. This transaction was overwhelmingly supported by Ardent shareholders with over 99% voting in favor of the transaction.
Following completion, the group has used the proceeds to pay down its Queensland Government debt and amounts payable to the Australian Taxation Office. On the 13th of July, the group also paid a distribution of AUD 455.7 million to its shareholders by way of a return of capital and a special unfranked dividend. Remaining sale proceeds of circa AUD 153 million have been retained to fund the recovery and growth of the theme parks business. On slide eight, we show the impact of the Main Event sale on the group's position moving forward. The table presents pro forma assets and liabilities of the group after adjusting for the sale of Main Event and subsequent use of the proceeds, which as I mentioned, include the full repayment of debt and the distribution to Ardent shareholders.
On a pro forma basis, the group's cash balances increased to AUD 150.7 million, with further post-completion proceeds of approximately $11.4 million still to be received on finalization of working capital adjustments. Following the sale, the group is now debt-free with unencumbered assets and a balance sheet, which has significantly strengthened. The large cash balance is expected to provide ample liquidity to recover, grow, and develop the remaining theme parks and attractions business going forward. Pro forma net assets following the sale are around AUD 277 million, an improvement of AUD 213 million compared to the reported position at 28th of June. However, it's also worth noting the considerable upside which potentially exists. Firstly, the numbers presented show theme park assets at historic cost, net of accumulated depreciation and impairments.
Prior to the Dreamworld incident and COVID, the carrying value of Dreamworld assets was approximately AUD 241 million, and the value of SkyPoint was just over AUD 34 million, well above the carrying values currently presented in the balance sheet. Secondly, the balance sheet presented excludes recognition of deferred tax assets relating to Australian tax losses of some AUD 122.8 million and deductible temporary differences of AUD 49.7 million, together representing a tax benefit combined of AUD 51.7 million. Although these are not in the balance sheet, these assets remain available for use by the group in future periods.
Finally, the numbers presented also exclude any recognition of further deferred and considered consideration on the sale of Main Event of up to $14.8 million, which Ardent stands to receive upon the utilization of certain U.S. tax losses by Dave & Buster's in the future. As you can see, the future realization of value for the items that I've just mentioned has the potential to materially increase the value of the group's net assets beyond what is shown here. I'll now hand over to our CEO, Greg Yong, who will walk you through the performance of Main Event and Theme Parks businesses.
Thanks, José, and good morning to everyone listening today. We've obviously got a lot of content to get through, so I'll speak relatively quickly this morning to allow some time for questions at the end. Certainly been a very turbulent 12 months. In fact, when we had this call a year ago, most of you were in lockdown, borders were closed, and the Delta variant was running rampant. Thankfully, we're in a very different position today, and while the effects of the pandemic continue to affect businesses in very new ways, we are in a much better trading environment than we were in a year ago. Turning to slide 10 and Main Event. I think the numbers here are well stated, and I think we're more than happy to take questions at the end of the presentation with relation to this transaction.
On slide 11, much of the same, and I think we've already alluded to the simply incredible performance of Main Event coming out of the pandemic. Turning to Theme Parks and Attractions on slide 13. We've outlined some of the meaningful success stories in the business over the past 12 months. Each of these outcomes are accretive to our strategy, and I'll touch on these throughout today's presentation. I'm very proud of the ongoing improvements we're seeing in safety, which is the most important aspect of our business. The opening of Steel Taipan on time and on budget demonstrates the capability of our team to execute significant capital projects and to work with key stakeholders such as regulators to achieve outcomes, which is a critical competency in this business.
New concepts to drive meaningful incremental revenue are also a key theme, and most pleasing has been the growth in our organizational culture scores. This, with the aggregated benefit of our other initiatives, has led to a significant improvement in guest service scores. These material enhancements, physically and culturally, in concept with a solid financial platform that is Ardent moving forward, as José has just outlined, leave me tremendously excited about the prospects into the future. Turning to slide 14. We've called out here that to accurately measure underlying performance, we've removed the impact of grants and JobKeeper from these numbers. This is particularly important given the size of the organization and the associated materiality of these on our results, with government support in FY 2021 representing a significant component of total income.
As you can see, we have seen positive movement in each of our key indices, and this is particularly notable given the very poor trading environment in the first half as a result of border closures and lockdowns. On slide 15, we outline the statutory results. You can clearly see the impact of grants on this slide. As José mentioned earlier, revenue finished up 37%, and whilst expenses have increased in line with business activity, we are comfortable that the spend is well below the pace of revenue growth, which essentially leads to an improvement in margins. We remain very comfortable with our annual pass performance, which is obviously critical for the first half of the year. In fact, annual pass sales for FY 2022 were the highest that we've seen since FY 2017.
This supports our other indicators, which suggest that local guests are starting to come back to the brand and in a significant way. Excluding one-off grants and subsidies, EBITDA improved by AUD 5.2 million on the prior year. As I've mentioned several times, the first half of the year was extremely hampered with borders closed, lockdowns throughout the period, and the need to keep the lights on from a cost perspective without the benefit of material government support. Given this, the result really is a tale of two halves. On slide 16, we've provided some deeper insights into the second half and furthermore into the July 2023 trading to give you an appreciation as to the considerable change in trajectory that we've seen since the borders reopened.
