Saturday, February 16, 2019

Heard On... Six Flags Entertainment's 2018 Full Year and 4th Quarter Earnings Call

This past week was also Six Flags Entertainment's earnings announcement, covering 2018 in total along with 4th quarter results.  The stock market had a pretty substantial negative impression of the results, even though they were record breaking in many aspects.  Let's take a closer look.

•  For full year 2018 Six Flags saw record revenues of $1.46 billion, an 8% increase.  Attendance was up 5% to 32 million, though mostly due to adding 5 new parks mid-year.  Adjusted EBITDA was up 7% to $554 million and per capita spending increased 2% for the year.  They also report spending $133 million on new capital expenditures in 2018, $23 million to acquire the 5 new parks, and paid $267 million to shareholders via dividends.

© Six Flags
•  The 4th quarter also saw new records achieved, with revenues of $270 million, up 5%, fueled by a 6% increase in guest spending and a 3% increase in attendance.  The numbers benefited from the addition of two new parks offering the Holiday in the Park event.

•  Six Flags is happy to report that during the year the Active Pass Base, those who have either a membership or season pass, increased 8%.  They rolled out new tiers at the start of 2018, and this led to pricing increases that also helped increase revenues as more signed up for higher tier plans than they expected.  For the year, pass and membership holders amounted to 63% of all attendance.  At the end of 2018 there were almost 8 million active pass members, more than 2 million of those are memberships.

•  Six Flags has had a Project 600 goal for some time now, which aimed to see $600 million in EBITDA by the end of last year.  They hit $554 million, but the failure to meet the goal meant some big bonuses were unaccrued which also helped the 4th quarter results.  They also wanted to hit $750 million by 2020, and now admit that probably won't happen, but think it could in 2021.

© Six Flags
•  In 2018 Six Flags recognized $42 million in revenue from licensing agreements.  They had to reverse $15 million in revenues in the 4th quarter due to delays on the parks in China.  The first parks are now expected to open in 2020, previously 2019, then more in 2021 and 2022.  The Dubai park is permanently on hold, and my never happen.  Since starting these agreements in 2014, Six Flags has booked $133 million in revenues from them.

•  Six Flags plans to continue to purchase water parks and other smaller operations in coming years located in "feeder" markets to the big parks, with "dozens" of opportunities available.  Since starting this in 2017 they've already added 8 parks.

Friday, February 15, 2019

Heard On... Cedar Fair's 2018 Year End and 4th Quarter Conference Call

Yesterday was Cedar Fair's 2018 Year End and 4th Quarter earning release, in which the company reported another successful year that saw record revenues of $1.35 billion.

Between the release and the usual earning conference call, there was plenty to be told about the company's year.  Let's dig in.

•  Looking at 2018 in total, revenues were up 2% to 1.35 billion, with a 1% increase of attendance (189,000 visits) to 25.9 million guests, per capita revenue was up 1%, and a 6% increase in out of park revenues to a total of $152 million.  Full year EBITDA was down 2% however, to $460 million.

•  The 4th quarter for the company was an especially good one.  During the period revenues hit $250 million, up 9% from last year, and record EBITDA for the period was achieve at $68 million, up 11% from last year.  The company had one more park started Winterfest this year, which helped the quarter greatly.

© Cedar Point
•  Season passes continue to be a focus for Cedar Fair, along with all park operators.  Right now season pass sales are up 25% over last year at this time.  During 2018 more than 50% of park attendance was from season pass holders.

•  Since 2012 the company has started stretched out payment options for passes along with utilizing a strong customer relation management system to increase pass sales.  Since that time the annual revenues from season pass sales have nearly doubled, with more room to grow in their opinion.  The current season pass base across all parks is around 2.5 million people.

•  This season a couple parks (not sure which) will roll out a rewards program for season pass holders.  It will let them redeem rewards at the parks and even some when the parks are closed.  2019 is a test of the program, will a full rollout planned for 2020.

© Carowinds
•  The company is pleased with their out of park revenues, which were a record.  Higher occupancy rates at their hotels, along with higher room rates, were the reason behind the results.  No new announcements have taken place aside from the hotels at Carowinds and Canada's Wonderland, but they're still focused on expanding in this area.

