Six Flags Reports Fourth Quarter and Full Year 2023 Performance
- None.
- Higher cash operating costs in the fourth quarter due to increased investments and inflationary impacts.
- Net loss of $22 million in the fourth quarter compared to net income of $10 million in the same period last year.
- Decrease in guest spending per capita driven by lower revenue from memberships and discontinuation of new memberships sale.
- Net income for the full year decreased from $101 million in 2022 to $39 million in 2023, primarily due to self-insurance reserves charge and merger-related costs.
Insights
The financial performance of Six Flags Entertainment Corporation reflects a nuanced picture of their business operations. The reported 5% increase in total revenue for both the fourth quarter and the full year of 2023 is indicative of the company's ability to attract more visitors, as evidenced by a 6% rise in attendance for the quarter and a 9% rise for the year. This growth in attendance, especially in a post-pandemic climate, suggests effective marketing strategies and an appealing product offering.
However, the decline in guest spending per capita is a concern, revealing a potential decrease in consumer spending power or a shift in the company's pricing strategy, particularly with a 7% drop in admissions spending per capita for the year. This could be a strategic move to boost attendance through more accessible pricing, but it also suggests a need to enhance in-park spending opportunities to offset lower admission revenues.
The company's net income decline of 61% year-over-year is significant and could raise red flags for investors. This decline, alongside a net loss of $22 million in the fourth quarter, could be attributed to a variety of factors, including the $38 million charge in self-insurance reserves and $15 million in merger-related transaction costs. It's crucial to assess how these one-time expenses and strategic decisions will influence profitability moving forward.
The merger with Cedar Fair is a substantial development with the potential to reshape the regional theme park landscape. The combined entity could benefit from economies of scale, expanded market reach and shared best practices. However, the success of such a merger will hinge on the integration of operations and cultures, as well as the realization of anticipated synergies.
From a market perspective, Six Flags' strategy of premiumization and its focus on innovative rides and guest-facing technological innovations are critical for differentiating itself in a competitive entertainment industry. The company's ability to grow guest spending per capita by 17% since 2021, despite a short-term decline, indicates a successful shift towards higher value offerings. The emphasis on a premium experience could attract a more affluent customer base and potentially increase revenue over the long term.
The company's investment in new entertainment events and digital guest-facing initiatives is a forward-thinking approach to enhancing the guest experience and operational efficiency. In the era of digital transformation, these investments could lead to improved customer satisfaction and loyalty, which are crucial for repeat business and positive word-of-mouth marketing.
Furthermore, the early success in sales of 2024 passes points to a solid foundation for the upcoming core operating season. This advance in sales not only provides immediate cash flow but also indicates consumer confidence in the brand and its offerings for the future.
Analyzing the economic implications of Six Flags' performance, the company's ability to lower cash expenses in the face of inflation is commendable and indicates strong cost management. Inflationary pressures are a significant concern for businesses globally and Six Flags' proactive measures to contain costs could help maintain margins in a challenging economic environment.
The company's decision to discontinue the sale of new memberships, leading to lower membership revenue, reflects a strategic shift that may impact the revenue model. While this could lead to a decrease in predictable, recurring revenue, it may also streamline the company's product offerings and reduce complexity for consumers.
Lastly, the increase in capital investments by $59 million over the prior year signals confidence in future growth prospects. These investments in the park's infrastructure are essential for maintaining competitiveness and ensuring long-term sustainability. However, the impact on cash flow and debt levels must be monitored closely to maintain financial health.
