Insights

Why the Ardent Leisure (ASX:ALG) share price is climbing 5%

The Ardent Leisure Group Ltd (ASX: ALG) share price is up around 5% today following a trading performance update. We take a closer look.
The post Why the Ardent Leisure (ASX:ALG) share price is climbing 5% appeared first on The Motley Fool Australia. –

rising asx share price represented by rollercoaster ride climbing higher

The Ardent Leisure Group Ltd (ASX: ALG) share price is on the move today following a trading performance update.

During late morning trade, the entertainment company’s shares are swapping hands for 86.5 cents, up 4.85%. In earlier trade, the Ardent Leisure share price climbed as high as 90 cents before retreating to its current level.

Let’s take a closer look at what the company announced.

Strong revenue momentum

Investors are fighting to get a hold of Ardent Leisure shares after the company revealed robust trading conditions.

According to its release, Ardent Leisure’s recent trading performance for Main Event Entertainment is continuing to recover.

For the first week of May (fiscal week ending 11 May), constant revenue increased by around 8%. The lift was attributed to strong, ongoing walk-in revenue, which partly offset the soft end-of-year school event business. The latter represented roughly 25% of the revenue mix from Ardent Leisure in the prior corresponding period.

Contributing to the strong result, 42 of the 44 centres operated by Ardent Leisure have re-opened. The remaining 2 locations are set to re-open their doors this month and in June, subject to COVID-19 restrictions.

Pleasingly, Main Event has generated positive earnings before interest, tax, depreciation and amortisation (EBITDA) throughout the second half of FY21. Ardent Leisure highlighted that the outcome is due to its efficient cost management policies within its centres and head office.

Segmented EBITDA (excluding specific items) for March and April recorded US$23.7 million. In comparison, this is 79% higher than the same time period in FY19 (US$13.2 million). However, when including the months of January and February, the variance between the two time periods diminishes. FY21 for the four months ending April, achieved EBITDA of US$29.4 million as opposed to US$26.2 million for FY19.

Ardent Leisure stated that the business has a high EBITDA cash conversation rate. Significant operating cash flows are generated before new centre capital spend and repayment of debt. New centre net capital spend came to US$4.1 million during the current second-half.

Available cash to its United States business stood at US$80.8 million, with outstanding debt totalling US$163.5 million.

About the Ardent Leisure share price

Over the last 12 months, the Ardent Leisure share price has accelerated to post a gain of close to 170%. This is a stark contrast from when the company’s shares nosedived to an all-time low in February last year.

Based on today’s prices, Ardent Leisure presides a market capitalisation of about $426 million, with approximately 479 million shares outstanding.

Where to invest $1,000 right now

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

Scott just revealed what he believes are the five best ASX stocks for investors to buy right now. These stocks are trading at dirt-cheap prices and Scott thinks they are great buys right now.

See The 5 Stocks

*Returns as of February 15th 2021

More reading

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post Why the Ardent Leisure (ASX:ALG) share price is climbing 5% appeared first on The Motley Fool Australia.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;


To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.


An active and funded account with a positive trading balance is required to continue to have access to the tools;


Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;


Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!