On the Couch with Greg Yong Coast Entertainment (CEO)

In this episode of On the Couch,  we sit down with Greg Yong CEO of Coast Entertainment (CEH), to discuss the recent results and the growth potential of the land rezoning.

Listeners will know CEH from its days as Ardent Leisure and is the owner of Dreamworld on the Gold Coast.

Greg was appointed Chief Executive Officer of the Theme Parks division in April 2021 and Group Chief Executive Officer in 2023.  He has over 20 years’ experience in the theme parks industry in Australia and overseas. 

An interesting story and not one that many focus on.

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Transcript

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Coast Entertainment

Henry: Welcome to another episode of On the Couch with myself, Henry Jennings from Marcus Today. Today I'm delighted to be joined by Greg Jung, who is the CEO of CEH, Coast Entertainment. Many of you will know Coast, I guess, as the theme parks of Dreamworld and the Gold Coast.

Greg has got a great story to tell. I have to say, as Greg said, he was a bit surprised when we reached out and said, "Hey, do you want to come on and have a chat?" It's not our normal fare, but any interesting story is a good story as far as we're concerned.

Welcome, Greg. Thoroughly enjoying having you on today.

Greg: Hey, thanks for having me. We're in the storytelling business, actually, so that works quite nicely. You are, aren't you?

Henry: Now, Greg, you've been the CEO for some time now, with 20 years' experience in the theme parks industry in Australia and overseas. You've got qualifications coming out of your ears, haven't you?

MBAs from Southern Cross University, postgraduate qualifications in professional accounting from UNE. I actually went to UNE as well, so there you go.

My qualifications are not quite as good as yours, unfortunately. Mine's just in media and international politics, so not very impressive at all.

But anyway, let's get on with the story because your results have just been out, and there were a few things that caught my eye.

As usual, this is general advice only, so please do your own research and contact your own financial adviser regarding any of the thoughts, ideas or insights in this podcast.

Greg, I have to say, when I looked at some of these numbers, two million guests through the gates, the highest attendance since FY16, revenue up nearly 21 per cent, theme park EBITDA more than doubling to $18.8 million, $35 million bucks in the bank, no debt and bank facilities. Things are going pretty well up in Queensland, aren't they?

Greg: Well, they are. It's been a journey at Coast, as I think a lot of your listeners would know if you've followed the Dreamworld story.

It's one of those ones where people look at it and say, "Geez, overnight recovery here." But if you look at the preceding years, it's really been a journey coming out of COVID and coming out of FY16, where, obviously, there was a terrible tragedy at Dreamworld.

I joined in 2019 to help drive the company along and drive the recovery. I was there for all of about eight months, feeling great about things, and then this thing called COVID came along and knocked us around.

I joined my chairman at that point in time, Gary Weiss, who's an incredible investor. From there, coming out of the COVID situation, we really tried to rebuild the business.

The good news was that we were starting to see some solid momentum. So, yeah, last year was a great year. But as you know, these things don't just happen in one year. It's usually four or five years of hard graft to get there.

Henry: Well, as they say, an overnight success doesn't actually happen overnight. It takes years and years and years to become an overnight success.

It must have been kind of surreal and weird, just after you joined, to be faced with COVID. Looking back on that period in our lives, it was a kind of weird time. It must have been really weird for you guys.

COVID Forces Hard Resets

Greg: Well, funnily enough, I joined in May 2019, and we had a very clear plan as to what we wanted to do. COVID wasn't on the risk register, and so we were executing that plan very clearly.

We had a great Christmas that year, actually, and then I recall we started to see all the shutdowns happening.

I actually had an investor come through the business, I think it was in about March, and the place was a ghost town. I'm literally on my phone showing them pictures of the park in December, saying, "Oh, it was really busy and the wave pool looked good."

They just weren't true believers, for obvious reasons.

It was a surreal experience and tough stuff in terms of repositioning the business. But at the same time, it gave us an opportunity to really, and I say this in the nicest of ways, take out the medicine and do some things that would structurally move the needle at Dreamworld.

I'd watched it from afar. I'd worked at our competitor for 20-odd years, internationally and in Australia, and we had some solid views about where we wanted to take the business.

COVID really helped us accelerate some of those changes, which were not easy. We closed a number of family-favourite headline attractions, but we had a strong view that we wanted to simplify the business and contemporise the fleet.