"As we close out our second year pursuing our premiumization strategy, we are encouraged by the progress we have made to date. Since 2021, we have grown guest spending per capita by
Fourth Quarter 2023 Results
|
Three Months Ended |
||||||||
(Amounts in millions, except per share data) |
December 31, 2023 |
|
January 1, 2023 |
|
% Change vs. 2022 |
||||
Total revenue |
$ |
293 |
|
|
$ |
280 |
|
5 |
% |
Net (loss) income attributable to Six Flags Entertainment (2) |
$ |
(22 |
) |
|
$ |
10 |
|
N/M |
|
Net (loss) income per share, diluted (2) |
$ |
(0.27 |
) |
|
$ |
0.12 |
|
N/M |
|
Adjusted EBITDA (1) , (3) |
$ |
98 |
|
|
$ |
99 |
|
— |
% |
Attendance |
|
4.3 |
|
|
|
4.1 |
|
6 |
% |
Spending per capita figures: (4) |
|
|
|
|
|
||||
Total guest spending per capita |
$ |
64.19 |
|
|
$ |
65.15 |
|
(1 |
)% |
Admissions spending per capita |
$ |
33.06 |
|
|
$ |
34.50 |
|
(4 |
)% |
In-park spending per capita |
$ |
31.13 |
|
|
$ |
30.65 |
|
2 |
% |
Total revenue for fourth quarter 2023 increased
The
The company had a net loss of
Full Year 2023 Results
|
Year Ended |
|||||||
(Amounts in millions, except per share data) |
December 31, 2023 |
|
January 1, 2023 |
|
% Change vs. 2022 |
|||
Total revenue |
$ |
1,426 |
|
$ |
1,358 |
|
5 |
% |
Net income attributable to Six Flags Entertainment (2) |
$ |
39 |
|
$ |
101 |
|
(61 |
)% |
Net income per share, diluted (2) |
$ |
0.46 |
|
$ |
1.20 |
|
(61 |
)% |
Adjusted EBITDA (1) , (3) |
$ |
462 |
|
$ |
461 |
|
— |
% |
Attendance |
|
22.2 |
|
|
20.4 |
|
9 |
% |
Spending per capita figures (2) |
|
|
|
|
|
|||
Total guest spending per capita |
$ |
61.03 |
|
$ |
63.93 |
|
(5 |
)% |
Admissions spending per capita |
$ |
33.43 |
|
$ |
35.99 |
|
(7 |
)% |
In-park spending per capita |
$ |
27.60 |
|
$ |
27.94 |
|
(1 |
)% |
Total revenue for full year 2023 increased
The
The company had a net income of
Balance Sheet and Capital Allocation
As of December 31, 2023, the company had total reported debt of
Cedar Fair Transaction
On November 2, 2023, the company and Cedar Fair (NYSE: FUN) entered into a definitive merger agreement to combine in a merger of equals transaction. On January 31, 2024, the Registration Statement on Form S-4 containing the proxy statement/prospectus relating to the transaction ("Registration Statement") was declared effective by the Securities and Exchange Commission ("SEC") and mailed to the company's shareholders on or about February 1, 2024. A shareholder meeting relating to the merger agreement and other related matters is scheduled for March 12, 2024. The merger is expected to close in the first half of 2024, following the receipt of aforementioned Six Flags shareholder approval, regulatory approvals, including the pending antitrust review in
Conference Call
At 7:00 a.m. Central Time today, February 29, 2024, the company will host a conference call to discuss its fourth quarter and full year 2023 financial performance. The call is accessible through either the Six Flags Investor Relations website at investors.sixflags.com, or by dialing 1-833-629-0614 in
About Six Flags Entertainment Corporation
Six Flags Entertainment Corporation is the world’s largest regional theme park company with 27 parks across
___________________________________
Forward Looking Statements
This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including statements regarding (i) the adequacy of our cash flows from operations, available cash and available amounts under our credit facilities to meet our liquidity needs, including in the event of a prolonged closure of one or more of our parks, (ii) our ability to execute our strategy to significantly improve our financial performance and the guest experience, (iii) expectations regarding consumer demand for regional, outdoor, out-of-home entertainment, including for our parks, and (iv) expectations regarding our annual income tax liability and the availability and effect of net operating loss carryforwards and other tax benefits.
