Tuesday, February 19, 2013

Heard On... Cedar Fair 2012 Earnings Call

Today Cedar Fair reported their results for 2012, able to share that they had their third consecutive year of record revenues and EBITDA figures.

The full press release can be found on the company's website, but they also had a conference call today to discuss the news.  Nothing too earth shattering was revealed, but I thought I'd share some notes regardless:

• The numbers:  In 2012 Cedar Fair had $1.068 billion in revenues (up 3.9% from 2011), EBITDA was $391 million (up 4.4%), attendance was 23.3 million (down 86k from 2011).  The EBITDA margin was 36.6%, up from 36.4% in 2011.

• A focus of the new e-commerce system started in February 2012 paid off in the form of large increases of season pass sales.  Season pass visits accounted for almost 40% of the year's attendance.  The total number sold was 10% higher than the previous year and the average price was up 6%.  Sales to date for this season are ahead of last year at this point, so these numbers could go even higher when 2013 is said and done.

• The group market is something leadership is pursuing, they've hired a new sales leadership team last year and done a full retraining for staff.  This also makes sense why Carowinds and Valleyfair! are spending capital cash to build new group catering areas.

• Per capita spending hit a record $41.95 in the year, with admission per cap up 4.4% and in park per caps up 7%.  The in park per caps were greatly helped by new initiatives like Fast Lane and a refocus on improving food quality.

• Leviathan sounds like it paid off for Canada's Wonderland - the park led all others in having the largest attendance increase for the year, along with the largest per capita spending increase.

• Totals for out of park revenues were down less than 1% or $789,000, mostly based on some softness at the chain's hotels.

• The results for the 4th quarter were down from 2011, in both revenues and attendance.  The weather is mentioned as a possible reason, but 2011 saw near perfect weather during the Fall and results that were extremely great.

• A Customer Relationship Management Strategy system will be implemented in 2013, though the benefits of it might not show up till '14.  The system, combined with e-commerce, will create a much larger marketing database that will make marketing efforts dramatically more effective (and modern).

• Currently all the projects that are a part of the $100 million being spent on capital expenditures for 2013 are on time and on budget.  This includes GateKeeper, which sounds like the company has really high hopes for this season.  An additional $15 to $20 million will be spent this year on new point of sale systems for four parks, and in the second half of the year renovations at employee dormitories and hotels.  The point of sale systems are going into Knott's Berry Farm (actually already up and running), California's Great America, Valleyfair!, and Worlds of Fun.  Only Michigan's Adventure will be left after this year, and that needs other infrastructure improvements to even have a new system set up.