Cedar Fair Reports First Quarter 2024 Results
- Delivered solid first-quarter performance with strong momentum across key long-lead indicators
- Completed opportunistic debt refinancing, further enhancing the Company’s capital structure and financial flexibility
-
Board declares quarterly cash distribution of
$0.30 per LP unit, payableJune 19, 2024
Highlights: First Quarter of 2024 Compared to First Quarter of 2023
- 44 net fewer operating days compared to Q1-2023.
-
Net revenues totaled a record
$102 million for the quarter, an increase of 20%, or$17 million . -
Including
$10 million of costs related to the proposed merger with Six Flags, the Company recorded a first quarter net loss of$133 million compared with a net loss of$135 million in Q1-2023. -
The Adjusted EBITDA(1) loss for the quarter totaled
$97 million compared with an Adjusted EBITDA loss of$101 million in Q1-2023. - Attendance totaled 1.3 million guests, an increase of 27%, or 290,000 guests.
-
In-park per capita spending(2) was
$60.53 , a decrease of 6%. -
Out-of-park revenues(2) totaled a record
$23 million for the quarter, an increase of 21%, or$4 million .
Highlights: First Quarter of 2024 Compared to Three Months Ended
-
62 fewer operating days than comparable three-month period ended
April 2, 2023 . -
Net revenues for the quarter of
$102 million increased 3%, or$3 million . -
Including
$10 million of merger-related costs, the Company’s first-quarter net loss of$133 million improved by 3%, or$4 million . -
The Adjusted EBITDA(1) loss for the quarter of
$97 million improved by$4 million , or 4%. - First quarter attendance of 1.3 million guests increased 10%, or 125,000 visits.
-
In-park per capita spending(2) for the quarter of
$60.53 decreased 8%. -
First quarter out-of-park revenues(2) of
$23 million increased 8%, or$2 million .
Balance Sheet and Capital Allocation Highlights
-
On
Mar. 31, 2024 , net debt(3) totaled$2.42 billion , calculated as total debt before debt issuance costs of$2.46 billion less cash and cash equivalents of$35 million . -
On
May 1, 2024 , the Company entered into new credit facilities, comprising of a 7-year$1.0 billion senior secured term loan B maturing in 2031 and a new$300 million revolving credit facility maturing in 2028. Proceeds from the new term loan were used to redeem all of the Company’s outstanding$1.0 billion 5.500% Senior Secured Notes due inMay 2025 . -
Cedar Fair’s Board of Directors today declared a cash distribution of
$0.30 per limited partner (LP) unit, payable onJune 19, 2024 , to unitholders of record onJune 5, 2024 .
CEO Commentary
“Our performance trends through the first four months of the season extend the momentum we established in the second half of 2023 and underscore the strength of our portfolio and business model,” said Cedar Fair President and CEO
Commenting on the proposed merger with Six Flags, Zimmerman added, “We were pleased that Six Flags shareholders overwhelmingly approved the merger-of-equals transaction, which we continue to believe will be completed before the end of the second quarter. We were also encouraged that our recent refinancing transactions were very well received by the credit markets, validating the strong financial profile and compelling growth opportunities of the combined company post-closing. Both
Results for First Quarter 2024 Compared to First Quarter 2023
Historically, first quarter results represent approximately 5% of the Company’s full-year attendance and net revenues, as most parks in Cedar Fair’s portfolio are closed during the period. Consequently, the Company typically operates at a loss during the first quarter.
