EXP - Experience Co

[Knobby22]

Q4 saw a 23% loss on earnings from Q4 last year... More weather impacts and cost of living... Blood bath at the moment.

Looking at it, all divisions went OK except Treetops Adventure NSW. every 5 years it seems to rain for 2 months straight in Sydney and surrounds. It's a shocking place for rain sometimes. I like the fact that they have a Canberra one now. I reckon that should be quite profitable.

 

[Dona Ferentes]

....they have a Canberra one now. I reckon that should be quite profitable.

Treetops Adventure Canberra - Majura Pines

Experience a Treetops Adventure High-Ropes Course! Zipline Adventures, Canberra. Tree Ropes Adventures Majura.

treetopsadventure.com.au

not cheap, but what is these days with PI.

The challenge with these experiences is to get repeat visits. Sure, as a one off special event, it becomes a fun thing to do, but how many times do you go? Surf parks are getting the same sort of reality check.

The Gold Coast as a themed destination has more going for it.

.
and Kambah reserve had a scary rope slide, a flying fox, at least it did in the 1990s. No supervision, no safety provisions and v. dangerous! but FREE.

 

[tobster112]

Looking at it, all divisions went OK except Treetops Adventure NSW. every 5 years it seems to rain for 2 months straight in Sydney and surrounds. It's a shocking place for rain sometimes. I like the fact that they have a Canberra one now. I reckon that should be quite profitable.

Millions pumped into the wild bush expansion and is underperforming. Skydive in Australia is the biggest issue. As a holder since 2021, I am looking forward to the update on the strategic review.

 

[tobster112]

Management roasted by the 6th largest shareholder in the conference call. Sounds like there are buyers interested.. unfortunately not much more detail on the strategic review at this stage.

 

[tobster112]

Management roasted by the 6th largest shareholder in the conference call. Sounds like there are buyers interested.. unfortunately not much more detail on the strategic review at this stage.

David Kingston with Casey Capital

"Hope you can hear me. I'm up in Singapore, but the phone seems to work. That's good. Look, John, I appreciate some of the challenges.But look, as we all know, for a few last few years, you've been indicating that you're going to get back to $40,000,000 EBITDA. Well, you're a long way off that. Obviously, concerningly, John, there's effectively 0 free cash flow coming out of the business, which obviously is a concern. And the share price is trading at $0.15 compared to equity raisings somewhere between $0.30 $0.70 over the last few years. So look, I welcome what the company is doing of a strategic review.I think I mentioned to you a year or 2 ago, John, that I think the small businesses are a real distraction. You might notionally book a small profit, but when you take into account head office time, they're a total distraction and I think you should never have bought into the small businesses. But if we look at the big ones, look, Reef is obviously going well. As you know, I've got a competitor up there, which makes plenty of money. Good business, makes plenty of money.So that's a good one. Treetops, I think, John, that's a business that individuals, owner operators that you bought it from can quite often make more money out of them than you do, being a corporate with overheads, being a listed company, big overheads. And clearly, it's been a very disappointing acquisition and yet you keep on pouring a lot of money into it. Skydiving in my view is better off owned by individuals like when Bowie owned it, it made plenty of money. We keep on hearing about the weather issues.But look, they're going to continue to occur, John, whether it's cyclones in Cairns or bad weather in weekends in Sydney or weather impacting upon skydiving. But the short fact is that Bowie, when he ran it as an individual and a smaller listed company, he made good money out of skydiving. At the moment, you're not making enough money out of skydiving. Because if we really look at it, John, the reef business makes good money, good quality business, but the rest of it is clearly overall losing money at a free cash flow line. Look, I'm not a huge holder, John.I'm probably about the 6th largest shareholder now, which is a small investment for me. But I'm just perplexed that the company continues to make excuses and continues to deliver effectively 0 free cash flow, which at the end of the day is the test of me, what free cash flow does it deliver. So look, I welcome the strategic review. I hope it's successful because I think the current structure of the company is wrong. And I think it needs the catalyst of sales or sale of the whole company to deliver shareholder value. So apologies for my direct comments, John, but I made a couple of comments a couple of years ago. And the performance continues to be poor. And I just think it from a shareholder value point of view needs to deliver a much better outcome. So that's my comment or question. Thanks."

EXP CEO John O'sullivan

"Well, what to unpack there, David. So I'll take it as a comment rather than a question. But obviously, we're looking at things through the strategic review, which is announced and obviously that will go to a lot of the issues that you raised and which I think is the purpose of the review. So we'll probably leave that there. Look, I'm sorry you think there are excuses, but they have been legitimate impacts on our business. And we are, as I said in my closing comments, we are looking at a number of things to improve the margins in the operating business. And I don't think anyone sort of here today sort of running around giving high fives to one another over the performance of the business. We want to do better. We're working hard to do that. And obviously, as the Board announced in April, the strategic review is a key part of that. So, but as always, welcome your comments and feedback and your insights. So, thank you."