Forward-looking statements include all statements that are not historical facts and often use words such as "anticipates," "intends," "plans," "seeks," "believes," "estimates," "expects," "may," "should," "could" and variations of such words or similar expressions. These statements may involve risks and uncertainties that could cause actual results to differ materially from those described in such statements. These risks and uncertainties include, among others, factors impacting attendance, such as local conditions, natural disasters, contagious diseases, or the perceived threat of contagious diseases, events, disturbances and terrorist activities; economic impact of political instability and conflicts globally, including the war in
Important Information about the Transaction and Where to Find It
In connection with the proposed transaction with Cedar Fair, the company and Cedar Fair have caused HoldCo to file with the SEC the Registration Statement that includes a proxy statement of the company and a prospectus of HoldCo. The Registration Statement was declared effective by the SEC and, a definitive proxy statement/prospectus was mailed to stockholders of the company on or about February 1, 2024. Cedar Fair, the company and HoldCo may also file other documents with the SEC regarding the proposed transaction. This communication is not a substitute for the Registration Statement, proxy statement/prospectus or any other document that Cedar Fair, Six Flags or HoldCo (as applicable) may file with the SEC in connection with the proposed transaction. BEFORE MAKING ANY VOTING AND/OR INVESTMENT DECISION, INVESTORS AND SECURITY HOLDERS OF CEDAR FAIR AND SIX FLAGS ARE URGED TO READ THE REGISTRATION STATEMENT, THE PROXY STATEMENT/PROSPECTUS AND ANY OTHER RELEVANT DOCUMENTS THAT ARE FILED OR WILL BE FILED WITH THE SEC, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THESE DOCUMENTS, CAREFULLY AND IN THEIR ENTIRETY WHEN THEY BECOME AVAILABLE BECAUSE THEY CONTAIN OR WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION AND RELATED MATTERS. Investors and security holders may obtain free copies of the registration statement and the proxy statement/prospectus, as each may be amended from time to time, as well as other filings containing important information about Cedar Fair or Six Flags, without charge at the SEC’s Internet website (http://www.sec.gov). Investors and security holders may obtain free copies of the registration statement and the proxy statement/prospectus and other documents filed with the SEC by Cedar Fair, Six Flags and HoldCo through the web site maintained by the SEC at www.sec.gov or by contacting the investor relations department of Cedar Fair or Six Flags at the following:
Six Flags
Evan Bertrand
Vice President, Investor Relations and Treasurer
+1-972-595-5180
investorrelations@sftp.com
The information included on, or accessible through, the company’s website is not incorporated by reference into this communication.
Participants in the Solicitation
Cedar Fair, the company, HoldCo and their respective directors and executive officers may be deemed to be participants in the solicitation of proxies from company stockholders in respect of the proposed transaction. Information regarding Cedar Fair’s directors and executive officers, including a description of their direct interests, by security holdings or otherwise, is contained in Cedar Fair’s Form 10-K for the year ended December 31, 2023 filed with the SEC on February 16, 2024 and its proxy statement filed with the SEC on April 13, 2023, and subsequent statements of changes in beneficial ownership on file with the SEC. Information regarding the company’s directors and executive officers, including a description of their direct interests, by security holdings or otherwise, is contained in Six Flags’ Form 10-K for the year ended January 1, 2023 filed with the SEC on March 7, 2023 and its proxy statement filed with the SEC on March 28, 2023, and subsequent statements of changes in beneficial ownership on file with the SEC. Additional information regarding the participants in the proxy solicitations and a description of their direct or indirect interests, by security holdings or otherwise, are contained in the proxy statement/prospectus and other relevant materials filed with the SEC when they become available.
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.