That was a plan that we had to do over the course of several years, and we ended up doing all of that in one go, right away and all at once.

I'd prefer not to have gone through COVID, but I think it did help us in terms of repositioning the business to go forward.

What Coast Owns Today

Henry: Now, I guess for those listeners out there that don't know the story or aren't familiar with the company, Coast Entertainment, it is pretty much Dreamworld, is it not?

Greg: Yeah. It was a much larger business and was formerly Ardent. We had marinas and gyms and a great business in the US called Main Event, which we sold coming out of COVID at a great price.

Now it is Gold Coast-based and listed on the ASX. We have Dreamworld and WhiteWater World in Coomera on the Gold Coast, and attractive land, which I'm sure we'll talk about later, in a fantastic part of the country.

We also have a great business called SkyPoint in Surfers Paradise, in the Q1 building, which is the largest residential building in Australia.

We own Level 1, Level 77 and Level 78, a fantastic business for dining and cocktails and sunset drinks, wedding events and things like that.

We've also got a climb over the top of the building, which is a bit like the Sydney Harbour BridgeClimb. Same idea.

SkyPoint's a really great business for us as well, and it's done tremendously well coming out of COVID.

I think the important thing with all of those, and the good news, is that we own them all. That's not what everyone can say about these businesses, but in our case we're lucky to be in a really strong position where we own all of our assets.

What Guests Reveal About The Economy

Henry: Now, Greg, when you look at your business at the moment, it's obviously very geared towards discretionary spending and consumer spending as well.

Is there anything that you can draw from what you're seeing at the moment in terms of where the economy is, where it's heading, potential holes in the economy? You must be kind of at the forefront of this.

Greg: Yeah, and I think every earnings season I'm particularly studious of retailers and people like that. We've seen some pretty ordinary responses to some reasonably good results out there, and I think people are, rightly, concerned about consumer discretionary.

I would say this: what we see happening at the moment is episodic. It's not endemic, particularly to our industry.

Structurally, we feel really good about what we do.

When you think about the GFC and the Australian government issuing stimulus cheques to try to help the economy motor along, people were out there using those cheques to go and buy plasma TVs.

Today, if we were in the same position and we were issuing those kinds of cheques again, we have no doubt in our minds that people would be out there buying experiences, holidays and travel for their families.

We think that, being in the industry we're in, it's incredibly well positioned for the future.

We don't know what the future particularly holds, but we feel more comfortable than probably others would about the long-term changes in work and life and those kinds of things, that people will gravitate to things that they enjoy doing with their families.

It's hard for sure at the moment. I think we're outpacing that difficulty. You can see that in our numbers. We're absolutely live to it, but we think medium term as opposed to just what's happening today.

Henry: Do you think there's a move, with overseas holidays and overseas trips? Obviously, we've got the war in the Middle East. Do you think there's a move towards more domestic-focused tourism, the simplified road trip to Queensland and the theme parks? Do you think that's playing a part at the moment?

Domestic Trips And The Local Base

Greg: Look, there's a bit of it. If you talk to destination marketing organisations, they'll tell you that's exactly what's going on.

We're seeing a bit of it, but we wouldn't ascribe the results that we saw last year really to that.

In fact, a lot of the growth that we're seeing is coming out of the domestic market. We're seeing that very locally to the parks. Gold Coast, Brisbane, Ipswich, some of those areas are particularly strong for us.

We're seeing a bit in Sydney and Melbourne and other Australian areas coming in, but not so much in the numbers that we've just posted.

If the war situation continues, we think there's a bit more of that to come. But the good story, again, is that we're seeing these performances despite that.

We think that's a good tailwind to come, but we're not seeing a lot of that in the numbers just yet.

Loyalty Programs And Annual Passes

Henry: Now, you've introduced a number of new attractions, Wild West, the Big Brother experience and King Claw as well.

Importantly for you guys, the loyalty program, which seems to be paying off, is that really moving the needle at the moment?

Greg: Everything that we think about is about safety, the guest experience and keeping people coming back to the parks to visit.

I've been doing this for a long, long time, and the holy grail is to try to find a way to grow revenue and attendance sustainably without putting a lot of capital in.

That's a difficult balance.

We're constantly thinking about investment and trying to do that in a judicious way to get the best returns we can for our holders.

