Thank you for standing by, and welcome to the Coast Entertainment Holdings Limited Annual General Meeting 2024. I would now like to hand the conference over to Mr. Gary Weiss, Chairman. Please go ahead.
Good morning, everyone, and welcome to the Annual General Meeting of Coast Entertainment Holdings Limited, which is once again being held at our SkyPoint observation deck on the Gold Coast. My name is Gary Weiss, and I'm the Chairman of Coast Entertainment Holdings Limited. For those attending in person, welcome to SkyPoint. It is our pleasure to showcase to you one of our iconic and best-performing assets. Similar to previous years, this AGM has been conducted in a hybrid manner to allow shareholders to participate either in person or virtually via the online platform. Before I formally open the meeting, I will ask our Company Secretary, Chris Todd, to outline some procedural matters on today's meeting for those who are joining us virtually.
Thanks, Gary, and good morning to everyone. Just a few administrative matters to start with. As mentioned, today's meeting's being conducted in a hybrid format, allowing some of those shareholders to attend virtually in addition to those here in the room. They'll do so via the online AGM platform. For those who are attending virtually, please note the following. If you experience any technical issues during the meeting, we have published a virtual meeting guide on our website, which includes details on how to seek assistance. Shareholders who are online will have the opportunity to ask questions via that virtual meeting platform.
If you are a shareholder or proxy, attorney, or corporate representative of a shareholder and wish to ask a question about an item of business online, then please click the icon "Ask a Question" on your screen, select the item of business your question relates to, and then click "Submit Question" once you have typed your question. For those who already have questions prepared, please submit them now on the platform so that we can consider them as and when we come to the relevant agenda item. You do not need to wait until the relevant item of business.
At the conclusion of today's meeting, we will endeavor to respond to any shareholder questions of a general nature that may not have been addressed in the general business update or if we consider that a response would benefit all shareholders. Finally, a recording of today's meeting will be available on our website at the end of today. With that, I'll now hand back to Gary to formally open the meeting.
Thank you, Chris. I now confirm that the quorum is present, and I declare the meeting open. It is my pleasure to introduce to you today the members of the Coast Entertainment Board in attendance today. I'm joined in SkyPoint by Randy Garfield. Randy's flown in all the way from Florida. Is it Randy?
Yes.
And Jemma Elder joining us from Southeast Queensland, and joining us on the phone from the United States are David Haslingden, Brad Richmond, and Erin Wallace. I would also like to welcome members of the executive team, Greg Yong, our Group Chief Executive Officer, and José De Sacadura, our Group Chief Financial Officer, who are both in attendance at SkyPoint today. I also want to specifically welcome Geoff Sartori. Geoff has been a significant part of the rehabilitation of this group and has performed an excellent role for us as safety advisor to the Board of Coast Entertainment. The Group's Auditor, Ernst & Young, represented by Anthony Yuan, is also in attendance today on the phone and is available to answer questions in relation to the FY24 auditor's report. The format for today's meeting will be as follows.
I will begin by providing some opening remarks regarding the activities and performance of the group for the year, and will then hand over to Greg to provide a more detailed update on the performance of the business. We will then move to the formal business of the meeting and put to shareholders a resolution set out in the notice of meeting. All resolutions to be put to the meeting today will be decided by way of poll. Shareholders attending the meeting will be able to cast their vote using ballot papers for attending in person or the electronic voting card received when your online registration is validated if attending online. Further information and assistance with online voting can be found in the virtual meeting guide available on the Group's website.
FY24 marked another solid year for Coast Entertainment, with the Group delivering its first positive consolidated EBITDA result for the continuing business since FY16. Amid a challenging trading environment and despite the impact of two severe storms, which caused significant damage and trading disruption to our parks during the peak summer holiday period, notwithstanding these challenges, the Group delivered a resilient performance, with visitation to our venues up 14% on the prior year, driven by strong annual pass sales and associated repeat visitation. This highlights the strength of our product and guest service levels, which are resonating very well with our guests, particularly in the local market. Revenue for the year of AUD 87 million was also up compared to the previous year, with a notable shift in mix towards more annual passes.
As a result, deferred revenue for the Group increased by 12% to AUD 12.1 million in June 2024. Despite inflationary pressures, we continue to diligently manage our cost base. Together with the revenue growth outlined, this led to the theme parks and attractions business achieving an EBITDA profit, excluding specific items, of AUD 7.4 million in FY24, an increase of 50% compared to the prior year. Notably, both Dreamworld and SkyPoint again delivered positive EBITDA contributions, and SkyPoint's performance was its best on record.
The FY24 result would have undoubtedly been better without the storms, and while we rue what could have been, we are continuing to work with our insurers to progress the related insurance claims for both property damage and lost earnings. Pleasingly, the performance trends we witnessed in FY24 have continued into FY25, with visitation, revenue, and EBITDA for the first four months again showing steady growth compared to the prior corresponding period, as Greg will outline shortly.
Slide five of the AGM presentation provides further detail on our capital management priorities and initiatives in the short to medium term. The Group's development pipeline is progressing well, with the new Rivertown Precinct incorporating the Jungle Rush family coaster and the iconic vintage cars adventure rethemed as Murrissippi Motors, on track for opening in December 2024, despite substantial weather-related delays over the last 10 months. Work has also advanced on a new highly themed Jungle Jane's family restaurant, which will augment this precinct. This additional investment is expected to drive incremental F&B revenue as we look to capitalize on returning international markets and events business. Additionally, as foreshadowed in our August 2024 results presentation, we are evaluating options for some of the older attractions in our fleet, including the need to provide for potential upgrades.
As part of this process and after 20 years in service as one of Dreamworld's most popular attractions, we have recently announced our decision to close The Claw attraction in early 2025. This iconic ride will be replaced with a new, larger, and faster King Claw attraction in FY26. As we've previously stated, our significant capital investment program is crucial to driving performance back to historical levels, and we are encouraged by the early signs, with attractions that have opened so far resonating well with our guests. As we've previously highlighted, the Group holds a substantial balance sheet with no debt, fully unencumbered real estate assets, and substantial cash balances.
Noting the continuing economic uncertainty and significant capital outlay still ahead, the Board continues that it's important to maintain balance sheet strength to provide headroom for the Group's operating and capital needs in the near term, as well as flexibility and capacity to pursue earnings growth opportunities as may arise. This is balanced with the Board's commitment to maximizing shareholder value, and I'm pleased to report that the on-market share buyback, which commenced in mid-September 2023, was completed in August 2024, with 48 million shares being bought back at a cost of AUD 22.6 million.
Having regard to the improving performance of the Group, the Board recognizes that a portion of its cash balances remain surplus to the Group's near-term needs and proposes to implement a further on-market share buyback of up to 10% of the issued capital over the next 12 months to improve shareholder returns and enhance capital efficiency.
This buyback will comply with both the 10/12 limit under the Corporations Act 2001 and the ASX listing rules. The timing and actual number of shares purchased under the buyback will depend on the prevailing share price, market conditions, and capital requirements of the Group. The Board remains confident that with a robust financial position, improving performance, and an exciting pipeline of capital projects underway, the Group is well positioned to benefit when economic conditions normalize and both international and domestic visitation return to historical levels. On behalf of the Board, I would like to express our gratitude to our dedicated team members across the Group for their valuable contribution and commitments in driving the performance of the business. I would also particularly like to thank and acknowledge the significant contribution of Brad Richmond, who today retires from our Board.
Brad has been a dedicated and valuable member of the Board for the past seven years and leaves a significant and lasting impression on the Group. Brad was instrumental in overseeing the turnaround and growth of Main Event and assisting management to steer that business through the COVID pandemic and subsequent sale by the Group in June 2022. Brad has also played an important role in the recovery of our theme parks and attractions business through some challenging periods. Our sincere thanks to Brad for all his contribution to the Group over his period of tenure. It is now my pleasure to invite Greg to provide a further update on the business. Following the update, we will move to the formal business of the meeting.
Thank you, Gary. Good morning to everyone today. As always, I've got a lot to cover, so I'll speak fairly rapidly so we've got some time at the end for all the good questions. Before we start, I'd like to remind everyone that we provided a comprehensive update of the FY24 results earlier this year at our four-year results presentation, and as such, you can refer to that presentation from August 2024. Today, I intend to provide a brief summary of those results and an update on the business for the first four months of 2025. Over to slide seven, which summarizes our key successes in FY24, and I'd like to take a brief moment to highlight some of the initiatives that often go unnoticed. Firstly, our success is deeply rooted in our collaboration with the local community.
We have strengthened partnerships with local schools and expanded sponsorships for grassroots sports and creative initiatives. I serve actively as a director on the Gold Coast Community Fund, which does remarkable work in the local area. We are also leaders in making our sites more accessible, thanks in part to our operations team who have introduced some initiatives like the Hidden Disabilities Sunflower Project, and we are very proud of opening Dreamworld's Calming Cottage, the first of its kind on the Gold Coast. The Dreamworld Wildlife Foundation team also continues its vital work in both local and global conservation efforts, especially in tiger conservation, through our partnership with the Zoological Society of London and the Wildcats Conservation Alliance. On slide eight, we want to feature some of the capital projects that we delivered during the 2024 financial year.