Operating days in the first quarter of 2024 totaled 117 compared with 161 operating days in the first quarter of 2023. The decrease was primarily due to a strategic decision to reduce the number of planned operating days in the first quarter of 2024 at several of the Company’s seasonal parks, including
For the quarter ended
Operating costs and expenses in the first quarter of 2024 increased
Depreciation and amortization expense in the first quarter of 2024 totaled
After the items noted above, the Company reported a 2024 first quarter operating loss of
Interest expense for the quarter totaled
During the first three months of 2024, the Company recorded a benefit for taxes of
After the items above, the Company reported a net loss of
For the 2024 first quarter, Adjusted EBITDA(1), which management believes is a meaningful measure of the Company’s park-level operating results, was a loss of
Results for First Quarter 2024 vs. Three Months Ended
As previously noted, the results for the first quarter of 2024 included an additional calendar week as compared with the first quarter of 2023. On a same-week basis, or comparing the three months ended
On a same-week basis, operating costs and expenses would have increased
Balance Sheet and Liquidity Highlights
Deferred revenues on
As of
On
On
Distribution
Today the Company announced the
Conference Call
As previously announced, the Company will host a conference call with analysts starting at
Investors and all other interested parties can access a live, listen-only audio webcast of the call on the
A digital recording of the conference call will be available for replay by phone starting at approximately
(1) |
Adjusted EBITDA is not a measurement computed in accordance with generally accepted accounting principles (GAAP). For additional information regarding Adjusted EBITDA, including how the Company defines and uses Adjusted EBITDA, see the attached reconciliation table and related footnotes. |
(2) |
In-park per capita spending and out-of-park revenues are non-GAAP financial measures. See the attached reconciliation table and related footnote for the calculations of in-park per capita spending and out-of-park revenues. These metrics are used by management as major factors in significant operational decisions as they are primary drivers of financial and operational performance, measuring demand, pricing, and consumer behavior. |
(3) |
Net debt is a non-GAAP financial measure. See the attached reconciliation table and related footnote for the calculation of net debt. Net debt is a meaningful measure used by the Company and investors to monitor leverage, and management believes it is meaningful for this purpose. |
About
Qualified Notice
This release is intended to be a qualified notice under Treasury Regulation Section 1.1446-4(b). Brokers and nominees should treat one hundred percent (100.0 percent) of
Forward-Looking Statements
Some of the statements contained in this news release that are not historical in nature constitute “forward-looking statements” within the meaning of the federal securities laws, including Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, including statements as to the Company's expectations, beliefs, goals, and strategies regarding the future. All statements, other than statements of historical fact, included in this communication that address activities, events or developments that we expect, believe or anticipate will or may occur in the future are forward-looking statements. Words such as “anticipate,” “believe,” “create,” “expect,” “future,” “guidance,” “intend,” “plan,” “potential,” “seek,” “target,” “synergies,” “will,” “would,” similar expressions, and variations or negatives of these words identify forward-looking statements. However, the absence of these words does not mean that the statements are not forward-looking. Forward-looking statements by their nature address matters that are, to different degrees, uncertain, such as statements about performance expectations and the consummation of the proposed transaction and the anticipated benefits thereof. These forward-looking statements may involve current plans, estimates, expectations, and ambitions that are subject to risks, uncertainties and assumptions that are difficult to predict, may be beyond our control and could cause actual results to differ materially from those described in such statements. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to be correct, that the Company's growth and operational strategies will achieve the target results, that the proposed transaction will close or that the Company will realize the anticipated benefits thereof. Important risk factors that may cause such a difference and could adversely affect attendance at our parks, our future financial performance, our growth strategies and/or the proposed transaction, and could cause actual results to differ materially from our expectations or otherwise to fluctuate or decrease, include, but are not limited to: general economic conditions; the impacts of public health concerns; adverse weather conditions; competition for consumer leisure time and spending; unanticipated construction delays; changes in the Company’s capital investment plans and projects; the expected timing and likelihood of completion of the proposed transaction, including the timing, receipt and terms and conditions of any required governmental and regulatory approvals of the proposed transaction; anticipated tax treatment, unforeseen liabilities, future capital expenditures, revenues, expenses, earnings, synergies, economic performance, indebtedness, financial condition, losses, future prospects, business and management strategies for the management, expansion and growth of the combined company’s operations and other conditions to the completion of the proposed transaction, including the possibility that any of the anticipated benefits of the proposed transaction will not be realized or will not be realized within the expected time period; the occurrence of any event, change or other circumstances that could give rise to the termination of the merger agreement; the outcome of any legal proceedings that may be instituted against
These risks, as well as other risks associated with the proposed transaction, are more fully discussed in the registration statement on Form S-4 filed by
Important Information about the Transaction and Where to Find It
This communication is not a substitute for the registration statement, proxy statement/prospectus or any other document that
The information included on, or accessible through, Cedar Fair’s or Six Flags’ website is not incorporated by reference into this communication.