David Kingston with Casey Capital

"But, John, if you look at the amount of capital raised, I don't have it in front of me. As I said, I'm in Singapore at the moment, but the amount of capital raised over the last 3 or 4 years, it's quite substantial. And I think you'd agree, it's embarrassing that the company is delivering virtually 0 free cash flow of the capital raised. It's good that you're debt free. I spoke to Bowie recently and I said, well done, Bowie.I'm glad you raised capital for the acquisitions because if you'd done it via debt, the company wouldn't be around. But I just think there's a degree of urgency, John. And if you get anything half decent from the strategic review, selling the small businesses or breaking the company up or selling the whole company, I think from a shareholder value point of view, you should take it. I don't think it's a time to be precious and wait for some knockout blow. Blow.I think shareholders are suffering, not me. I bought fairly recently at a low price. So I'm not whinging or whining. I'm ahead, but I think a lot of shareholders are suffering. And I think every year, there's reasons, John, reasons or excuses, take your pick, why the free cash flow is not there and the share price continues to suffer.But I think it's time to bring it ahead and deliver some shareholder value pretty quickly."

EXP CEO John O'sullivan

"Thanks David, all noted"

 

[Knobby22]

David Kingston with Casey Capital

"Hope you can hear me. I'm up in Singapore, but the phone seems to work. That's good. Look, John, I appreciate some of the challenges.But look, as we all know, for a few last few years, you've been indicating that you're going to get back to $40,000,000 EBITDA. Well, you're a long way off that. Obviously, concerningly, John, there's effectively 0 free cash flow coming out of the business, which obviously is a concern. And the share price is trading at $0.15 compared to equity raisings somewhere between $0.30 $0.70 over the last few years. So look, I welcome what the company is doing of a strategic review.I think I mentioned to you a year or 2 ago, John, that I think the small businesses are a real distraction. You might notionally book a small profit, but when you take into account head office time, they're a total distraction and I think you should never have bought into the small businesses. But if we look at the big ones, look, Reef is obviously going well. As you know, I've got a competitor up there, which makes plenty of money. Good business, makes plenty of money.So that's a good one. Treetops, I think, John, that's a business that individuals, owner operators that you bought it from can quite often make more money out of them than you do, being a corporate with overheads, being a listed company, big overheads. And clearly, it's been a very disappointing acquisition and yet you keep on pouring a lot of money into it. Skydiving in my view is better off owned by individuals like when Bowie owned it, it made plenty of money. We keep on hearing about the weather issues.But look, they're going to continue to occur, John, whether it's cyclones in Cairns or bad weather in weekends in Sydney or weather impacting upon skydiving. But the short fact is that Bowie, when he ran it as an individual and a smaller listed company, he made good money out of skydiving. At the moment, you're not making enough money out of skydiving. Because if we really look at it, John, the reef business makes good money, good quality business, but the rest of it is clearly overall losing money at a free cash flow line. Look, I'm not a huge holder, John.I'm probably about the 6th largest shareholder now, which is a small investment for me. But I'm just perplexed that the company continues to make excuses and continues to deliver effectively 0 free cash flow, which at the end of the day is the test of me, what free cash flow does it deliver. So look, I welcome the strategic review. I hope it's successful because I think the current structure of the company is wrong. And I think it needs the catalyst of sales or sale of the whole company to deliver shareholder value. So apologies for my direct comments, John, but I made a couple of comments a couple of years ago. And the performance continues to be poor. And I just think it from a shareholder value point of view needs to deliver a much better outcome. So that's my comment or question. Thanks."

EXP CEO John O'sullivan

"Well, what to unpack there, David. So I'll take it as a comment rather than a question. But obviously, we're looking at things through the strategic review, which is announced and obviously that will go to a lot of the issues that you raised and which I think is the purpose of the review. So we'll probably leave that there. Look, I'm sorry you think there are excuses, but they have been legitimate impacts on our business. And we are, as I said in my closing comments, we are looking at a number of things to improve the margins in the operating business. And I don't think anyone sort of here today sort of running around giving high fives to one another over the performance of the business. We want to do better. We're working hard to do that. And obviously, as the Board announced in April, the strategic review is a key part of that. So, but as always, welcome your comments and feedback and your insights. So, thank you."

