Coast Entertainment Holdings Limited (CEH) Earnings Call Transcript & Summary

Thank you. Thank you for standing by, and welcome to the Coast Entertainment Holdings Limited Annual General Meeting 2024. I would now like to hand the conference over to Mr. Gary Weiss, Chairman. Please go ahead.

Good morning, everyone, and welcome to the Annual General Meeting of Coast Entertainment Holdings Limited, which is once again being held at our SkyPoint Observation Deck on the Gold Coast. My name is Gary Weiss, and I'm the Chairman of Coast Entertainment Holdings Limited. For those attending in person, welcome to SkyPoint. It is our pleasure to showcase to you one of our iconic and best-performing assets. Similar to previous years, this AGM is being conducted in a hybrid manner to allow shareholders to participate either in person or virtually via the online platform. Before I formally open the meeting, I will ask our Company Secretary, Chris Todd, to outline some procedural matters on today's meeting for those who are joining virtually.

Thanks, Gary, and good morning to everyone. Just a few administrative matters to start with. As mentioned, today's meeting is being conducted in a hybrid format, allowing some of those shareholders to attend virtually in addition to those here in the room, they'll do so via the online AGM platform. For those who are attending virtually, please note the following. If you experience any technical issues during the meeting, we have published a virtual meeting guide on our website, which includes details on how to seek assistance. Shareholders who are online will have the opportunity to ask questions via that virtual meeting platform. [Operator Instructions] For those who already have questions prepared, please submit them now on the platform so that we can consider them as and when we come to the relevant agenda item. You do not need to wait until the relevant item of business. At the conclusion of today's meeting, we will endeavor to respond to any shareholder questions of a general nature that may not have been addressed in the general business update or if we consider that a response would benefit all shareholders. And finally, a recording of today's meeting will be available on our website at the end of today. With that, I'll now hand back to Gary to formally open the meeting.

Thank you, Chris. I now confirm that a quorum is present, and I declare the meeting open. It is my pleasure to introduce to you today the members of the Coast Entertainment Board in attendance today. I'm joined in SkyPoint by Randy Garfield, Randy's flown all the way from Florida, is it, Randy? Yes?

Yes.

And Jemma Elder, joining us from Southeast Queensland; and joining us on the phone from the United States are David Haslingden, Brad Richmond and Erin Wallace. I would also like to welcome members of the executive team, Greg Yong, our Group Chief Executive Officer; and Jose de Sacadura, our Group Chief Financial Officer, who are both in attendance at SkyPoint today. I also want to specifically welcome [ Geoff Sartori ]. [ Geoff ] has been a significant part of the rehabilitation of this group and has performed an excellent role for us as safety adviser to the Board of Coast Entertainment. The group's auditor, Ernst & Young, represented by Anthony Ewan, is also in attendance today on the phone and is available to answer questions in relation to the FY '24 auditor's report. The format for today's meeting will be as follows. I will begin by providing some opening remarks regarding the activities and performance of the group for the year and will then hand over to Greg to provide a more detailed update on the performance of the business. We will then move to the formal business of the meeting and put to shareholders the resolutions set out in the notice of meeting. All resolutions to be put to the meeting today will be decided by way of poll. Shareholders attending the meeting will be able to cast their vote using ballot papers if attending in person or the electronic voting card received when your online registration is validated if attending online. Further information and assistance with online voting can be found in the virtual meeting guide available on the group's website. FY '24 marked another solid year for Coast Entertainment with the group delivering its first positive consolidated EBITDA result for the continuing business since FY '16 amid a challenging trading environment and despite the impact of 2 severe storms, which caused significant damage and trading disruption to our parks during the peak summer holiday period. Notwithstanding these challenges, the group delivered a resilient performance with visitation to our venues up 14% on the prior year, driven by strong annual pass sales and associated repeat visitation. This highlights the strength of our product and guest service levels, which are resonating very well with our guests, particularly in the local market. Revenue for the year of $87 million was also up compared to the previous year, with a notable shift in mix towards more annual passes. As a result, deferred revenue for the group increased by 12% to $12.1 million in June 2024. Despite inflationary pressures, we continue to diligently manage our cost base together with the revenue growth outlined. This led to the Theme Parks & Attractions business achieving an EBITDA profit excluding specific items of $7.4 million in FY '24, an increase of 50% compared to the prior year. Notably, both Dreamworld and SkyPoint again delivered positive EBITDA contributions, and SkyPoint's performance was its best on record. The FY '24 result would have undoubtedly been better without the storms. And while we rue what could have been, we are continuing to work with our insurers to progress the related insurance claims for both property damage and lost earnings. Pleasingly, the performance trends we witnessed in FY '24 have continued into FY '25 with visitation, revenue and EBITDA for the first 4 months, again, showing steady growth compared to the prior corresponding period, as Greg will outline shortly. Slide 5 of the AGM presentation provides further detail on our capital management priorities and initiatives in the short to medium term. The group's development pipeline is progressing well with the new Rivertown precinct, incorporating the Jungle Rush family coaster and the iconic Vintage Cars adventure rethemed Murrusippi Motors on track for opening in December 2024 despite substantial weather-related delays over the last 10 months. Work has also advanced on a new highly themed Jungle Jane's family restaurant, which will augment this precinct. This additional investment is expected to drive incremental F&B revenue as we look to capitalize on returning international markets and events business. Additionally, as foreshadowed in our August 2024 results presentation, we are evaluating options for some of the older attractions in our fleet, including the need to provide for potential upgrades. As part of this process and after 20 years in service as one of Dreamworld's most popular attractions, we have recently announced our decision to close The Claw attraction in early 2025. This iconic ride will be replaced with the new larger and faster King Claw attraction in FY '26. As we've previously stated, our significant capital investment program is crucial to driving performance back to historical levels, and we are encouraged by the early signs with attractions that have opened so far resonating well with our guests. As we have previously highlighted, the group holds a substantial balance sheet with no debt, fully unencumbered real estate assets and substantial cash balances. Noting the continuing economic uncertainty and significant capital outlay still ahead, the Board continues it important to maintain balance sheet strength to provide headroom for the group's operating and capital needs in the near term as well as flexibility and capacity to pursue earnings growth opportunities as may arise. This is balanced with the Board's commitment to maximizing shareholder value, and I'm pleased to report that the on-market share buyback, which commenced the mid-September 2023 was completed in August 2024 with 48 million shares being bought back at a cost of $22.6 million. Having regard to the improving performance of the group, the Board recognizes that a portion of its cash balances remain surplus to the group's near-term needs and proposes to implement a further on-market share buyback of up to 10% of the issued capital over the next 12 months to improve shareholder returns and enhance capital efficiency. This buyback will comply with both the 10/12 limit under the Corporations Act 2001 and the ASX Listing Rules. The timing and actual number of shares purchased under the buyback will depend on the prevailing share price, market conditions and capital requirements of the group. The Board remains confident that with a robust financial position, improving performance and an exciting pipeline of capital projects underway, the group is well positioned to benefit when economic conditions normalize and both international and domestic visitation return to historical levels. On behalf of the Board, I would like to express our gratitude to our dedicated team members across the group for their valuable contribution and commitments in driving the performance of the business. I would also particularly like to thank and acknowledge the significant contribution of Brad Richmond, who today retires from our Board. Brad has been a dedicated and valuable member of the Board for the past 7 years and leaves a significant and lasting impression on the group. Brad was instrumental in overseeing the turnaround and growth of Main Event and assisting management to steer that business through the COVID pandemic and subsequent sale by the group in June 2022. Brad has also played an important role in the recovery of our Theme Parks & Attractions business through some challenging periods. So our sincere thanks to Brad for all his contribution to the group over his period of tenure. It is now my pleasure to invite Greg to provide a further update on the business. Following the update, we will move to the formal business of the meeting.