As previously announced, we have reimagined our kids' offering, starting with an extension of the Ocean Parade Precinct, which now includes new attractions like the Serpent Slayer, Deep Sea Dodgers, and the Seabed Splash Water Play Area. Additionally, we have completed the renewal of our kids' precinct, Kenny and Belinda's Dreamland, with new attractions across the board, including Big Red Planes and the Big Red Boat Coaster in partnership with our friends at the Wiggles. The new Dreamworld Fly has also been a real hit among families, with 64 seats providing great ride capacity, showcasing over 120 fountain jets and 3,000 lights, adding a new dynamic to the park and an incremental pay-per- play opportunity at the Dreamworld Night Markets.
The success of this attraction has been clear, with it now consistently ranking in the top three most ridden attractions in the park. We've also seen attendance improve following the opening of each of these attractions, and our guest satisfaction scores continue to materially outperform our Gold Coast peers, suggesting that these products are resonating very well with our guests. These developments were delivered on time and on budget, and I think that's a significant achievement in today's challenging construction environment and a true testament to our entire team.
But of course, the best is yet to come, and I'll provide an update on the upcoming Rivertown Precinct and the Jungle Rush Family Coaster, as well as the newly announced King Claw attraction later in this presentation. On slide nine of our presentation, we summarize some of the key financial highlights for FY24. As mentioned earlier, elevated interest rates and the cost of living pressures have seen many consumers feeling the pinch. Additionally, FY24 saw us face some significant challenges at Dreamworld with severe weather events and significant construction throughout most of the year, and pleasingly, despite these significant challenges, ticket sales were the highest we have seen since FY16 and were 40% higher than in FY17, largely driven by an increase in annual passes. As I've outlined on numerous occasions, these passes are very important for the business.
They allow us to build meaningful relationships with local patrons and drive repeat visitation, leading to higher total revenue and a greater propensity for retention. With income in these passes recognized over 12 months, they also provide a very important short-term weather hedge, buffering us against adverse conditions, and I think the summer storm season was a very clear evidence of that fact.
The increased sales of annual passes also highlight the strength we're seeing in our local market as our product and our service offering continues to resonate well with local guests. This comes at a time when interstate visitation is being somewhat stifled by economic conditions and international visitation remaining well below historical levels, albeit that it is improving. With increased volumes, per capita revenue yield has softened due to several factors, including increased repeat visitation from passholders, some tactical promotional activities, and improving international visitation, which I've stressed that in the past will come at lower yields. However, we note that the yield environment is structurally different to what it was in FY17, and our long-term focus is to continue to grow per capita revenues.
Over to slide 10, and FY24 performance was covered in some detail at our August 2024 results presentation. Therefore, I will just highlight some of the key performance drivers. As Gary mentioned, we have faced a tough trading environment with elevated interest rates and high inflation continuing to weigh on the consumer discretionary spending.
We have seen strong support in the local markets, but interstate has been challenged, and we're not alone in this space, with the ABS reporting in 2024, earlier in June, a 23% increase in the cost of housing, a 21% increase in the cost of food, and a 22% increase in the cost of transport compared to December 2019 or the pre-COVID levels, and CBA in their 2024 results announcement reported a decline in household savings, falling real disposable income, and consumers winding back in discretionary spending, with the heaviest impacted cohort being the younger 20 to 44 age group, which, as you all are well aware, is one of our core demographics.
Against this backdrop, though, we were pleased to see growth in our ticket sales and visitation in 2024, which helped drive revenue of AUD 87 million, the highest since FY16. On the expense side, we faced similar challenges to many organizations, but we have continued to find efficiencies and managed to keep expenses flat despite a 14.3% increase in attendance. All of this accumulated in a 56% increase in EBITDA for FY24, marking our second positive EBITDA for the operating business and our first positive EBITDA at the consolidated group level since 2016. Both businesses reported positive EBITDA results, with SkyPoint's performance being the best on record, and I think what people would be most interested in is FY25 and what we've seen so far.
Certainly, we've seen a very positive start with year-to-date unaudited results showing a 9% increase in visitation, 8% growth in operating revenue to its highest level again since FY17, and a preliminary unaudited EBITDA result excluding specific items, which is up 49% above the current period. These results exclude AUD 3.6 million of insurance proceeds, which we've received in FY25 to date. These are interim payments, and we continue to progress our claims with our insurers for related property damage and business disruption. And while ticket sales for the first four months of FY25 at a statutory level have reported a slight decline against the prior period, it is important to note that a prior period included a bulk sale to a reseller, which provided a timing-related benefit which we expect will reverse over the coming months.
Excluding this bulk sale, ticket sales on the year-to-date basis were up 3% on the prior period. As outlined on slide 11, our events and activations continue to be key drivers of our engagement and of our revenue. The Dreamworld Night Market has proven to be a sustainable and profitable venture, and we're excited about its long-term potential, and pleasingly, our recent Halloween activation, which ran for a record six nights and had the most attendances participating in the event's history. On slide 12, we provide a glimpse of Rivertown and the Jungle Jane's Restaurant. This new world will be transformative for Dreamworld, featuring attractions designed to offer intergenerational experiences, with rides that are exciting for the entire family. Murrissippi Motors is a reimagined take on our previous vintage cars attraction, which is an iconic favorite at Dreamworld.
The ride vehicles are being completely rebuilt and rethemed, with two vehicles designed to be completely wheelchair accessible, which we think is just a critical thing for our guests with disabilities. The immersive theming, the innovative track layout, and more central location make this a standout attraction, and we believe that it will be a massive hit with our guests. Jungle Rush will be the most thematic attraction that we've ever built at Dreamworld. This family coaster is designed for young children, but it is about fun for the entire family. The ride has several world-first elements and an incredible storyline that we cannot wait to share as we get closer to opening. And lastly, Jungle Jane's will be the most immersive themed restaurant in the country by a long shot.
This sit-down family restaurant will offer a menu designed to be more premium than our core theme park offering, and we have also incorporated plans to cater to our returning international groups as well as our events business. We believe that this will become one of the go-to venues on the Gold Coast for unique gala dinners or corporate team-building events. As I've said at nauseam, Rivertown will play a crucial role in driving attendance and enhancing the overall guest experience. The ongoing construction is challenging, given all of the weather disruption we've faced. However, it will ultimately be well worth it and reinforce Dreamworld as a must-visit destination for families in Australia. On to slide 13. Many of our investors and our guests will be very familiar with The Claw. It's one of Dreamworld's most popular and iconic attractions.
At 20 years old, this ride has unfortunately reached the end of its operational life and faces some significant hurdles with ongoing maintenance and manufacturer support. Given the huge popularity of this ride, management has spent considerable time working through various options available to us, including the closure and the removal of the ride, and we have taken the tough decisions and closed rides that did not fit our risk appetite in the past, as we've outlined previously. We certainly contemplated this alternative in this case, however, we came to the view that this is something that would be far too detrimental to the guest experience, and ultimately, we felt it was detrimental on an ongoing basis to financial performance.
As we've also done on other attractions such as the Gold Coaster and the Giant Drop, we ran scenarios around conducting a major overhaul or even acquiring a like-for-like attraction to replace The Claw. Although a major overhaul could extend the life of the ride, the residual lifespan would remain uncertain, with costs running into several million dollars and yielding little in the way of incremental return. The last alternative considered was to upgrade to a new attraction. We looked at several vendors, and as we've outlined in previous remarks, we will only work with tier-one vendors going forward.
Given the popularity of The Claw, installation of a larger, faster, and higher capacity version of the ride from a world-class vendor in Intamin is considered to be the best option, giving a nod to our iconic attraction of the past while providing a new, more thrilling experience, which we hope and expect will drive incremental visitation. The new King Claw attraction will be one of three in the world, and having seen this and ridden this elsewhere, I can assure you this is an incredible ride, and it will be sure to be one of our most popular attractions once open. Slide 14 of the presentation provides a further update on the land development opportunities at Dreamworld.
As previously disclosed, we have lodged a preliminary development application for the broader site, and this process has now passed the public consultation phase. Council and state continue to consider the application, albeit the process is taking longer than we had initially hoped it would. In the last few days, the group has submitted a stop-the-clock notice on our application to allow time to clarify some details with SARA, the State Assessment and Referral Agency. We remain optimistic that our application will create significant value to the northern Gold Coast in the future, and we will continue to keep the market updated as our progress continues. On slide 15 of the presentation, we reconfirm our strategy for long-term growth, and I think importantly, this strategy has remained consistent since we first shared our plan to restore value several years ago.
We have seen traction and momentum in the right direction, and the progress is clearly evident. The divisional EBITDA line, we broke even in FY23 ahead of our internal expectations, and we achieved a year-on-year increase of over 50% in FY24. Notably, this was the first time in FY17 that we've reported positive consolidated EBITDA for the group after corporate costs. Against the backdrop of a slowdown in discretionary spending across the economy, we have taken tactical steps to remain competitive in this challenging environment.
