Experience Co Reports Flat Q4 Revenue, 31% Drop in Underlying EBITDA

Revenue Holds Firm Despite Skydive Australia Weakness

Experience Co Limited (ASX:EXP) closed out FY26 with Q4 revenue broadly matching the prior corresponding period (PCP) at $29.4 million, but underlying EBITDA tumbled 31% to $2.0 million. The softness was driven primarily by a 4% revenue decline in the Skydiving segment, weighed down by a 15% drop in Skydive Australia, which struggled with weather disruptions and softer consumer demand.

Skydive New Zealand bucked the trend, delivering a robust 17% revenue and 25% volume increase, helped by improved booking flows in May and June after a weather-hit April. However, the consolidation of Victorian operations saw the Melbourne drop zone placed into care and maintenance and the Yarra Valley site permanently closed, reflecting a strategic retreat from underperforming locations.

Adventure Experiences Segment Drives Growth

The Adventure Experiences division provided a bright spot, posting a 5% revenue increase to $15.2 million in Q4. Both Reef Unlimited and Treetops Adventure contributed, with Reef Unlimited’s revenue up 4% thanks to a 3% volume increase and a modest 1% rise in average revenue per customer. Demand for lower-priced domestic experiences like Fitzroy Island helped offset weather-related softness earlier in the quarter.

Treetops Adventure revenue climbed 8%, led by a 10% volume surge including contributions from the newly opened Canberra Networld attraction. However, average revenue per customer dipped 3%, reflecting a higher share of lower-priced Networld visits. The recent acquisition of West Beach Adventure in Adelaide adds a promising growth avenue for the portfolio.

Cost Pressures and Strategic Moves Shape Outlook

Operating costs came under pressure from rising fuel prices, which increased from about 4% to 6.5% of group revenue following geopolitical tensions in the Middle East. Weather impacts, wage inflation, and incremental promotional spending to stimulate sales further squeezed margins.

On the strategic front, Experience Co has agreed to a non-binding term sheet with Inflite Group to divest its Australia and New Zealand skydive and aviation operations, retaining a minority stake. This move aligns with the company’s focus on scalable adventure experiences and follows earlier portfolio streamlining, including the May sale of the Wild Bush Luxury business.

Meanwhile, the Skydive Australia Enterprise Bargaining Agreement is now subject to an Intractable Bargaining Determination at Fair Work Australia, with evidence submissions expected in coming months; a potential source of operational uncertainty.

Investments Target Long-Term Growth

Experience Co is advancing growth initiatives, notably the construction of a new vessel, Reef Magic IV, funded in part by a $4 million Queensland Government Tourism Icons Investment Fund grant. The vessel is slated for service by December 2027, aiming to enhance Reef Unlimited’s capacity and customer experience.

The company’s selective approach to expansion; balancing consolidation in some areas with targeted acquisitions and new attractions; reflects an adaptive strategy amid external challenges.