For the second half, ticket sales and revenue to Dreamworld and WhiteWater World were up significantly, and more importantly were the highest that we've seen since FY 2017, the year that the TRRR tragedy occurred. These top-line results, coupled with the business transformation initiatives that we've implemented, led to the lowest second half EBITDA loss the business has seen since FY 2017. In July, we've seen significant improvement in ticket sales and revenue, which is understandable when considering the difficult trading period last year. Importantly, though, ticket sales and revenue were the highest that we've seen since July 2018 on the back of the lowest expense numbers that we've seen since July 2018, culminating in an EBITDA profit for July and moreover, the highest EBITDA profit for a July since 2018. Turning to slide 17.
As we've outlined in previous presentations, our pervasive strategy is in many ways a flight to quality across all aspects of the business. In line with that change, we're seeing good responses to our stratified pricing architecture, which was implemented last year. This has allowed us to grow admission yields while maintaining sales velocity by having offers that cater to all elements of our pass base. This means that you can still get a very affordable pass to our parks if that's what your family requires, but it also provides clear opportunities for guests to select more value-packed options should they desire. The work that our team has done on digital has meant that the path to purchase clearly demonstrates tiers of value along the guest journey. As a result of this optimization, we've seen the majority of our total sales fall into our highest yielding passes.
As an aside, the average price of our aggregated ticketing mix at year-end was 59% higher than what we were seeing back in FY 2017. Our in-park businesses have been no different. Organically, we're committed to making material improvements in our F&B offer. While we'll always have opportunities for improvement, our guests have recognized the change, and we are seeing solid incremental financial uplifts and guest feedback scores. We've also seen very strong growth in our retail and experience businesses. A success story I'm particularly proud of is the collaboration with our team and LEGO to launch the Dreamworld online LEGO store, which has seen simply incredible results.
All of this, along with the implementation of initiatives like Ride Express, Slide Express, and the Steel Taipan Tailwhip experience, has led to an increase in in-park yields of over 40% since FY 2017. Moving to slide 18. I know as fervent followers of our business, all of you will be aware of our exposure to weather events and moreover, the negative impact that these can have on financial performance. What makes our second half performance even more outstanding is the fact that we suffered what can only be described as just terrible weather for much of the half. For the period from January through to June, almost 60% of our trading days were rain affected, and this has clear impact on attendance and therefore revenue performance.
I can tell you that everyone here was very buoyed by what was, in our view, one of the best Aprils we'd seen in the entire business. Then almost immediately, we felt as though we'd had one of the worst May results ever as a result of just persistent rain throughout the month. The statistics tell the story, with rain-affected days for the half being twice the monthly averages that we've seen over the past 30 years on the Gold Coast. As an organization, we are very clear about not giving guidance, and I can tell you that notion extends very much to giving predictions about the weather. What's almost certain is that if rain falls anything like traditional averages, the business performance would have been clearly even stronger.
On slide 19, we've attempted to give you a picture as to the impact of international visitation, which has remained at largely negligible levels. International represented anywhere between 17% and 19% of the business in the lead up to the pandemic. While some of that was quite dilutionary, in particular markets like China, the yield profile across all of the markets was actually quite disparate. What's clear is that as international returns, there's an upside opportunity for us to recapture that business. What's also clear is that we have a unique opportunity to contemplate how we reprice those markets. That may not simply be about putting up price, although it probably will likely be part of it, but it will also involve us being more sophisticated in the types of products that we offer to which segments, be it OTAs or FIT guests.
On slide 20, and with the able assistance of Kenny the Koala, we've outlined what we believe are the four key themes for the business over the coming few years. I'll discuss each in some detail with safety, business transformation, and people being relatively straightforward and revenue having some further tenets to the plan. As I've outlined to each of our key stakeholders, safety is our fundamental focus. We have a responsibility for the safety of our team, our guests, and our animals, and I can assure you that we take this responsibility very seriously. You can see a number of those initiatives on slide 21. In my opinion, we have led the broader industry in terms of our diligent and systematic response to COVID.
Similarly, our team has been at the forefront of next-generation safety systems and the significant works related to our application for major amusement park licenses as part of the Queensland Government's world-class safety legislative framework. Fleet modernization continues with substantial improvements are being invested into iconic attractions such as the Giant Drop, which is undergoing a major refurbishment as we speak. Any safety expert will tell you that systems are one thing, but without a robust culture, performance is far from optimized. I'm very pleased to say that we have seen what can only be put as a transformative change in our culture over the last few years. This is evidenced by our internal survey results and moreover, from feedback that we've received from third parties, including safety auditors, independent contractors, and our insurers.
I cannot emphasize what a significant amount of effort and passion has gone into this area of our business. To that end, I'd like to thank our operational members of the Executive Team, in particular, Adrian Summers, our Director of Engineering, Michelle Erasmus, our Director of Operations, and Dwayne Clark, our General Manager of Commercial and Facilities, for their extraordinary leadership and moreover, for the efforts of their extremely talented teams. Further, I must recognize the incredible contribution of James Redgrove, our GM of Safety Systems, and Guy Marshall and Manager of Safety Assurance. Both James and Guy have brought what are by any measure, world-class commercial aviation protocols to our business and have tailored them to meet our context.
