Sunday, November 17, 2019

Heard On... Cedar Fair's 3rd Quarter 2019 Earnings Call

© Cedar Fair
Cedar Fair's 3rd Quarter 2019 earnings announcement was filled with good financial news.  Often when chains purchase new parks they do not break out the "legacy" parks, however Cedar Fair has done that for us to make things easier to compare in the growth department.  Here are some highlights from the earnings call, along with some of the most interesting slides from their most recent investor presentation:

• For the 3rd quarter alone net revenues were up $51 million, attendance was up 818k, per capita spending was up $0.47 and out of park revenues were up $6 million.  That is for all parks, including the two Schlitterbahn parks.  Excluding them revenues ere up $43 million, attendance was up 732k, per caps were up less than 1% and out of park revenues were up $6 million.  EBITDA, which the investment community is after, was up $17 million including Schlitterbahn, and up the same with out them. (due to calendar shifts, not their performance)

• Year to date (through November 3rd) including the Schlitterbahn parks, net revenues were $1.37 billion with attendance of 25.8 million visitors.  Excluding the parks revenues were up $71 million with attendance up 1 million guests over 2018.

© Cedar Fair
• Season pass sales are off to their best start ever, causing deferred revenues to be up $40 million over the same time in 2018.  That also translates to an increase of 350,000 units sold (probably most at Cedar Point!).

• Grand Carnivale will come back to all existing parks and debut at two new parks in 2020, and Monster Jam Thunder Alley will switch to three new parks next year.

• Company continues to be committed to a "long range plan" that includes "more immersive entertainment offerings" - this was something mentioned several times.  These offerings led to a second season in a row of growing the number of unique visitors to the parks, which they want to use in their CRM database.

© Cedar Fair
 • When asked more about the shift in capital spending, the chain noted that they are seeing a similar boost to value perception from large events as they've seen from big coasters in the past.

• Knott's Berry Farm is continuing to produce huge numbers.  They had a very slow start to 2019 but have come back and are on the path again to make 2019 the best year ever for the park.  They are kicking off a new "targeted marketing" project at Knott's in the 4th quarter.  Also, this past Halloween Haunt was their best ever.

• The two Schlitterbahn parks contributed $23 million of EBITDA during the 3rd quarter after they were purchased.  Cedar Fair is spending heavily on them in the 4th quarter to make improvements, which will bring their EBITDA contribution down to $12 - $14 million in EBITDA.

© Cedar Fair
• More on Schlitterbahn, they see much room for improvement in the two parks' revenues and attendance.  Most system changes to link the parks to the chain will happen in 2020, meaning 2021 will be the first big season for them as a part of Cedar Fair.

• The 4th quarter events of Halloween and Winterfest and Knott's Merry Farm now account for 15% of the company's annual attendance, and that is growing.

• On the hotel front, Carowinds' new Springhill Suites is opening in a couple weeks.  The company has also started renovations projects at Castaway Bay, the Knott's Hotel and the Sawmill Creek Resort.  The Hyatt hotel by Canada's Wonderland is moving slowly, but they hope to open it in 18 to 24 months.  Over the next three years, including the Canadian hotel, they will spend $70 million on hotel renovations and additions.

© Cedar Fair

• The new indoor section of the Cedar Point Sports Center will open in early 2020 and bookings are running slightly ahead of Cedar Fair's budget.  They expect the facility to create incremental demand for room stays at Cedar Point's hotel properties.

• To better accommodate guests (due to increasing attendance) the chain will also focus on improving parking facilities, ingress/egress to the parks, more food and beverage capacity and expanded restrooms.

• The company declined to comment on the Six Flags purchase rumors, noting that they plan for the future of the company's success on its own.

© Cedar Fair
• Cedar Point's new Gold Pass has gone bonkers in sales, and is drawing a ton of new guests - at a ration of 7 new for each 1 renewal.

• Pass Perks will roll out chain-wide in 2020.  They tested at 4 parks this year and were working to see what offers would get guests to show up for an additional visit.  They found that the most motivating offer was anything food and beverage related.

Saturday, November 16, 2019

Conneaut Lake Park to Expand Picnic Operations with Help from State Grant

© Conneaut Lake Park
The little park that could has had another recent success, being awarded a $112,000 grant from the Pennsylvania Department of Conservation and Natural Resources.  The grant will be used to redevelop picnic pavilions, allowing the Trustees of Conneaut Lake park, who operate the facility, to build six new pavilions.

The project would allow the property to attract large groups that want to have picnics, such as family reunions, company outings and more.  The grant will cover about 50% of the funds needed for the project, which also includes tearing down several older pavilions.  The park hopes to be able to have the pavilions done for the 2020 season, however they need to finish items related to the grant and get appropriate approvals for the work so it will be a tight schedule.