•  A new long term strategy has been set in place to achieve a yearly goal of $575 million in EBITDA by 2023 - which is about 4% growth each year.  The company will get there through three areas of focus - broadening the guest experience through new activities and events, expanding their season pass program even further, and increasing market penetration through focused marketing.  For example, Knott's has 49 million people living in the market around it, and they only get 2% of those as guests.  If they add even 1% more that's equal to 500,000 more guests at the park.

•  A lot of discussion on capital spending took place.  It seems in reaction to guests looking for "multidimensional entertainment" Cedar Fairs parks will push hard for more events, festivals, and special time-limited offerings.  They will leverage their existing inventory of thrill rides to space out larger investments, meaning more years in between the big rides, and focus each year on "interactive and immersive family attractions."

© Knott's Berry Farm
•  Knott's Berry Farm is the example of this method, where all their events - marketed as 5 seasons of fun - have pushed annual attendance up over the six million mark.  This year the company will roll out the 'seasons of fun' message to more parks.  They also cite Cedar Point's Forbidden Frontier and the addition of Winterfest at Canada's Wonderland as examples of how to build upon this plan.

•  This is not to say that rides will not be built, (even Knott's, as the example of the plan, got a big coaster this year) but there will be a stronger mix of other interactive and special events in between them.  Cedar Fair plans to spend around $140 - $150 million a year on capital, with items like hotel developments above and beyond that figure.  In 2019 they are spending $140 on marketable additions, and $30 - $40 million more on the two hotels at Carowinds and Canada's Wonderland.

•  Also worth noting is that the company feels they have accomplished some heavy capital plans that took years to finish, such as renovating group catering facilities at all the parks, investing in wifi (the last two parks will get it this year), etc.  With that behind them, they have created a new plan for the future focused on splitting between big rides and interactive attractions and events.

© Carowinds
•  And interesting quote was given on capital plans - they will "continue to place an emphasis on building to scale in all of our projects, as we believe it differentiates our parks and helps protect the integrity of our business models for years to come."  That can be taken different ways, and I wish they had elaborated more on it.  Still, they also said they will make sure they have something that they can market for each park each year... but that's not to say it is a new ride like Six Flags does.

•  In the next couple weeks they will be announcing some sort of new event that is designed to drive urgency and visits during the early season.  They would not give details, but reference the Boysenberry Festival at Knott's when speaking about it.  That event has created some of the busiest days at the park for the entire year when it takes place, and it sounds like they want to duplicate it (though not in focus on boysenberries) at the other parks.

Wednesday, February 13, 2019

Sesame Place Building New Sesame Street Neighborhood with Live Character Show in 2019

© Sesame Place
Sesame Place will be celebrating their 50th anniversary in 2019, and is completely redoing their Sesame Street Neighborhood to mark the occasion.

Nestled in the center of the park, the Neighborhood has long been a true recreation of the set of the popular children's show, however that set has evolved over time.  The park is updating to better match the current appearance of the neighborhood, and expanding with new offerings at the same time.

© Sesame Place
This concept art gives a sample of what the new Sesame Street Neighborhood will look like.  You can also see drawings of the entire block in this promotional video:

The street will feature famous storefronts such as Hooper's Store and the 123 stoop along with Abby's Garden and more.  There will be several photo spots, including a brand new Big Bird's Nest, along the route and Sesame Place promises special interactive areas that will engage guests and delight young visitors.  For the first time ever, visitors can meet Snuffleupagus in person at the park this year as well.

Another big premier will be a new live show titled "Our Street Is Sesame Street," featuring the actual Muppet characters, including Elmo, Abby Cadabby and Big Bird, for the first time at the park.  I'm not sure if the show will take place in the storefronts of the Neighborhood, but the concept art above does feature the characters looking out of the windows.  The show promises to have guests singing, dancing and clapping along to the production.

© Sesame Place
The Neighborhood will also have a new location to get delicious treats named Cookie Monster's Foodie Truck.  Guests can sample snacks that both Cookie Monster and Gonger would be sure to devour, according to Sesame Place.

“Having been in this position now for just over a year, it is incredible to think of the remarkable transformation that has taken place at the park,” said Cathy Valeriano, Sesame Place Park President. “We have invested more resources than ever before into ensuring an outstanding experience for our guests.  From becoming the world’s first theme park to be designated a Certified Autism Center, to the opening of our second roller coaster, Oscar’s Wacky Taxi, and now opening our brand-new Sesame Street Neighborhood, the entire park will come to life in a way guests have never experienced before.