All of the things that we've been putting in of late have been tremendously successful.

We spend a lot of time agonising over these decisions. Outside of safety, some of the biggest decisions we make are capital allocation in nature.

When we think about big capital coming into a business like ours, we've got to get it right. We spend a huge amount of time really thinking deeply about every aspect of one of those investments.

Not only will it create revenue and ticket sales and all those key demand-driving things, but these things are going to be with us for 20-odd years.

For us, it's about the lifetime cost of ownership, the maintenance complexity, what it does to our fleet of other attractions, all of those things are part of our thinking.

When we boil that down, that really comes to how do we drive loyalty out of locals?

There's a reason we're hugely passionate about locals and annual passes, and that is because they're our strongest ticket in terms of the value of the ticket. It's the highest-priced ticket that we sell.

We have this really unique opportunity to keep people coming back over and over, which is why the loyalty program comes in.

We think the more often that they come, the more value they perceive to get out of their ticket, and the more likely they are to renew their ticket and stay with us for another year.

Loyalty and that perception of value for us is just a critical part of the whole story.

Henry: I guess it's a lot easier to market to people who already know about your business and have already experienced the business, as opposed to trying to get new clients.

It's something that we see a lot. It annoys me sometimes. You're a loyal customer of somebody for 10 or 15 years and there's no loyalty bonus for that loyalty. Whereas if you're a new customer, you get $50 off or whatever the offer is.

It feels like you're being taken.

It's the same with insurance when you get that annual thing. They just say, "Why don't you just pay it? Don't bother shopping around." And people do, because they're lazy.

But I guess creating that loyal customer base is a great way to keep the growth going.

Greg: You're right. The cost of acquisition of a new guest is just so much more than retaining an existing one.

Our industry and our business have been pretty terrible, to be frank with you, in terms of our level of maturity around retention.

The board has really turned our minds to that.

Your point's exactly well made, and Gary, our chairman, constantly makes the point that if you're with a big telco and you've had enough and you're ready to jump, and all of a sudden they throw you a great offer to stay, you go, "Yeah, where have you been all my life?"

It's really annoying.

We have a contrary view to that. We believe that if we can keep you in our ecosystem, it's a fantastic thing to do, because we really perceive that lifetime value is a critical metric.

It's not just, "What can we do with the guest over the course of one year?"

Interestingly enough, when you talk about marketing costs, the other significant benefit of winning in a local market is that if you think about the Gold Coast and what we call VFR, visiting friends and relatives travel, that is a massive component of visitation to the Gold Coast.

If you live in New Zealand, the Gold Coast has the largest number of Kiwi expats anywhere else in the world.

If you're coming from New Zealand to the Gold Coast to visit friends and relatives, and they've already got a ticket to Dreamworld, your propensity to come and visit us versus going elsewhere is significantly higher.

Again, we've got a multitude of reasons why we think locals and annual passes are a critical part of our story, and you can see that playing out in the numbers.

Finding Growth Without Overspending

Henry: This is probably a dumb question. You've got a kind of single asset. How do you grow that asset?

Obviously, you're working hard on the loyalty of locals and working hard on getting new people through the park. How do you grow the business at the moment?

I know there's a land component, and maybe we should talk about that.

Greg: Maybe just for two seconds before we go to the land, because I think it's a really interesting question.

The good news is when we look at our numbers, and the thing that we're at pains to look at when we talk about last year, is to say, "Incredible result, huge growth, good momentum. Is that it? What else is there?"

What we're excited about is when we look back to FY16, our business was doing 2.4 million people. Today we've just exceeded two million, and that's come from less than a million when I first joined.

So, great growth, but there's 400,000 just in that opportunity alone.

We know everything about where those people are from. We know those segments very clearly in terms of our level of penetration or under-penetration, if you will.

In the early tests that we're doing, we can really see that performance-based marketing in those key areas is moving the needle.

We actually think there's tremendous upside to come still in the organic business.

Then we move to the land opportunity, and that is where the rubber really does hit the road.

It's been a journey to get there. We've been going for three years now to really unlock the value of the land.

Prior to the approval that we've received now from the state government, the Coomera site was really only available in terms of two different land uses.

We had the opportunity to put major tourism product on there, so roller coasters and rides and associated infrastructure, or open space, which is essentially not a whole lot.