No Offer or Solicitation
This communication is for informational purposes and is not intended to, and shall not, constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote or approval, nor shall there be any offer, solicitation or sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No offer of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act of 1933, as amended.
This news release and prior releases are available under the News tab at https://ir.cedarfair.com
- more -
(financial tables follow)
|
|||||||
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS |
|||||||
(In thousands) |
|||||||
|
Three months ended |
||||||
|
|
|
|
||||
Net revenues: |
|
|
|
||||
Admissions |
$ |
45,441 |
|
|
$ |
39,529 |
|
Food, merchandise and games |
|
38,858 |
|
|
|
32,064 |
|
Accommodations, extra-charge products and other |
|
17,316 |
|
|
|
12,961 |
|
|
|
101,615 |
|
|
|
84,554 |
|
Costs and expenses: |
|
|
|
||||
Cost of food, merchandise, and games revenues |
|
11,611 |
|
|
|
10,381 |
|
Operating expenses |
|
141,938 |
|
|
|
133,340 |
|
Selling, general and administrative |
|
61,424 |
|
|
|
46,465 |
|
Depreciation and amortization |
|
10,312 |
|
|
|
13,681 |
|
Loss on impairment / retirement of fixed assets, net |
|
2,614 |
|
|
|
3,636 |
|
|
|
227,899 |
|
|
|
207,503 |
|
Operating loss |
|
(126,284 |
) |
|
|
(122,949 |
) |
Interest expense |
|
34,696 |
|
|
|
32,129 |
|
Loss on foreign currency |
|
5,240 |
|
|
|
3,999 |
|
Other income |
|
(337 |
) |
|
|
(441 |
) |
Loss before taxes |
|
(165,883 |
) |
|
|
(158,636 |
) |
Benefit for taxes |
|
(32,416 |
) |
|
|
(24,090 |
) |
Net loss |
|
(133,467 |
) |
|
|
(134,546 |
) |
Net loss allocated to general partner |
|
(1 |
) |
|
|
(1 |
) |
Net loss allocated to limited partners |
$ |
(133,466 |
) |
|
$ |
(134,545 |
) |
|
|||||||
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEET DATA |
|||||||
(In thousands) |
|||||||
|
|
|
|
||||
Cash and cash equivalents |
$ |
35,128 |
|
|
$ |
33,562 |
|
Total assets |
$ |
2,264,265 |
|
|
$ |
2,209,741 |
|
Long-term debt, including current maturities: |
|||||||
Revolving credit loans |
$ |
158,000 |
|
|
$ |
170,000 |
|
Notes |
|
2,277,941 |
|
|
|
2,268,275 |
|
|
$ |
2,435,941 |
|
|
$ |
2,438,275 |
|
Total partners' deficit |
$ |
(730,919 |
) |
|
$ |
(793,240 |
) |
|
|||||||
RECONCILIATION OF ADJUSTED EBITDA |
|||||||
(In thousands) |
|||||||
|
Three months ended |
||||||
|
|
|
|
||||
Net loss |
$ |
(133,467 |
) |
|
$ |
(134,546 |
) |
Interest expense |
|
34,696 |
|
|
|
32,129 |
|
Interest income |
|
(360 |
) |
|
|
(514 |
) |
Benefit for taxes |
|
(32,416 |
) |
|
|
(24,090 |
) |
Depreciation and amortization |
|
10,312 |
|
|
|
13,681 |
|
EBITDA |
|
(121,235 |
) |
|
|
(113,340 |
) |
Non-cash foreign currency loss |
|
5,239 |
|
|
|
3,703 |
|
Non-cash equity compensation expense |
|
5,284 |
|
|
|
5,053 |
|
Loss on impairment / retirement of fixed assets, net |
|
2,614 |
|
|
|
3,636 |
|
Costs related to proposed merger (1) |
|
10,147 |
|
|
|
— |
|
Other (2) |
|
771 |
|
|
|
(116 |
) |
Adjusted EBITDA (3) |
|
(97,180 |
) |
|
|
(101,064 |
) |
(1) |
Consists of |
|
|
(2) |
Consists of certain costs as defined in the Company's current and prior credit agreements. These costs are added back to net loss to calculate Adjusted EBITDA and have included certain legal expenses, severance and related benefits and contract termination costs. This balance also includes unrealized gains and losses on short-term investments. |