Thank you, Gary. Good morning to everyone today. As always, I've got a lot to cover, so I'll speak fairly rapidly so we've got some time at the end for all of your questions. Before we start, I'd like to remind everyone that we provided a comprehensive update of the FY '24 results earlier this year at our full year results presentation. And as such, you can refer to that presentation from August 2024. Today, I intend to provide a brief summary of those results and an update on the business for the first 4 months of 2025. Over to Slide 7, which summarizes our key successes in FY '24. And I'd like to take a brief moment to highlight some of the initiatives that often go unnoticed. Firstly, our success is deeply rooted in our collaboration with local community. We have strengthened partnerships with local schools and expanded sponsorship for grassroots sports and creative initiatives. I serve actively as a director on the Gold Coast Community Fund, which does remarkable work in the local area. We are also leaders in making our sites more accessible, thanks in part to our operations team who have introduced some initiatives like the Hidden Disabilities Sunflower Project. And we are very proud of opening Dreamworld's Calming Cottage, the first of its kind on the Gold Coast. The Dreamworld Wildlife Foundation team also continues its vital work in both local and global conservation efforts, especially in tiger conservation through our partnership with the Zoological Society of London and the Wildcats Conservation Alliance. On Slide 8, we want to feature some of the capital projects that we delivered during the 2024 financial year. As previously announced, we have reimagined our kids' offering starting with an extension of the Ocean Parade precinct, which now includes new attractions like the Serpent Slayer, Deep Sea Dodgems and the Seabed Splash water play area. Additionally, we have completed the renewal of our kids' precinct, Kenny & Belinda's Dreamland, with new attractions across the board, including Big Red Planes and the Big Red Boat coaster in partnership with our friends at the Wiggles. The new Dreamworld Flyer has also been a real hit among families with 64 seats providing great ride capacity, showcasing over 120 fountain jets and 3,000 lights, adding a new dynamic to the park and an incremental pay-per-play opportunity at the Dreamworld Night Markets. The success of this attraction has been clear with it now consistently ranking in the top 3 most ridden attractions in the park. We've also seen attendance improve following the opening of each of these attractions, and our guest satisfaction scores continue to materially outperform our Gold Coast peers, suggesting that these products are resonating very well with our guests. These developments were delivered on time and on budget, and, I think, that's a significant achievement in today's challenging construction environment and a true testament to our entire team. But of course, the best is yet to come, and I'll provide an update on the upcoming Rivertown precinct and the Jungle Rush family coaster as well as the newly announced King Claw attraction later in this presentation. On Slide 9 of our presentation, we summarize some of the key financial highlights for FY '24. As mentioned earlier, elevated interest rates and the cost of living pressures have seen many consumers feeling the pinch. Additionally, FY '24 saw us face some significant challenges at Dreamworld with severe weather events and significant construction throughout most of the year. And pleasingly, despite these significant challenges, ticket sales were the highest we have seen since FY '16 and were 40% higher than in FY '17, largely driven by an increase in annual passes. As I've outlined on numerous occasions, these passes are very important for the business. They allow us to build meaningful relationships with local patrons and drive repeat visitation leading to higher total revenue and a greater propensity for retention. With income in these passes recognized over 12 months, they also provide a very important short-term weather hedge buffering us against adverse conditions. And I think the summer storm season was a very clear evidence of that fact. The increased sales in annual passes also highlight the strength we are seeing in our local market as our product and our service offering continues to resonate well with local guests. This comes at a time when interstate visitation is being somewhat stifled by economic conditions and international visitation remaining well below historical levels, albeit that it is improving. With increased volumes, per capita revenue yield has softened due to several factors, including increased repeat visitation from passholders, some tactical promotional activities and improving international visitation, which I've stressed in the past, will come at lower yields. However, we note that the yield environment is structurally different to what it was in FY '17, and our long-term focus is to continue to grow per capita revenues. Over to Slide 10. And FY '24 performance was covered in some detail at our August 2024 results presentation. Therefore, I will just highlight some of the key performance drivers. As Gary mentioned, we have faced a tough trading environment with elevated interest rates and high inflation continuing to weigh on the consumer discretionary spending. We have seen strong support in the local markets, but Interstate has been challenged. And we're not alone in this space with the ABS reporting in 2024 earlier in June, a 23% increase in the cost of housing, a 21% increase in the cost of food and a 22% increase in the cost of transport compared to December 2019 or the pre-COVID levels. And CBA in their 2024 results announcement reported decline in household savings, falling real disposable income and consumers winding back in discretionary spending with the heaviest impacted cohort being the younger 20 to 44 age group, which, as you all are well aware, is one of our core demographics. Against this backdrop, though, we were pleased to see growth in our ticket sales and visitation in 2024, which helped drive revenue of $87 million, the highest since FY '16. On the expense side, we faced similar challenges to many organizations, but we have continued to find efficiencies and managed to keep expenses flat despite a 14.3% increase in attendance. All of this cumulated in a 56% increase in EBITDA for FY '24, marking our second positive EBITDA for the operating business and our first positive EBITDA at the consolidated group level since 2016. Both businesses reported positive EBITDA results with SkyPoint's performance being the best on record. And I think what people would be most interested in is FY '25 and what we've seen so far. Certainly, we've seen a very positive start with year-to-date unaudited results showing a 9% increase in visitation 8% growth in operating revenue to its highest level again since FY '17 and a preliminary unaudited EBITDA result, excluding the specific items, which is up 49% above the current period. These results exclude $3.6 million of insurance proceeds, which we've received in FY '25 to date. These are interim payments, and we continue to progress our claims with our insurers for related property damage and business disruption. And while ticket sales for the first 4 months of FY '25 at a statutory level have reported a slight decline against the prior period, it is important to note that a prior period included a bulk sale to a reseller, which provided timing-related benefits, which we expect will reverse over the coming months. Excluding this bulk sale, ticket sales on a year-to-date basis were up 3% on the prior period. As outlined on Slide 11, our events and activations continue to be key drivers of our engagement and of our revenue. The Dreamworld Night Market has proven to be a sustainable and profitable venture, and we're excited about its long-term potential. And pleasingly, our recent Halloween activation, which ran for a record 6 nights and had the most attendances participating in the event's history. On Slide 12, we provide a glimpse of Rivertown and the Jungle Jane restaurant. This new world will be transformative for Dreamworld, featuring attractions designed to offer intergenerational experiences with rides that are exciting for the entire family. Murrissippi Motors is a reimagined take on our previous vintage cars attraction, which is an iconic favorite at Dreamworld. The ride vehicles have been completely rebuilt and rethemed with 2 vehicles designed to be completely wheelchair accessible, which we think is just a critical thing for our guests with disabilities. The immersive teaming, the innovative track layout and more central location make this a standout attraction, and we believe that it will be a massive hit with our guests. Jungle Rush will be the most thematic attraction that we've ever built at Dreamworld. This family coaster is designed for young children, but it is about fun for the entire family. The ride has several world-first elements and an incredible storyline we cannot wait to share as we get closer to opening. And lastly, Jungle Jane's will be the most immersive themed restaurant in the country by a long shot. This sitdown family restaurant will offer a menu design to be more premium than our core theme park offering. And we have also incorporated plans to cater to our returning international groups as well as our events business. And we believe that this will become one of the go-to venues on the Gold Coast for unique gala dinners or corporate team building events. As I've said ad nauseam, Rivertown will play a crucial role in driving attendance and enhancing the overall guest experience. The ongoing construction is challenging, and given all of the weather the disruption we faced. However, it will ultimately be well worth it and reinforce Dreamworld as a must-visit destination for families in Australia. On to Slide 13. Many of our investors and our guests will be very familiar with The Claw. It's one of Dreamworld's most popular and iconic attractions. At 20 years old, this ride has unfortunately reached the end of its operational life and faces some significant hurdles with ongoing maintenance and manufacturer support. Given the huge popularity of this ride, management has spent considerable time working through various options available to us, including the closure and the removal of the ride. And we've taken the tough decisions and closed rides that did not fit our risk appetite in the past, as we've outlined previously. We certainly contemplated this alternative in this case. And when we came to the view that this is something that would be far too detrimental to the guest experience. And ultimately, we felt it was detrimental on an ongoing basis to financial performance. As we've also done another attraction such as the Gold Coaster and the Giant Drop, we ran scenarios around conducting a major overhaul or even acquiring a like-for-like attraction to replace The Claw. Although a major overhaul could extend the life of the ride, the residual lifespan would remain uncertain with costs running into several million dollars and yielding a little in the way of incremental return. The last alternative considered was to upgrade to a new attraction. We looked at several vendors. And as we've outlined in previous remarks, we will only work with Tier 1 vendors going forward. Given the popularity of The Claw, installation of a larger, faster and higher capacity version of the ride from a world-class vendor in Intamin is considered to be the best option, giving a nod to our iconic attraction of the past while providing a new more thrilling experience, which we hope and expect will drive incremental visitation. The new King Claw attraction will be 1 of 3 in the world, and having seen this and read this elsewhere, I can assure you this is an incredible ride, and it will be sure to be one of our most popular attractions once open. Slide 14 of the presentation provides a further update on the land development opportunities at Dreamworld. As previously disclosed, we have lodged a preliminary development application for the broader site, and this process is now past the public consultation phase. Council and state continue to consider the application, albeit the process is taking longer than we had initially hoped it would. In the last few days, the group has submitted a stop the clock notice on our application to allow time to clarify some details with SARA, the State Assessment and Referral Agency. We remain optimistic that our application will create significant value to the Northern Gold Coast in the future, and we will continue to keep the market updated as our progress continues. On Slide 15 of the presentation, we reconfirm our strategy for long-term growth. And I think importantly, this strategy has remained consistent since we first shared our plan to restore value several years ago. We have seen traction and momentum in the right direction, and the progress is clearly evident. The divisional EBITDA line we break even in FY '23 ahead of our internal expectations, and we achieved a year-on-year increase of over 50% in FY '24. Notably, this was the first time in FY '17 that we've reported positive consolidated EBITDA for the group after corporate costs. Against the backdrop of a slowdown in discretionary spending across the economy, we have taken tactical steps to remain competitive in this challenging environment. Our solid multifaceted plan allows us to sustainably increase revenue while differentiating ourselves from our competitors. Finally, I want to take a moment to recognize our team. They've done an incredible job demonstrating resilience, innovation and dedication over the last 12 months. It's their hard work that gives us the confidence in our strategy and our optimism for the future. I'll now hand over to Gary to conduct the formal business of the meeting.

