It is unfortunately true to say that the SeaWorld family of parks have had a rocky time financially over the last few years. SeaWorld has been trying to fight its way back slowly but surely by offering aggressive special deals and through investing heavily in new attractions. It was positive news when the 2018 annual attendance report showed a 16% increase although this growth then slowed down considerably in 2019 with only a 1% rise.
Due to the COVID-19 pandemic SeaWorld Entertainments closed their parks on March 16. The parks group, which owns and operates not only the SeaWorld parks, but also Busch Gardens, Aquatica parks and Discovery Cove, were reported to be in serious trouble following the parks closure.
Luckily, in early May it was reported that SeaWorld were taking new measures to stay afloat during closure and had secured enough loans to survive the year. In line with government guidelines and with new health and safety measures in place, a phased reopening of its parks with reduced capacity began with Aquatica in Texas as of June 6. SeaWorld Orlando, Busch Gardens Tampa, Aquatica and Discovery Cove closely followed on June 11 and although SeaWorld Orlando was reported to have had a rough reopening day, it continues operating daily apart from Tuesdays and Thursdays.
Back in March, SeaWorld reported positive attendance and revenue gains in most recent financial results. According to SeaWorld's latest financial release, attendance at their theme parks during the last quarter of 2019 increased 2.2%, to 4.7 million guests from the fourth quarter of 2018. Serge Rivera, Chief Executive Officer of SeaWorld Entertainment, Inc made the following statement:
"We are pleased to report a strong finish to the year with record-setting performance in the fourth quarter and fiscal year. Despite continued unfavorable weather during the quarter, we continued to grow attendance and total revenue per capita and executed on our cost and efficiency initiatives. Our strategic focus on new rides, attractions and events in every park every year, improved marketing, communications and pricing strategies and a relentless focus on cost efficiency initiatives has resulted in significant increases in attendance, revenue, and Adjusted EBITDA over the last two years."
Last week, SeaWorld announced Preliminary Second Quarter Results for 2020. So, it isn't going to be a surprise for anyone to hear that in the second quarter of 2020 during a time when theme parks were closed due to the COVID-19 that the current report is going to look somewhat different than it would have looked if we were in a normal climate.
Key Introduction Points of Report
Here are the key points that are outlined in the introduction to the report:
- Attendance since the parks reopened in June has been impacted by capacity limitations, fewer operating days per week, limited marketing spend and a reduced events line-up.
- Total attendance trends for the parks that have reopened has increased 14% from the week ended June 28 (the first full week these parks were open) to the most recent week ended July 26.
- The Discovery Cove Park is showing strong trends for for 2021 bookings and states that 2021 forward bookings for Discovery Cove as of July 19, 2020 are 169% higher than 2020 bookings as of the same time one year ago.
- The report says that the Company believes attendance will strengthen as special events and interactive experiences are reintroduced as well as when the marketing spend increases.
The report reminds readers that these results are indeed preliminary as "given the timing of these estimates, the Company has not completed its customary financial closing and review procedures, and as a result its estimates are subject to change."
So in the second quarter of 2020 (April-June):
- Attendance was 0.3 millon guests. Decline of 6.2 million guests compared to second quarter of 2019.
- Total revenue is expected to be $18 million compared to $406 million in second quarter of 2019.
- Admission per capita is expected to increase by approximately 2% to $35.94 compared to $35.25 in the second quarter of 2019 which is mostly due to higher prices for admission.
- In-park capita is expected to increase by around 10% due to increased sales of products and higher prices and fees.
- Annual Passes for those reopened parks has increased 13% since the end of May and has increased 8% across all parks over the same time period.
- Net loss is expected to be approximately $105 million with adjusted EBITDA loss expected to be approximately $54 million.
- Average monthly burn of $12 million.
There are no surprises in this report regarding the decline in attendance and revenue during the second quarter of 2020. It is certainly encouraging to see a 13% increase in the Annual Pass Holder base and the increase in Discovery Cove bookings for 2021. Hopefully this enthisiasm for visiting SeaWorld parks in 2021 will continue to increase especially when heading into next year.
To read the full report click here.To find out about the latest news regarding new rides be sure to read on...