The approval that we've received now gives us the opportunity to divide our land up into four key precincts and gives us a multitude of different uses that we can see across the site.

When we look at Dreamworld and theme parks around the world, and we're very close to all the operators out there, we don't think Dreamworld itself needs to be any bigger today in terms of its footprint than what it is right now.

We could do twice the attendance, three times the attendance that we need to do off the existing Dreamworld footprint.

As a result, we've identified areas of surplus land.

The job for us now is to get the approval, which has been done, and then work out how do we crystallise that value?

We see three key uses for our land.

The first and easiest one is a really significant residential opportunity on our site. We're within a tennis-ball throw of a major airline. We're on the northern Gold Coast, the fastest-growing region in the country right now.

We think residential is a really significant opportunity.

We also see an opportunity for hotel accommodation. In all of the work that we've done, hotel accommodation adjacent to a theme park is just an incredible opportunity.

It's a natural incremental investment into the parks. It does well in and of itself, but it also is a flywheel for the core business and helps the parks themselves do better.

Lastly, there's an opportunity for mixed-use products as well. If you think entertainment-side businesses that are adjacent to Dreamworld and strategically complementary, we see all that as a really significant opportunity.

The execution is the key part now, and there's obviously a lot of questions that we need to answer in that regard.

The Coomera Land Value Opportunity

Henry: They're always there.

I remember going when I was younger to Disney World in Orlando and staying in one of the hotels very close to the theme park. It was a fantastic experience.

It just made so much sense to be able to stay amongst it, as opposed to having to commute into it.

As far as the valuation goes, the independent valuations you have for both Dreamworld and SkyPoint are considerably higher than the market's describing at the moment and the book value.

Do you think that's justified?

Greg: Look, our job is to make sure that we do a good job explaining the story.

These are not our numbers, as you put it. They're independent valuations.

We look at this business structurally and say, "Here we've got a business which has had a significant externality that's impacted it."

We're showing good returns relative to our previous performance and a really good organic story in that regard.

We're growing our land story and what we can do in that regard.

This has been going on for, if you've followed this stock in its different incarnations over the last 25 years, it's been a conversation.

But this board and this management team have finally got this approval.

I think what the market's looking to do now is say, "Show me how you're going to do this and give me some comfort that you're going to make good, responsible decisions around the next phase of this development."

I think that's where we see an opportunity for the stock to be considerably re-rated and reconsidered.

When we look at it, there's really strong uplift on the Dreamworld business, really strong uplift on the SkyPoint business, and we've also got these really unique pockets of value in our business that are hard for some investors to get their heads around.

Sophisticated investors get it, but retail investors, we've got to do a better job of communicating to them what this looks like.

A case in point is $50 million worth of tax assets, deferred tax assets, that are sitting off the balance sheet.

The good news is we are starting to pay tax again, or having the need to pay tax again, and the good news is we don't have to pay for it because we're using these deferred tax assets.

As that happens, these are being recognised on the balance sheet.

We've got this interesting story.

When we look at the land and the different precincts, we think about Precinct Four, which is our residential opportunity.

We have no aspirations as a business to be out there looking to be a property developer. It's not in our core competency, nor do we have the capital to do it ourselves.

We're contemplating a disparate amount of opportunities there.

One may well be that we simply sell the land.

The second option might be that we vend the land in and work with the developer to realise the upside.

When we think of the hotel and the mixed use, our view is that we prefer to probably do that ourselves, but again, we've got to look at the capital structure and think about the right way to do that for shareholders over the medium term.

Valuation Gap And Execution Options

Greg: We've engaged Barrenjoey Advisory to assist us with that.

They're going through that process now, and we've asked them to really test our thinking, really critically, on these ideas and think about how all of this could be realised for the benefit of all our holders.

I think that's the real opportunity, and that's what the market is waiting for, to understand what does this all look like?

There's certainly some noise in consumer discretionary and all of that, but I think that's a short-term thing.

I think the bigger opportunity here is to think, "What could this all look like in 2030 to 2032 if all of these things come to fruition?"

Henry: Because you had a bit of a pop on the announcement back in July that the application for the land and the zoning had been approved.

But since then it's kind of gone a bit quiet again.

Are we expecting more news imminently? Is there a timeline for Barrenjoey to come back and say, "These are your options"?