Thank you very much, Greg. We will now move to the formal business of the meeting. The resolutions for consideration today may only be voted on by shareholders, proxy holders and shareholder company representatives. I propose to call a poll on each of the resolutions. As a reminder, shareholders attending via the online platform will have the opportunity to ask questions on each matter being put to the meeting. If you have questions already prepared, please go ahead and submit them now. Turning to the first item of business that is to receive the annual financial report, the director's report and the independent external auditor's report for the company to the financial year ended 25 June 2024. The remuneration report will be put to a vote for adoption separately. Are there any questions from those present in relation to the annual financial report, the directors' report of the independent external auditor's report? Yes, sir. Sorry, we'll give you a microphone.

[ Brian Mitchell ], shareholder. Just a comment, by poor hearing, Mr. Yong's rather quiet voice and rapid delivery, I didn't catch it all. Will his address be available on the stock exchange report or whatever in writing?

Yes. Yes, it will be.

Great. I'll look it up and have a quiet read before I go to...

Good. There's some encouraging signs in it. So hopefully, you'll get a bit excited by what Greg has had to say. Okay. Thank you. Sorry, over there.

[ Charlie Kingston ] from [ CI Capital ]. I'd just like to make some comments, please, firstly, and then I'll have my questions. And I appreciate broken record, but we did raise a lot of the same concerns last year and the AGM...

Charlie, just cut to the questions. We don't need to go over what you went over last year.

I'm entitled to make some comments per the Corporations Act, I think. So I'd like to make some comments and then follow it up with some questions. But again, we did raise some of these concerns. But just for some context, the stock is unchanged since last year. So I think they are equally, if not more, relevant today. There have been no dividends over the past year. And in light of the hit again, another CapEx program announced today, I think they're certainly relevant. But for context, Gary, nice to see you here again today. You were here last year. So I think I'm entitled to my comments. But when you did campaign 7 years ago to become Chairman of Ardent, now Coast, you said in your presentation you would spend $25 million in CapEx on Dreamworld to restore visitation and improve profitability with your EBITDA target with that CapEx was going to be $36 million. You were also hoping to sell excess lands, which you said at the time was worth $25 million. Since then, 7 years later, you've spent or committed to spend $130 million in CapEx. Today, you've announced another $13 million to $14 million in CapEx. So let's assume that it's going to be around about $150 million, which is $125 million over the initial guidance. We have no real update on the excess land 7 years later. Visitation today is still miles below the peak pre-tragedy. International visitation has not returned. The company is still, in our assessment, free cash flow negative post the overhead, post the maintenance CapEx, notwithstanding the positive EBITDA at a divisional level. Now the market today is valuing Dreamworld at a market cap just below $200 million. We have $60 million of cash post the CapEx. But after today's announcement, for FY '26, that's probably going to be well below $50 million. But the enterprise value today of Coast is $150 million or thereabouts. Now for that, we own SkyPoint. It's a bit of a building we're in today. The top 3 floors, which you value at $37 million. The excess land is around about $25 million, which, I think, was your assessment 7 years ago that you did acknowledge was uneducated, but I assume that it's probably similar, if not more, today, as Greg often says that the land is not going down in value. But all that implies that today, Dreamworld is valued at less than $100 million. Now that's very concerning given post today's announcement, you will be spending up to $150 million in CapEx, which implies that $50 million has gone down the gurgler. It's a very nicely indicted by the market. I note that Dreamworld has also changed hands or sold multiple times around about the 2000s and prior in the 1990s for a valuation well above $100 million. So with all that context, clearly, the market is not ascribing much value or likelihood of a return on that CapEx. And given your promises when you were campaigning Gary to become Chair, and it's been 7 years post, appreciate the main event was a great rate outcome. Certainly congratulate you on that, but -- and there were some one-offs, COVID, et cetera. But 7 years later, and a lot of money has been spent and you've committed to spending more today. I suppose my first question is, why should investors trust that you can deliver shareholder value when shares are less than half the price if you adjust for that main event dividend, then when you took over 7 years prior? And I would just like to read a quote from [ Kevin Seymore ], who you were campaigning with at the time, 7 years ago. We do not believe that a Board which has presided over such a significant loss of value over the last few years can miraculously turn themselves into wealth creators and now belatedly deliver improved returns to security holders. I think that's a very relevant applicable quote. Maybe for the Board today, but that's my first question. And then the second question is just around Dreamworld as a whole. I mean again, there's been an enormous amount of CapEx spent. Yes, it's positive EBITDA at a divisional level, but is this a structurally flawed business? And given you were very clear armchair commentator, which, I think, you called us when rewrite to shareholders, but I think you did the same when you initially put out your $36 million EBITDA target 7 years ago, but now that you come in to additional CapEx and shareholders or the markets -- the stock is doing nothing, if not drifting. So clearly, nobody believes that it's going to return anything significant for shareholders. But what do you think that $150 million of CapEx will return for shareholders now that you've had 7 years to understand what you think the business can -- and I presume you've got a more accurate assessment than 7 years ago when you took over, but it's $150 million we're spending. What do you think that can actually return for shareholders, please?

Thank you, and thank you for your review of history. I might remind you and others who care to go back. You can sit down, Charlie. I might go on for a little bit here about the facts of what's occurred over the last 7 years. So when I commenced my campaign against Ardent Leisure, I had a number of key elements of the plan to restore value. The first was to sell the Australian business, the Bowling and Entertainment business, which we succeeded in selling about 2 months after I became Chairman at a 32x EBIT multiple. The second goal was to significantly improve the profitability of Main Event Entertainment. As you will recall, that business has gone off the rails. That had reported 3 half year of negative like-for-like sales growth. EBITDA had been stuck at around the mid $44 million level. Over the 4 years of Ardent owning Main Event Entertainment, we improved the EBITDA from the mid-40s. I think the EBITDA that we contributed for the year just before we sold to Dave & Buster's was north of $100 million. We sold that business at an 8.5x EBITDA multiple at a time today when Dave & Buster's trades at 4.7x EBITDA multiple. The other significant plank of our campaign revolved around Dreamworld. And our goal was to restore historical performance at Dreamworld. And if one -- and as you would appreciate, we were hardly given due diligence to undertake proper reviews of the assets of Dreamworld. So we formed our view on the back of public information, the same as any investor and a public company does. So when you looked at Dreamworld and you looked at referable historical presidents, where there had been tragedies at theme park, the evidence indicated that, by and large, between 2 to 3 years after the tragedy, visitation return to pre-tragedy levels. That did not occur at Dreamworld, self-evidently, and I'll come to that in a moment. So let me talk first about what we found at Dreamworld. We found a fleet of aging attractions, some that were 20 years plus old that were no longer supported by the original equipment manufacturers. Under a new regulatory regime that had been brought in by the Queensland government, the strictest in the world a lot of these attractions simply would not have been allowed to continue to operate, number one. So we had an aging fleet of attractions that need a replacement. Secondly, in case it had escaped you, we had 2 years of extremely negative publicity that meant not just through the Gold Coast and Southeast Queensland, it was a national matter. The tragedy at Dreamworld, it was a tragedy that struck at the heart of many Australians. And the negative publicity that impacted on the operations of the park, of the people who turned up every day to try and run the business against the gauntlet of substantial media onslaught and having lost the trust and love and affection of, not only the local market but many Australians for whom Dreamworld had been a right of passage for them and their family. So we had to endure that. And then we had to endure a 1 in 100-year pandemic, which closed the park. Okay. So I wish -- believe me, I wish we could have restored this park with the level of expenditure that I thought was necessary. But to be perfectly frank, not only was I but I believe everyone else involved underestimated just what repair job was needed at Dreamworld. And I make no apology for what this Board has done to address that situation. Certainly, from my point of view, and if you look around at the caliber of this Board, these are people who are committed to quality. So we've undertaken a very serious and costly process of rebuilding Dreamworld literally from the ground up but doing so underpinned by first rate quality. So let me give you an example. The new Board does not approve the purchase of any item of equipment other than from first-tier global manufacturers. Just like in the case of Qantas and indicated before, the Board Safety Adviser [indiscernible], the former General Manager of Safety for Qantas that Qantas will tell you Qantas only buy from Tier 1 manufacturers, Boeing and Airbus. We only buy from Tier 1 manufacturers. We could probably have repopulated attractions in this park at a significantly lower cost by sourcing from manufacturers from China or somewhere else. We will not do that, and we make no apology for that. The end result that it has cost us considerably more than we had hoped. But we do know that we have the highest-quality amusement rides in the world. And as I said, we make no apology for that. And we are very confident that the investment in quality in that has been certainly my experience over 30 years in business that an investment in quality, not only in physical assets, but quality in terms of people will deliver the results that we anticipate. In terms of the land, let me just say this, that we could have sold pockets of the land off from time to time. Indeed, as COVID hit us, we sold a noncontiguous small piece of land and just in order to bring in some cash. But as you well know, the land has certain planning restrictions on it, which under -- significantly understate the potential value of the land if we are able to achieve a wider range of development opportunities for the site. That we were not in a position to have begun that process with any credibility with the council until we had actually reestablished the park as a going concern and with a vibrant future. And at that point, we launched our development application just over 12 months ago with the council. And as Greg has updated today, this is by no means an exceptional situation. Anyone who's involved in the development of building industry will tell you that planning throughout Australia is a very, very difficult process. And our application is far from simple. We remain confident of an outcome, and I believe that the end result will be a significant value-creation opportunity for this group. In terms of the share price, frankly, it is what it is. I think it's incredibly cheap. So does the Board. That's why we continue to buy back stock. And I continue to believe in the age old edict of Benjamin Graham that in the short term, the stock market is a voting machine, but in the long term, it's a weighing machine. And when you look at the assets, the very, very, very valuable assets that we own, I'm very confident that in the future, that will be well and truly recognized by the market. So thank you. I think we had a question over there. Yes. Sorry, we'll get you the microphone.