|
|
(3) |
Adjusted EBITDA represents earnings before interest, taxes, depreciation, amortization, other non-cash items, and adjustments as defined in the Company's current and prior credit agreements. The Company believes Adjusted EBITDA is a meaningful measure as it is widely used by analysts, investors and comparable companies in the industry to evaluate operating performance on a consistent basis, as well as more easily compare the Company's results with those of other companies in the industry. Further, management believes Adjusted EBITDA is a meaningful measure of park-level operating profitability and uses it for measuring returns on capital investments, evaluating potential acquisitions, determining awards under incentive compensation plans, and calculating compliance with certain loan covenants. Adjusted EBITDA is provided as a supplemental measure of our operating results and is not intended to be a substitute for operating income, net income or cash flows from operating activities as defined under generally accepted accounting principles. In addition, Adjusted EBITDA may not be comparable to similarly titled measures of other companies. |
Adjusted EBITDA loss for the three months ended
|
|||
CALCULATION OF NET DEBT |
|||
(In thousands) |
|||
|
|
||
Long-term debt, including current maturities |
$ |
2,435,941 |
|
Plus: Debt issuance costs and original issue discount |
|
22,059 |
|
Less: Cash and cash equivalents |
|
(35,128 |
) |
Net Debt (1) |
$ |
2,422,872 |
|
(1) |
Net Debt is a non-GAAP financial measure used by the Company and investors to monitor leverage. The measure may not be comparable to similarly titled measures of other companies. |
|
|||||
KEY OPERATIONAL MEASURES |
|||||
(In thousands, except per capita and operating day amounts) |
|||||
|
Three months ended |
||||
|
|
|
|
||
Attendance |
|
1,349 |
|
|
1,059 |
In-park per capita spending (1) |
$ |
60.53 |
|
$ |
64.47 |
Out-of-park revenues (1) |
$ |
23,265 |
|
$ |
19,225 |
Operating days |
|
117 |
|
|
161 |
(1) |
In-park per capita spending is calculated as revenues generated within the Company's amusement parks and separately gated outdoor water parks along with related parking revenues (in-park revenues), divided by total attendance. Out-of-park revenues are defined as revenues from resort, out-of-park food and retail locations, online transaction fees charged to customers, sponsorships and all other out-of-park operations. In-park revenues, in-park per capita spending and out-of-park revenues are non-GAAP measures. These metrics are used by management as major factors in significant operational decisions as they are primary drivers of the Company's financial and operational performance, measuring demand, pricing, and consumer behavior. A reconciliation of in-park revenues and out-of-park revenues to net revenues for the periods presented is as follows: |
|||||||
|
|
Three months ended |
||||||
|
(In thousands) |
|
|
|
||||
|
In-park revenues |
$ |
81,646 |
|
|
$ |
68,303 |
|
|
Out-of-park revenues |
|
23,265 |
|
|
|
19,225 |
|
|
Concessionaire remittance |
|
(3,296 |
) |
|
|
(2,974 |
) |
|
Net revenues |
$ |
101,615 |
|
|
$ |
84,554 |
|
On a same-week basis, concessionaire remittance totaled
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