There are plenty of property developers on the Gold Coast, after all.

Greg: Yeah, look, our view is let's get it done as quickly as we can.

The challenge with dealing with stakeholders like state governments and councils and other things like that with an approval is that you're in their hands and at the behest of the bureaucrats.

But we got there in the end.

The good news with this is we can be much more expeditious. We control our destiny a little bit here, but at the same time we want to make sure that we do this properly.

This is too big a value opportunity for us to get wrong, and so we want to do the work with Barrenjoey, we want to do it properly, and we want to really consider all of our options.

I think there will certainly be more news this half.

It may well be the case that we can give a very clear announcement as to what we intend to do, but we may not have started executing on that yet.

Again, it's a little early to give you a really clear timeline, other than to say that the faster we do it, the better off the shareholders are.

This is a very proprietorial company. It's tightly held. All of us are shareholders, and so we sit in the same boat with institutional and retail holders that want to see a change in the price.

We're cognisant of that, and we're very keen to get this moving in the right direction, but again, with the right level of pragmatism and being considerate about getting it right.

Planning Dreamworld's 50th Anniversary

Henry: The volume in the stock can be a little sporadic, to say the least, but we're starting to see a little bit more interest in Coast, I guess, which is a good thing.

And of course you've got a big anniversary coming up in five years' time. I'd imagine there's going to be a bit of a focus on that one.

Greg: Yeah, look, 2031 is a big news story, 50 years of Dreamworld.

And again, what does that mean? Well, is it a point in time? Is it a cake on a day? Well, certainly not.

The good experience that we have is we speak a lot to other people in the market. In fact, I've got two directors on our board who are ex-Disney directors and have considerable experience in Disney parks and experiences.

We've seen, particularly in those Disney properties, that the celebration of an anniversary like the 50th is something that you want to work towards for as long as you can.

It'll be a year of celebration and a real opportunity for us to stake our position on the Gold Coast and really drive significantly more visitation.

It's about driving that story of Dreamworld being a critical part of the fabric of tourism on the Gold Coast.

We're terribly excited about it, but it's really about a programme over the course of a year, not a splash in the pan.

Learning From Disney Without Copying It

Henry: Now, Greg, I'm going to ask you a bit of a personal question here. How many times have you been to a Disney theme park?

Greg: Well, over 20.

Funnily enough, I go to them a lot. I go to a lot of theme parks, but the parks that I get the most value out of are actually regional theme parks because Disney and Universal are a different animal.

I happened to be in China with a few colleagues last year. We went on a ride at Shanghai Disney and they said, "What a fantastic ride that is. We should do something like that at Dreamworld."

That ride was worth twice our market cap. One ride.

So you've got to have a degree of, "What can we take from those organisations?"

Again, I've got two incredible directors that have come to us who help us with our strategic thinking around product and the guest.

At the same time, we've got to understand who our guest is, and I think we are experts at understanding who our guest is and what they like and what they're about.

We think regional theme parks, both in Europe and the US, are a much better proxy for what we do.

Interestingly, there's a whole range of different ownership structures which we think are quite unique.

We talk to people that are publicly held, private equity held, and also held in families or unique situations like garden trusts and other things like that.

We get a really disparate array of approaches and thinking, and that's a lot of what helps us drive our thinking around hotels and other elements of future growth.

We all love to see a Disney park, but you've got to understand what you're looking at.

I'm the guy taking photos of rubbish bins and queue lines and speakers.

I'm past the point of looking at big rides at Disney and thinking, "We could knock that over."

Henry: So it's a bit like a busman's holiday, really, when you go to Disney.

But you must go to some of these things and think, "Wow, we could do something similar to that."

Rebuilding Motor Coaster Into Lost Mine Mayhem

Henry: One of your big fan favourites, Motor Coaster, was retired earlier this year. What replaces something like Motor Coaster?

Greg: Well, it's a really interesting story because this is a good one for both our guests and our investors.

We're taking the old Motor Coaster attraction and literally taking it apart. We're taking the track down piece by piece, stripping it back to bare metal, completely rebuilding the track and replacing the trains with brand-new ATV-style trains.

We're opening a new attraction called Lost Mine Mayhem.

One of the things that we've really focused on over the last few years, and if you haven't been to Dreamworld, I'd love to have you in the park and show you what we've done, is that we're all about narrative, we're all about storytelling and about theming, as opposed to just putting big rides in.

