Experience Co Faces Weather Risks Despite Strong FY25 Earnings Growth
Experience Co Limited reported a solid FY25 financial performance with revenue rising 6% to $134.3 million and underlying EBITDA jumping 34%, driven by strong recovery in skydiving and adventure segments. The company declared a fully franked dividend and outlined an optimistic FY26 outlook focused on growth and efficiency.
- 6% revenue growth to $134.3 million in FY25
- 34% increase in underlying EBITDA to $19.3 million
- Fully franked dividend of 0.25 cents per share declared
- Strong performance in Skydiving and Adventure Experiences segments
- Positive FY26 outlook with focus on free cash flow and expansion
Robust Financial Growth Amid Tourism Recovery
Experience Co Limited (ASX – EXP) has delivered a commendable FY25 result, reflecting a steady recovery in the tourism and adventure sectors across Australia and New Zealand. The company reported a 6% increase in sales revenue to $134.3 million, underpinned by a 34% surge in underlying EBITDA to $19.3 million. This performance was largely driven by the rebound in international visitor numbers and strong domestic demand, particularly in the skydiving and adventure experiences segments.
Despite challenging weather conditions impacting some operations, Experience Co managed to enhance operating margins through improved site efficiencies and cost-saving initiatives, including a procurement review targeting over $2 million in annualised savings for FY26. The company also maintained a modest net debt position of $10.9 million, supported by a strong balance sheet and tangible asset base.
Segment Highlights and Strategic Initiatives
The Skydiving division, Experience Co’s flagship segment, saw a notable recovery with tandem skydiving volumes increasing by 9% in Australia and 10% in New Zealand. Enhanced operational efficiencies and higher average revenue per customer, boosted by strong photo and video sales, contributed to a 27% rise in underlying EBITDA for this segment.
Adventure Experiences, including Treetops Adventure and Reef Unlimited, also recorded solid growth. Treetops Adventure expanded its footprint with a successful first year at the Canberra site and plans for further new locations. Reef Unlimited benefited from the addition of the new vessel Aquarius II, which supported increased charter demand and contributed to a 7% revenue increase.
Outlook and Growth Priorities for FY26
Looking ahead, Experience Co is optimistic about FY26, anticipating continued revenue growth driven by improving tourism markets and a recovering international visitor base. The company plans to accelerate earnings recovery in Skydive Australia, expand Treetops Adventure sites, and launch new products such as Reef Unlimited’s Two Island Explorer. Cost management remains a priority, with ongoing efforts to enhance procurement and reduce operating expenses.
Experience Co has also initiated an on-market share buy-back program of up to 10% of shares, signaling confidence in its capital position and future prospects. The company expects free cash flow generation to improve further, with a focus on converting incremental EBITDA into net profit and cash.
Overall, Experience Co’s FY25 results and strategic roadmap position it well to capitalize on the resurgence in adventure tourism, balancing growth ambitions with disciplined financial management.
Bottom Line?
Experience Co’s FY25 momentum sets the stage for a growth-focused FY26, but execution risks and tourism market volatility remain key watchpoints.
Questions in the middle?
- How will Experience Co manage weather-related disruptions impacting key sites?
- What is the timeline and expected impact of reopening the Yarra Valley skydiving site?
- How might evolving international tourism trends, especially from China, influence FY26 growth?