Our solid, multifaceted plan allows us to sustainably increase revenue while differentiating ourselves from our competitors. Finally, I want to take a moment to recognize our team. They've done an incredible job demonstrating resilience, innovation, and dedication over the last 12 months. It is their hard work that gives us the confidence in our strategy and our optimism for the future. I'll now hand over to Gary to conduct the formal business of the meeting.
Thank you very much, Greg. We will now move to the formal business of the meeting. The resolutions for consideration today may only be voted on by shareholders, proxy holders, and shareholder company representatives. I propose to call a poll on each of the resolutions. As a reminder, shareholders attending via the online platform will have the opportunity to ask questions on each matter being put to the meeting. If you have questions already prepared, please go ahead and submit them now.
Turning to the first item of business, it is to receive the annual financial report, the director's report, and the independent external auditor's report for the company for the financial year ended 25 June 2024. The remuneration report will be put to a vote for adoption separately. Are there any questions from those present in relation to the annual financial report, the director's report, or the independent external auditor's report? Yes, sir.
Sorry, we'll give you a microphone. Brian Mitchell, shareholder, long-standing. Just a comment. By poor hearing, Mr. Yong's rather quiet voice and rapid delivery, I didn't catch it all. Will his address be available on the stock exchange report or whatever in writing?
Yes, yes, it will be.
I'll be able to look it up and have a quiet read before I go to bed tonight.
Good. There's some encouraging signs in it, so hopefully you'll get a bit excited by what Greg has had to say. Thank you. Okay, thank you. Right. Sorry, we'll do over while you're over there.
Thank you. Charlie Kingston from K Capital. Just like to make some comments, please, firstly, and then I'll ask my questions. And I appreciate broken record, but we did raise a lot of the same concerns last year and the AGM.
Charlie, just cut to the questions. We don't need to go over what you went over last.
I'm entitled to make some comments per the Corporations Act, I think. So I'd like to make some comments and then follow it up with some questions. But again, we did raise some of these concerns, but just for some context, the stock is unchanged since last year, so I think they are equally, if not more relevant today. There have been no dividends over the past year. And in light of the yet again another CapEx program announced today, I think they are certainly relevant. But for context, Gary, nice to see you here again today. You weren't here last year, so I think I'm entitled to my comments.
But when you did campaign seven years ago to become chairman of Ardent, now Coast, you said in your presentation you would spend AUD 25 million in CapEx on Dreamworld to restore visitation and improve profitability with your EBITDA target, with that CapEx was going to be AUD 36 million. You were also hoping to sell excess land, which you said at the time was worth AUD 25 million. Since then, seven years later, you've spent or committed to spend AUD 130 million in CapEx. Today, you've announced another AUD 13-AUD 14 million in CapEx. So let's assume that it's going to be around about AUD 150 million, which is AUD 125 over the initial guidance.
We have no real update on the excess land seven years later. Visitation today is still miles below the peak pre-tragedy. International visitation has not returned. The company is still, in our assessment, free cash flow negative post the overhead, post the maintenance CapEx notwithstanding the positive EBITDA at a divisional level. Now, the market today is valuing Dreamworld at a market cap just below $200 million. We have $60 million of cash post the CapEx, but after today's announcement for FY26, that's probably going to be well below $50 million. But the enterprise value today of Coast is $150 million or thereabouts. Now, for that, we own SkyPoint, this beautiful building we're in today, the top three floors, which you value at $37 million.
The excess land is around about $25 million, which I think was your assessment seven years ago that you did acknowledge was uneducated. But I assume that it's probably similar, if not more, today, as Greg often says, that the land is not going down in value. But all that implies that today Dreamworld is valued at less than AUD 100 million. Now, that's very concerning given post today's announcement you will be spending up to AUD 150 million in CapEx, which implies that AUD 50 million has gone down the gurgler. It's a very nasty indictment by the market. I note that Dreamworld has also changed hands or sold multiple times around about the 2000s and prior in the 1990s for a valuation well above AUD 100 million.
So with all that context, clearly the market is not ascribing much value or likelihood of a return on that CapEx. And given your promises when you were campaigning, Gary, to become Chair, and it's been seven years post, appreciate the Main Event was a great outcome. Certainly congratulate you on that. But and there were some one-offs, COVID, etc., but seven years later and a lot of money has been spent and you've committed to spending more today. I suppose my first question is, why should investors trust that you can deliver shareholder value when shares are less than half the price if you adjust for that Main Event dividend than when you took over seven years prior?
And I would just like to read a quote from Kevin Seymour, who you were campaigning with at the time seven years ago. "We do not believe that a board which has presided over such a significant loss of value over the last few years can miraculously turn themselves into wealth creators and now belatedly deliver improved returns to security holders." I think that's a very relevant, applicable quote. Maybe for the board today, but that's my first question.
And then the second question is just around Dreamworld as a whole. I mean, again, there's been an enormous amount of CapEx spent. Yes, it's positive EBITDA at a divisional level, but is this a structurally flawed business? And given you were a very clear armchair commentator, which I think you called us when we wrote to shareholders, but I think you did the same when you initially put out your $36 million EBITDA target seven years ago. But now that you're committing to additional CapEx and shareholders, well, the markets, the stock's doing nothing, if not drifting.
So clearly nobody believes that it's going to return anything significant for shareholders. But what do you think that $150 million of CapEx will return for shareholders now that you've had seven years to understand what you think the business can earn? I presume you've got a more accurate assessment than seven years ago when you took over, but it's AUD 150 million we're spending. What do you think that can actually return for shareholders, please?
Thank you. And thank you for your review of history. I might remind you and others who care to go back. You can sit down, Charlie. I might go on for a little bit here about the facts of what's occurred over the last seven years. So when I commenced my campaign against Ardent Leisure, I had a number of key elements of the plan to restore value. The first was to sell the Australian business, the bowling and entertainment business, which we succeeded in selling about two months after I became chairman at a 32 times EBIT multiple. The second goal was to significantly improve the profitability of Main Event Entertainment.
As you will recall, that business had gone off the rails. It had reported three half-year of negative like-for-like sales growth. EBITDA had been stuck at around the mid-AUD 44 million level. Over the four years of Ardent owning Main Event Entertainment, we improved the EBITDA from the mid-40s. I think the EBITDA that we contributed for the year just before we sold to Dave & Buster's was north of AUD 100 million. We sold that business at an eight and a half times EBITDA multiple at a time today when Dave & Buster's trades at a 4.7 times EBITDA multiple.
The other significant plank of our campaign revolved around Dreamworld, and our goal was to restore historical performance at Dreamworld, and as you would appreciate, we were hardly given due diligence to undertake proper reviews of the assets of Dreamworld. We formed our view on the back of public information the same as any investor in a public company does. So when you looked at Dreamworld and you looked at referable historical precedents, where there had been tragedies at a theme park, the evidence indicated that by and large, between two to three years after the tragedy, visitation returned to pre-tragedy levels. That did not occur at Dreamworld, self-evidently, and I'll come to that in a moment.
So let me talk first about what we found at Dreamworld. We found a fleet of aging attractions, some that were 20 years plus old, that were no longer supported by their original equipment manufacturers under a new regulatory regime that had been brought in by the Queensland government, the strictest in the world. A lot of these attractions simply would not have been allowed to continue to operate, number one.
So we had an aging fleet of attractions that needed replacement. Secondly, in case it had escaped you, we had two years of extremely negative publicity that went not just through the Gold Coast and Southeast Queensland, but was a national matter. The tragedy at Dreamworld was a tragedy that struck at the heart of many Australians. And the negative publicity that that impacted on the operations of the park, of the people who turned up every day to try and run the business against the gauntlet of substantial media onslaught and having lost the trust and love and affection of not only the local market, but many Australians for whom Dreamworld had been a rite of passage for them and their family. So we had to endure that.
And then we had to endure a one-in-a-hundred-year pandemic, which closed the park. Okay? So I wish, believe me, I wish we could have restored this park with the level of expenditure that I thought was necessary. But to be perfectly frank, not only was I, but I believe everyone else involved underestimated just what repair job was needed at Dreamworld. And I make no apology for what this board has done to address that situation. Certainly, from my point of view, and if you look around at the caliber of this board, these are people who are committed to quality. So we've undertaken a very serious and costly process of rebuilding Dreamworld literally from the ground up, but doing so underpinned by first-rate quality.
So let me give you an example. The new board does not approve the purchase of any item of equipment other than from first-tier global manufacturers. Just like in the case of Qantas and indicated before, the Board Safety Advisor, Jeff Sartori, the former general manager of safety for Qantas, will tell you Qantas only buy from tier one manufacturers, Boeing and Airbus. We only buy from tier one manufacturers. We could probably have repopulated attractions in this park at a significantly lower cost by sourcing from manufacturers from China or somewhere else. We will not do that, and we make no apology for that. The end result is that it has cost us considerably more than we had hoped.
