Adventure Tourism to Australia Sees Boost from Chinese Travel

Skift Take

The Chinese traveler’s slow return continues to impact global travel. But adventure tourism operators are optimistic they’ll be parachuting into newly opened group travel countries like Australia.

Thrill-seekers from China have a renewed interest in adventure travel to Australia and New Zealand, with one adventure tourism operator, Experience Co, seeing a direct boost, according to its financial update on Thursday. 

The New South Wales-based company specializes in adventure tourism experiences from safaris, skydiving, and scuba diving and saw an uptick in New Zealand during the early stages of China’s Golden Week holiday in late September.

Ord Minnett senior researcher John O’Shea expects that growth to spread. “We expect a similar situation to unfold in Australia over the coming months, given New Zealand’s earlier acceptance as an Approved Destination Status for Chinese tour groups,” said O’Shea. New Zealand was cleared for Chinese group travel in January of this year, yet China only lifted its group travel restrictions for Australia in August. 

The travel appetite of the Chinese traveler has yet to fully return, with outbound travel from China significantly below 2019 levels. Dragon Trail and ForwardKeys market analysis just ahead of the peak October travel period also showed that 55% of respondents in a Chinese Traveler Sentiment Report planned to travel within Asia.

‘An International Opportunity’

Earlier in 2023, Experience Co invested in reconstruction projects for its Wild Bush Luxury and Treetops Adventure business and has seen a return to normal visitor numbers. 

Experience Co also acquired the Australian Jump Pilot Academy for its Performance Aviation business unit in April to address its labor constraints in anticipation of a return to pre-pandemic visitor numbers.  

“It is really about ensuring that we have a steady pipeline of pilots and pilot capability to allow us to flex back to those pre-pandemic levels within our Skydive operating segment. Whilst Australia’s inbound recovery is fantastic news, the name of the game for EXP is really down to the return of the international market and, in particular, the Chinese traveler. The international opportunity remains,” said Experience Co CEO John O’Sullivan. 

Reopening group travel for Australia and New Zealand is also expected to improve aviation capacity.

Earnings Boost from Adventure Experiences 

Experience Co reported revenues of $68.54 million (AUS$108.6 million) for its 2023 financial year, which ended 30 June, and EBITDA of $7.13 million (AUS$11.3 million). The net loss after tax was $316,175 (AUS$500,000).

The Adventure Experiences segment was a key driver, contributing $8.52 million (AUS$13.5 million) to the EBITDA, a significant increase from $3.53 million (AUS$5.6 million) in 2022. 

Its Skydive business segment also improved, posting an underlying EBITDA of $2.59 million (AUS$4.1 million), compared to a loss of $1.33 million (AUS$2.1 million) in the previous fiscal year.

Looking ahead: Investment bank Ord Minnett forecasts the company will produce revenue of $85.9 million (AUS$136.1 million) in the 2024 fiscal year. Chinese in-bound tourism will play a role.

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