Experience Co posted a slight decline in Q3 FY26 revenue and underlying EBITDA, weighed down by adverse weather, industrial action, and inflationary pressures, while advancing cost reductions and strategic reviews.
- Q3 FY26 revenue fell 3% to $33 million
- Skydiving segment revenue down 5% due to weather and strikes
- Adventure Experiences revenue steady with volume declines offset by higher spend
- Management progressing Skydive Australia business review and Victorian consolidation
- Wild Bush Luxury sale completed, proceeds to reduce debt
Q3 FY26 Revenue and Earnings Pressure
Experience Co Limited (ASX:EXP) reported a modest 3% decline in group sales revenue to $33 million for Q3 FY26, with underlying EBITDA falling 11% to $5.1 million compared to the prior corresponding period. The performance came under pressure from a confluence of external factors including significant weather disruptions in Tropical North Queensland, adverse conditions in New Zealand, prolonged industrial action affecting Skydive Australia, inflationary cost pressures, and the onset of the Middle Eastern conflict in late February.
Despite these headwinds, management has implemented tactical pricing campaigns and targeted rate increases, alongside a group-wide cost reduction program that has already realized 75% of its $2 million annualized savings target for FY26. These measures aim to bolster average revenue per customer and improve margins as the year progresses.
Skydiving Segment Faces Weather and Industrial Challenges
The skydiving division, which accounted for $19 million in revenue during the quarter, saw a 5% drop from Q3 FY25. Skydive Australia’s revenue and volumes declined by 7% and 2% respectively, impacted heavily by protected industrial action that disrupted key trading periods including the Christmas/New Year and Chinese New Year seasons, as well as adverse weather events. Skydive New Zealand also experienced a 3% revenue decline, compounded by weather-related processing delays and a weaker New Zealand dollar against the Australian dollar.
Bookings in New Zealand remain robust, consistently outpacing the prior year, suggesting demand resilience despite operational challenges. Meanwhile, Experience Co continues to advance its review of the Skydive Australia business unit, a process first flagged in the 1H26 results, which recently led to the consolidation of Victorian operations including the closure of the Yarra Valley Drop Zone and placing the Melbourne Drop Zone into care and maintenance.
Adventure Experiences Segment Shows Steady Revenue
The Adventure Experiences segment maintained revenue at $13.9 million, flat on the prior corresponding period, despite a 5% decline in Reef Unlimited volumes and a 3% dip in Treetops Adventure volumes. These volume declines were offset by increases in average revenue per customer of 5% and 4% respectively, driven by price adjustments and enhanced ancillary sales. Reef Unlimited’s performance was notably affected by softer visitation to Tropical North Queensland, with hotel occupancy down 34% on the three-year average due to severe weather events and operational disruptions including a crocodile presence restricting certain experiences.
Treetops Adventure demonstrated resilience with volume growth of 12% year-to-date, supported by new attractions such as the Canberra Networld site and strong performances in Western Australia and New South Wales, despite the loss of the Newcastle site.
April Trading and Strategic Moves
April, a critical peak trading month, saw revenue from continuing operations of $12 million, down from $13.2 million in April 2025, and underlying EBITDA of $1.8 million versus $2.8 million previously. The group continues to navigate the ongoing effects of geopolitical tensions, consumer sentiment shifts, and inflationary cost pressures, particularly fuel costs which rose from about 4% to 6% of group revenue since the Middle Eastern conflict began.
Notably, the sale of the Wild Bush Luxury business unit was completed on 1 May 2026, with net proceeds earmarked for debt reduction, aligning with Experience Co’s strategic focus on scalable adventure tourism segments. This follows the earlier sale of Wild Bush Luxury portfolio announced in December 2025 and finalised in May 2026.
Management remains focused on cost control and cash flow generation, with the Skydive Australia review ongoing. The consolidation of Victorian operations reflects a strategic recalibration in response to volume declines, particularly a 17% drop in Skydive Australia volumes year-on-year in April, partially offset by stronger performances in NSW and Queensland. Meanwhile, Skydive New Zealand volumes were down 6% due to weather impacts, though booking trends remain encouraging.
Experience Co’s ongoing cost-out program and selective growth initiatives in the Adventure Experiences segment aim to offset the challenging trading environment. The company’s ability to adapt to external shocks while maintaining customer spend will be critical as it approaches the FY26 full-year results scheduled for late August.
Bottom Line?
Experience Co’s Q3 results underscore the challenge of balancing weather disruptions, industrial action, and inflation while pursuing strategic reviews and cost savings ahead of FY26 full-year results.
Questions in the middle?
- How will the Skydive Australia business review reshape the segment’s future operations?
- Can pricing and cost-out initiatives fully offset ongoing external pressures in the near term?
- What impact will the Victorian consolidation have on market share and customer experience?