EVT Reports Record FY26 Earnings and Launches $800 Million Property Divestment

Robust Financial Performance Amid Geopolitical and Weather Challenges

EVT Limited (ASX:EVT) closed FY26 with a solid set of results, posting a 6.3% lift in normalised revenue to $1.315 billion and an 8.4% rise in normalised EBITDA to $174.4 million. Reported net profit after tax soared 51.9% to $50.7 million, boosted by operational improvements and accounting benefits from lease standards. The Group's Hotels and Resorts division set new records for revenue and earnings, while Entertainment capitalised on a stronger second half film slate and its strategic ‘Fewer, Better’ cinema footprint rationalisation.

Despite the Middle East crisis dampening corporate demand late in the year and challenging weather conditions impacting Thredbo, EVT managed to grow market share and operational leverage. The Thredbo Alpine Resort posted a 13.7% EBITDA increase, supported by a strong 2025 winter season, although early winter 2026 was softer due to limited snow.

$800 Million Capital Recycling Program Targets Non-Core Properties

To fund future hotel growth and optimise capital allocation, EVT has identified approximately $800 million of non-core property assets for potential divestment over the next three years. This portfolio includes the George and Market Street precinct in Sydney, where recent development approvals have enhanced asset value and clarified redevelopment options. After considering alternatives, the Group concluded that divestment offers the most attractive strategic path to redeploy capital into hotel growth.

Other assets earmarked include 525 George Street, which is already on the market with ongoing detailed buyer interest but no finalised outcome, several non-core hotels, and two small freehold properties in Germany. EVT intends to retain QT Sydney under a hotel management agreement post-sale, maintaining asset-light exposure to hotel earnings while unlocking capital.

Proceeds from divestments will prioritise hotel growth initiatives, with the Board also open to returning capital to shareholders via special dividends. Timing and structure of the program remain subject to market conditions and satisfactory outcomes.

Hotels and Connect Hospitality Drive Growth

The Hotels and Resorts division delivered a record result with revenue up 5.1% to $434.5 million and normalised EBITDA rising 1.0% (3.2% underlying). RevPAR growth was strong across key markets including Sydney, Perth, Adelaide, Queenstown, and Christchurch. The first half of FY26 saw 5.6% RevPAR growth, moderated by softer corporate demand in the second half due to geopolitical uncertainty.

Strategic initiatives included the launch of Connect Hospitality, a third-party hotel management platform seeded with the acquisition of Pro-invest Hotels in December 2025, and the acquisition of QT Auckland in March 2026. Connect Hospitality now manages 17 hotels under franchise agreements and is delivering earnings at the upper end of initial guidance. EVT’s asset-light expansion also gained traction with new management agreements in Thailand and the Independent Collection’s bespoke branding solutions.

Entertainment Division Benefits from Strategic Rationalisation and Premiumisation

EVT’s Entertainment division saw admissions rise 3.6%, revenue increase 7.7%, and EBITDA surge 45.8%. The ‘Fewer, Better’ strategy, which involved exiting 11 underperforming cinema locations and investing in premium formats like IMAX, ScreenX, and 4DX, underpinned improved operating leverage. In Australia, EBITDA met or exceeded pre-COVID levels despite admissions at around 70% of pre-pandemic levels. Germany’s CineStar circuit posted a 9.5% admissions increase and a 254.8% EBITDA jump, supported by a strong local film slate.

Group Structure Review to Support Long-Term Shareholder Value

EVT has engaged Rothschild & Co to independently evaluate management’s proposed Group structure options aimed at better positioning the company to capitalise on hotel growth opportunities and maximise shareholder returns. An Independent Board Committee, led by newly appointed lead independent director Brett Chenoweth, oversees the review. While no transaction or structural change is guaranteed, this strategic priority for FY27 signals EVT’s intent to explore new avenues for value creation.

FY27 Outlook and Dividend Declaration

Looking ahead, EVT expects EBITDA growth in both Hotels and Entertainment divisions, subject to film performance, weather, and market conditions. The Hotels division is forecast to deliver another record year, supported by $13 million incremental EBITDA from strategic initiatives including QT Auckland, Connect Hospitality, and the QT Queenstown redevelopment. However, early construction at LyLo Gold Coast and delays in seismic upgrades at Queenstown temper near-term earnings, with benefits anticipated from FY28 onwards.

Entertainment has kicked off FY27 strongly with blockbuster titles and anticipates continued EBITDA growth, while Thredbo’s EBITDA is tracking below prior year due to snow shortages. The Board declared a fully franked final dividend of 23 cents per share, bringing total dividends for FY26 to 41 cents per share.

Sustainability and Climate Risk Management

EVT disclosed climate-related risks and opportunities in line with Australian Sustainability Reporting Standards, highlighting Board oversight, risk management integration, and emissions reduction targets validated by the Science-Based Targets initiative. The Group aims to reduce Scope 1 and 2 emissions by 30% and Scope 3 by 20% by FY2030 from a FY2023 baseline, with ongoing investments in energy efficiency and snowmaking technology at Thredbo. While climate-related financial impacts remain difficult to quantify precisely, EVT continues to embed climate considerations into capital planning and risk frameworks.

Independent auditor KPMG issued an unqualified opinion on EVT’s financial statements and sustainability disclosures, underscoring the robustness of the Group’s reporting.

EVT’s FY26 results and strategic initiatives position the company for sustained growth, but execution of the capital recycling program and outcomes of the Group structure review will be critical to watch as the Group seeks to unlock further shareholder value.