But we do know that we have the highest quality amusement rides in the world. And as I said, we make no apology for that. We are very confident that the investment in quality, and that has been certainly my experience over 30 years in business, that an investment in quality, not only in physical assets, but quality in terms of people, will deliver the results that we anticipate. In terms of the land, let me just say this: that we could have sold pockets of the land off from time to time. Indeed, as COVID hit us, we sold a non-contiguous small piece of land just in order to bring in some cash.
But as you well know, the land has certain planning restrictions on it, which significantly understate the potential value of the land if we are able to achieve a wider range of development opportunities for the site. That we were not in a position to have begun that process with any credibility with the council until we had actually reestablished the park as a going concern and with a vibrant future, and at that point, we lodged our development application just over 12 months ago with the council, and as Greg has updated today, this is by no means an exceptional situation. Anyone who's involved in the development or building industry will tell you that planning throughout Australia is a very, very difficult process, and our application is far from simple.
We remain confident of an outcome, and I believe that the end result will be a significant value creation opportunity for this group. In terms of the share price, frankly, it is what it is. I think it's incredibly cheap, so does the board. That's why we continue to buy back stock. I continue to believe in the age-old edict of Benjamin Graham that in the short term, the stock market is a voting machine, but in the long term, it's a weighing machine. And when you look at the assets, the very, very, very valuable assets that we own, I'm very confident that in the future, that will be well and truly recognized by the market. So thank you. I think we had a question over there. Yeah, sorry. We'll get you at the microphone though.
Thank you. Niall Amber from the Australian Shareholders' Association. Just your previous comments, Gary, if you don't mind, can I just make a comment on behalf of you? Yeah. I'm now speaking as a long-term shareholder, not as from the ASA. The Ardent Leisure situation was disgraceful. None of the existing board seven plus years ago had any experience in the industries they were running. Net result, the repairs and maintenance part of things were a disaster in the bowling division, as well as no doubt up here as well.
The sale of the bowling division for the price you got, Gary, was to us in the bowling business bloody amazing. Okay? And I did send you a nice little Christmas speech about that. It was amazing. It did, though. Yes. However, I think people must realize that the fact that this type of business is fantastic. 99% of the people who are coming through that front door at Dreamworld are there to have a good time. And all Greg has to do is help them. Sounds pretty simple, doesn't it? Plus, everyone has paid in advance. No bad debts.
They've paid before they even used the facility. Dreamworld is a wonderful business. And I do believe, as a shareholder, I'm not talking ASA now. From my point of view, you're on the right track. Questions now with the ASA hat on. A bit concerned about the cash flow situation where the income was unfortunately AUD 97. This is on your operating part, AUD 97-odd million. And your expenses were AUD 123 million. I'll give you a chance to answer that, which you have a little bit. But the other thing I'd like to address is the fact that the major issues that happened with Dreamworld were responsibly by poor repairs and maintenance. I estimate you're spending about 5.3% currently on repairs and maintenance. Is that sufficient?
Sorry. Do you want to?
Yeah. Look, I might take the first question, Niall, on repairs and maintenance, or the last question on repairs and maintenance, and then hand over to José on the cash question specifically. I think, and very happy to show anyone that wants to come to Dreamworld, that our culture around efficiency, we understand that we're a value stock and we are a value-based management team. And so you will come to Dreamworld and you will find that we're emptying our own bins, we're cleaning our own tables at night, and we care very deeply about every cent that we spend in the organization. The reason for that is that we need to pay for our priorities. And our priorities clearly and simply are safety, and that really comes at engineering safety.
I have no other levers to pull other than to make sure every other part of the business is as efficient as it possibly can be, and I think the board who are here at the moment and have been here through this week and visit regularly, Gary, much more again, can see that we have not got people sitting around with nothing to do. We don't have a large management or executive team. People are doing two and three jobs, and that is fundamentally for us, as I restate, to make sure that we do commit to the cost base that we must maintain in engineering and in safety and in operations.
And so I can assure you that the spending that we contribute to those departments today is much more significant, and it should be than what it was prior to the incident, and will continue to do so for as long as I'm involved at Ardent or at Coast. And so, as I say, every other area of the business, we scrutinize rigorously to make sure that we can commit to those areas. And I can tell you now that there are no shortcuts under this executive and management team, and certainly not in any way endorsed by the board whatsoever. José, would you like to? Yeah.
Just on the cash flows in FY24, a big component of the cash outflows in total were the large amount of CapEx that we spend as part of the current investment program that we're undergoing, as well as about AUD 18 million as part of the share buyback that we were undertaking. If we look at the operating cash flows on their own, they were negative AUD 3.5 million for the year. But within that number, there was about AUD 4 million of shareholder class action settlement costs, which is a one-off item. If you sort of add that back, then we were marginally positive, which is broadly in line with the AUD 1.1 million positive EBITDA at a consolidated level for the year. So it has turned around. The business is a very high fixed cost business.
Obviously, over the last few years, the revenue hasn't been there to cover that cost base. But certainly, the last two years have seen the theme parks business generate a profit, and obviously, in FY24, sufficient profit now to cover the corporate costs. As we look forward into the future, particularly with the investment of the CapEx that is due to open around Christmas, and as those revenues grow, we see quite a high fall through because those costs are fairly fixed. We don't expect the expenses to ramp up quite so much. A lot of it will fall through to the EBITDA line.
So just add a couple of points, if I may. Sorry, I'll come to you in a moment. Your point about relevant industry experience, Niall, you look at this board today. Randy preceded me onto this board by a matter of a couple of months. But look at Randy's CV. Distinguished service with the two gold standards of the theme park industry globally at Universal and Disney. Erin Wallace. Erin was very distinguished. 30-year history, I think, with Disney, including running Magic Kingdom, the largest single theme park for Disney.
I think we are so privileged here for still a relatively small company in Australia to be able to have world-class people with world-class experience in the theme park industry available to us. And if I could just, and I hope Erin doesn't mind me breaching her confidence, Erin was here last year and spent a week or 10 days with us.
She wrote me a note to say that she was so impressed by the team at Dreamworld and that, in her view, the management team at Dreamworld was as good or as, if not exceeded, the level of skills that she had seen at any management team at Disney. So I think we have an outstanding team. As I've indicated earlier, we have an unabashed commitment to quality. It takes longer. It takes time. It certainly costs a lot more. But we are very confident that the outcome will be satisfactory, hopefully more so than that, for shareholders and that we will all take great pride in being part of the recovery and the rehabilitation of this extremely important asset for Southeast Queensland and an asset that's an iconic asset and important to families around Australia.
Sorry. My name's Brian Fuller. I've been a long-term shareholder, going right back to Macquarie Leisure. One thing I'd like to do is compliment the board and also the workers at Dreamworld, that the way they've recovered from some of th e worst situations you could have with the accident and then COVID. I'd like to also make a suggestion, if possible. One thing, I've been to Dreamworld on many occasions. I went there approximately a year or so ago.
What I noticed at the food outlet was that you had a situation where the staff literally had to yell at the top of their voice to convey to the customers that their orders were ready. I then relayed that to the management of Dreamworld. I also got in touch with the manager of the venue. She informed me that she was concerned too.
But she was a bit timid in actually forwarding that information onto management because she was worried there might be some untoward reaction. So I raised that issue about a year or so ago. I went there this year, and I noticed the same situation had developed. I then contacted the head office of Coast management in Sydney through the registry. I also contacted the health and safety officer at Dreamworld, and I related my concerns.
A situation where you had the customers bunching up in front of the delivery area. Somebody who actually had to do the serving, they had to yell at the top of their voice all day. I related that to the management and also the safety officer. I said, "I did that a year ago. I did it again this year." This year, my concerns were responded to.
The management down in Sydney then sent me an email. I was contacted by the manager, one of your managers, who also related that they were going to bring in a new serving electronic system. Me and my Japanese friend went down there only about a month or so ago, and they've implemented that electronic thing. It's fantastic. I've talked to the actual serving staff. They said, "It's wonderful."
Okay? I was just wondering, is there some process with the staff where, if any of their concerns are raised, those concerns are then implemented and also raised with management? I was a bit concerned with the manager being a little bit afraid to relate her concerns. So is there any way that if people, like we're talking right down to the lowest category of worker at Dreamworld, if they could actually relate any of their concerns? Because that, I believe, would be very important.
I'll defer to Greg in a moment. But let me just say that around the board table and with management, we have a very, very open and transparent relationship. We're all in this together. We operate as a team, and we are all involved actively and, to the extent physically possible, visiting our facilities, engaging with our team members. We have a philosophy around all our venues of see something, say something. So if a team member sees something that is out of the ordinary, draw it to our attention so we can deal with it. I'd be very surprised if there was an atmosphere of the nature you're alluding to. But Greg, perhaps you can talk about culture.
Yeah. But first of all, thank you for raising the issue. The problem that we have is we're a large, complex organization. And I'd like to say that we're omnipotent and we see everything and deal with it as quickly as we can. But we do miss things. And without feedback from holders as well as customers, we don't get to those things. And so first of all, I'd like to thank you for doing that. And I'm very pleased that you saw the new system that's been implemented very rapidly and that it is working very well.