[indiscernible], the Australian Shareholders' Association. Just your previous comments, Gary, if you don't mind. Can I make a comment on behalf of you? I'm now speaking as a long-term shareholder, not as from the ASA. The Ardent Leisure situation was disgraceful. None of the existing Board 7-plus years ago had any experience in the industries they were running. Net result, the repairs and maintenance part of things were a disaster in the bowling division as well as no doubt up here as well. The sale of the bowling division for the price you got, Gary, was to us in the bowling business was pretty amazing, okay? And when you see your nice Christmas question about that -- it was a mine.

It did not. Yes.

However, I think people must realize that the fact that this type of business is fantastic. 99% of the people are coming through that front door at Dreamworld are there to have a good time. And all they have to do is help them. Sounds pretty simple. Plus everyone has paid in advance. No bad debt. They've paid before they even use the facility. Dreamworld is a wonderful business. And I do believe, as a shareholder, I'm not talking ASA now, from my point of view, you're on the right track. Questions now with the ASA hat on. A bit concerned about the cash flow situation, where the income was unfortunately 97 -- versus on your operating part, $97 odd million, and your expenses were $123 million. I'll give you a chance to answer that, which you have a little bit. But the other thing I'd like to address is the fact that the major issues that happened with Dreamworld were responsible by poor repairs and maintenance. I estimate you're spending about 5.3% currently on repairs and maintenance. Is that sufficient?

So do you want to...

Yes. Look, I might take the first question on repairs and maintenance, the last question on repairs and maintenance, and hand over to Jose on the cash question specifically. I think -- and very happy to show anyone that wants to come to Dreamworld that our culture around efficiency, we understand that we're a value stock and we're a value-based management team. And so you will come to Dreamworld and you find that we're emptying our own bin. We're watching -- we're cleaning our own tables at night. And we care very deeply about every cent that we spend the organization. The reason for that is that we need to pay for our priorities. And our priority is clearly and simply our safety, and that really comes at engineering safety. I have no other levers to pull other than to make sure every other part of the business as efficient as it possibly can be. And I think the Board who are here at the moment and have been here through this week and visit regularly, Gary, much more again, can see that we have not got people sitting around with nothing to do. We don't have a large management or executive team. People are doing 2 and 3 jobs. And that is fundamentally for us, as I restate, to make sure that we do commit to the cost base that we must maintain in engineering and in safety and in operations. And so I can assure you that the spending that we contribute to those departments today is much more significant, and it should be than what it was prior to the incident. And we'll continue to do so for as long as I'm involved at Ardent or at Coast. And so as I say, every other area of the business, we scrutinize rigorously to make sure that we can commit to those areas. And I can tell you now that there are no shortcuts under this executive and management team and certainly not in any way endorsed by the Board whatsoever. Jose, would you like to...

Yes. So just on the cash flows in FY '24, a big component of the cash outflows, in total, were the large amount of CapEx that we spend as part of the current investment program that we're undergoing as well is about $18 million as part of the share buyback that we are undertaking. If we look at the operating cash flows on their own, they were negative $3.5 million for the year. But within that number, there was about $4 million of shareholder class action settlement costs, which is a one-off item. If you sort of add that back, then we were marginally positive, which is broadly in line with the $1.1 million positive EBITDA at the consolidated level for the year. So it has turned around the business a very high fixed cost business. And so obviously, over the last few years, the revenue hasn't been there to cover that cost base. But certainly, the last 2 years have seen the theme parks business generated profit and obviously, in FY '24, sufficient profit now to cover the corporate costs. And as we look forward into the future, particularly with the investment of the CapEx that is due to open around Christmas, and as those revenues grow, we see quite a high fall-through because those costs are fairly fixed. We don't expect the expenses to ramp up quite so much. A lot of it will fall through to the EBITDA line.

So I'll just add a couple of points, if I may. Sorry, I come to you in a moment. So your point about relevant industry experience. Now you look at the sport today, Randy proceeded me on to the sport by a matter of a couple of months, but look at Randy's CV, distinguished service with the 2 gold standards of the theme park industry globally at Universal and Disney. Erin Wallace, Erin was a very distinguished 30-year history, I think, with Disney, including running Magic Kingdom, the largest single theme park for Disney. I think we are so privileged here for still a relatively small company in Australia to be able to have world-class people with world-class experience in the theme park industry available to us. And if I could just -- and I hope Erin doesn't mind me breaching her confidence. Erin was here last year and spent a week or 10 days with us, and she wrote me a note to say that she was so impressed by the team at Dreamworld and that in her view, the management team at Dreamworld was as good as, if not exceeded, the level of skills that she had seen at any management team at Disney. So I think we have an outstanding team. As I've indicated earlier, we have an unmatched commitment to quality. It takes longer. It takes time. It certainly costs a lot more. But we are very confident that the outcome will be satisfactory, hopefully more so than that for shareholders and that we will all have -- take great pride in being part of the recovery and the rehabilitation of this extremely important asset for Southeast Queensland and an asset that's an iconic asset, and important to families around Australia. Sorry, sir, yes.

My name is [ Brian Fuller ]. I've been a long-term shareholder, going right back to Macquarie Leisure. One thing I'd like to do is complement the Board and also the workers at Dreamworld. The way we recovered from some of the worst situations you could have with the accident and then COVID. I'd like to also make a suggestion if possible. One thing -- I've been to Dreamworld on many occasions. I went there approximately a year or so ago. What I noticed at the food outlet was the other situation where the staff literally had to yell at the top of their voice to convey to the customers that their orders were ready. I then relate that to the management of Dreamworld. I also got in touch with the manager of the [indiscernible]. She informed me that she was concerned, too, but she was a bit timid and actually forwarded that information on to management because she was worried there might be some untoward reaction. So I raised that issue about a year or so ago. I went there this year, and I noticed the same situation. I then contacted the head office of Coast management in Sydney through the registry. I also contacted the health and safety officer at Dreamworld, related my concerns. The situation where you had the customers punching up in front of the delivery area, somebody who actually had to do the survey to yell the top of their voice all day, I related that to the management and all the safety officer. I thought -- so I said I did that a year ago. I did it again this year. This year, my concerns were responded to. The management down in Sydney then sent me an e-mail. I was contacted by the manager, one of your managers, who also related that they're going to bring in a new serving electronic system. Many of my Japanese friend went down there about a month or so ago. And they implemented that electronic thing. It's fantastic. I've talked to the actual serving staff. They said it's wonderful. Okay. I was just wondering. Is there some process with the staff where if any of their concerns were raised those concerns are then implemented and also raised with management? I was a bit concerned with the manager being a little bit afraid to relate her concerns. So is there any way that your people like we're talking right down to the lowest category of work or at Dreamworld, if they could actually relate their concerns because I believe would be very important. I'll defer to Greg in a moment.

But let me just say that around the Board table and with management, we have a very, very open and transparent relationship. We're all in this together. We operate as a team, and we are all involved actively, and to the extent physically possible, visiting our facilities, engaging with our team members. We have a philosophy around all our venues of see something, say something. So if a team member sees something that is out of the ordinary, draw it to our attention so we can deal with it. I'd be very surprised of there was an atmosphere of the nature you're alluding to. But Greg, perhaps you can talk about culture.

