Coast Entertainment (ASX:CEH) posted a $6.1 million net profit in FY26, driven by strong theme park attendance and record revenues, while securing a major land development approval that boosts asset value by over $50 million.
- Net profit of $6.1 million reverses prior year loss
- Theme Parks & Attractions revenue up 20.8% to $116.5 million
- Attendance grows 29.3% to 2 million visitors
- Coomera land development approval lifts Dreamworld valuation by $52 million
- Deferred revenue surges 58.7% on strong annual pass sales
Profitability Returns Amid Strong Visitor Growth
Coast Entertainment Holdings Limited (ASX:CEH) has swung back to net profit in FY26, reporting a $6.1 million net profit after tax compared to a loss of $0.1 million the previous year. This turnaround comes on the back of a 20.8% increase in operating revenue to $116.5 million, fueled by a 29.3% surge in total visitation to 2 million guests across its Dreamworld, WhiteWater World, and SkyPoint attractions.
Despite ongoing macroeconomic headwinds including inflation and consumer discretionary spending pressures, the Theme Parks & Attractions division more than doubled its EBITDA (excluding specific items) to $18.8 million, marking its fourth consecutive year of positive earnings growth. The division’s EBITDA margin improved by 7.3 percentage points to 16.1%, the highest since FY16, reflecting operational leverage from higher attendance and disciplined cost control.
New Attractions and Marketing Drive Momentum
Key growth drivers included the first full-year contribution from the Rivertown precinct, which opened in December 2024, and the December 2025 launch of King Claw, the fastest Gyro Swing ride in the Southern Hemisphere. These investments, alongside increased marketing and promotional activities, helped ticket sales rise 33% (24% like-for-like), surpassing pre-COVID FY16 levels.
Annual pass sales played a pivotal role, increasing deferred revenue by 58.7% to $20.2 million as cash is received upfront but revenue recognised over 12 months. This growing passholder base contributed to a dilution in average revenue per visitor but boosted repeat visitation and in-park spending, with Food & Beverage and Retail revenues hitting record highs, up 22.7% like-for-like.
Land Development Approval Unlocks Significant Asset Value
July 2026 marked a watershed moment for Coast Entertainment with Queensland Government approval of the development application for its 55-hectare Coomera landholding. This approval expands permissible land uses across four precincts, including mixed-use hotel, residential, retail, and entertainment zones, significantly enhancing the site’s development potential.
Independent valuations commissioned post-approval by CBRE put the fair value of Dreamworld and associated assets at $295.9 million, a $52 million uplift from pre-approval valuations. There is further upside potential of $38.5 million tied to redeveloping the car park area, though this would require relocating existing parking facilities. SkyPoint’s valuation also rose to $51.7 million, up $14.7 million since December 2023.
While these valuation uplifts are not recognised in the FY26 financial statements due to accounting policies, they underscore substantial intrinsic value not reflected on the balance sheet. The Group has engaged Barrenjoey Advisory to explore capital and funding options to maximise shareholder value from this strategic asset.
Robust Balance Sheet and Cash Flow Support Growth
Coast Entertainment ended FY26 with a strong balance sheet, holding $35 million in cash and maintaining a fully undrawn $20 million bank facility. Operating cash flow more than doubled to $19.7 million, fully funding $16 million in capital expenditure and $3.7 million in share buybacks, underscoring the business’s self-funding capability.
Capital investment was focused on maintenance and development projects, notably the King Claw ride and preparatory works for the Motocoaster replacement, Lost Mine Mayhem, expected to open in late 2027. This new family-friendly coaster will reuse existing track infrastructure to reduce costs while enhancing capacity and guest experience.
Executive Remuneration Reflects Strong Performance
Executive remuneration outcomes for FY26 mirror the Group’s robust performance, with CEO Greg Yong receiving a $612,912 bonus tied to financial targets and strategic achievements, including safety and guest satisfaction. However, none of the FY24 long-term incentive performance rights vested due to unmet total shareholder return and revenue growth hurdles, illustrating a balanced approach to executive rewards.
The Board also saw a leadership change with the departure of Non-Executive Director Jemma Elder in July 2026, succeeded by David Haslingden as Chair of the Remuneration & Nomination Committee.
Visitor Experience and Market Penetration Still Have Room to Grow
Despite the strong FY26 results, Coast Entertainment’s visitation remains 17% below FY16 levels, reflecting under-penetration in a growing Southeast Queensland market. International tourism, particularly from China, remains subdued at 30% of pre-COVID levels, though domestic and local demand have more than compensated.
Looking ahead, the Group’s strategy to grow attendance and revenue focuses on expanding its reach through new events like the Christmas in July after-dark festival, loyalty initiatives such as the Annual Dining Pass and Dreamworld +Plus program, and leveraging strategic partnerships with brands like the New Zealand Warriors and Australian Geographic.
Operational excellence efforts include technology-driven improvements in guest ordering and personalised marketing, alongside AI and automation to drive efficiency and cost optimisation.
With the Brisbane 2032 Olympics on the horizon and Dreamworld’s 50th anniversary in 2031, Coast Entertainment is positioning itself to capture long-term growth opportunities while navigating the uncertainties of economic and tourism recovery.
Investors will be watching closely how the Group balances capital allocation between ongoing park enhancements and unlocking value from its newly approved land development, as well as how the shift to EBITDA-based long-term incentive hurdles influences executive focus and company performance.
Bottom Line?
Coast Entertainment’s FY26 marks a clear turning point with profitability restored and a major land approval boosting asset value, but the path to fully recovering pre-pandemic visitation and translating land optionality into shareholder returns remains to be charted.
Questions in the middle?
- How will Coast prioritise capital between park upgrades and land development projects?
- What timeline and costs will be involved in realising the potential $38.5 million valuation uplift from car park redevelopment?
- How will the shift to EBITDA-based long-term incentives affect executive decision-making and growth focus?