Footnotes
(1) |
See the following financial statements and Note 4 to those financial statements for a discussion of Adjusted EBITDA (a non-GAAP financial measure) and its reconciliation to net income (loss). |
|
(2) |
Reflects revisions to be made to previously issued financial statements for immaterial errors in the unaudited interim financial statements for the periods ended April 3, 2022 and July 3, 2022 and revisions reflected herein for the unaudited financial statements for the quarterly periods ended October 2, 2022 and the audited annual financial statements for the period ended January 1, 2023 related to the recognition of stock-based compensation in the Company's annual report on Form 10-K for the three months ended January 1, 2023. As a result of these revisions, selling, general and administrative expense for the three-month and twelve-month periods ended January 1, 2023, increased by |
|
(3) |
During 2023, the company reclassified the net pension-related expense (benefit) to “Other (income) expense, net”, in our consolidated statements of operations. This reclassification has been reflected in all periods presented. As a result, Adjusted EBITDA for the three-month period and the twelve-month period ended January 1, 2023, declined by |
|
(4) |
The company uses certain per capita operational metrics that measure the performance of our business on a per guest basis and believe that these metrics provide relevant and useful information for investors because they assist in comparing our operating performance on a consistent basis, make it easier to compare our results with those of other companies and our industry and allows investors to review performance in the same manner as our management. |
|
|
|
|
|
|
|
|
|
|
(5) |
“Cash operating costs” includes operating expenses (excluding depreciation and amortization) and selling, general and administrative expenses (excluding stock-based compensation). "Cash operating costs" also excludes the |
Statement of Operations Data
|
Three Months Ended |
|
Year Ended |
|||||||||||
(Amounts in thousands, except per share data) |
December 31,
|
|
January 1,
|
|
December 31,
|
|
January 1,
|
|||||||
Park admissions |
$ |
142,072 |
|
|
$ |
140,149 |
|
$ |
743,657 |
|
|
$ |
735,415 |
|
Park food, merchandise and other |
|
133,755 |
|
|
|
124,516 |
|
|
614,036 |
|
|
|
570,965 |
|
Sponsorship, international agreements and accommodations |
|
16,724 |
|
|
|
15,211 |
|
|
68,210 |
|
|
|
51,856 |
|
Total revenues |
|
292,551 |
|
|
|
279,876 |
|
|
1,425,903 |
|
|
|
1,358,236 |
|
Operating expenses (excluding depreciation and amortization shown separately below) |
|
133,952 |
|
|
|
126,647 |
|
|
622,952 |
|
|
|
590,660 |
|
Selling, general and administrative expenses (excluding depreciation and amortization shown separately below) (1) (2) |
|
55,204 |
|
|
|
34,296 |
|
|
247,883 |
|
|
|
169,403 |
|
Costs of products sold |
|
22,960 |
|
|
|
22,157 |
|
|
110,397 |
|
|
|
108,146 |
|
Depreciation and amortization |
|
29,120 |
|
|
|
30,352 |
|
|
115,086 |
|
|
|
117,124 |
|
Impairment of park assets |
|
22,956 |
|
|
|
16,943 |
|
|
22,956 |
|
|
|
16,943 |
|
Loss on disposal of assets |
|
9,648 |
|
|
|
891 |
|
|
16,393 |
|
|
|
3,927 |
|
Operating income |
|
18,711 |
|
|
|
48,590 |
|
|
290,236 |
|
|
|
352,033 |
|
Interest expense, net |
|
40,196 |
|
|
|
33,885 |
|
|
158,256 |
|
|
|
141,590 |
|
Loss on debt extinguishment |
|
— |
|
|
|
— |
|
|
13,982 |
|
|
|
17,533 |
|
Other (income) expense, net |
|
11,146 |
|
|
|
1,985 |
|
|
9,208 |
|
|
|
(84 |
) |
(Loss) income before income taxes |
|
(32,631 |
) |
|
|
12,720 |
|
|
108,790 |
|
|
|
192,994 |
|
Income tax (benefit) expense |
|
(10,235 |
) |
|
|
2,703 |
|
|
22,290 |
|
|
|
46,960 |
|