Yes. So first of all, thank you for raising the issue. The problem that we have is we're a large, complex organization. I'd like to say that we're [indiscernible] and we see everything and deal with it as quickly as we can, but we do miss things. And without feedback from holders as well as customers, we don't get to those things. And so first of all, I'd like to thank you for doing that, and I'm very pleased that you saw the new system that's been implemented very rapidly and that it is working very well. We have a number of different methods that we use around how we track culture in the organization. It's one of, in my view, our competitive advantages from others in the industry. We have a very, very close relationship with management and the frontline team. We know everyone's names. We have a very galaterian approach to the organization. We don't have special cash pots for the executive team. We all have the same team member discounts. We do not run a business where there is big gaps between senior people in the organization, the people that really matter that deliver the experience every single day. We have some other more structural elements to that. So we run team town halls on a very regular basis where the executive and management team get up and show the team members what we're working on, take feedback, ask questions about the organization. And in the past, there's been a bit of a view, to be frank, that we've got to be careful how much we told the team for fear that the competitor finds out. My real issue is that I'm really worried if our team don't know what's going on. And so we take the view that we want to make sure our team are well across what we're trying to do, and we share with them in every element of the business, including the financial performance in rigorous detail. We also have a very clear governance structure, which [ Jeff Satori ] has been critical in implementing, which ensures that frontline team members have every opportunity to escalate elements of their roles right through to the Board. And so for example, we have a frontline safety committee meeting, which is held regularly. And to be frank with you, it's the most important meeting that I go to in my whole calendar. And I'm there every single time to, not only talk about what we're trying to do but to give a very clear opportunity for a team member in the organization to tell me anything that they're concerned about, so we can act on it. And I think given our history, it is critical that management are very close to those things. And that all sounds very good and it sounds very impressive. But at the end of the day, what are the facts? And I can tell you that our ENPS or our employee engagement scores are some 3,000% better than what they were prior to the pandemic. We regularly survey that. We surveyed every year. And we go into rigorous detail to look at every one of those comments. On the guest experience things, I'm happy for anyone in the room to go and have a look at the Google reviews. I've outlined on numerous occasions how critical this is as part of our experience. And if you go to our Goggle reviews and look at the most recent review, you'll find that every single one of those reviews other than the last few days have had a personal comment from someone in our team, often myself and of Melinda, who helps me out very regular on this, we look at every single comment. We respond to it. And if we have to, because we've learned something that we need to resolve, we're out there and we're dealing with it as quickly as we possibly can. Outside of safety, that guest experience is our #1 priority. And so your feedback is welcomed, very disappointed it took 12 months for it to happen, and that's on the -- not on the advantage that you spoke to. So hopefully, that gives you some kind of insights into how we think about those kind of things.

One other thing with your financial prospects going forward. I was just wondering what sort of relationship you have with overseas entertainment partners and what sort of promotion you do to Asian countries such as India, Japan and other Asian countries. Of course, I believe with Dreamworld, we've got a fantastic future. And the future for this company is just unlimited. I'll give you an example of that. I got into a [indiscernible] when it started, it was 2 little buildings. The year before, I said [indiscernible] it lost $29 million. I was told, don't wash your money. It's going that way. That's what this is when it started. I think you're way ahead than when they started. So I believe that if you do more promotion in Asia, like I said, to India, Japan, the Southeast Asian countries, this company has unlimited prospects.

So look, let me -- and Greg will add to it. But let me say that we agree with you. We think we have a unique proposition in Australia, all the worlds and one and a feature of Dreamworld, which is often not appreciated is our wildlife component. And by that, I don't mean the tigers but our koala collection. And we breed koalas. We're one of the largest breeders of koalas in Australia. Bill Bees, again, we just opened a fantastic [ Bilby ] exhibition. And we are breeding bill bees under extinction. Australian tree kangaroos, et cetera, we have them all at Dreamworld. And indeed, yesterday, we're having a very concentrated sales and marketing discussion to look at how we really present Dreamworld to audiences in South Korea or India or whatever. I mean if you're in South Korea, you don't need to come to a theme park in Australia. You've got theme parks either close or in the region. So what's going to really drive you to Dreamworld? And we think the product that we have allied as well with our fantastic flying theater, Sky Voyager -- I don't know whether you've seen that. It's fantastic. For a visitor to Australia to fly over the wonderful iconic scenes from Australia is a tremendous experience. So we do have some very compelling cards in our hands. And certainly, we will -- we continue to look at expanding that international market, which is changing significantly post COVID. But Greg, you want to add to that?

Can I say one thing? My friend here is from Japan. She was holding the koala 2 months ago at Dreamworld. Dreamworld has one advantage. [ Long pine ] just gave up 4 visits to Koalas. When we went to Dreamworld, we're able to interact with the koalas with about 10 minutes. Loan pine, you had to book 3 days in advance. So I think you've got a wonderful traction with the Australian marsupials and native animals. And my friend was only saying this morning that, that is one big advantage. The most theme parks just have the rides without the animal attractions. You've got both of them, and my friend from Japan loved it.

I mean it's a central part of our proposition, is the fact that we've got all the world in one place. Many of you would have children or have had families. I believe strongly that when you come to the Gold Coast for a holiday, we would love you to spend your entire trip with us at Dreamworld, WhiteWater World than SkyPoint. But to be frank, we need to think about the consumer. I mean, I think what we've been very clear about that is critical central inescapable that we think about the consumer. And when they come to the Gold Coast, they don't want to spend the entire time in theme parks. If you're a person who has come to a theme park with a bunch of young children, it's not always an easy experience. Our goal is to try to make it easier. But I think you want to go to the beach, you want to go enjoy other great parts of this town in this city. And so for us, our proposition of having all the worlds and one really talks about comfort, efficiency, ease to do those very things. And so one of the things that you'll see in the very near future as we do more work on our brand. is to really sell that message that, look, what's different about us and how are we differentiated to others is you can do all the things in one place. And again, as Gary said, sales and marketing is critical for us. I mean we think we've got an incredible story to tell. And frankly, we're not doing a good enough job of that. And that's another critical pillar in my mind as to where we've got to just continue to improve. To your question around do we work with others, I can tell you that, that is top of my mind. One of the challenges in this industry is that there's only -- there's a very few amount of participants in Australia. And as you're probably well aware, we're a long way from anywhere else. We have the turn of distance as well. I'm the incoming President of Elara, which is the Australian Association for Leisure and Amusement and Recreation, I'll take that responsibly extremely seriously. That's a representation of, not only theme parks but traveling fairs and other recreational industries. And I'm heavily involved with [ AR ], which is the international association as well. And I spend a lot of my time talking to, and I can tell you that I had a discussion just last week with a very senior Swiss executive from Six Flags, the largest regional operator in the world. And I can have a conversation with any of these operators fairly regularly. And that is really just to make sure that we are thinking and learning about everything we possibly can that's happening out there in the world. I can tell you that we get a lot of good feedback and advice from people like Randy and Erin, who have incredible experience at Disney. But I also think it's just as important to talk to smaller operators that have a very proprietorial approach. And so I can tell you that I have conversations with people with the [ MAC ] company who own Europe Park, one of the largest theme parks in Europe, family owned. And so they treat it like they own it, and they think very carefully about how they invest in that organization. So I spend a lot of time early in the morning, late at night because of time challenges, to talk to these other operators and learn what they're doing. In terms of Asia marketing, I think you're 100% right. We see a huge opportunity there. I think the prospects for China over time are really significant. And I think your point around India is critical as well. I think everyone from 2, I believe there is a really tremendous opportunity over the next short while. What we ask to deal a fair amount of online travel agency business, and that is good and bad. The benefit of OTAs is that it really helps us be efficient in terms of our marketing spend overseas. If you can imagine us conducting over the line advertising in Delhi or elsewhere, it would be hugely expensive and problematic where we use OTAs to really do that work for us. And obviously, we pay for that service through a commission. I think the benefit that we see over time is that the FIT business or the free independent traveler business is becoming more and more significant over time with the advent of technology. If you think back to prior to COVID, we could be use a QR code and now everyone can. I think we're seeing technology really play a part in an overseas traveler really being much more able to travel on their own. And the key part for us is thinking, well, where in the funnel are we going to really market and advertise to those type of people. That may be somewhat futile to market to them in their home countries. It may more be about trying to a top of funnel give them awareness. But as they come into Australia to really make sure that we target them in the right spaces. And again, that for us is critical as to how do we think really prudently about our marketing spend. To give you a very pertinent example, when we think about billboards and airports, we get offered every time that we talk to certain advertising companies. They say, well, look, I've got a great billboard at Brisbane Airport and the Qantas terminal. Sadly, we're not savvy to be frank. But frankly, it's just not our customer. Our customer is a Virgin customer or a Jetstar customer with young families, and that's where we'll commit our money. And we have a view as to how we think about overseas markets, is where are we going to get the most return on that investment. Again, is it good enough? Look, frankly, we're never pleased, and we want to continue to improve our performance in that space. And I can say to you that Jemma Elder had a very short time on the Board is already really driving a huge amount of additional focus in that space, and we're incredibly excited to see where we can go with that journey as well.