As we move into the future, our focus is on consolidating and continuously improving the good work already done while turning our attention to the emerging risks on the horizon. Turning to slide 22 and business transformation. Over the last three years, we have worked very hard to run a more efficient business. Safety considerations will always take precedence over costs, and there is no clearer proof than the fact that we've found significant cost reductions since FY 2017 despite record spending on rides and safety system improvements. The decisions that we've taken, such as removing older and economically unviable attractions, closing the water park in cooler months, rethinking the deployment of variable labor and running an incredibly lean back end to the business have all contributed to these results.
We must remain extremely disciplined on maintaining this level of diligence while investing in technology to generate new efficiencies in the organization. This starts with a new ERP system and a contemporary time and attendance system. I must stress that we've spent a great deal of time ensuring that these solutions are appropriate for an organization of our size and make the job for our operational teams easier, not harder. In fact, I've seen too many organizations put in new systems that drive additional complexity into business and take skilled people, like engineers or chefs, away from what they do best and put them in front of a computer to feed the ERP machine. That is something we are very keen to avoid here, and to be frank, it's something that I will simply not let happen in this organization.
On slide 23, we outline the key tenets of our plan to grow revenue over the coming years. Other than safety, these are the most critical elements of our strategy to move the business to break even and towards historical financial performance. The first element is to be brilliant at the basics. It's no secret that guests come to our parks to experience attractions first and foremost. That is why it is so important to ensure that our attraction availability and our attraction reliability are focus areas for our team. Often this and safety actually go very much hand in hand. While maintenance is a non-negotiable part of our business, we are reshaping our maintenance program to meet our maintenance objectives while also minimizing the number of attractions that are down at any one time.
This may even lead us to complete maintenance tasks before they're due, which can be somewhat financially less efficient, but in order to have a ride available for a peak period. Our focus on reliability is as much a measure of good maintenance management as it is on having attractions available for the guests to experience. At the same time, our team have absolutely no reservations on having an attraction closed if we perceive there to be any risk whatsoever to safety. From a sales and marketing perspective, we have seen very pleasing results in the digital mobile-first initiatives that I've previously discussed. Our newly designed website has been specifically built with mobile front of mind, and as I outlined earlier, our path to purchase has been optimized, and it's delivering conversion rates for higher priced tickets that are much greater than what we initially anticipated.
We continue to work on further leveraging tech to provide a more frictionless experience for our guests, and we intend on extending this work through to other parts of the business, such as Moonlight, over the coming few months. Lastly, and fundamental to incremental growth, is our product master plan, which I'll speak to shortly. Over to slide 24. Our efforts to be brilliant at basics, and as a result, deliver the Dreamworld difference to our guests, is starting to bear fruit. I've spoken about the range of different areas that we've been working on from attraction availability to F&B and pretty much everything in between. What has also been a focus for us is being the best at being busy.
This means detailed planning in advance of the school holiday periods, a very analytical approach to recruitment and scheduling, and more importantly, ensuring our attractions have additional units maintained and ready to be deployed for peak periods. This entails things like having additional trains on roller coasters, additional dodgem cars on tracks, but it also means having people that are incredibly well trained and supported by a management team, a team that work weekends, that work most every day in holiday periods in the parks and on the tools, so to speak, to be able to meet the demand if and when it comes. All of these measures have led to absolutely incredible results. Our net promoter scores are up significantly, some 31%, some 31 points on the prior corresponding period.
Furthermore, our Global Review Index scores, which are essentially an aggregation of reviews principally from places like Google or Tripadvisor, have led our parks to being rated as the most popular best theme park experience on the Gold Coast for each of the school holiday periods since borders have reopened. I'm tremendously proud of our team for the care and the attention that they give to our guests each and every day, and these quantitative results are a testament to those efforts. Turning to slide 25, and the first part of our major product master plan. I've spoken at length about the importance of events and tentpole events at that to our revenue plan. These events add significant value to our annual pass. In fact, we can empirically measure enhanced propensity to purchase passes as a direct response to marketing of these events.
Just as importantly, they provide a distinct reason to visit for existing pass holders or interstate guests that are looking for a unique addition to their theme park experience. We now have a calendar which is absolutely world-class. In fact, I doubt there is a standalone regional park on Earth that has this level of activity in their calendar. On slide 26, you can see Winterfest, a fantastic event which I know you're all very familiar with. We also ran our second Dreamworld Fun Run. A great event for the entire family, with both a 2 km fun run and a 5 km race for the more competitively minded. I think the experience of running through our water park, past our incredible wildlife, rides, and attractions, and with our favorite characters, makes for a completely unique event.
