- Comments On Revenue And Attendance Trends Through July SANDUSKY,
Ohio, Aug. 4 /PRNewswire-FirstCall/ -- Cedar Fair Entertainment
Company (NYSE:FUN), a leader in regional amusement parks, water
parks and active entertainment, today announced results through the
second quarter ended June 28, 2009 and provided attendance and
revenue trends through July. Cedar Fair generated net revenues of
$264.1 million in the second quarter and net income of $7.4
million, or $0.13 per diluted limited partner unit. For the same
period last year the Company reported net income of $14.7 million,
or $0.26 per diluted limited partner unit, on net revenues of
$296.2 million. Net revenues for the fiscal six months ended June
28, 2009, which included 39 fewer operating days compared with
2008, were $290.6 million and the net loss for the period was $45.9
million, or $0.83 per diluted limited partner unit. This compares
with net revenues of $336.6 million and a net loss of $29.1
million, or $0.53 per diluted limited partner unit, for the
six-months ended June 29, 2008. Adjusted EBITDA, which management
believes is a meaningful measure of the Company's park-level
operating results, decreased to $32.1 million for the six months
ended June 28, 2009 from $52.0 million during the same period last
year. See the attached table for a reconciliation of adjusted
EBITDA to net income (loss). As mentioned above, it is important to
note the Company's 2009 operating calendar had 39 fewer operating
days during the first six months of the year when compared with the
same period a year ago. This will reverse itself during the last
half of the operating season as the Company adds 70 operating days,
for a total of 31 additional operating days in 2009 when compared
with 2008. "Our performance through the first half of the year has
been a challenge for us," said Dick Kinzel, Cedar Fair's chairman,
president and chief executive officer. "Through the end of the
second quarter our parks entertained 6.6 million visitors, average
in-park guest per capita spending was $39.50 and out-of-park
revenues totaled $36.6 million. This compares with attendance of
7.6 million, average in-park guest per capita spending of $40.45
and out-of-park revenues of $40.5 million through the second
quarter of 2008. "The decrease in attendance was the result of a
decline in group sales business at most of our parks due to the
continued economic uncertainty and spending cuts at corporations
and other organizations," added Kinzel. "First-half results were
also impacted by a decline in the number of season passes sold for
the year, combined with a reduction in season pass visits due to
fewer operating days in the first half. Finally, while weather will
typically average itself out over an operating season, we believe
early-season results were negatively impacted by poor weather, in
particular cooler than normal temperatures at most of our parks."
Excluding depreciation, amortization and other non-cash expenses,
cash operating costs and expenses were $258.5 million for the
six-month period ended June 28, 2009 versus $284.6 million for the
same period in 2008. The lower operating costs were primarily due
to the closure of Star Trek: The Experience in late 2008, as well
as the Company's continued focus on controlling cash operating
costs across the parks in the face of decreased revenues. After
depreciation, amortization and all other non-cash costs, the
operating loss for the period was $15.6 million in 2009 compared
with an operating loss of $1.9 million for the same period in 2008.
Interest expense decreased to $59.8 million from $67.1 million a
year ago. The decrease in interest expense is attributable to lower
interest rates on the Company's variable-rate debt, along with
lower average term-debt borrowings during the period. A credit for
taxes of $29.3 million was recorded during the first half of 2009
to account for the tax attributes of the Company's corporate
subsidiaries and publicly traded partnership (PTP) taxes. This
compares with a $39.5 million credit for taxes for the same period
in 2008. July Operations Based on preliminary July results,
revenues for the first seven months of the year, on a same-park
basis (excluding the impact of Star Trek: The Experience which
closed in September 2008), were $561.6 million compared with $626.5
million for the same period a year ago, on 4%, or 39 fewer
operating days. This is a result of a decrease in attendance to
12.6 million visitors compared with 14.0 million in 2008, a
decrease of 1% in average in-park guest per capita spending to
$39.80, and a decrease in out-of-park revenues of $7.7 million to
$59.6 million, primarily due to declines in hotel occupancy. Over
the past five weeks, revenues were down 9%, or approximately $25.9
million, on a same-park basis. This decrease was largely due to an
8%, or 495,000-visit, decrease in attendance, and a $5.0 million
decrease in out-of-park revenues. Over the same five-week period,
average in-park guest per capita spending was essentially flat.