Net (loss) income |
$ |
(22,396 |
) |
|
$ |
10,017 |
|
$ |
86,500 |
|
|
$ |
146,034 |
|
Less: Net income attributable to noncontrolling interests |
|
— |
|
|
|
— |
|
|
(47,501 |
) |
|
|
(44,651 |
) |
Net (loss) income attributable to Six Flags Entertainment Corporation |
$ |
(22,396 |
) |
|
$ |
10,017 |
|
$ |
38,999 |
|
|
$ |
101,383 |
|
|
|
|
|
|
|
|
|
|||||||
Weighted-average common shares outstanding: |
|
|
|
|
|
|
|
|||||||
Basic: |
|
83,556 |
|
|
|
83,156 |
|
|
83,410 |
|
|
|
84,366 |
|
Diluted: |
|
84,084 |
|
|
|
83,230 |
|
|
83,935 |
|
|
|
84,695 |
|
|
|
|
|
|
|
|
|
|||||||
(Loss) earnings per average common share outstanding: |
|
|
|
|
|
|
|
|||||||
Basic: |
$ |
(0.27 |
) |
|
$ |
0.12 |
|
$ |
0.47 |
|
|
$ |
1.20 |
|
Diluted: |
$ |
(0.27 |
) |
|
$ |
0.12 |
|
$ |
0.46 |
|
|
$ |
1.20 |
|
| ____________________________________________________________________________ | ||
(1) |
Includes stock-based compensation of |
|
(2) |
Reflects revisions to be made to previously issued financial statements for immaterial errors in the unaudited interim financial statements for the periods ended April 3, 2022 and July 3, 2022 and revisions reflected herein for the unaudited financial statements for the quarterly periods ended October 2, 2022 and the audited annual financial statements for the period ended January 1, 2023 related to the recognition of stock-based compensation in the Company's annual report on Form 10-K for the three months ended January 1, 2023. As a result of these revisions, selling, general and administrative expense for the three-month and twelve-month periods ended January 1, 2023, increased by |
|
|
As of |
||||||
(Amounts in thousands, except share data) |
December 31, 2023 |
|
January 1, 2023 |
||||
ASSETS |
|
|
|
||||
Current assets: |
|
|
|
||||
Cash and cash equivalents |
$ |
77,585 |
|
|
$ |
80,122 |
|
Accounts receivable, net |
|
62,660 |
|
|
|
49,405 |
|
Inventories |
|
31,624 |
|
|
|
44,811 |
|
Prepaid expenses and other current assets |
|
80,897 |
|
|
|
66,452 |
|
Total current assets |
|
252,766 |
|
|
|
240,790 |
|
Property and equipment, net: |
|
|
|
||||
Property and equipment, at cost |
|
2,733,094 |
|
|
|
2,592,485 |
|
Accumulated depreciation |
|
(1,447,861 |
) |
|
|
(1,350,739 |
) |
Total property and equipment, net |
|
1,285,233 |
|
|
|
1,241,746 |
|
Goodwill |
|
659,618 |
|
|
|
659,618 |
|
Intangible assets, net of accumulated amortization |
|
344,141 |
|
|
|
344,164 |
|
Right-of-use operating leases, net |
|
134,857 |
|
|
|
158,838 |
|
Other assets, net |
|
34,859 |
|
|
|
20,669 |
|
Total assets |
$ |
2,711,474 |
|
|
$ |
2,665,825 |
|
|
|
|
|
||||
LIABILITIES AND STOCKHOLDERS' DEFICIT |
|
|
|
||||
Current liabilities: |
|
|
|
||||
Accounts payable |
$ |
27,235 |
|
|
$ |
38,887 |
|
Accrued compensation, payroll taxes and benefits |
|
18,957 |
|
|
|
15,224 |
|
Self-insurance reserves |
|
64,605 |
|
|
|
34,053 |
|
Accrued interest payable |
|
28,704 |
|
|
|
38,484 |
|
Other accrued liabilities |
|
73,087 |
|
|
|
67,346 |
|
Deferred revenue |
|
127,556 |
|
|
|
128,627 |
|
Short-term borrowings |
|
56,867 |
|
|
|
— |
|
Current portion of long-term debt |
|
180,000 |
|
|
|
100,000 |
|
Short-term lease liabilities |
|
10,514 |
|
|
|
11,688 |
|
Total current liabilities |
|
587,525 |
|
|
|
434,309 |
|
Noncurrent liabilities: |
|
|
|
||||
Long-term debt |
|
2,128,612 |
|
|
|
2,280,531 |
|
Long-term lease liabilities |
|
155,335 |
|
|
|
164,804 |
|
Other long-term liabilities |
|
27,263 |
|
|
|
30,714 |
|
Deferred income taxes |
|
189,700 |
|
|
|
184,637 |
|
Total liabilities |
|
3,088,435 |
|
|
|
3,094,995 |
|
|
|
|
|
||||
Redeemable noncontrolling interests |
|
520,998 |
|
|
|
521,395 |
|
|
|
|
|
||||
Stockholders' deficit: |
|
|
|