Not only did it sell out, but we raised over AUD 10,000 for local [inaudible] . I have to say that I'm extremely excited about this event, and we've a ton of new ideas to bring it to a whole new level in 2023. In fact, this morning I spent a little bit over an hour with our two US-based directors from Disney, Randy and Erin, talking about their experiences in this very space. Our Dreamworld Country Fair, which has the cutest baby animals, beautiful garden decorations, live music, and incredible home-style food offerings, and much more, was launched to rave reviews last year and is returning this September. On slide 27, Happy Halloween has become a family favorite. We were the first to bring a whole of park family Halloween experience to the Gold Coast.
Last year, with some fantastic embellishments, we had the highest attendance and the highest revenue since the event's inception in 2019. For our local Kiwis, of which there are many on the Gold Coast, our esteemed chairman, Waitangi Day is a very special occasion, and we were pleased to present our iteration of that event earlier this year. Based on the great feedback that we've received, we have decided to make Waitangi Day at Dreamworld an annual event. In April this year, we launched our inaugural Street Food Festival. Given our extensive research into food-based events, we had very high hopes, but we were absolutely blown away by the response of the market to this new offer. Our April ticket sales were better than pre-incident ticket sales, and NPS scores were materially higher than the same period last year.
You can be assured that this will be a regular fixture here at Dreamworld moving forward. Lastly, over December and January, we delivered our 40th birthday Making Memories activation. We presented The Wiggles Live, and we presented Cosentino Live. Executing each of these individually is a significant undertaking, let alone together over a period of only a month or so. As you can tell, this is an exhausting list of activity, and the work that goes into simply replicating and enhancing existing events each year is substantial. You take that and then add on top the fact that we launched the Dreamworld Fun Run, the Dreamworld Country Fair, Waitangi Day, and the Street Food Festival, along with all of the holiday activations in the last 12 months out of a very small team, and you can get a glimpse of the dedication and the caliber of our people.
Turning to slide 28 in new attractions. Firstly, we remain committed to refurbishing iconic attractions wherever possible. This year we reopened an all-new Dreamworld Express with state-of-the-art new rolling stock designed to allow wheelchairs in every carriage and a host of new safety features. I can say it has been an absolute hit with guests of all ages. We're also completing a multi-million dollar refurbishment of Dreamworld's Giant Drop, an attraction that has become a beacon for the park and is seen from all over the Gold Coast. New attractions, though, plain and simple, is where the rubber meets the road. These are some of the most important decisions that we'll make as an organization, and as such, the degree of critical review, analysis, and modeling that we apply is commensurately significant. It's no good to be able to procure new attractions if you can't get them open.
I'm very pleased with the fact that our team delivered Steel Taipan, one of the most ambitious new roller coasters in the Southern Hemisphere, on time, on budget, in the midst of a global pandemic and with unconditional design registration from our regulator. This gives us a very high degree of confidence as we consider our future options. I can say today that those future options are very much well advanced. We have a board-approved product pipeline that will bring new to the parks from this year right through to 2025. In fact, we've already executed several contracts in that regard. We intend to make some more fulsome announcements on these very exciting plans prior to the end of the calendar year. Turning to slide 29 in complementary development.
As we've outlined in the previous presentations, we see significant value in our surplus land holdings. At the same time, and particularly given our renewed balance sheet position, it is our first priority to achieve the highest commercial return. In some cases, for parcels of land that are currently landlocked but are expected to see public road connectivity in the near term, we're not looking at divesting this land for less than we believe is realizable once these connections are in place. In terms of land that we've earmarked for accommodation and other development, our efforts towards working to achieve these outcomes have progressed, and I can confirm that management and the board have been engaged with various local and state authorities as part of this process.
An area of emerging opportunity is for us to better sweat the existing assets and to develop new revenue streams that are ancillary to our day-to-day operating business. To that end, we have recently launched Dreamworld Night Market, which is held every Friday and every Saturday night here at Dreamworld. This is an altogether new business designed to leverage both existing infrastructure and existing core competencies within the organization. We have been extremely pleased with the guest response to the concept and, moreover, the incremental financial performance has exceeded our base case expectations and is trending rapidly towards exceeding our highest case scenarios. We anticipate with warmer weather and some additional very targeted investment that this concept will become a material new revenue stream and EBITDA stream for the organization.
Similarly, through a great piece of innovation through our commercial team, we launched our online store for LEGO a little over a year ago for what was a very modest investment. Performance in this initiative has well and truly exceeded all of our expectations, with the online segment of the business generating over AUD 1.5 million in the first 12 months of operation. Again, our analysis suggests that this is almost all incremental, with the LEGO store continuing to exceed historical performance. We're investigating several other opportunities along these lines given these very encouraging success stories. On slide 30, and as I've discussed throughout today's presentation, we have an incredible team here at Ardent.
Sound strategy is one thing, but execution is equally critical, and I'm very happy with the caliber of the people in place and very thankful that they've embraced a high-performance culture, one that is clearly required for an organization in the midst of such a significant turnaround. From a cultural standpoint, our employee net promoter score, or eNPS, is at an all-time high. In fact, from 2018 and 2019 through to today, the percentage increase is so significant I couldn't bring myself to include it in the deck. I can tell you that it's hundreds and hundreds of percent up on those years and in terms of pure points, markedly better than cultural scores that I've seen in my businesses globally.