David Kingston with Casey Capital

"But, John, if you look at the amount of capital raised, I don't have it in front of me. As I said, I'm in Singapore at the moment, but the amount of capital raised over the last 3 or 4 years, it's quite substantial. And I think you'd agree, it's embarrassing that the company is delivering virtually 0 free cash flow of the capital raised. It's good that you're debt free. I spoke to Bowie recently and I said, well done, Bowie.I'm glad you raised capital for the acquisitions because if you'd done it via debt, the company wouldn't be around. But I just think there's a degree of urgency, John. And if you get anything half decent from the strategic review, selling the small businesses or breaking the company up or selling the whole company, I think from a shareholder value point of view, you should take it. I don't think it's a time to be precious and wait for some knockout blow. Blow.I think shareholders are suffering, not me. I bought fairly recently at a low price. So I'm not whinging or whining. I'm ahead, but I think a lot of shareholders are suffering. And I think every year, there's reasons, John, reasons or excuses, take your pick, why the free cash flow is not there and the share price continues to suffer.But I think it's time to bring it ahead and deliver some shareholder value pretty quickly."

EXP CEO John O'sullivan

"Thanks David, all noted"

Thanks @tobster112
I missed this when you posted it.
He made some good points.

They are basically breaking even now, which is an improvement but not good enough. Keen to see what the strategic review brings.

 

[Knobby22]

No announcements or news this month. I note it is a buy by the firms following. I think the continuing tightening of the Australian economy will make things tough for the next half.

 

[tobster112]

AGM to be held in late November... For the last few years this has been late October.. are they pushing it back so they can announce something to do with the strategic review

 

[Knobby22]

AGM to be held in late November... For the last few years this has been late October.. are they pushing it back so they can announce something to do with the strategic review

Or is it just hope that something will come along?
New lows. Trying to help a buyer by getting the price down? No announcements for a long time.

 

[Knobby22]

Or is it just hope that something will come along?
New lows. Trying to help a buyer by getting the price down? No announcements for a long time.

And so they make an announcement next day

Looking better. two operations put on hold as a cost saving measure.
Volumes up on the other facilities, I would expect a decent profit jump for the next half.
Nice to see Treetop Adventures doing OK.

 

[Knobby22]

Annual shareholder meeting just occurred. Greater profitability promised. I see all the brokers have the company as a buy.
But share price continues to languish.
Only a month left, running out of time for a rebound before the end of year.

 

[Sdajii]

Annual shareholder meeting just occurred. Greater profitability promised. I see all the brokers have the company as a buy.
But share price continues to languish.
Only a month left, running out of time for a rebound before the end of year.

Talk is cheap, most companies including most of the trash ones which will never deliver tell everyone to expect big things, and we all know how much value broker recommendations are worth. Making lovely promises isn't enough; EXP needs to demonstrate good results for the market to pay attention.

If you believe those promises, buy up now and enjoy the rewards when the promises are fulfilled.

 

[Dona Ferentes]

Talk is cheap, most companies including most of the trash ones which will never deliver tell everyone to expect big things, and we all know how much value broker recommendations are worth. Making lovely promises isn't enough; EXP needs to demonstrate good results for the market to pay attention.

If you believe those promises, buy up now and enjoy the rewards when the promises are fulfilled.

I think you will find @Knobby22 is just adding comments for the tipping competition, rather than selling a dream.

 

[tobster112]

https://arichlife.com.au/experience-co-asx-exp-stock-analysis-small-cap-mailbag/

Not the best write up here...

No good offers from the Strategic Review.

The suffering will continue in the near term I think. Hopefully there is light at the end of the tunnel soon.

 

[Country Lad]

What I find interesting about a lot of the commentary around EXP is how it suffered during Covid which misses the point about the business model completely.
The business was failing long before Covid with the share price having fallen around 75% before Covid hit.



At its peak it was popular with the younger generation and particularly backpackers. Not too many backpackers around these days and being dependent on discretionary spending its market has shrunk.
Skydiving:- at the whim of weather, a niche market and without a repeat customer base;
Island Day Trips: Mainly push Fitzroy with lower cost accommodation which is not on the reef. Nice, I have been there numerous times but not a reef island.
Reef Tours: - The Green Is and Low Is trios are very competitive and against long standing internationally recognised operators.
Rainforest Tours: Limited market and competing against small lower cost experienced operators.
Luxury Overnight Tours: Limited market and competing against well-established small and large scale operators;
Tree Ropes & Ziplining: Very small market, more likely impulse participation by travellers.

The company offers the following activities through a range of brands:
The company has 15 brands the marketing for which must be expensive, cumbersome and untargeted. It looks to me like a jumble of small business competing with other small (& large) business. Acknowledging this means the strategic view iwas a waste of time and it need some logical business decisions.

Might bounce if the economy improves but in my opinion will not bounce back substantially.