Although modestly better than trends through the first six months
of the year, the revenue shortfall was primarily due to difficult
economic conditions and inconsistent weather patterns, in
particular cooler than normal temperatures at most of our parks.
Cash and Liquidity "With respect to liquidity and cash flow, we
ended the second quarter of 2009 in sound condition," added Kinzel.
As of June 28, 2009, the Company had $1,671 million of
variable-rate debt and $135.8 million in borrowings under its
revolving credit facilities. Of the total term debt, $17.2 million
is scheduled to mature within the next twelve months. Kinzel also
noted that credit facilities and cash flow from operations are
expected to be sufficient to meet working capital needs, debt
service, and planned capital expenditures. "Given the current
uncertainty of the credit markets and our need to refinance our
debt over the next few years, we continue to look at a wide range
of alternatives to address our capital structure and reduce debt
levels," continued Kinzel. "I'm pleased to say we have finalized an
agreement with the Vaughan Health Campus of Care in Ontario, Canada
for the sale of 87 acres of surplus land near our Canada's
Wonderland park. Net proceeds from the sale of the land will total
approximately $50 million and will be used entirely to pay down
term debt. We expect the transaction to close during the third
quarter of 2009. The reduction of our distribution that we
announced in March of this year, along with this transaction, will
have a positive impact on our leverage ratio, which in turn should
benefit upcoming debt refinancing efforts. "We knew 2009 would be a
challenging year for our operations when compared with our
record-breaking results in 2008," continued Kinzel. "With
approximately 40% of our season still ahead of us, we remain
focused on adding value to the guest visit through special events
and promotions, while also controlling costs. It has been my
experience over the years to be careful not to over-react in the
short term in ways that could negatively affect the guest
experience and the perception of value. While we never like to see
a decrease in revenues and cashflow, as long as we remain committed
to providing our guests with world-class thrills, fun and family
entertainment, in a clean and safe environment, we believe Cedar
Fair and our amusement parks will be very successful over the long
term." The Company will host a conference call with analysts today,
August 4, 2009, at 10:00 a.m. Eastern Time, which will be web cast
live in "listen only" mode via the Cedar Fair web site
(http://www.cedarfair.com/). It will also be available for replay
starting at approximately 1:00 p.m. ET, Tuesday, August 4, 2009,
until 11:59 p.m. ET, Tuesday, August 18, 2009. In order to access
the replay of the earnings call, please dial 1-800-406-7325
followed by the access code 4116678. Cedar Fair is a publicly
traded partnership headquartered in Sandusky, Ohio, and one of the
largest regional amusement-resort operators in the world. The
Company owns and operates 11 amusement parks, six outdoor water
parks, one indoor water park and five hotels. Amusement parks in
the Company's northern region include two in Ohio: Cedar Point,
consistently voted "Best Amusement Park in the World" in Amusement
Today polls and Kings Island; as well as Canada's Wonderland, near
Toronto; Dorney Park, PA; Valleyfair, MN; and Michigan's Adventure,
MI. In the southern region are Kings Dominion, VA; Carowinds, NC;
and Worlds of Fun, MO. Western parks in California include: Knott's
Berry Farm; California's Great America; and Gilroy Gardens, which
is managed under contract. Some of the statements contained in this
news release constitute forward-looking statements. These
statements may involve risk and uncertainties that 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 have been
correct. Important factors, including general economic conditions,
competition for consumer leisure time and spending, adverse weather