Despite this, we have much to do, and while our culture is healthy, I still see a massive amount of potential to make Ardent a place that people aspire to be a part of. Lastly, myself and our Leadership Team are focused on making a paradigm shift around diversity, equality, and inclusion in the organization. We're not doing this because it's topical. We're doing it because it's right. Having a much more representative team who are fairly compensated in all levels of the organization mirrors the type of families that we serve each and every day here at Dreamworld. We will shortly be launching our three-year DEI strategy, and I'm looking forward to seeing the positive impact of these changes on how we do business here at Ardent. In closing, on slide 31, I have never been more confident in the recovery of the business than I am right now.
Despite what was a very difficult first half, we have seen a significant change in performance with the best second half result since FY 2017. The strongest ticket sale performance since FY 2017. On the strongest yield since FY 2017, and on the most efficient cost base since FY 2017. All of this despite twice the amount of rain-affected days that we've ever seen, and with little to no international visitation, and with record spending on safety related initiatives. If you couple these indicators with the fundamentals of our very robust balance sheet with no debt, 100% owned land holdings in one of the fastest growth corridors in Australia, and sufficient cash to deploy strategically by a proven leadership team, and we have a very compelling thesis.
It would be remiss of me not to acknowledge the potential headwinds, and we are obviously very cognizant of the macroeconomic environment both in Australia and overseas, let alone the impacts that continue to persist as a result of the pandemic, namely the availability of skilled labor. We do believe that we are in the best shape possible to manage these conditions as they present themselves. Finally, I'd like to thank our entire Ardent team for their commitment and their dedication over the past 12 months. Thank you, and I'll hand back over to José.
I'll just very quickly, conscious of time, just note pages 33 and 34 of the presentation. Just a word or two on corporate costs. You'll see there that there has been an increase during the period, largely attributable to an increase in insurance costs. There are also additional charges at a corporate level arising out of the considerable work that went into the sale of Main Event to Dave & Buster's. Central costs will continue to be a matter of focus for the board going forward. That's probably all that needs to be said just at this moment. We'll open up to questioning.
Your first question comes from Nicholas McGarrigle at Barrenjoey. Please go ahead.
Good day. Thanks for taking questions. Just wanted to touch on July as a month. Can you give us a sense on, in a more normal environment, say FY 2016 or earlier, was there a lot of seasonality in July? I'm just trying to get a sense on the, where that profit stands in the broader mix of the year.
Yeah. Hi, Nick. Look, July is an important month. It's almost all school holidays, so it's certainly not, you know, an off-peak period. It's not a February or a May or a November. You know, almost the entire month is made up of school holidays. So in terms of its, you know, ratio, if you will, comparatively to other months in the year, it's in the top, you know, three or four months in the entire year.
Just in terms of the profitability, in July, obviously benefiting from obviously that extra attendance. In terms of annual passes, you obviously booked that monthly. You've had a great experience there. Do you expect that even in sort of an August or September when things are a bit quieter, that you can maintain profitability?
Look, we still are very hesitant to give guidance given, you know, just how uncertain the environment is to a degree even today. What is a factor is deferred revenue balances as a result of annual pass holder sales. As we've mentioned in the past, we try to talk both about ticket sales as well as revenue, given that they are actually distinctly different in this organization. Look, we're really happy with July. Months like August are quite interesting though, because as I've outlined with regard to international, the degree of international that we're seeing compared to what we were seeing in those off-peak months previously is still, you know, quite a gap.
You know, as I say, we don't give any guidance, but yeah, that's still a factor in our thinking.
Is it fair to look at the deferred revenue balance, in payables? Or just there's a few different balances there, but which one should we look at to get a sense on the sort of momentum in ticket annual pass sales?
Yeah, José, it might be best for you to answer that. Nick, in terms of annual pass sales or sales in general, we have called out you know the change in performance around just net ticket sales, which is an aggregation of single day, multi-day and annual pass. You can see the growth that we've had in those on in the deck. In terms of the actual accounting treatment of them in particular, where you can locate that, I might just ask José to make a few comments.
Yeah. Nick, if you have the financial statements in front of you, note 14 of the financial statements, the payables note, outlines the deferred revenue balance there. That is, you know, predominantly the theme parks revenue on annual pass or multi-day passes with revenue to be released over the period of the pass. In past years, that balance would have typically included Main Event, but Main Event has been stripped out this year and presented separately as held for sale. That relates pretty much to the theme parks.
Yeah, understand. I guess, 'cause that went from 16 down to 11.5, but the 16 includes the Main Event. That's fair. That's fine.
Yes, that's correct.
Just in terms of wages, I imagine that the new minimum wage standards are gonna have an impact up in the Gold Coast. Can you just comment on wages and just inflation more generally?
Yeah, absolutely. Look, it's a very competitive market, as you well know, and we've passed on the increase in wages as we're obligated to do so. Look, it's a pressure on the organization. I think what I've always called out, though, is that we've taken some very significant measures to drive efficiency in the organization. A lot of those measures, you know, mean that the business today is less susceptible to what those changes might have been in previous years. If I point to things like the water park not being open in off-peak periods, attraction rationalization, you know, those type of things, you know, somewhat reduce that risk.