And please keep coming back to the park. Any other questions in the room? Okay. Chris, anything online?

Not in relation to the..

Sorry.

A question to the officers. As a long-term shareholder and a businessman, well, I'm virtually interested in and I've held these shares virtually since the float. They've reached the status there and they're down to $0.46. What's the incentive for us as retail shareholders to continue to hold the shares? We don't know -- we talked about yesterday. We talked about today. What about tomorrow? I'm nearly 89. What is the incentive to buy or sell Dreamworld shares or Coast shares? What is the incentive? Is there a projection of when you will start paying the shareholders some dividend? Or is there going to be a reasonable capital gain? Or are we just going to sit here and talk about the shares still $0.46 despite the fact of the [ $0.25 ] that you introduced, which brought up to $1.40. So all I would -- as a long time shareholder, I don't know about the rest of these people, but I'm sure they're here to find out what the future holds, and I haven't heard this today as regards when or if the shareholders will see return.

So let me -- we don't make any -- obviously, any predictions about the future. All I can tell you is that we have made a significant investment. Charlie gave you the numbers where they're completely accurate or not, doesn't matter. But directionally, that is the case. We have had to invest substantially more into fixing this part than had ever been contemplated. The good news is that we're through a huge proportion of that. Yes, we have another new major ride that we will introduce over the next 12 months. But if I can direct you to Page 10 of the presentation. I think you should be encouraged by the fact that due to the nature of this business, which has obviously got a very heavy fixed cost base, incremental revenues flow increasingly through the bottom line result. We're in a fantastic financial position. We own all our assets. We have no debt. And we will -- I'm very confident, turn the point where we start generating significant cash flows for this group, which then will give us optionality in terms of returns to shareholders. So I feel your pain. My group and associates holds 10% of Coast. I would love to have dividends and so on. But as I said before, as Chairman of this group, together with my colleagues on the Board, we are committed to fixing this properly so that we have a solid base, based on concrete, not on sand, to deliver significant value for our shareholders for the future.

So there's no time frame at this stage.

Well, we -- I think you're seeing the fact that we've made the investments now and refreshing the park. You will -- I don't know when it was the last time you went to the park, but if you compare the pack today from where it was 5 years ago, it's unrecognizable. And we are -- you can see through Page 10, our competitor down the road is going -- it's had a reduction in its revenues. We've gone up. Now we've gone up even against a backdrop where interstate visitation from -- particularly from South Wales and Victoria has been down significantly. International visitation is yet to return, but we are showing positive growth. Our EBITDA was up over 50% last year, notwithstanding the major storms that hit us at our peak trading period. In the first 4 months to date, our EBITDA, which ultimately is largely cash for us, is up 46%. We have said that we do believe -- and this is not made as a projection, but we do believe that the investments that we have made and will continue to make have a pathway for us to achieve, at least, if not exceed historical levels of earnings for Dreamworld. So we -- I appreciate it's been long. It's been frustrating. I could have done without having to deal with the tragedy and its consequences. I would have loved to have been able to not have to endure a 1 in 100-year pandemic. But these are the cards that have been dealt with. And I think the fact that you look at where we are today in terms of our financial position, we are in a very, very good, solid financial position unlike lots of other groups around today, that are burdened with debt, we have no debt. We own all our assets, including this fantastic asset here, 55 hectares of land at Coomera. I believe there is a very good future for us. So please. I appreciate you've been patient. Please give us a bit more leeway. Let's meet again in 12 months' time, and hopefully, we can present a better pathway back to a return to shareholders.

Okay. So we'll turn to the remuneration report, which is resolution 1. That resolution is to adopt the remuneration report for the year ended 25 June 2024. As the report is included and the annual report has been made available to shareholders, investors should note the vote in relation to the remuneration report is not binding on the company or the directors. The company will disregard any votes cast on resolution 1 that do not comply with the voting exclusion requirements of the Corporations Act as set out in the notice of meeting. I move that the company's remuneration report for the financial year ended 25 June 2024 as set out in the directors' report be received, considered and adopted. The proxy results received for the resolution are shown on the screen. Any questions? Yes. The microphone.

Just few comments again. But I'm glad that I'm not the only shareholder concerned about value, which is the critical issue. Yes, there's a lot of gold plated CapEx, et cetera. But I don't mean to sound callous, but ultimately, that means to drive a return, and it hasn't to date. So I'm glad that issue was also raised. I don't think that this company is a charity. But specific to the remuneration report, just on the targets for the LTI. The 2 targets is revenue growth. Now to be honest, if you spent $150 million and you didn't get any revenue growth, that would be incredibly alarming. But shareholders, you Gary as a shareholder, you can't eat revenue growth. All you can eat is earnings. That's how you pay distributions back to shareholders. That's really all that matters. So why is earnings and particularly per share not a target? Why is it revenue? And the second target, I think, is a relative shareholder return. I'm not sure what the starting point is or how the comparable index is, but we're starting at $0.45, which is a very, very low share price. As Has been discussed. It's a lot lower than when you took charge. I'm just not sure why a relative share price is a fair target. Have you considered an absolute share price target or total shareholder return target? Because it does seem revenue is not appropriate and nor is relative given the current starting point.

David Haslingden, who's not with us physically is online, he can address some of your questions. Let me just correct you on one thing. The share price being materially lower. Well, it's lower than the $1.50 I started buying shares and what is now Coast Entertainment conveniently forgotten. But thank you for pointing out the fact that we've had $0.95 a share back by way of capital return and dividend. So unfortunately, notwithstanding the significant wins that we've had, we are where we are. I shared it to think where we could have been. But for -- and you've heard it from know from shareholders' association, and he knows the industry where we would have been without some, frankly, fantastic sales of assets that we commanded prices for that I doubt many others would have achieved. In terms of earnings, you talk about the CapEx. If you take Rivertown, it's probably cost us north of $40 million. Very hard to show a return on that since it hasn't opened. We are hopeful that it will open in time for the Christmas holidays. And we would anticipate seeing significant increase in attendance, which will translate into revenue, which as I've observed earlier, in the case of this company and its operating leverage, increasing revenue falls increasingly to the bottom line. David, did you have anything you wanted to add?

I'd just add we are moving from -- away from the revenue increase KPI to an earnings increase KPI in the current fiscal year. The reason we chose a revenue component in the fiscal year being analyzed now is because as we were breaking even, the percentage increases over prior year were highly volatile, notwithstanding small incremental amounts in actual earnings. So it was regarded as a more reasonable KPI to set it at revenues for this year. But in the current fiscal year, the appropriate KPI will be [indiscernible]. As to relative or absolute shareholder return, most companies in the ASX 100 use relative return. And I know the proxy [indiscernible] thought that was appropriate.

Chris, anything online?

There's an online question. And again, David is on the line, so perhaps David can answer it. I'll read it. I'll summarize it because it's quite long. But the question is, which of the 5 proxy advisers in the Australian market issued a report ahead of today's meeting? And did any recommend a vote against any of today's resolutions, including this rem report? If so, what reasons did they give? And how are you going to respond? I might just before David answers say that as those of you who received proxy reports know, we're not in a position to disclose what -- which proxy advisers say what, but I think David can generally respond to the question about whether there was a vote against the rem report -- sorry, a recommendation to vote against it and how we're going to respond.

Yes, thanks. We reviewed reports by 2 [indiscernible] and ISF. One was in favor of the remuneration report, one not in favor. The proxy advisers are not in favor and had an objection with the specifics of our KPIs for short-term volumes. We closed the bonus as we discussed. We didn't go into [indiscernible] components. And we didn't think it's necessary or appropriate. The proxy adviser [indiscernible] in favor of the remuneration report made similar comments. But inform you that thought the overall iteration was appropriate. They didn't have a problem with the lack of specificity. We will be talking to both proxy adviser after the AGM and discussing whether we need to increase the specific in next year's remuneration report.

Thank you, David. Okay. Move to resolution 2, which is the election of director. So resolution 2 relates to the election of Jemma Elder as a director of the company. As noted in the notice of meeting, and supporting documentation, Jemma brings to the Board extensive experience as a senior executive with 20 years in roles focused on business strategy and growth, technology and e-commerce sales and marketing. So I'll now formally move the appointment of Jemma as a director of the company and the proxy votes in relation to this resolution are on the screen. Are there any questions? Yes.

Jemma, I think you used to work at Dreamworld., Is that right? But it would be great to hear your thoughts. A fresh set of eyes on, I suppose, the critical issue of shareholder value and all the money that's been spent, I don't know, when you're working there. But just noting that, thinking through that, Qantas analogy, Qantas shares are at an all-time high. Gold plated their CapEx, maybe or arguably. [ Joe Aston ] might think differently. But to your analogy, they're at an all-time high. Coast continues to sink. So clearly, the market thinks they're getting a return from their CapEx. But the market does not believe Coast is getting a return on their CapEx. So what are your thoughts on maybe just the historical context when you used to work there from what you're seeing today? And what sort of is going to be your focus? How do you think Coast can actually get a return on the money that it is spending? And what's going to be your sort of input in that critical issue?