Tuesday, February 12, 2019

Six Flags Announces Improvements + Name Changes to Four Properties

© Six Flags
Six Flags has formally announced the rebranding of three of the latest parks to join the company's family of properties and a new name for an existing one.  Darien Lake, Wet & Wild Splashtown and Wet & Wild Phoenix will all have brand new names, and the water park at The Great Escape will be renamed.

Six Flags Darien Lake, as it will be called (again) was an easy one to see coming, and honestly the park has already made it clear that was the direction they were headed.  The park is building the Six Flags SkyScreamer for 2019, a 242 foot tall swing ride that will move passengers in seats at 35 miles per hour.

The park's website also offers that guests arriving at the park will be greeted by a "revamped main gate area with a towering, new digital pylon and a new Six Flags Darien Lake entrance sign."

© Six Flags
Formerly known as Wet & Wild Splashtown, Six Flags Hurricane Harbor Splashtown will be making a, well, splash in the Houston, Texas area this summer.  The 48 acre park will debut all new Caribbean theming to match the new name, along with a major new waterslide.

© Six Flags
Known as the Wahoo Wave, the thrilling family raft ride will stand six stories and "send four riders into near vertical motion as they experience extended hang times and zero g-forces.  Riders plunge 30 feet straight down before sweeping across the top of a massive waterfall, then descending into a refreshing pool below."

© Six Flags
Next up is the transformation of Wet & Wild Phoenix into Six Flags Hurricane Harbor Phoenix.  While there will be no major new attraction at the water park this year, it will also receive all-new Caribbean theming to match the name, along with an updated dining area with plenty of expanded seating.

The Great Escape is changing the name of their water park to Hurricane Harbor to better fit the portfolio of the company, it was also announced today.  It will introduce "two brand-new family attractions: Bucket Blasters, where riders will spin around in barrels for a good old-fashioned water gun battle and Shipwreck Cove, a fun activity pool with interactive water sprays, geysers, and fountains for hours of water play entertainment."

Monday, February 11, 2019

New Plans Show Massive Coaster Headed to Busch Gardens Williamsburg in 2020

© Google Maps
According to new plans located by BGWFans, the above open area within Busch Gardens Williamsburg will look very different in 2020.  The space, located adjacent to the Italy themed section of the park, has been rumored to be the location of a big new roller coaster for almost two years now.

BGWFans, was able to find some plans that were submitted to local planning authorities, and share the results of their analysis.  This link will get you to their story, but here's a front page shot from their social media feed:

As you can see, the site was able to locate some blueprints that reveal plans for footings that give a general layout of the new coaster.  The good news is that it looks to match up to the images that were leaked last fall.

The ride appears to use a launch to perform an initial swoop down toward the Rhine River in what would be the bottom right of the aerial up top.  The ride will have a second launch after that which will make use of switch-track to allows trains to be launched up a high point, then go backwards up a spike, then full blast launch one more time and up a top hat or similar element.

Then comes what looks like a massive drop down toward the river which could involve some serious elevation change and speed.  The leaked images show a big fan turn afterward to burn off some of that speed, and BGWFans' layout shows some more twists and turns on the way back to the station.

Obviously this is all very preliminary but it's very encouraging, and looks like a thrilling attraction is on the way!

Sunday, February 10, 2019

The Steel Curtain is Looking Massive at Kennywood!

© Kennywood
If you haven't been following Kennywood on social media, Twitter especially, then you've certainly been missing out on some awesome Steel Curtain construction photos the last few weeks.

Despite freezing temperatures and a passing snow storm or two, Kennywood has started the 'tall' phase of construction, with The Steel Curtain's tallest supports going up.  The park used smaller cranes to put up all of the lower portions of the ride earlier, and those completed sections can be seen in these photos.

© Kennywood
The park even went up to the top of the Racer to take some great photos of the new coaster.  This is certainly one of the most interesting coasters to go up in recent memory... so massive and different than most coasters lately.

© Kennywood
When finished The Steel Curtain will stand 220 feet above the park and feature 9 different inversions, two of which can be seen above, and a top speed of 76 miles per hour.  The ride will be the centerpiece of Steelers Country, a new themed area created from a partnership with the Pittsburgh Steelers.