It is certainly there, and we are seeing some impacts around that, you know, not only in labor, but in areas like F&B, supply chain, and things like that. Look, we believe that there's a degree of opportunity there to price against that. As you can see from our yield numbers, we have been doing that. We're quite mindful about, you know, just taking what we see as the bluntest weapon with price and trying to make sure that as we move price, we enhance value at the same time.
I think there's a few case studies around the place, where if price is simply the only thing that you contemplate, then I think guests react pretty negatively to that if you can't demonstrate, you know, commensurate value.
Yes, that's fair enough. Just in terms of the property plan, has anything evolved there in terms of the thinking on which parts you redevelop, take a partner, or look to divest?
No, nothing's really changed there, Nick, in terms of our thinking on it. You know, we identified some time ago what that looks like in terms of our land holdings and how much is, in our view, you know, surplus to our needs. That hasn't changed in terms of how that all kind of looks. If I just give you the high level numbers, we're sitting on around 56 hectares here. We've got 34, you know, that are used, and we've got, you know, a degree of residual. You know, we've identified very clearly in our minds what parts of that would be surplus and ultimately divestible, and what parts we think we can just get a higher and better use out of.
As I mentioned, though, some of the areas that we've called out as being surplus and, you know, prospectively able to be sold are not quite ready today to be moved on given some connectivity issues and such. We have a pretty good idea as to what that looks like. As I called out in the prepared remarks, we're just not in a hurry to do that without getting the highest potential value that we can achieve. I think as Gary's called out a number of times, the land's not getting any less valuable here in the Gold Coast, particularly in Coomera. You know, so yeah, we're keen to make it happen, but we absolutely want to achieve the best possible price.
Yeah. Okay. Thanks for talking us through that. I might jump back in the queue and let someone else ask a question. Thanks.
Yeah.
Thank you. Your next question comes from Allan Franklin at Canaccord Genuity. Please go ahead.
Yeah. Hi, everybody. Thanks for your time today. Just interested in some discussion around per capita spend, please. On some very rough workings, looks like it was AUD 60 in the second half. Just to what extent we can use that as a rule of thumb moving forward, or is there any overlay of seasonality to think about within that number?
Yeah. Hi, mate. Look, in terms of the yield spends, we've done a lot of really good work there. There's no doubt about that. As I called out, you know, the fundamental driver of that is ticket pricing. We've called out that ticket prices today versus, you know, at around the time of the incident, you know, we're near on 60% up on that period. The only thing I'd say to you in terms of your own workings would be that the mix is quite different. As I called out, you know, 19% or 20%, roughly, of our attendances in the past were international. We expect that will return over the next period of time.
How long that takes, we're not really sure. As I called out also, the yield profile of international is quite disparate. You've got China, which was very low yield, and you've got other markets which was, you know, very close to the yield that we see out of the local market. The only thing I would say is that as we see international coming back, if you aggregate international, it's almost certainly somewhat dilutionary to the per cap that we're doing today. So it's something to be mindful of. In terms of seasonality, look, not really any material changes there. In fact, you know, what we've seen over the second half has been a much stronger mix of single day entries.
As you know, that's a slightly lower yielding product for us than annual pass. That is a factor to contemplate. I think is just you know the change in mix that has been occurring over the last years.
Yeah, perfect. Thank you. Perhaps a slightly tricky one, but just interested in any disclosure you can provide on the month-to-month variations in attendance over that sort of second half with the view of sort of trying to get to a guide of what might have been a missed opportunity on the attendance front. You know, is it in the region of 10%, 20%, 30% in terms of what you could have done better, weather permitting?
Yeah. It's a hard one. Allan, I got to tell you, we don't really have a particular number we can point to on that, to be frank. We just call out those two key things. You can certainly make your own derived view on that based on what I've called out, which is rainfall by month. You can probably very closely link rainfall by month to deviations in attendance and thereby revenue by month. Similarly, if you think about international's probably less fluctuation that you see in international over the period of the half.
Yeah, look, to answer your question directly, we haven't got a number that we're comfortable to call out, but we've called out the two really significant factors in our mind that hindered what would have been a stronger result.
No, perfect. Thank you. Just last quick one, please. Just on pricing. Appreciate you obviously have shifted your ticket pricing. You do still look to be either flat to a sort of 30-ish% discount to Village, depending on the pass level. Just your ability and/or interest in doing price discounting at certain times of the year, and what's the catalyst for that, and how do we think about that if we do come across a, you know, a position where you are discounting a day pass or an, you know, annual pass?
Yeah, look, we've got an open mind to promotions at times. Very much if we look to do that, there's a lot of strategy and thinking behind that, and they're very much ring-fenced and you know, designed for a particular objective. I can say to you, though, in the broadest terms that our view is that we wanna continue to see yields move up over the coming years. We believe now that we're starting to have a offer that is commensurate to the increase in price at the time.