We have a number of different methods that we use around how we track culture in the organization. It's one of, in my view, our competitive advantages from others in the industry. We have a very, very close relationship with management and the frontline team. We know everyone's names. We have a very egalitarian approach to the organization. We don't have special car spots for the executive team.
We all have the same team member discounts. We do not run a business where there are big gaps between senior people in the organization and the people that really matter, that deliver the experience every single day. We have some other more structural elements to that, so we run team member town halls on a very regular basis where the executive and management team get up and show the team members what we're working on, take feedback, ask questions about the organization, and in the past, there's been a bit of a view, to be frank, that we've got to be a bit careful about how much we tell the team for fear that the competitor finds out. My real issue is that I'm really worried if our team don't know what's going on.
And so we take the view that we want to make sure our team are well across what we're trying to do. And we share with them every element of the business, including the financial performance, in rigorous detail. We also have a very clear governance structure, which Jeff Sartori has been critical in implementing, which ensures that frontline team members have every opportunity to escalate elements of their roles right through to the board. And so, for example, we have a frontline safety committee meeting, which is held regularly. And to be frank with you, it's the most important meeting that I go to in my whole calendar.
I'm there every single time to not only talk about what we're trying to do, but to give a very clear opportunity for any team member in the organization to tell me anything that they're concerned about so we can act on it. I think, given our history, it is critical that management are very close to those things. That all sounds very good, and it sounds very impressive. At the end of the day, what are the facts? I can tell you that our eNPS, or our employee engagement scores, are some 3,000% better than what they were prior to the pandemic. We regularly survey that. We survey it every year. We go into rigorous detail to look at every one of those comments.
On the guest experience perspective of things, I'm happy for anyone in the room to go and have a look at our Google reviews. I've outlined on numerous occasions how critical this is as part of our experience, and if you go to our Google reviews and you look at the most recent reviews, you'll find that every single one of those reviews, other than the last few days, have had a personal comment from someone in our team, often myself and often Melinda, who helps me out very regularly on this. We look at every single comment.
We respond to it, and if we have to, because we've learned something that we need to resolve, we're out there and we're dealing with it as quickly as we possibly can. Outside of safety, the guest experience is our number one priority, and so your feedback is welcomed. I'm very disappointed it took 12 months for that to happen. And that's on me, not on the manager that you spoke to. So hopefully, that gives you some kind of insight into how we think about those kind of things.
Yeah. Thank you very much. One other thing with your financial prospects going forward. I was just wondering what sort of relationship you have with overseas entertainment parks and what sort of promotion you do to Asian countries such as India, Japan, and other Asian countries. Because I believe with Dreamworld, you've got a fantastic future. And the future for this company is just unlimited. I'll give you an example of that. I bought into the Village Roadshow when it started. It was two little buildings.
The year before, as a De Laurentiis had lost AUD 29 million. I was told, "Don't waste your money. It's going nowhere." That's what they said about Village Roadshow when it started. I think you're way ahead of them when they started. So I believe that if you do more promotion in Asia, like I said, to India, Japan, the Southeast Asian countries, this company has unlimited prospects in the future.
So Greg will add to it. But let me say that we agree with you. We think we have a unique proposition in Australia, all the world's in one. A feature of Dreamworld, which is often not appreciated, is our wildlife component. By that, I don't mean the tigers, but our koala collection. We breed koalas. We're one of the largest breeders of koalas in Australia. Bilbies, again, we just opened a fantastic bilby exhibition. We are breeding bilbies. They're under threat of extinction. Australian tree kangaroos, etc. We have them all at Dreamworld. Indeed, yesterday, we're having a very concentrated sales and marketing discussion to look at how we really present Dreamworld to audiences in South Korea or India or whatever.
I mean, if you're in South Korea, you don't need to come to a theme park in Australia. You've got theme parks either close or in the region. So what's going to really drive you to Dreamworld? And we think the product that we have allied as well with our fantastic flying theater, Sky Voyager. I don't know whether you've seen that. Fantastic. For a visitor to Australia to fly over the wonderful iconic scenes from Australia is a tremendous experience. So we do have some very compelling cards in our hands. And certainly, we continue to look at expanding that international market, which is changing significantly post-COVID. But Greg, perhaps add to that.
Can I just say one thing? My friend here is from Japan. She was holding a koala about two months ago at Dreamworld. Dreamworld has one advantage. Lone Pine just gave up for visitors to hold koalas. When we went to Dreamworld, we were able to interact with the koalas within about 10 minutes. Lone Pine, you had to book three days in advance. So I think you've got a wonderful attraction with the Australian marsupials and native animals. And my friend was only saying this morning that that is one big advantage. The most theme parks just have the rides without the animal attractions. You've got both of them. And my friend from Japan loved it. Thank you very much.
It's a central part of our proposition, is the fact that we've got all the world in one place. Many of you would have children or have had families. I believe strongly that when you come to the Gold Coast for a holiday, selfishly, we would love you to spend your entire trip with us at Dreamworld, WhiteWater World, and SkyPoint, but to be frank, we need to think like the consumer. I think what we've been very clear about that is critical, central, inescapable, that we think about the consumer and when they come to the Gold Coast, they don't want to spend the entire time in theme parks. If you're a person that has come to a theme park with a bunch of young children, it's not always an easy experience.
Our goal is to try to make it easier, but I think you want to go to the beach. You want to go and enjoy other great parts of this town and this city. And so for us, our proposition of having all the world in one really talks about comfort, efficiency, ease to do those very things. And so one of the things that you'll see in the very near future as we do more work on our brand is to really sell that message that, "Look, what's different about us and how are we differentiated to others?" is you can do all the things in one place.
And again, as Gary said, sales and marketing is critical for us. I mean, we think we've got an incredible story to tell. And frankly, we're not doing a good enough job of that. And that's another critical pillar in my mind as to where we've got to just continue to improve. To your question around, "Do we work with others?" I can tell you that that is top of my mind.
One of the challenges in this industry is that there's a very few amount of participants in Australia. As you're probably well aware, we're a long way from anywhere else. We have the tyranny of distance as well. I'm the incoming president of AALARA, which is the Australian Association for Leisure, Amusement, and Recreation. I take that responsibility extremely seriously. That's a representation of not only theme parks, but traveling fairs and other recreational industries. I'm heavily involved with IAAPA, which is the International Association as well. I spent a lot of my time talking to, and I can tell you that I had a discussion just last week with a very senior C-suite executive from Six Flags, the largest regional operator in the world. I can have a conversation with any of these operators fairly regularly.
That is really just to make sure that we are thinking and learning about everything we possibly can that's happening out there in the world. I can tell you that we get a lot of good feedback and advice from people like Randy and Erin, who have incredible experience at Disney. I also think it's just as important to talk to smaller operators that have a very proprietorial approach. I can tell you that I have conversations with people at the Mack Company, who own Europa Park, one of the largest theme parks in Europe, family-owned.
They treat it like they own it. They think very carefully about how they invest in that organization. I spend a lot of time early in the morning, late at night, because of time challenges, to talk to these other operators and learn what they're doing. In terms of Asia marketing, I think you're 100% right. We see a huge opportunity there. I think the prospects for China over time are really significant. And I think your point around India is critical as well. I think everyone from Tourism Australia down believe India is a really tremendous opportunity over the next short while. What we are seeing is still a fair amount of online travel agency business. And that is good and bad.
The benefit of OTAs is that it really helps us be efficient in terms of our marketing spend overseas. If you can imagine us conducting above-the-line advertising in Delhi or elsewhere, it would be hugely expensive and problematic where we use OTAs to really do that work for us. And obviously, we pay for that service through a commission. I think the benefit that we see over time is that the FIT business, so the free independent traveler business, is becoming more and more significant over time with the advent of technology. If you think back to prior to COVID, we could barely use a QR code. And now everyone can. I think we're seeing technology really play a part in an overseas traveler really being much more able to travel on their own.
And the key part for us is thinking, "Well, where in the funnel are we going to really market and advertise to those types of people?" And it may be somewhat futile to market to them in their home countries. It may well be about trying to, atop a funnel, give them awareness. But as they come into Australia, to really make sure that we target them in the right spaces.
And again, that for us is critical as to how do we think really prudently about our marketing spend. To give you a very pertinent example, when we think about billboards and airports, we get offered every time that we talk to certain advertising companies, they say, "Well, look, I've got a great billboard at Brisbane Airport in the Qantas terminal." Sadly, well, not sadly, to be frank, frankly, it's just not our customer. Our customer is a Virgin customer, a Jetstar customer with young families.
And that's where we'll commit our money. And we have a similar view as to how we think about overseas markets is, "Where are we going to get the most return on that investment?" Again, is it good enough? Look, frankly, we're never pleased. And we want to continue to improve our performance in that space. I can say to you that Jemma in her very short time on the board is already really driving a huge amount of additional focus in that space. We're incredibly excited to see where we can go with that journey as well.
Thank you. Please keep coming back to the park.
Any other questions in the room?