||||
Preferred stock, |
|
— |
|
|
|
— |
|
Common stock, |
|
2,112 |
|
|
|
2,079 |
|
Capital in excess of par value (2) |
|
1,131,208 |
|
|
|
1,119,222 |
|
Accumulated deficit (2) |
|
(1,961,603 |
) |
|
|
(2,000,671 |
) |
Accumulated other comprehensive loss, net of tax |
|
(69,676 |
) |
|
|
(71,195 |
) |
Total stockholders' deficit |
|
(897,959 |
) |
|
|
(950,565 |
) |
Total liabilities and stockholders' deficit |
$ |
2,711,474 |
|
|
$ | 2,665,825 |
|
|
Year Ended |
||||||
(Amounts in thousands) |
December 31, 2023 |
|
January 1, 2023 |
||||
Cash flows from operating activities: |
|
|
|
||||
Net income |
$ |
86,500 |
|
|
$ |
146,034 |
|
Adjustments to reconcile net (loss) income to net cash provided by operating activities: |
|
|
|
||||
Depreciation and amortization |
|
115,086 |
|
|
|
117,124 |
|
Stock-based compensation (2) |
|
11,387 |
|
|
|
15,218 |
|
Interest accretion on notes payable |
|
924 |
|
|
|
1,111 |
|
Loss on debt extinguishment |
|
13,982 |
|
|
|
17,533 |
|
Amortization of debt issuance costs |
|
5,356 |
|
|
|
7,097 |
|
Loss on disposal of assets |
|
16,393 |
|
|
|
3,927 |
|
Deferred income tax expense |
|
1,320 |
|
|
|
30,638 |
|
Loss on impairment of park assets |
|
22,956 |
|
|
|
16,943 |
|
Other |
|
(4,195 |
) |
|
|
(3,088 |
) |
Changes in operating assets and liabilities: |
|
|
|
||||
(Increase) decrease in accounts receivable |
|
(13,831 |
) |
|
|
48,648 |
|
(Increase) decrease inventories, prepaid expenses and other current assets |
|
(2,785 |
) |
|
|
(28,856 |
) |
(Increase) decrease in deposits and other assets |
|
6,700 |
|
|
|
(11,720 |
) |
Decrease in ROU operating leases |
|
11,773 |
|
|
|
11,410 |
|
(Decrease) increase in accounts payable, deferred revenue, accrued liabilities and other long-term liabilities |
|
6,297 |
|
|
|
(79,585 |
) |
Decrease in operating lease liabilities |
|
(10,610 |
) |
|
|
(11,003 |
) |
Decrease in accrued interest payable |
|
(9,780 |
) |
|
|
(12,070 |
) |
Net cash provided by operating activities |
|
257,473 |
|
|
|
269,361 |
|
|
|
|
|
||||
Cash flows from investing activities: |
|
|
|
||||
Additions to property and equipment |
|
(171,814 |
) |
|
|
(116,589 |
) |
Property insurance recoveries |
|
1,089 |
|
|
|
5,080 |
|
Proceeds from sale of assets |
|
488 |
|
|
|
— |
|
Net cash used in investing activities |
|
(170,237 |
) |
|
|
(111,509 |
) |
|
|
|
|
||||
Cash flows from financing activities: |
|
|
|
||||
Repayment of borrowings |
|
(1,163,623 |
) |
|
|
(460,000 |
) |
Proceeds from borrowings |
|
1,144,984 |
|
|
|
200,000 |
|
Payment of debt issuance costs |
|
(19,678 |
) |
|
|
— |
|
Stock repurchases |
|
— |
|
|
|
(96,774 |
) |
Redemption premium payments on debt extinguishment |
|
— |
|
|
|
(200 |
) |
Payment of cash dividends |
|
— |
|
|
|
1,039 |
|
Proceeds from issuance of common stock |
|
(8,587 |
) |
|
|
— |
|
Payment of tax withholdings on equity-based compensation through shares withheld |
|
— |
|
|
|
(12,600 |
) |
Reduction in finance lease liability |
|
(999 |
) |
|
|
(1,016 |
) |
Purchase of redeemable noncontrolling interest |
|
(328 |
) |
|
|
(556 |
) |
Distributions to noncontrolling interests |
|
(47,533 |
) |
|
|
(44,651 |
) |
Net cash used in financing activities |
|
(95,764 |
) |
|
|
(414,758 |
) |
|
|
|
|
||||
Effect of exchange rate on cash |
|
5,991 |
|
|
|
1,443 |
|
|
|
|
|
||||
Net decrease in cash and cash equivalents |
|
(2,537 |
) |
|
|
(255,463 |
) |
Cash and cash equivalents at beginning of period |
|
80,122 |
|
|
|
335,585 |
|
Cash and cash equivalents at end of period |
$ |
77,585 |
|
|
$ |
80,122 |
|
|
|
|
|
||||
Supplemental cash flow information |
|
|
|
||||
Cash paid for interest |
$ |
164,571 |
|
|
$ |
146,693 |
|
Cash paid for income taxes |
$ |
21,238 |
|
|