In terms of the difference between us and others in the market, look, I think if you look at our pricing and how we structured it, our single day offer is typically priced at basically the same level as single other parks in the market. That's purely because of our belief that our single day offer is as good, if not better, than other properties on the Gold Coast. If you think about particularly the offer with Dreamworld, WhiteWater World, our animal experience is all in one place. So many worlds in one, if you will. You know, we just believe that's a fantastic offer for a single day visit.
If you look at our annual passes, look, we price that in terms of what we think is appropriate in terms of value compared to, you know, other annual pass offers out in the market. Saying that, we still see upside there. We talk about price, and we talk about yield pretty much on a daily basis here, and we think very carefully about that. You can be assured that there won't be any, you know, of the what I would term relatively crazy promotions that you might have seen in the past. That's just not part of what we do going forward.
Helpful. Thanks.
Thank you. Your next question comes from Brian Han at Morningstar. Please go ahead.
Thank you. Firstly, are most of Dreamworld tickets and annual passes sold through your digital channel, or are there still other big sales channels or meaningful walk-in sales?
Significantly through direct and digital. Brian, look, it's been a change, I think, across the industry over the last several years. We've done a lot of work in that space. One of the things that we've done is rationalize our retailer base. Look, retailers are really important to us, so don't get me wrong. It's not as though we don't rely on retailers to a degree. I can tell you that the amount of digital and direct that we sell today is so much more than what it used to be, you know, back three or four or five years ago. Yeah, the bulk of our ticketing mix is sold direct.
Is it more like 70/30?
We don't really call out the number, Brian, but it's. You're not miles away from it, put it that way.
Okay, Greg. Apologies for this silly question, given that we're still in the midst of a pandemic, but just for my interest.
Mm-hmm.
Are there any restrictions on you guys installing new rides or other revenue-generating units on part of the surplus land you have?
No, not really. Look, in terms of the park proper, there are some intricacies to it. If the things that we're looking to do are largely theme park ride-based, then essentially we're under a regime here where it's essentially self-assessable development. No, there's no impediment to us putting, you know, new rides up on our land. If we were looking to do things as you might have kind of been alluding to around, you know, hotels and accommodation, there are some, you know, things that we need to do with council and state, as I alluded to in the presentation, around development applications.
To that end, we've had several conversations with the relevant authorities in that regard.
Right. There are no restriction on you sort of doing a pop-up ride on a piece of land that you have development ambitions in mind?
Not really. Short of what you would expect are the typical restrictions that are required in terms of getting an attraction, you know, design registered in Queensland and passing all the appropriate regulatory safety hurdles. As I've outlined before, we've had you know very good success with that in for the last few years. Short of that, not really.
Okay. Thank you.
Thanks, Brian.
Thank you. A reminder, if you would like to ask a question, please register by pressing star then one on your telephone. Next, we have a follow-up question from Nicholas McGarrigle at Barrenjoey. Please go ahead.
Thanks. I'll be quick. Just in terms of the CapEx, it looks like second half CapEx was negative. I'm not sure if there was a restatement around that in theme parks, particularly around growth CapEx. Just a view on significant investments that you're making in the next couple of years and how we should think about CapEx versus what you put into the park in FY 2022.
Yeah. I might hand over to José to take you through that one.
Yeah, Nick, I don't think there's been a lot of change. You know, some of the CapEx at reporting dates, we have to make accruals for expected costs. They can sometimes be, you know, reversal of some of those accruals so that, you know, if you're seeing a small reversal, it might be because of that. I don't expect that to be too significant.
Sorry, just ongoing CapEx expectations, maybe on the mid-term basis, if you're putting bigger rides in or anything material on the growth side?
Greg, probably in relation to future CapEx, you're probably better placed to answer that.
Yeah, no problems. Look, Nick, we've got a pipeline that we've called out in terms of new attractions. Our intention is to make announcements on that later on this year. As you can imagine, the work that we do in this regard drops in certain periods as a result of lead times. So there's elements of deposits, there's things around shipping and so on. In terms of that pipeline and what it looks like over the next several years, I can say to you it's, you know, between AUD 50 million and AUD 60 million over the next three or so years. In terms of maintenance CapEx, look, it fluctuates generally between AUD 5 million and AUD 10 million a year.
You know, with the long run average sitting at about AUD 8 million, which is, you know, in line with depreciation and other things. That's our best guidance to what it looks like at the moment. As I say, in terms of how that drops year-on-year, it's something that particularly given the uncertain environment right now as to when, you know, outflows are required to contract, it's a bit harder to kind of give you that kind of detail.
Sure. Just clarifying, the growth CapEx is AUD 50 million-AUD 60 million over the sort of next three years or something like that?
That's right. Yeah.
Thanks.
Thank you. Your next question comes from Roger Colman at [inaudible] . Please go ahead.
Gary, if the CapEx is only AUD 50 million-AUD 60 million on new rides, and I presume the EBITDA will get back to somewhat close to the target levels, why keep about AUD 100 million in cash infrastructure?
That's a good question, Roger. I hope you're well. Look, it's merely that that's what we think is appropriate right now. We've two things, I suppose. One of the things that we're mindful of is, we've done a lot of work here to rationalize the ride count. You know, and I don't think you're inferring that we should just put more money in to just blazing away with new attractions either. I'm not suggesting that's the case, but I suppose the question is, what are you gonna do with the excess funds and why are you holding on to it? I think in our mind at the moment, just again, given the uncertainty in the environment, it makes sense for us to retain that cash balance.