Well, first thing, it's very exciting opportunity for Coast Entertainment Holdings over the next few years. We've spoken a lot about the capital improvement program, capital investment program, the attraction pipeline. I think it was you last year who identified visitation as the key tenet on any strategy, any sales and marketing strategy to actually drive earnings and return. And that's where we'll be focusing our attention predominantly, fixed cost base. We've spoken about that at length today. And there's only upside in my view and my observations, from my experience. I did work at Dreamworld. You're correct. I spent about 15 years on off working with the Coast Entertainment Holding assets in various capacities, marketing predominantly. I was head of marketing at Dreamworld. I spent a lot of time with the team over the past 2 days, and may lead up to a due diligence, being appointed a director. I'm very excited by the opportunities. We have faced some economic headwinds. Hopefully, they will subside over the next few years. International visitation still hasn't returned to pre-pandemic barrels on the Gold Coast. We're seeing stronger domestic Southeast Queensland population growth. Annual pass visitation is a beneficiary of that. I certainly think there's significant opportunities and upside, which is part of the reason, in fact, one of the most compelling reasons for me to join the Board and help use my experience over the past 25 years as a Southeast Queensland business woman to actually help and continue to drive visitation, number one, but also shareholder return.

Thank you, Jemma. Chris, any questions?

Yes, Gary, there's a question says, could the Chair -- I'm not sure whether that refers to you or to the -- to David as chair of Remuneration and Nomination Committee comment, please, on the process that led to Jemma's appointment to the Board. Was a headhunter involved? Did full Board interview Jemma together as a group or separately? And did they interview any other candidates? And was Jemma known to any of the directors before engaging with the recruitment process?

I'll deal with that. It's very simple response. For some time, we feel it's important for this company, recognizing our very strong association with the Gold Coast, and indeed, that identification with the Gold Coast underpinned the change of name from Ardent Leisure to Coast Entertainment to signify our strong commitment and our involvement on the Gold Coast. And would like to know whether a group of brand consultants were engaged in that process, sadly, the answer is no. We want to couple that together. And so as part of this process, we thought it incredibly important to have someone from Southeast Queensland, someone who was steeped in sales and marketing where we think we have, as you've already heard, a great opportunity against the backdrop where we've invested so significantly again, as been pointed out. We think very judiciously and high-quality global leading product, allied now with an aggressive push on sales and marketing, that Jemma fitted the bill. Jemma had been recommended to us by a very prominent business person on the Gold Coast. We interviewed Jemma. We were delighted to say that she accepted with alacrity. And part of the reason I believe for that Jemma having regard to the conversation that's already taken place was your historical role at Dreamworld. You were there during some of the best times the Dreamworld that's seen. You know and have always appreciated just how important an asset Dreamworld is to the Gold Coast community, to the families on the Gold Coast in Brisbane, et cetera. You're a mother of 2 youngest children. And with your exceptional background in groups like Publicis, we thought it was a fantastic opportunity to invite Jemma. We were absolutely delighted that she accepted. And I think the question, I think, you asked before about staff morale was interesting. Walking around the park yesterday, Jemma remarked to me. People came up talking to Jemma. People had been with us park for over 20 years, they recognized Jemma and so delighted to see her back and telling Jemma that they never felt so proud to be a member of the Dreamworld team than they are today with what's happening there and all the investment that we have made and the opportunities in front of us. So any other questions, Chris?

None on that resolution.

Okay. So that..

Just a quick follow-up. Maybe if you could be more specific, please, Jemma, given the previous experience, and I don't know when you were there, but it sounds like you were there under the old management. And some comments today have been pretty damning about how this company was previously run, sort of run down rides, et cetera, and cutting corners. And -- but you were there at the time, and you're obviously doing your job...

I didn't say cutting corners. I said we don't cut corners.

But there have been some pretty damning comments about the previous Board, no experience, et cetera. But they were making money, notwithstanding the tragedy, again, I don't want to diminish that at all. But given your time there, what do you think is missing ingredient today? But visitation isn't returning. Is it lack of new rides? Again, we've announced the new one today. International hasn't returned. Is there any structural reputational damage? Is there more alternatives for entertainment today? But if you could just be specific when you were there, why was it Dreamworld such an easy sell compared to why now, noting we have to spend a lot of money?

I think we're talking about 2 different -- very different periods of time, number one. And I also think that the management team that we have here today, I can only comment on this particular team. I'm not going to comment on my time prior. I'm more focused on the future. I'm spending extraordinary amount of time now with Greg, with Jose, with the senior management team operationally, safety. I'm convinced now the park actually has the capital investment that's required. You yourself spoke to their number, the amount that the Board has approved a mono invested in the capital works program. It is a world-class asset. It is a world-class theme park. And I can say confidently, it is a better theme park by way of experience, by way of attractions, by way of a broader range of experience than it has been in the past. And I think that will bode well for the future, particularly as we start to see a return of international and domestic tourism to the Gold Coast and a growing Southeast Queensland population.

Thank you. All right. So we'll move to resolution 3, which is the appointment of BDO as the new auditor for the group. I've got the man here from BDO. Ernst & Young has been the group's external auditor for the last 7 years. Having regard to the downsizing of the group in recent years and in the interest of good corporate governance, the Board decided it was appropriate to undertake a competitive tender for the company's external audit services. Following a comprehensive tender process, BDO Audit Pty Limited was selected as the new external auditor of the group, subject to shareholder approval at this meeting. As a result, the directors recommending to shareholders of BDO Audit Pty Limited be appointed as external auditor of the company and its controlled entities for the financial year beginning on 26 June 2024. In accordance with section 328B(1) of the act, the company has sought and obtained a nomination from [ Michel ] for BDO Audit Pty Limited to be appointed as the company's. copy of this nomination is attached to the notice of meeting as attachment A. The Australian Securities and Investments Commission has also consented to the resignation of Ernst & Young as auditor of the company. I now move for the purposes of Section 327B(1)(b) of the Corporations Act 2001 and for all other purposes, BDO Audit Pty Limited, having been nominated by shareholder to act on the capacity of auditor following the resignation of Ernst & Young and having consented in writing to perform the role, be appointed as the auditor of the company. The proxy results for this resolution are on the screen. Any questions relating to this resolution? Chris, any...

Yes. Gary, there's a question -- could you bring the microphone to Anthony Ewan, who is the EY partner. There's a question asking for a quick comment from the Ernst & Young signing partner on whether they were invited to tender in the order process, when they found out that they were being replaced by BDO and whether or not there was any impact in that decision on their sign-off on the 24 accounts.

Certainly, and thank you for the question. Anthony Ewan, I was the audit sign partner from EY, responsible for the conduct of the FY '24 audit. To answer those -- various tranches to those questions. We were invited to retender. We were notified of the outcome in August of this year. The tender process had no impact on the audit process for FY '24. And I'm sitting here next to Mr. [ Tim Mann ], who is the incoming audit partner from BDO. We've completed the formalities of the auditor change process subject to your deliberations today. And in the coming weeks, we'll facilitate the handover process in advance of 31 December for the half year review -- sorry, December for the half year review.

All right. The resolution -- or the proxies have shown up there. So before closing the media -- take questions of a general nature. I might take one, Chris, that has come through online, which you've referred to me. The question reads, thank you to Brad Richmond for his 7 years of service on the Board. It's always helpful for investors to have access to some exit perspectives from retiring independent directors. And his final contribution as a Coast Entertainment director, could Brad, please comment on what he regards as the best decisions made during his time on the Board? And does he have any regrets? Before asking Brad to comment, I'd just perhaps by way of historical record note that Brad joined the Board of what is now Coast Entertainment the same day that I did. We stood as a ticket to seek Board representation. Our request for Board representation was initially robust but ultimately was accepted. And I think it is not worthing that we have 2 directors who were in place the company at the time who is still on the board. Randy had only joined a matter of weeks before I joined the Board and David who had only been a recent appointee to the Board as well. But Brad, if you're online, do you mind providing a response?

