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- Indoor Skydive Australia Group (IDZ) has completed a debt restructure, wrapping up the “repair” stage of its strategic plan after a costly legal dispute in 2018
- Following a fallout with SkyVentures International, the group and its affiliates paid US$3.8 million (around A$4.85 million) to settle the dispute and took out a loan facility with Sky Ventures to fund the settlement
- The company has entered agreements with existing lenders Westpac (WBC) and Birkdale and new lender Causeway Financial to facilitate the debt restructure which will result in a $7.7 million increase in net tangible assets
- Indoor Skydive has also arranged creditor write-downs of legal services from the arbitration and outstanding director fees to the tune of $942,000
- Meanwhile, the company has also released its half-yearly results today, highlighting a turnaround in earnings to $869,000 in 1H FY21 from negative $1.3 million in the prior corresponding period
- The increase in earnings was attributed to a 3 per cent increase in revenue, a reduction in overheads and the implementation of more efficient systems
- Shares have jumped 92.9 per cent to trade at 2.7 cents
Indoor Skydive Australia Group (IDZ) has completed a debt restructure, wrapping up the “repair” stage of its strategic plan following a costly legal dispute in 2018.
The leisure group has two indoor skydiving facility’s under its iFLY business, and also operates a virtual reality business under the brand FREAK Entertainment.
The dispute
After a fallout with SkyVentures International surrounding purchase and licence agreements, the jointly selected U.S. arbitrator ruled the agreements were clear, reasonable and enforceable.
As such, the group agreed to pay US$3.8 million (around A$4.85 million) to SkyVenture and confirmed all intellectual property relating to the vertical wind tunnels remained the exclusive property of SkyVenture.
The company subsequently entered into agreements for SkyVenture to provide a loan facility to Indoor Skydive to fund the full value of the settlement.
Restructure
The company has entered into agreements with existing lenders Westpac (WBC) and Birkdale, and new lender Causeway Financial to facilitate the restructure which will result in a $7.7 million increase in net tangible assets.
Indoor Skydive has also arranged creditor write downs of legal services from the arbitration and outstanding director fees to the tune of $942,000.
“This positive result in negotiations and repairing the balance sheet marks the end of over two years of commitment and hard work on behalf of all ISA Group employees, officers and the board of directors,” said CEO Wayne Jones.
“The result has positioned ISA Group on a stable footing to now focus on growth opportunities including the continuation of the rollout of Virtual Reality facilities, and the development of its immersive training and simulation business,” he added.
The restructure marks the completion of the company’s “repair” phase and its progression to the “growth and diversification” phase which includes the rollout of FREAK Entertainment to new sites and the development of a franchise model.
It also includes the development of an immersive training and simulation business, strengthening of the board and further diversification and growth through acquisitions.
H1 FY21 results
Meanwhile, the company has also released its half-yearly results today, highlighting a turnaround in earnings before interest, taxes depreciation and amortisation (EBITDA) to positive $869,000 in 1H FY21 from negative $1.3 million in the prior corresponding period.
The increase in earnings was attributed to a 3 per cent increase in revenue to $3.5 million, a reduction in overheads and the implementation of more efficient systems and marketing.
COVID-19 closures and restrictions did, however, impact both the company’s iFLY and FREAK Entertainment businesses yet key financial metrics improved.
For the half, the group recorded a net loss after tax of $626,000, less severe than the loss of $3.4 million it tabled in the prior corresponding period.
Shares have jumped 92.9 per cent to trade at 2.7 cents at 1:10 pm AEDT.
