Six Flags' revenue beats as theme-park operator says consumers flocked to its parks in October

Dow Jones11-06

MW Six Flags' revenue beats as theme-park operator says consumers flocked to its parks in October

By Ciara Linnane

Stock pops 2.9% in premarket trade

Six Flags Entertainment Corp.'s stock rose 2.9% early Wednesday, after the theme-park operator's third-quarter revenue beat consensus estimates and said strong consumer demand continued through October.

Charlotte, N.C.-based Six Flags $(FUN)$, which closed its merger with Cedar Fair on July 1, had net income of $111 million, or $1.10 a share, for the quarter, down from the $215 million, or $4.21 a share, earned by the combined company in the year-earlier period.

Revenue rose to$1.35 billion from $842 million a year ago.

The FactSet consensus was for EPS of $2.96 and revenue of $1.34 billion.

"While extreme weather and other operating disruptions at critical points during the third quarter impacted our financial results, consumer demand for our parks remained strong during normalized operating conditions," Chief Executive Richard A. Zimmerman said in prepared remarks.

"The strength of our business and considerable demand for our parks was particularly evident over the past five weeks, when attendance was up more than one million visits compared to combined legacy Cedar Fair and legacy Six Flags attendance over the same period last year."

Attendance totaled 21.0 million guests in the quarter, 9.2 million of whom attended legacy Six Flags parks added in the merger. The FactSet consensus was for 20.8 million guests. In-park per capita spending was $61.27.

Since completing the merger, the company has been reviewing its costs and is expecting to deliver run-rate cost synergies of $50 million by year-end and to follow with another $70 million by the end of 2025, said Zimmerman.

The company is now targeting at least $800 million of annual unlevered pre-tax free cash flow by 2027, he said.

There were 2,585 operating days in the quarter, compared with 1,091 in the same period in 2023. Of the 1,494 operating-day increase, 1,591 resulted from legacy Six Flags parks, which was partially offset by 71 fewer operating data at legacy Cedar Fair parks. That was due to a fiscal calendar shift, planned reductions in operating calendars and bad weather including Hurricanes Beryl, Debby and Helene.

Six Flags is now expecting to benefit from a 20% increase in attendance for the five-week period ended Nov. 3 to 6.5 million visits. That in turn propelled sales of 2025 season passes of 8% to 60,000 units.

The stock has gained 6.9% in the year to date, while the S&P 500 SPX has gained 21%.

-Ciara Linnane

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November 06, 2024 07:01 ET (12:01 GMT)

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Six Flags' revenue beats as theme-park operator says consumers flocked to its parks in October

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