$ |
10,637 |
|
Definition and Reconciliation of Non-GAAP Financial Measures
We prepare our financial statements in accordance with
However, because these non-GAAP financial measures are not determined in accordance with GAAP, they are susceptible to varying calculations, and not all companies calculate these measures in the same manner. As a result, these non-GAAP financial measures as presented may not be directly comparable to a similarly titled non-GAAP financial measure presented by another company. These non-GAAP financial measures are presented as supplemental information and not as alternatives to any GAAP financial measures. When reviewing a non-GAAP financial measure, we encourage our investors to fully review and consider the related reconciliation as detailed below.
The following tables set forth a reconciliation of net income to Adjusted EBITDA for the three-month periods and twelve-month periods ended December 31, 2023, and January 1, 2023:
|
Three Months Ended |
|
Twelve Months Ended |
|||||||||||
(Amounts in thousands, except per share data) |
December 31, 2023 |
|
January 1, 2023 |
|
December 31, 2023 |
|
January 1, 2023 |
|||||||
Net (loss) income |
$ |
(22,396 |
) |
|
$ |
10,017 |
|
$ |
86,500 |
|
|
$ |
146,034 |
|
Income tax (benefit) expense |
|
(10,235 |
) |
|
|
2,703 |
|
|
22,290 |
|
|
|
46,960 |
|
Other (income) expense, net (3) |
|
11,146 |
|
|
|
1,985 |
|
|
9,208 |
|
|
|
(84 |
) |
Loss on debt extinguishment |
|
— |
|
|
|
— |
|
|
13,982 |
|
|
|
17,533 |
|
Interest expense, net |
|
40,196 |
|
|
|
33,885 |
|
|
158,256 |
|
|
|
141,590 |
|
Loss on disposal of assets |
|
9,648 |
|
|
|
891 |
|
|
16,393 |
|
|
|
3,927 |
|
Depreciation and amortization |
|
29,120 |
|
|
|
30,352 |
|
|
115,086 |
|
|
|
117,124 |
|
Impairment of park assets |
|
22,956 |
|
|
|
16,943 |
|
|
22,956 |
|
|
|
16,943 |
|
Stock-based compensation (2) |
|
2,369 |
|
|
|
1,814 |
|
|
11,387 |
|
|
|
15,218 |
|
Merger-related transaction costs |
|
15,386 |
|
|
|
— |
|
|
15,386 |
|
|
|
— |
|
Self-insurance reserve adjustment (4) |
|
— |
|
|
|
— |
|
|
37,558 |
|
|
|
— |
|
Modified EBITDA (5) |
$ |
98,190 |
|
|
$ |
98,590 |
|
$ |
509,002 |
|
|
$ |
505,245 |
|
Third party interest in EBITDA of certain operations (6) |
|
— |
|
|
|
— |
|
|
(47,501 |
) |
|
|
(44,651 |
) |
Adjusted EBITDA (5) |
$ |
98,190 |
|
|
$ |
98,590 |
|
$ |
461,501 |
|
|
$ |
460,594 |
|
| ____________________________________________________________________________ | ||
| (1) |
Amounts recorded as “Other (income) expense, net” include certain non-recurring costs incurred in conjunction with changes made to our organizational structure in December 2021. During 2023, we reclassified the net pension-related expense (benefit) to other (income) expense, net. in our consolidated statements of operations. This reclassification has been reflected in all periods presented. As a result of this reclassification, Adjusted EBITDA for the three-month and twelve-month periods ended January 1, 2023, declined by |
|
| (2) | Amount relates to an adjustment to our self-insurance reserves resulting from a change in accounting estimate that increased our ultimate loss indications on both identified claims and incurred but not reported claims, as discussed in more detail above in our review of second quarter 2023 results. We have excluded this adjustment from our reported Adjusted EBITDA because we believe (i) the change in actuarial assumptions and related change in accounting estimate that gave rise to the adjustment is unusual and not expected to be recurring; (ii) excluding it provides more meaningful comparisons to our historical results; and (iii) excluding it provides more meaningful comparisons to other companies in our industry. |