What you'll see from us, over the last few years and what you'll see in the future, is less frequent investment, but quality investment when we do it.

What you'll see with Lost Mine Mayhem is a great storytelling experience, incredible theming and a ride for a really broad mix of people.

This is one that's intergenerational. You can have young kids on it. The minimum height is 110 centimetres, so you can get little kids on it, but Grandma and Grandpa would happily go on this attraction and have a great time and still have a good experience.

When we think about new capital, we're really thinking of it in that way.

I think what we are is very interested in how we deliver those kinds of attractions for a very tight budget.

We're really interested in how we source theming and how we develop a lot of the theming ourselves in the parks.

We can do as good a job in some of the areas that we're working on as the Disney parks for a fraction of the price.

I say to people, if you come to Dreamworld and look at Rivertown, our newest land that we did a few years ago, you could absolutely pick that up and put it into any Disney park in the world and it would fit perfectly.

For us to do that for a fraction, I think a tenth of that investment, is what we're all about trying to do.

Australian IP And Lasting Park Memories

Henry: I guess we've seen the power of the narrative with Disney in something like Pirates of the Caribbean.

It's extraordinary, the spin-off there from a theme park ride into the Johnny Depp movies.

Greg: Yeah, IP is an interesting conversation, and strategy for us is what we do, but it's also what we don't do.

Dreamworld had some great brands associated with it. We had a really good partnership with Universal, which had the DreamWorks business there, so we had Shrek and Kung Fu Panda and other things like that.

Our competitor on the Gold Coast is also really strong in IP, and they've got all sorts of different IP that's very American-based.

Our view was, "Is that what we want to do? Try to chase them down this road, or do we want to really stand for parochial Australian IP?"

We made the difficult decision and said, "Look, we don't want to be in this business," and walked away from the Universal deal in a good way. Everyone was very happy at the end of that exercise.

We really dug into great Australian IP.

We've got ABC Kids, we've got the Wiggles, and we've also got an incredible brand in terms of Dreamworld's Kenny and Belinda Koala.

As we mentioned, we're coming up to 50 years, and they've been critical to Dreamworld all those years.

We've really got behind Kenny and Belinda. They're a bit like the Barbie dolls of old. They've got about 53 different jobs.

So we just say Christmas in July, Kenny and Belinda in their Christmas outfits and all that.

This Sunday we've got our fun run at Dreamworld, which is a fantastic event, and then Kenny and Belinda are in their running gear.

We've got Country Fair coming up in September. Straight away they're into line dancing and country clobber, and then we get into Halloween and they're in pumpkin outfits and Belinda the Witch and all that.

They're working bloody hard, Kenny and Belinda, but they're giving the parks a lot of mileage, which is great.

Henry: And how many Kenny and Belindas do you have? Do you have a string of people that are Kenny and Belinda?

I have a friend of mine who was Peppa Pig in the US for one of the tours.

Greg: It depends on who's asking.

There's only one Kenny and Belinda, but there's a lot of people that make Kenny and Belinda come together, that's for sure.

They've got a personality which we've got to be very much true to.

I've actually got a wealth of experience in terms of this. Back when I was a young guy, I was Jeffrey the Giraffe at the Gold Coast project.

So I'm well prepared and well equipped to talk about this. One of the highlights of my career, actually.

We take it really seriously. It's a bit of fun, but that job is a critical part of what we do because that is the touch point with our guests every single time they're in the park.

I look at it this way: we try to stop and take a photo for a family, and people don't think about it, but if that photo gets printed, which they still do, in 15 or 20 years you're at someone's house and there's a picture on the wall.

That's that moment that you kind of took at Dreamworld, and 20 years on that's sitting in someone's house and everyone's grown up.

They look back to those fond memories.

It's a really important part of what we do.

The Bull Case For Investors

Henry: I concur with that wholeheartedly.

I've still got a picture, not quite on the fridge, but a picture of my wife and I with the kids very young at Legoland, going down the roller coaster, I think it was, with our arms in the air.

I'm sure there are millions of people around the world that have a similar picture on their fridge or in a frame somewhere.

Absolutely.

Now, Greg, thank you so much for your time today.

If we could just finish off, let's go from Kenny and Belinda to the more corporate side of things.