We certainly are open to looking at other things to do with it. But at this point in time, you know, given again, how uncertain things have been, you know, we're looking to retain that cash for the moment.
I've got a follow-up question. I mean, typically, this company does about AUD 500,000 worth of revenue with a 30%-36% EBITDA margin going back nearly two decades now. You've got that rate around about 1.6 million visitors. Looking at July attendances, are you back to 1.6 million as an attendance rate?
No, not really. Roger, look, therein lies another opportunity, to be frank. As you can see from the statutory numbers, what we're seeing is lower attendances across the board. That's a function of a few things, no international being one of them. The reason the revenue results are propping up a little bit more is obviously because of this much more enhanced yield environment. Again, this is not a peculiarity to Australia, but something you probably identified as happening in other markets around the world. Yeah, to answer your question directly, it's not at 2016 levels in terms of attendance.
You know, our fervent hope is that if we can get to those numbers on the yield profile we've got now, you know, that presents a degree of upside in our models that we haven't factored in at this point.
Right. Then Greg, just following up from that. With the development, you know, Halloween and the extra markets and other Saturday Night Markets, etc., they're not gonna be at the 30%-35% EBITDA margin to do these extra revenue share factor in. Are the revenue percentages coming from what?
Yeah.
I call the variable assets or variable revenue.
Yeah.
Set up? Give us a picture of it.
Look, they're quite different, Roger. If I talk about, you know, LEGO, for example, you know, the margin is a little bit less than that, given there's a fairly significant component of that being the cost of goods sold for the product itself.
Yeah.
In terms of the handling costs and so on, you know, we've got a lot of good efficiency in the organization, so we're pretty happy with that. Similarly with night markets, you know, the margins that we're seeing there, you know, we're very happy with. They're north of 25% at the moment is a good way to put it. Again, as I've called out with the night markets, we are very happy with how it's been going, but I've gotta tell you, we see really significant upside to come. Just to give you a bit of color in that, you know, we've got a degree of F&B, we've got a degree of beverage in that business at the moment, but nothing like what we hope and aspire to have.
Similarly, we're not looking to have all the food and beverage business. I think having others really adds gravitas to the offer. As we increase our share of that, you know, there's certainly, you know, a good flow through to the bottom line as a result, given the investments we've already made so far.
Yes. Yes. Just on, you know, ride collection, on, you know, these, some of these lumps are pretty big, the AUD 32 million for the Steel Taipan, you know, at least, you know. How do you measure the contribution, at the margin from a major CapEx like that?
Well, there's a whole host of things to look at, Roger, as I'm sure you can imagine. Look, the fundamental thing is what will a new attraction do in terms of driving new and incremental attendance into the organization. We obviously then derive from that to numbers around, you know, ticketing models, what that could look like if we were to move price potentially, given a new attraction, and what are the incremental other things that we will get as a result of that in terms of F&B and retailing, park performance and so on. We also factor in, you know, potential efficiencies that come from that as well if we were sun-setting another attraction, and things like that.
All of those things, you know, conflate into the mix as to the type of things that we consider. Ultimately it kind of bears out to a point where we've got a Return on Invested Capital number that we have in mind, and a hurdle that we keep pretty close to our chest, but that we use to measure that performance. I would say also, 'cause I'd imagine that your next question would be, well, what about the things that you've done of late?
The only thing I'd say to that is that, you know, we're very happy with the performance of Steel Taipan in particular. You know, it opened in the middle of Omicron, and so it's actually the halo effect, if you will, is continuing with that. We're still seeing really strong positivity in the market about Steel Taipan, despite the fact that it opened over six months ago.
Right. Just a matter of interest, I did check out Steel Taipan when I was out there, and also checked out DC Rivals. They scream about twice as loudly on DC Rivals compared with the shout on your ride.
Sorry, you scream twice as loud on DC Rivals, did you say?
Yes. It did. I waited for about four or five cycles to see if the screaming was consistent.
Oh, yeah. Yeah.
Seemed to have a about a 30-60-second faster cycle time on setting the ride up.
Look, as I've called out, we spend a lot of time around how we can be better at being busy. A lot of what you say in terms of how long it takes at other places to get on rides is a function of, one, attendance, no doubt, but also around units on the track and efficiency of the ride operations.
Yeah. Yeah
which we're very proud of. In terms of the screaming effect, look, I've got to tell you, I had a lot to do with both of the attractions and I think Steel Taipan is far and away the best roller coaster in the Southern Hemisphere.
Right.
One of the best things about it, Roger, is that, you know, it's re-rideable, so it's not so scary that you go, "Oh, look, I'm not doing that again." In fact, what we see.
Ah.
More often is people coming back over and over.
Right. Okay. All right. Thanks a lot. That's it from me. Thanks.
Thanks, Roger.
Thank you. That concludes our question and answer session today. I'll now hand back for closing remarks.
Thank you. Thank you everyone who joined us on the call today. I'll now close the presentation.