Regular customer.
Okay. Chris, anything online?
Not in relation to the auditors.
Sorry.
Question to the financial officer. As a long-term shareholder and a businessman, while I'm very interested in, I've held these shares very since the float. They've reached a stratosphere and they're down to AUD 0.46. What's the incentive for us as retail shareholders to continue to hold these shares? We talk about yesterday. We talk about today. What about tomorrow? I'm nearly 89. What is the incentive to buy or sell Dreamworld shares or Ardent Leisure shares or Coast Entertainment shares? Sorry. What is the incentive? Is there a projection of when you will start paying the shareholders some dividend? Or is there going to be a reasonable capital gain?
Or are we just going to sit here and talk about the shares are still AUD 0.46 despite the fact of the AUD 0.95 that you introduced, which brought it up to AUD 1.40? As a long-suffering shareholder, I don't know about the rest of these people, but I'm sure they're here to find out what the future holds. I haven't heard this today as regards when or if the shareholders will see a return.
We don't make, obviously, any predictions about the future. All I can tell you is that we have made a significant investment. Charlie gave you the numbers. Whether they're completely accurate or not doesn't matter. But directionally, that is the case. We have had to invest substantially more into fixing this park than had ever been contemplated. The good news is that we're through a huge proportion of that. Yes, we have another new major ride that we will introduce over the next 12 months.
But if I can direct you to page 10 of the presentation, I think you should be encouraged by the fact that due to the nature of this business, which has obviously got a very heavy fixed cost base, incremental revenues flow increasingly through to bottom-line result. We're in a fantastic financial position. We own all our assets. We have no debt.
And we will. I'm very confident we will reach the point where we start generating significant cash flows for this group, which then will give us optionality in terms of returns to shareholders. So I feel your pain. My group and associates holds 10% of Coast. I would love to have dividends and so on. But as I said before, as Chairman of this group, together with my colleagues on the board, we are committed to fixing this properly so that we have a solid base, a base on concrete, not on sand, to deliver significant value for our shareholders for the future.
So there's no time frame at this stage. No prediction.
Well, I think you're seeing the fact that we've made the investments now in refreshing the park. I don't know when it was the last time you went to the park. But if you compare the park today from where it was five years ago, it's unrecognizable.
Yeah.
And you can see through page 10, our competitor down the road has had a reduction in its revenues. We've gone up. Now, we've gone up even against a backdrop where interstate visitation, particularly from New South Wales and Victoria, has been down significantly. International visitation has yet to return. But we are showing positive growth. Our EBITDA was up over 50% last year, notwithstanding the major storms that hit us at our peak trading period. In the first four months to date, our EBITDA, which ultimately is largely cash for us, is up 46%.
We have said that we do believe, and this is not made as a projection, but we do believe that the investments that we have made and will continue to make have a pathway for us to achieve, at least, if not exceed, historical levels of earnings for Dreamworld. So we're on. I appreciate it's been long. It's been frustrating. I could have done without having to deal with the tragedy and its consequences. I would have loved to have been able to not have to endure a one-in-a-hundred-year pandemic. But these are the cards that have been dealt with. And I think the fact that you look at where we are today in terms of our financial position, we are in a very, very good, solid financial position.
Unlike lots of other groups around today that are burdened with debt, we have no debt. We own all our assets, including this fantastic asset here, 55 hectares of land at Coomera. I believe there is a very good future for us. So please, I appreciate you've been patient. Please give us a bit more leeway. Let's meet again in 12 months' time. And hopefully, we can present a better pathway back to a return to shareholders. Accepted. Trust and hope. Okay. So we'll turn to the remuneration report, which is resolution one. That resolution is to adopt the remuneration report for the year end of 25 June 2024.
The report is included in the annual report and has been made available to shareholders. Investors should note the vote in relation to the adoption of the remuneration report is not binding on the company or the directors. The company will disregard any votes cast on resolution one that do not comply with the voting exclusion requirements of the Corporations Act as set out in the notice of meeting. I move that the company's remuneration report for the financial year end of 25 June 2024, as set out in the director's report, be received, considered, and adopted. The proxy results received for the resolution are shown on the screen. Are there any questions?
Yep.
We've got a microphone.
Thank you. Just a few comments again. But I'm glad that I'm not the only shareholder concerned about value, which is the critical issue. Yes, there's a lot of gold-plated CapEx, etc. But I don't mean to sound callous. But ultimately, that needs to drive a return. And it hasn't to date. So I'm glad that issue was also raised. I don't think that this company is a charity. But specific to the remuneration report, just on the targets for the LTI, the two targets are revenue growth. Now, to be honest, if you spend AUD 150 million and you didn't get any revenue growth, that would be incredibly alarming.
But as shareholders, Gary, as a shareholder, you can't eat revenue growth. All you can eat is earnings. That's how you pay distributions back to shareholders. That's really all that matters. So why is earnings, and particularly per share, not a target? Why is it revenue? And the second target, I think, is a relative shareholder return. I'm not sure what the starting point is or who the comparable index is.
But we're starting at AUD 0.45, which is a very, very low share price. As has been discussed, it's a lot lower than when you took charge. So I'm just not sure why a relative share price is a fair target. Have you considered an absolute share price target or total shareholder return target? Because it does seem revenue is not appropriate and nor is relative given the current very low starting point. Thank you.
David Haslingden, who's not with us physically, is online. He can address some of your questions. Let me just correct you on one thing. The share price being materially lower. Well, it's lower than the AUD 1.50 I started buying shares in what is now Coast Entertainment. Conveniently forgotten is. But thank you for pointing out the fact that we've had AUD 0.95 a share back by way of capital return and dividend. So unfortunately, notwithstanding the significant wins that we've had, we are where we are. I shudder to think where we could have been.
But for, and you've heard it from Niall from the Australian Shareholders' Association, who knows the industry, where we would have been without some frankly fantastic sales of assets that we commanded prices for that I doubt many others would have achieved. In terms of earnings, you talk about the CapEx. If you take Rivertown, it's probably cost us north of AUD 40 million. Very hard to show a return on that since it hasn't opened. We are hopeful that it will open in time for the Christmas holidays. We would anticipate seeing a significant increase in attendance, which will translate into revenue, which, as I've observed earlier, in the case of this company and its operating leverage, increasing revenue falls increasingly to the bottom line. David, did you have anything you wanted to add?
I'd just add we are moving away from the revenue increase KPI to an earnings increase KPI in the current fiscal year. The reason we chose a revenue component in the fiscal year being analyzed now is because as we were breaking even, the percentage increases over prior year were highly volatile, notwithstanding small incremental amounts in actual earnings. So it was regarded as a more reasonable KPI to set it at revenues for this year. But in the current fiscal year, the appropriate KPI will be at a. As to relative or absolute shareholder return, most companies in the ASX 200 use a relative return. And I know the proxy advice all thought that was appropriate.
Okay. Chris, anything online?
There's an online question. And again, David's on the line. So perhaps David can answer it. I'll read it. I'll summarise it because it's quite long. But the question is, which of the five proxy advisors in the Australian market issued a report ahead of today's meeting and did any recommend a vote against any of today's resolutions, including this REM report? If so, what reasons did they give and how are you going to respond? I might just, before David answers that, say that as those of you who have received proxy reports know, we're not in a position to disclose which proxy advisors say what. But I think David can generally respond to the question about whether there was a vote against the REM report, sorry, a recommendation to vote against it, and how we're going to respond.
Yes. Thanks. We reviewed reports by two proxy advisors, Glass Lewis and ISS. One was in favor of the remuneration report, one not in favor. The proxy advisor not in favour had an objection with the specificity of our KPIs for short-term bonus. We closed up the broad bonus, as we discussed in the question. We didn't go into each of the components, and we didn't think it necessary or appropriate to do so.
The proxy advisor who voted in favour of the remuneration report made similar comments, but for those that thought the overall remuneration was appropriate, they didn't have a problem with the lack of specificity. We will be talking to both proxy advisors after the AGM and discussing whether we need to increase the level of specificity in next year's remuneration report, and that's what [audio distortion] .
Thank you, David. Okay. Move to resolution two, which is the election of director. Resolution two relates to the election of Jemma Elder as a director of the company, as noted in the notice of meeting and supporting documentation. Jemma brings to the board extensive experience as a senior executive with 20 years in roles focused on business strategy and growth, technology, and e-commerce, sales, and marketing. I'll now formally move the appointment of Jemma as a director of the company. The proxy votes in relation to this resolution are on the screen. Are there any questions?
Yep.
Hi, Jemma. I think you used to work at Dreamworld. Is that right? But it would just be great to hear your thoughts, fresh set of eyes on, I suppose, the critical issue of shareholder value and all the money that's been spent. I don't know when you were working there. But just noting that, thinking through that Qantas analogy, Qantas shares are at an all-time high. They've gold-plated their CapEx, maybe, or arguably. Joe Aston might think differently, but to use your analogy, they're at an all-time high.