conditions, unanticipated construction delays and other factors
could affect attendance at our parks and cause actual results to
differ materially from the Company's expectations. Contact: Stacy
Frole (419) 627-2227 Cedar Fair Entertainment Company SUMMARY
STATEMENTS OF OPERATIONS SECOND QUARTER (unaudited) (In thousands
except per Three Months Ended Six Months Ended Twelve Months Ended
unit) 6/28/09 6/29/08 6/28/09 6/29/08 6/28/09 6/29/08 Net revenues:
Admissions $150,540 $163,647 $160,863 $181,246 $545,883 $571,905
Food, merchandise and games 96,028 112,156 107,481 129,852 333,546
369,774 Accommodations and other 17,558 20,431 22,248 25,538 70,759
77,917 Total net revenues 264,126 296,234 290,592 336,636 950,188
1,019,596 Cash operating costs and expenses 180,176 194,098 258,509
284,591 614,260 666,663 Adjusted EBITDA (a) 83,950 102,136 32,083
52,045 335,928 352,933 Depreciation and amortization 42,977 44,089
47,191 50,272 122,757 130,924 Loss on impairment of goodwill and
other intangibles - - - - 86,988 - Loss on impairment / retirement
of fixed assets, net - 3,265 30 3,265 5,190 58,163 Equity-based
compensation 296 328 459 458 717 671 Operating income (loss) 40,677
54,454 (15,597) (1,950) 120,276 163,175 Interest expense 30,909
34,262 59,811 67,063 122,309 142,864 Other (income) expense (177)
167 (205) (448) (166) (1,482) Income (loss) before taxes 9,945
20,025 (75,203) (68,565) (1,867) 21,793 Provision (credit) for
taxes 2,557 5,337 (29,310) (39,471) 9,226 5,784 Net income (loss)
$7,388 $14,688 $(45,893) $(29,094) $(11,093) $16,009 Weighted
average units outstanding - diluted 55,195 55,603 55,161 55,407
55,111 56,125 Per limited partner unit: Net income (loss) - diluted
$0.13 $0.26 $(0.83) $(0.53) $(0.20) $0.29 Cash distributions paid
$0.250 $0.480 $0.730 $0.955 $1.690 $1.905 Balance Sheet Data: Total
assets $2,295,215 $2,529,641 Total debt 1,806,846 1,837,914 Total
partners' equity 45,461 212,974 (a) Adjusted EBITDA represents
earnings before interest, taxes, depreciation, amortization and
other non-cash costs. The Partnership believes adjusted EBITDA is a
meaningful measure of park-level operating profitability. Adjusted
EBITDA is not a measurement of operating performance computed in
accordance with generally accepted accounting principles and is not
intended to be a substitute for operating income, net income or
cash flow 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.
Cedar Fair Entertainment Company RECONCILIATION TO ADJUSTED EBITDA
SECOND QUARTER (unaudited) Three Months Ended Six Months Ended
Twelve Months Ended (In thousands) 6/28/09 6/29/08 6/28/09 6/29/08
6/28/09 6/29/08 Net income (loss) $7,388 $14,688 $(45,893)
$(29,094) $(11,093) $16,009 Interest expense 30,909 34,262 59,811
67,063 122,309 142,864 Provision (credit) for taxes 2,557 5,337
(29,310) (39,471) 9,226 5,784 Depreciation and amortization 42,977
44,089 47,191 50,272 122,757 130,924 Loss on impairment of goodwill
and other intangibles - - - - 86,988 - Loss on impairment /
retirement of fixed assets, net - 3,265 30 3,265 5,190 58,163
Equity-based compensation 296 328 459 458 717 671 Other (income)
expense (177) 167 (205) (448) (166) (1,482) Adjusted EBITDA (a)
$83,950 $102,136 $32,083 $52,045 $335,928 $352,933 (a) Adjusted
EBITDA represents earnings before interest, taxes, depreciation,
amortization and other non-cash costs. The Partnership believes
adjusted EBITDA is a meaningful measure of park-level operating
profitability. Adjusted EBITDA is not a measurement of operating
performance computed in accordance with generally accepted
accounting principles and is not intended to be a substitute for
operating income, net income or cash flow 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. This press release
and prior releases are available on the Cedar Fair website at
http://www.cedarfair.com/. DATASOURCE: Cedar Fair Entertainment
Company CONTACT: Stacy Frole of Cedar Fair Entertainment Company,
+1-419-627-2227 Web Site: http://www.cedarfair.com/
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