If we could finish off with why investors should look at this.

Obviously, there is a big discount to the NTA, or pro forma NTA, of $1.08. Here we are at 54 cents.

There's clearly some upside there if you can execute.

Why should we be looking at the Coast Entertainment story?

It may not happen overnight, but it has been a little bit of a slow burn. It's risen from 40 cents to 54 cents recently.

So clearly there's money to be made.

What are the reasons we should be looking at Coast?

Greg: I think to start with, the fundamental opportunities in the numbers, intrinsic value is, in our view and based on independent valuations, north of a dollar a share.

If you simply look at that, there's a mathematical opportunity there.

But the maths is one thing.

I would say this: what has been happening over the last few years is a very clear organic recovery.

One of the slides in our packs that many investors fail to really spend a lot of time on is the guest experience.

Our guest experience scores are the best on the Gold Coast for the last five years.

To me, that's a very strong leading indicator of revenue, and you can see that in our numbers.

The organic opportunity is tremendous. We've still got headroom there, as I outlined.

We're at two million people. We think there's another 400,000 at least.

That's not even thinking about the growth in the south-east Queensland market over the last few years.

Then there's this really interesting opportunity around the land for us to really drive incremental value, both in terms of potentially realising some capital through some of that land and then establishing new businesses on that land that I think will do well in and of themselves.

But they'll also really drive the core business in a whole new way, bring different guests and higher-spending guests as well.

Importantly, this is not a unique idea. You can see this around the world, and it's worked in every instance.

We've done a huge amount of work on it. We feel incredibly bullish about the opportunity because we've spent a huge amount of time talking to people in the market and seeing that performance.

Based on all of that research, we feel tremendously excited about the opportunity.

The last point I'd make is that the business that I was at previously has a theme park hotel on the Gold Coast, 30 minutes from where we're established, and it was a great hotel.

We think we'll even do a better job.

We look at all that and it gives us a huge amount of confidence for the future.

At the price it is now, great buying.

We bought back 20 per cent of the register because we felt so strongly about the price and how cheap it was.

We still feel the same way. We're holding our fire at the minute. We've got a bit of dry powder to think about the future.

To me, if you're a contrarian investor looking at the opportunity, this is one that's not complex.

It's not like AI and all this kind of stuff where there are big macro things going on.

People know who Dreamworld is. They've been there. They understand the story.

There are some really interesting dynamic elements of value there that I think people can put their hands around if they spend the time looking at it.

Could Private Equity Make A Move?

Henry: Do you think there's potential for private equity to come calling?

We've seen it. They have a voracious appetite at the moment. It seems every week or so we're getting a new private equity player coming to Australia and trying to buy up undervalued assets.

Is there potential here for someone to look at it and go, "You know what? This is worth a lot more. This land is worth a lot more than the market is describing, and maybe we should have a go at this."

Greg: Look, I think I would agree with them, hence the conversations that we're having with people in the markets.

There's always a chance of that.

Private equity, in my experience, have been, and I'm a fan of a lot of the aspects of private equity, I like the focus, I like the investment thesis being quite simple and a rigorous approach of trying to execute to achieve value in a short timeframe.

Our businesses are a little bit different to that. There's a degree of cash intensity that's required to do it.

Again, we're now at a point where we're funding our growth, and so it's not difficult to do that. It's part of the story.

They have a much shorter view of the world than other holders might.

I've found in my experience when I look at private equity coming into businesses like ours in Australia and globally, they've found it a little bit more difficult than what they have in other segments.

So, could it happen? For sure.

Are they a great natural owner of our type of asset? I think that's to be decided.

Final Thoughts And What's Next

Henry: I think that is to be decided.

Greg, it's been an absolute delight speaking to you today. Thank you so much for coming on.

I think it's a story that a lot of listeners won't be that familiar with. We'll be familiar with the Dreamworld story, but it's not the automatic sort of stock you look at and think, "Ooh."

It is a bit of a sleeper stock.

I'm really happy that we've had the chance today to have a chat about Coast because it clearly is an undervalued asset and things are heading in the right direction.

Thanks once again.

Greg: I really appreciate you having me on, Henry, and hopefully I can tell you some good news stories in the next little while about our land.

Henry: Cool. We'll definitely stay in touch. Thank you, Greg. Much appreciated.