Yes, Gary, I'll be happy to. I think the things that stick out to me is, first, it's all about people. It's all about your leaders. And that talks everything from the executive leaderships in our different businesses to the Board room. And so I look at that with pride and confidence that we have the right leaders in place to take the business where we want to get it to. I think, obviously, for me, my early days, we're focused on Main Event and the repositioning of that business and then navigating through COVID and all that and actually came out in a pretty good shape with the work that we've done during that period that resulted in a pretty handsome sale of the business to Dave & Buster's. I think also for me, my work on the Audit and Risk Committee about really instilling and having the appreciation for sound financial practices and discipline on those was something that I look back on that, I think, was beneficial to the organization. I think you've heard us talk a fair amount about this already, but this is the whole safety culture. I clearly understand the importance from my background. I understand importance from the business at Main Event, but also at the parks. And that safety culture, it's a part of our DNA. It's talked about all the time, and it comes into play in every one of our decisions about making the right choices for the business and for the safety of our employees and guests. I would say I'm very confident in the strategy that the business has going forward. I'm confident in the leadership, from the Board to the executive leadership. I think we have the right people in place to take this business where it should be. And just you didn't quite ask this, but I would just add, I've really enjoyed my time on the Board. I've always felt valued. I felt people -- I was always heard. I was always respected. And same way, we're not had comments to share and all that. So there was that good healthy tension, if you will, in the Board room to talk about our business in a very candid and forward way to move it forward. And I'm really only stepping down just because I've assumed a new role of as CEO of a company here in the U.S. that's consuming a lot of my time. And so it's just a matter of rationalization of my time. I have no regrets there, and I have only optimistic thoughts about where this business can go.

Thank you, Brad. Okay. Yes.

For Randy, so you don't feel left out. But I suppose similar sort of question in the -- yes, you've got an excellent CV Disney, Universal, I think it was. You've been here since 2018. But given that exceptional experience, I'm not sure how it would work within those companies, how long they tolerate visitation not responding to such significant capital expenditure or not actually getting a return from that spend. So maybe if you could just give us your thoughts as to why it hasn't worked to date, what's missing, given the Disney and other theme park experience, which we're so privileged to have, I think somebody else mentioned, and what would be -- I don't know the Walt Disney return hurdles. Have they got sort of a 15% type return? If you're going to spend $150 million, what sort of returns would they demand from their employers? And I think they are -- they're doing pretty well in parks. But for some reason, Dreamworld is not. So just appreciate your high-level thoughts, please.

Well, first of all, I'm going to tell you that investments in this industry usually require a lengthy period of time before they pay off. So I'm not going to address what Disney's perspective was on this. But you're looking at very different companies here, okay? You're looking at companies that in the States are dependent on, not only the local market but have built humongous resorts that are destinations in and of themselves. So you've got a very different scenario here. But as far as the business itself, the changes that I've seen in the 7 years that I've been associated with us are absolutely remarkable in terms of, not only the culture but the vibe of the employees and the fact that people -- they're energized. They're delivering a good experience. And in my opinion, we've dealt with a huge number of external obstacles, besides the incident that took place years ago, which have an impact on this business, but you don't necessarily have the ability to affect it. If people aren't coming here from China or different parts of the world, that's really the function of the national tourist office. That's the function of the state tourist office, to drive that demand. And then we want a disproportionate portion of the market share. So in my opinion, the things that have adversely impacted Dreamworld's attendance were not local. We're not the brand and how it's viewed here but was really the diminishing number of international and long-haul visitors coming into the market that we try to market to. It would be totally imprudent for Dreamworld to go out and market on its own in some of those destinations because individuals -- and Greg mentioned this earlier. Someone coming here from Korea doesn't need to go to a theme park. They want to see the animals. They want to see nature. They want to see wildlife. So our message in each market is unique and distinct to that market, but it will always be dependent on how many of those people are coming here for a destination that includes Dreamworld but is also far more comprehensive in terms of the riches that this destination has. So our -- if you look at our brand amongst our guests, it's very high. If you look at the guest satisfaction index, it's very high. The function we're talking about really is mostly long haul and not local or interstate traffic.

And then just another question. I think you mentioned, yes, we are restarting the buyback and the Board thinks the shares are very undervalued. But Randy, I think you own 55,000 shares. Is that correct?

I think it's closer -- it's above that.

Anyway, it's a lot less than your annual salary, and you've been here since 2018. But any intentions on increasing that shareholding given where...

I certainly am always open to improving my investments.

I should add that there's been a significant trading restriction on directors' share purchases over recent times.

Just final one. But the excess even post the core spend, you might have probably $40 million, absent any sort of gains or losses from the operating business. But any thoughts on the use of that cash? Are you going to develop excess land? Or I think, historically, you've said hotel spend. Somebody else would always develop it. But any thoughts on retaining -- I know you've restarted the buyback again today, but you're still going to have -- if you were to fully execute on that buyback, a lot of excess cash. Can you give us your thoughts as to where that is going to be spent? Any interest in acquisitions or further capital expenditure, please?

We have nothing particularly targeted beyond that, those matters that we've already raised, which is completing Rivertown and completing the opening -- the closure of the existing Claw ride and the commencement of construction of King Claw, which should be, what, 12-month program, Greg. And we will then review the position as to where we are. We are confident enough today to begin -- to announce the recommencement of our share buyback program. We do believe the stock to be very cheap. So we were delighted to have already bought back 10% of the company, continue to be buying at prices that we believe to represent a material discount to intrinsic value. Believe me, if we get to a point where we have excess cash that we can prudently look to redeploy, as I've mentioned earlier, my group and associates speak for 10% of the register. So we would like a return. I'm sure others have already heard. At least one gentleman would like a return. I'm sure there are plenty of others who would like to join the Q4. And clearly, that will be front of mind for us. Any other questions? Yes, sorry. Mel, can you just...

Chairman, could your Board consider shifting the Annual General Meeting to Dreamworld itself? And maybe you could give the shareholders a guided tour of the improvements that you're in at the present time?

Sure. Actually driving here, I thought why wouldn't we have the AGM at Dreamworld. It'd be fair to say, I think this particular asset is well geared for a meeting of this type. But let me take that on Board. But let me also say to you, if you're a shareholder, we would welcome you coming to the park to have a look for yourself at what we've done and to appreciate the area in which we operate out of. Going back to Jemma's initial formative years of professional career at Dreamworld, Dreamworld was surrounded by empty panics and farms. If you go to it today, it's -- you may well be from the region. So you know what I'm talking about. It's a booming area. But please let us know that you'd like to come to the park. Greg and his team will come in. We'll show you around with great pride at what we are doing because I think you will see -- I don't know when you were last in the park. But the park today represents a very, very different curated proposition to a very high standard above and beyond anything that Dreamworld ever had in place before. We're very excited about our new precinct. We will have a theme precinct that will be without peer in the Australian market. We've built it. And I certainly hope and I know Charlie expects us to see a significant spike in attendances for all the expenditure that we've made. I believe we will see it. But let us know. Come out. We'd love to host you. If you've got family, bring them all out and have a great time. Yes. We'll give free entry. You can't discount -- but hold on, you've got to show us you're a shareholder. But you can't discount free, okay? Just remember that.

[indiscernible] when they started, they were desperate for money at that time. And so they used to really take care of their shareholders. And they put on some beautiful breakfast to shareholders at Annual General Meetings and all the good is like free admission to the park, free movie tickets, et cetera, et cetera. What developed was as they didn't need the shareholders, all those goodies disappeared. So what's your proposing now is something that's going to be very accepted by all shareholders. Well, if you could put a bit of free coffee and cake would be appreciated, too.

There's some downstairs, Greg reminds me. So at the moment, apart from letting us know you're coming to the park in free entrants, you get a free cup of coffee downstairs. But anyway, look, I'd like to thank you all for your attendance.

Sorry, Gary, at the start with the Q&A., there were a number of -- for the record, there's a number of online questions that have come through. Obviously, they cover the topics of share price, land, what we're doing to land and return to shareholders. I'd just like to say, I think, we've adequately dealt with those through the Q&A in the room, which has dominated the Q&A. So for those online who ask questions, thank you for your questions. And yes, they've been adequately dealt with in my opinion.

So look forward to next year. Maybe we'll take on board having the AGM at Dreamworld, and we'll see who's game to ride the new Jungle Rush coaster. But thank you all for your attendance. We do really appreciate the level of interest that you have in our group, and our goal is to try and deliver on the promise that we've held out there over the next 12 months. So thank you all for coming.

Sorry. May name is [ Suzie ] and my husband [ Stephen ]. We've been shareholders from the inception. What you then say a shareholder here mentioned about full entry into Dreamworld. So maybe a group of us can come together one day and then we can meet with Greg Yong. Just how all of this come together. It will be easier.

So let me just say, in principle, a shareholder as a part owner of the asset, so if you want to come, just let us know, and we will organize everything for you.

Okay. That has to be individual, you mean?

No, I have -- I much prefer to take you in a group around the property. I think it's efficient for us. I think as a whole, you would want us to spend our time managing the organization. So if I could do it with you together, that would be preferable for us, and, I think, you would probably get a better experience as well.

Well, can I make a suggestion for anyone here who once ago on the group tour to Dreamworld, let Mel know your contact details. And we'll arrange that over the next few weeks. Are you a local resident?

We're from Brisbane.

Yes. Okay. Local enough. Okay. So let's collect the names, and we'll look after you. We'll have try and find a time that suits you all, and you come and spend time. We'll show you around the park, show you everything that's been done. And then if you want a free time, go off and enjoy yourself.