Coast continues to sink, so clearly, the market thinks they're getting a return from their CapEx, but the market does not believe Coast is getting a return on their CapEx, so what are your thoughts on maybe just the historical context when you used to work there from what you've seen today? And what sort of is going to be your focus? How do you think Coast can actually get a return on the money that it is spending? And what's going to be your sort of input in that critical issue? Thank you.
Firstly, I think it's a very exciting opportunity for Coast Entertainment Holdings over the next few years. We've spoken a lot about the capital improvement program, capital investment program, the attraction pipeline. I think it was you last year who identified visitation as the key tenet of any strategy, any sales and marketing strategy to actually drive earnings and return, and that's where we'll be focusing our attention predominantly. It's a fixed-cost base. We've spoken about that at length today, and there's only upside, in my view, in my observations and from my experience. I did work at Dreamworld. You're correct. I've spent about 15 years on and off working with the Coast Entertainment Holdings assets in various capacities, marketing predominantly.
I was head of marketing at Dreamworld. I've spent a lot of time with the team over the past two days, and in my lead-up to and during my due diligence before being appointed a director, I'm very excited by the opportunities. We have faced some economic headwinds. Hopefully, they will subside over the next few years. International visitation still hasn't returned to pre-pandemic levels on the Gold Coast. We're seeing stronger domestic or Southeast Queensland population growth. Annual pass visitation is a beneficiary of that.
I certainly think there's significant opportunities and upside, which is part of the reason, in fact, one of the most compelling reasons for me to join the board and help and use my experience over the past 25 years as a Southeast Queensland businesswoman to actually help and continue to drive visitation, number one, but also shareholder return.
Thank you, Jemma. Chris, any questions?
Yes, Gary. There's a question. It says, "Could the chair, I'm not sure whether that refers to you or to David as chair of remuneration nomination committee, comment, please, on the recruitment process that led to Jemma's appointment to the board? Was a headhunter involved? Did the full board interview Jemma together as a group or separately? And did they interview any other candidates? And was Jemma known to any of the directors before engaging with the recruitment process?
I'll deal with that. It's a very simple response. For some time, we've felt it important for this company recognising our very strong association with the Gold Coast. Indeed, that identification with the Gold Coast underpinned the change of name from Ardent Leisure to Coast Entertainment to signify our strong commitment and our involvement on the Gold Coast. To any cynic who would like to know whether a group of brand consultants were engaged in that process, sadly, the answer is no. We managed to cobble that together.
And so, as part of this process, we thought it incredibly important to have someone from Southeast Queensland, someone who was steeped in sales and marketing, where we think we have, as you've already heard, a great opportunity against the backdrop where we've invested so significantly, again, as has been pointed out. We think very judiciously and high-quality global-leading product, allied now with an aggressive push on sales and marketing that Jemma fit the bill. Jemma had been recommended to us by a very prominent businessperson on the Gold Coast. We interviewed Jemma. We were delighted to say that she accepted with alacrity.
And part of the reason, I believe, for that, Jemma, having regard to the conversation that's already taken place, was your historical role at Dreamworld. You were there during some of the best times that Dreamworld had seen. You know and have always appreciated just how important an asset Dreamworld is to the Gold Coast community, to the families on the Gold Coast, Brisbane, etc. You are a mother of two youngest children, and with your exceptional background in groups like Publicis, we thought it was a fantastic opportunity to invite Jemma. We were absolutely delighted that she accepted, and I think to a question I think that you asked before about staff morale, it was interesting.
Walking around the park yesterday, Jemma remarked to me, people came up talking to Jemma, people who'd been with this park for over 20 years who recognized Jemma and so delighted to see her back and telling Jemma that they'd never felt so proud to be a member of the Dreamworld team than they are today with what's happening there and all the investment that we've made and the opportunities in front of us. So any other questions? Chris?
Not on that resolution. No.
Okay. So that. Yeah.
Just a quick follow-up. Maybe if you could be more specific, please, Jemma, given the previous experience. And I don't know when you were there, but it sounds like you were there under the old management. And some comments today have been pretty damning about how this company was previously run, sort of rundown, rides, etc., and cutting corners. But you were there at the time, and you're obviously doing your job. I didn't say cutting corners. I said we don't cut corners. Okay. But there have been some pretty damning comments about the previous board, no experience, etc., but they were making money. Notwithstanding the tragedy, again, don't want to diminish that at all. But given your time there, what do you think is the missing ingredient today? That visitation isn't returning?
Is it lack of new rides? Again, we've announced a new one today. International hasn't returned. Is there any structural reputational damage? Is there more alternatives for entertainment today? But if you could just be specific, when you were there, why was Dreamworld such an easy sell compared to why now, noting we have spent a lot of money?
I think we're talking about two very different periods of time, number one. And I also think that the management team that we have here today, I can only comment on this particular team. I'm not going to comment on my time prior. I'm more focused on the future. I've spent an extraordinary amount of time now with, over the past few days, with Greg, with José, with the senior management team, operationally, safety. I'm convinced now the park actually has the capital investment that's required.
You yourself spoke to the number and the amount that the board has approved and management have invested in the Capital Works program. It is a world-class asset. It is a world-class theme park, and I can say confidently it is a better theme park by way of guest experience, by way of attractions, by way of a broader, more range of experience than it has been in the past, and I think that'll bode well for the future, particularly as we start to see a return of international and domestic tourism to the Gold Coast and a growing Southeast Queensland population.
Thank you, Jemma. All right, so we'll move to resolution three, which is the appointment of BDO as the new auditor for the group. And we have two men here from BDO. Ernst & Young has been the group's external auditor for the last seven years, having regard to the downsizing of the group in recent years. In the interest of good corporate governance, the board decided it was appropriate to undertake a competitive tender for the company's external audit services. Following a comprehensive tender process, BDO Audit Pty Ltd was selected as the new external auditor of the group, subject to shareholder approval at this meeting.
As a result, the directors are recommending to shareholders that BDO Audit Pty Ltd be appointed as external auditor of the company and its controlled entities for the financial year beginning on 1 July 2024. In accordance with section 328B(1) of the Act, the company has sought and obtained a nomination from a shareholder for BDO Audit Pty Ltd to be appointed as the company's auditor.
A copy of this nomination is attached to the notice of meeting as attachment A. The Australian Securities and Investments Commission has also consented to the resignation of Ernst & Young as auditor of the company. I now move, for the purposes of section 327B(1)(b) of the Corporations Act 2001 and for all other purposes, BDO Audit Pty Ltd having been nominated by a shareholder to act in the capacity of auditor following the resignation of Ernst & Young and having consented in writing to perform the role, be appointed as the auditor of the company. The proxy results for this resolution are on the screen. Any questions relating to this resolution? Chris, any?
Yeah, Gary, there's a question. Might be normal if you bring the microphone to Anthony Yuan, who's the EY partner. There's a question asking for a quick comment from the Ernst & Young signing partner on whether they were invited to tender in the audit process when they found out that they were being replaced by BDO and whether or not there was any impact in that decision on their sign-off on the '24 accounts.
Certainly, and thank you for the question. Anthony Yuan, I was the audit signing partner from EY responsible for the conduct of the FY '24 audit. To answer those, the various tranches to those questions, we were invited to re-tender. We were notified of the outcome in August of this year. The tender process had no impact on the audit process for FY '24. And I'm sitting here next to Mr. Tim Aman, who's the incoming audit partner from BDO. We've completed the formalities of the auditor change process, subject to your deliberations today. And in the coming weeks, we'll facilitate the handover process in advance of 31 December for the half-year review or sorry, December for the half-year review. Thank you.
All right. The resolution or the proxies have shown up there. So before closing the meeting, I'll take questions of a general nature. I might take one, Chris, that has come through online, which you've referred to me. The question reads, "Thank you to Brad Richmond for his seven years of service on the board. It's always helpful for investors to have access to some exit perspectives from retiring independent directors. In his final contribution as a Coast Entertainment director, could Brad please comment on what he regards as the best three decisions made during his time on the board?
And does he have any regrets?" Before asking Brad to comment, I just, perhaps by way of historical record, note that Brad joined the board of what is now Coast Entertainment the same day that I did. We stood as a ticket to seek board representation. Our request for board representation was initially rebuffed, but ultimately was accepted. I think it is noteworthy that we have two directors who were in place at the company at the time who are still on this board. Randy, who had only joined a matter of weeks before I joined the board, and David, who had only been a recent appointee to the board as well. But Brad, if you're online, do you mind providing a response?
Yeah, Gary, I'd be happy to. I think the things that stick out to me is, first, it's all about people. It's all about your leaders. That talks everything from the executive leaderships in our different businesses to the boardroom. So I look at that with pride and with confidence that we have the right leaders in place to take the business where we want to get it to. I think, obviously, for me, my early days were focused on Main Event and the repositioning of that business and then navigating through COVID and all that and actually came out in a pretty good shape for the work that we've done during that period that resulted in a pretty handsome sale of the business to Dave & Buster's.