|
| (3) | Modified EBITDA,” a non-GAAP measure, is defined as our consolidated income (loss) from continuing operations: excluding the following: the cumulative effect of changes in accounting principles, discontinued operations gains or losses, income tax expense or benefit, restructure costs or recoveries, reorganization items (net), other income or expense, gain or loss on early extinguishment of debt, equity in income or loss of investees, interest expense (net), gain or loss on disposal of assets, gain or loss on the sale of investees, amortization, depreciation, stock-based compensation, fresh start accounting valuation adjustments and other significant non-recurring items. Modified EBITDA, as defined herein, may differ from similarly titled measures presented by other companies. Management uses non-GAAP measures for budgeting purposes, measuring actual results, allocating resources and in determining employee incentive compensation. We believe that Modified EBITDA provides relevant and useful information for investors because it assists in comparing our operating performance on a consistent basis, makes it easier to compare our results with those of other companies in our industry as it most closely ties our performance to that of our competitors from a park-level perspective and allows investors to review performance in the same manner as our management. |
|
"Adjusted EBITDA," a non-GAAP measure, is defined as Modified EBITDA minus the interests of third parties in the Modified EBITDA of properties that are less than wholly owned (consisting of Six Flags Over Georgia, Six Flags White Water Atlanta and Six Flags Over Texas). Adjusted EBITDA is approximately equal to “Parent Consolidated Adjusted EBITDA” as defined in our secured credit agreement, except that Parent Consolidated Adjusted EBITDA excludes Adjusted EBITDA from equity investees that is not distributed to us in cash on a net basis and has limitations on the amounts of certain expenses that are excluded from the calculation. Adjusted EBITDA as defined herein may differ from similarly titled measures presented by other companies. Our board of directors and management use Adjusted EBITDA to measure our performance and our current management incentive compensation plans are based largely on Adjusted EBITDA. We believe that Adjusted EBITDA is frequently used by all our sell-side analysts and most investors as their primary measure of our performance in the evaluation of companies in our industry. In addition, the instruments governing our indebtedness use Adjusted EBITDA to measure our compliance with certain covenants and, in certain circumstances, our ability to make certain borrowings. Adjusted EBITDA, as computed by us, may not be comparable to similar metrics used by other companies in our industry. |
||
| (6) | Represents interests of non-controlling interests in the Adjusted EBITDA of Six Flags Over Georgia, Six Flags Over Texas and Six Flags White Water Atlanta. |
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20240229214938/en/
Evan Bertrand
Vice President, Investor Relations and Treasurer
+1-972-595-5180
investorrelations@sftp.com
Source: Six Flags Entertainment Corporation
FAQ
What were Six Flags Entertainment Corporation's (SIX) fourth-quarter revenue, net loss, and adjusted EBITDA?
What were Six Flags Entertainment Corporation's (SIX) full-year revenue, net income, and adjusted EBITDA?
What factors contributed to the decrease in guest spending per capita for Six Flags Entertainment Corporation (SIX)?
What challenges did Six Flags Entertainment Corporation (SIX) face in the fourth quarter?
What major event impacted Six Flags Entertainment Corporation (SIX) in 2023?