© Conneaut Lake Park
Each season Conneaut Lake Park, which dates back to 1892, has been growing and improving after a good deal of troubling financial years.  In 2019 a slew of improvements debuted at the park, including the Ferris wheel seen above.  The park also added a smaller Ferris wheel in the kids area, made cosmetic improvements, added new roofs around the park, new paint, additional lockers, restroom improvements and even work on the famous Blue Streak roller coaster.

For ride fans, the Blue Streak is the most important reason to see the park continue its streak of success.  The Ed Vettel designed ride opened in 1938 and is about as classic as a wooden coaster can be in current day.

Friday, November 15, 2019

Aquatica Orlando Announces New Riptide Race Dueling Slides for 2020

© Aquatica Orlando
Aquatica Orlando has announced the addition of Riptide Race for the park's 2020 season.  The new slide tower will stand 68 feet tall and be "Florida's first-ever dueling water slide," according to the park's press release.

Riders will grab a raft that seats two people and head to the top of the tower.  The attraction has two separate paths that allow for side-by-side racing at "top speeds."  The ride's path will feature low walls which will "ensure full view of the competition" as the sliders race through a combined total of nearly 650 feet of slide.  Riptide Race's path will feature both enclosed and open sections, tight turns and section of acceleration.

“Riptide Race will offer a ride experience you won’t be able to get anywhere else in Florida. Aquatica will be the first waterpark in the state to have a thrilling, and more importantly, dueling water slide,” said David Heaton, Aquatica Orlando vice president. “Riptide Race is the perfect addition to our attraction portfolio, complementing what is already one of the most family friendly waterslide lineups in Orlando.”

Riptide Race will have a height requirement of 42 inches to appeal to families with children, and the new slide will be conveniently located on the north side of the park next to Banana Beach Cook Out.

Thursday, November 14, 2019

Cedar Fair Says No Thanks to Purchase of Schlitterbahn Kansas City

© Google Maps
Back when Cedar Fair purchased two of Schlitterbahn's iconic water parks they also had the right to potentially purchase the remains of Schlitterbahn Kansas City, which sat dormant for the 2019 season, for $6 million.  The company only had so long to decide to make the purchase or not, and that time has now passed with no sale completed.

The local news is reporting that while Cedar Fair has let their option to buy the water park expire, local officials are still hopeful that it can operate as a water park again some day in the future.  Who would be the owner and operator is unclear, however.

The Kansas City water park was set to be the start of a large vacation destination that Schlitterbahn was going to develop, though little more than the water park was ever built.  The park's prior troubles are believed to have led the private Schlitterbahn company to be forced to sell two of their parks in the first place.

Some argued that if Cedar Fair purchased and operated the park it could be a secondary attraction for Worlds of Fun, however they already have a fully developed water park there with Ocean of Fun.  In the end it appears as though Cedar Fair didn't see the value in having two water parks operating so close to one another. 

Wednesday, November 13, 2019

Worlds of Fun Makes Changes to 2020 Addition to Beat a World Record

© Worlds of Fun
The previously announced 2020 addition to Worlds of Fun's water park, Oceans of Fun, has received a small design change that has allowed it to become a world record breaking attraction.

The park has announced that Riptide Raceway, a 4 lane racing mat slide, has had the length of each path increased by ten feet, from 476.9 to 486 feet, to make it the longest slide of its kind in the world.  It is amazing what ten more feet of slide can do!

© Worlds of Fun
The park has also sent out this schematic of Riptide Raceway, giving us a detailed look at the path each of the four lanes will follow.  Riders need only be 42 inches tall to race, and using mats they will head down the lanes head-first through tight turns and enclosed sections, with a final drop toward the finish line.  The attraction will feature bright colors that will fit with the vibe of Ocean of Fun.

The slide will be built into the landscape of the park and start at around five stories above the final splash run out.  The competitive racing nature of the slide is sure to make it a popular attraction when Oceans of Fun opens for the 2020 season.

Tuesday, November 12, 2019

Schlitterbahn Galveston Indoor Water Park Closing for Extended Refurbishments

© Schlitterbahn Galveston
Schlitterbahn Galveston, now a part of the Cedar Fair family, has announced that it will close its indoor operations early for the season on November 17th for extended refurbishments and improvements.

Touting a "new and improved experience in 2020," the water park will see a number of changes that will make guests more comfortable starting when it reopens on February 29th, 2020.  When Cedar Fair closed on the purchase of the two Schlitterbahn water parks they said that they were planning some significant capital expenditures for them over the next two years, this seems to be the first of them to be announced.

© Schlitterbahn Galveston
So what exactly is happening?  The park has posted an information update about the changes and described some of them in detail.  They plan to focus on attraction maintenance, improve the food and beverage operations of the park, renovate all the restrooms, and give the park's main entrance a full makeover to make getting in the park faster, more streamlined and "prettier."

Granted none of these things are an exciting massive new water slide or attraction, but after Cedar Fair has some time to make cosmetic and operational changes this year I wouldn't be shocked to see a big new attraction in 2021.

Schlitterbahn Galveston also promises additional announcements, surprises, and updates to be posted to their blog as work progresses, so stay tuned for more details.