I think also, for me, my work on the audit and risk committee about really instilling and having the appreciation for sound financial practices and discipline around those was something that I look back on that I think was beneficial to the organization. I think you've heard us talk a fair amount about this already, but this is the whole safety culture. I clearly understand the importance from my background. I understand the importance from the business at Main Event, but also at the parks, and that safety culture, it's a part of our DNA. It's talked about all the time, and it comes into play in every one of our decisions about making the right choices for the business and for the safety of our employees and guests.
I would say I'm very confident in the strategy that the business has going forward. I'm confident in the leadership from the board to the executive leadership. I think we have the right people in place to take this business where it should be, and you didn't quite ask this, but I would just add I've really enjoyed my time on the board.
I've always felt valued. I felt people I was always heard. I was always respected, and same way when I had comments to share and all that. So there was that good, healthy tension, if you will, in the boardroom to talk about our business in a very candid and forward way to move it forward. I'm really only stepping down just because I've assumed a new role as CEO of a company here in the U.S. that's consuming a lot of my time, so it was just a matter of rationalization of my time. I have no regrets there, and I have only optimistic thoughts about where this business can go.
Thank you, Brad. Okay. Yeah. Sorry.
Question for Randy so you don't feel left out. But I suppose similar sort of question in that, yes, you've got an excellent CV. Disney, Universal, I think it was. You've been here since 2018. But given that exceptional experience, I'm not sure how it would work within those companies, how long they'd tolerate visitation not responding to such significant capital expenditure or not actually getting a return from that spend. So maybe if you could just give us your thoughts as to why it hasn't worked to date, what's missing, given the Disney and other theme park experience, which we're so privileged to have.
I think somebody else mentioned. And yeah, what would be, I don't know, the Walt Disney return hurdles if they got sort of a 15% type return? If you're going to spend 150, what sort of returns would they demand from their employers? And I think they are doing pretty well, the theme parks. But for some reason, Dreamworld is not. So just appreciate your high-level thoughts, please.
First of all, I'm going to tell you that investments in this industry usually require a lengthy period of time before they pay off. So I'm not going to address what Disney's perspective was on this. But you're looking at very different companies here, okay? You're looking at companies that in the States are dependent on not only the local market, but have built humongous resorts that are destinations in and of themselves. So you've got a very different scenario here. But as far as the business itself, the changes that I've seen in the seven years that I've been associated with this are absolutely remarkable in terms of not only the culture, but the vibe of the employees and the fact that people, they're energized. They're delivering a good experience.
And in my opinion, we've dealt with a huge number of external obstacles besides the incident that took place years ago, which have an impact on this business, but you don't necessarily have the ability to affect it. If people aren't coming here from China or different parts of the world, that's really the function of the national tourist office. That's the function of the state tourist office to drive that demand. And then we want a disproportionate portion of the market share. So in my opinion, the things that have adversely impacted Dreamworld's attendance were not local, were not the brand and how it's viewed here, but was really the diminishing number of international and long-haul visitors coming into the market that we try to market to.
It would be totally imprudent for Dreamworld to go out and market on its own in some of those destinations because individuals, and Greg mentioned this earlier, someone coming here from Korea doesn't need to go to a theme park. They want to see the animals. They want to see nature. They want to see wildlife.
Our message in each market is unique and distinct to that market, but it will always be dependent on how many of those people are coming here for a destination that includes Dreamworld, but is also far more comprehensive in terms of the riches that this destination has. If you look at our brand amongst our guests, it's very high. If you look at the guest satisfaction index, it's very high. The function we're talking about really is mostly long-haul and not local or interstate traffic.
Then just another question. I think, Gary, you mentioned, yes, well done on restarting the buyback. And the board thinks the shares are very undervalued. But Randy, I think you're on 55,000 shares. Is that correct? I think it's closer. It's above that. Anyway, it's a lot less than your annual salary. And you've been here since 2018. But any intentions on increasing that shareholding given where?
I certainly am always open to improving my investments.
Okay.
I should add that there's been a significant trading restriction on directors' share purchases over recent times.
Just final one. But the excess cash, even post all the Claw spend, you might have probably AUD 40 million absent any sort of gains or losses from the operating business. But any thoughts on the use of that cash? Are you going to develop the excess land? Or, I think historically, you've said hotel spend, somebody else would always develop it. But any thoughts on retaining? I know you've restarted the buyback again today, but you're still going to have, if you were to fully execute on that buyback, a lot of excess cash. Can you give us your thoughts as to where that is going to be spent? Any interest in acquisitions or further capital expenditure, please?
We have nothing particularly targeted beyond those matters that we've already raised, which is completing Rivertown and completing the closure of the existing The Claw and the commencement of construction of King Claw, which should be what, 12-month program, Greg? And we will then review the position as to where we are. We are confident enough today to begin to announce the recommencement of our share buyback program. We do believe the stock to be very cheap.
So we were delighted to have already bought back 10% of the company, continue to be buying at prices that we believe to represent a material discount to intrinsic value. Believe me, if we get to a point where we have excess cash that we can prudently look to redeploy, as I've mentioned earlier, my group and associates speak for 10% of the register. So we would like a return. I'm sure others have already heard. At least one gentleman would like a return. I'm sure there are plenty of others who would like to join the queue for that. And clearly, that will be front of mind for us. Any other questions?
Yep.
Sorry. Mel, can you just?
Chairman Gary, could your board consider shifting the annual general meeting to Dreamworld itself? Maybe you could give the shareholders a guided tour of the improvements that you're making at the present time.
Sure. Actually, driving here, I thought, why wouldn't we have the AGM at Dreamworld? To be fair to say, I think this particular asset is well geared for a meeting of this type. Let me take that on board. Let me also say to you, if you're a shareholder, we would welcome you coming to the park to have a look for yourself at what we've done and to appreciate the area in which we operate out of. Going back to Jemma's initial formative years of professional career at Dreamworld, Dreamworld was surrounded by empty paddocks and farms. If you go to it today, you may well be from the region, so you know what I'm talking about. It's a booming area.
But please let us know that you'd like to come to the park. Greg and his team will come in, will show you around with great pride at what we are doing because I think you will see. I don't know when you were last in the park, but the park today represents a very, very different curated proposition to a very high standard above and beyond anything that Dreamworld ever had in place before.
We're very excited about our new precinct. We will have a themed precinct that will be without peer in the Australian market. We've built it. And I certainly hope, and I know Charlie expects us to see a significant spike in attendances for all the expenditure that we've made. I believe we will see it. But let us know. Come out. We'd love to host you. Got family, bring them all out and have a great time.
Okay.
We'll get free entry. You can't discount. But hold on. You've got to show us that you're a shareholder. But you can't discount free. Okay? Just remember that. Okay. All right. Yeah.
I bought shares in Village Roadshow when they started, they were desperate for money at that time. And so they used to really take care of their shareholders. And they put on some beautiful breakfast for shareholders at annual general meetings and all the goodies like free admission to the park, free movie tickets, etc., etc. What developed was as they didn't need the shareholders, all those goodies disappeared. So what you're proposing now is something that's going to be very accepted by all shareholders, I believe. And if you could put on a bit of free coffee and cake, that would be appreciated too.
There's something downstairs, Greg, reminds me. So at the moment, apart from letting us know you're coming to the park and free entrance, you get a free cup of coffee downstairs, but anyway, look, I'd like to thank you all for your attendance. As I've.
Sorry, Gary. Just with the Q&A—for the record, there's a number of online questions that have come through. Obviously, they cover the topics of share price, land, what we're doing to land, and return to shareholders. I'd just like to say I think we've adequately dealt with those through the Q&A in the room, which has dominated the Q&A, so for those online who ask questions, thank you for your questions, and yeah, they've been adequately dealt with, in my opinion.
So look forward to next year. Maybe we'll take on board having the AGM at Dreamworld, and we'll see who's game to ride the new Jungle Rush coaster. But thank you all for your attendance. We do really appreciate the level of interest that you have in our group, and our goal is to try and deliver on the promise that we've held out there over the next 12 months. So thank you all for coming.
My name is Susie and my husband, Steven. But we've been shareholders from the inception. What do you think a shareholder here mentioned about free entry into Dreamworld? So maybe a group of us can come together one day, and then we can meet with Greg Yong. Just hope all of us come together.
Yep. Absolutely.
It would be easier for you. Yeah.
So let me just say, in principle, a shareholder is a part owner of the asset. So if you want to come, just let us know, and we will organize everything for you. Okay?
May it have to be individually, you mean?
Well.
No, I would much prefer to take you in a group around the property. I think it's efficient for us. I think as a holder, you would want us to spend our time managing the organization. So if I could do it with you together, that would be preferable for us. And I think you would probably get a better experience as well.
Well, can I make a suggestion? For anyone here who wants to go on a group tour of Dreamworld, let Mel know your contact details, and we'll arrange that over the next few weeks. Are you a local resident?
We're from Brisbane.
Yeah. Okay. Local enough. Yeah. Yeah. Okay. So let's collect the names, and we'll look after you. We'll try and find a time that suits you all. And you come and spend time. We'll show you around the park, show you everything that's been done. And then if you want free time, go off and enjoy yourself. Okay?
Hold on.