Six Flags reports August attendance growth, revenue decrease

GoBucks89:

Anyone visiting more than 5 times would result in no additional revenue after the 5th visit

I wasn’t clear. They would need to adjust the average gate per visitor, not the revenue realized. If I paid $100 for my pass, at 1 visit they’re recording $20 admission for the visit. If I attend 9 more times, that number drops to $10 per visit. But if I never visit again, because I’m a sucker, it goes to $100 per visit after the adjustment.

They don't need to look at it on an individual basis. Total revenue from admissions divided by number of visitors is admissions per cap. Total in-park revenues divided by number of visitors is in-park per cap.

I am not suggesting they have to look at it on an individual basis.

Assume Happyland has two customers, who both have an annual pass that they paid $100 for. One of them, Brutus, visits on the first of the month in May, June, July and August. The other, Scarlet, visits on the first day of May and finds that she has to wait in line behind Brutus, who bought his pass during the sale when it included the Waiting is for Little People upgrade for free. Annoyed, Scarlet never visits again.

On May 31, Happyland reports their per cap admission as $25, expecting 4 visits per passholder. On June 30, same. On July 31, same. They are still expecting Scarlet to make 3 more visits at that point.

The park closes for the year on August 30, because they can’t find help once The Happy State University reopens. On August 31, they again report their per caps. At that point, they recognize all the revenue from both passholders.

From a revenue perspective, August looks great! They record $100 in revenue for Brutus’s one actual visit, and the remainder of Scarlet’s pass value, since the season is over and the value of the pass has been exhausted.

From a per-cap perspective, which they have been reporting all along at $25, they now have a total of $200 in admission revenue over 5 visits, so their actual per cap is $40. So they have to adjust what they would have reported the day before.

super7*:
I emailed their client relations and they replied back that the season passes are recognized over the first five uses, one fifth at a time. It had to do with the average use of a season pass. I would assume if it was used less than five times it would be fully recognized at year end.

I wonder if this is different for season passes and "memberships" whereby with memberships you pay a little each month?

They aren't "adjusting" per caps from one reporting period to the next. They are calculating anew each time. Second quarter admission per cap is admission revenue for first 2 quarters divided by attendance for first two quarters. When reporting admission per cap for the third quarter, they do not start with second quarter per cap and make adjustments to it. They look at 3 quarters of admission revenue divided by 3 quarters of attendance.

In terms of memberships, footnote from Six Flags financial statements indicates that revenue from memberships is recognized on the same basis as non-membership, multi-use products (so based on an expected number of visits) for the first 12 months and thereafter its recognized on a straight-line basis (so amount of monthly payment in month 13 and beyond).

Your determination to correct me seems almost pathological at this point. Have fun.

PhantomTails:

The weather was godawful during the summer for most of the country. May and June were extremely wet and July and August were extremely hot.

Found the next board chairman!

Could you maybe integrate synergies into that statement as well?

In all fairness, it was unbearably hot for those few months. I postponed a few theme park trips during that time. I went to Hocking Hill State Park for the first time ever and it was too hot to go outside and enjoy the scenery. I recall people on social media saying that the parks were dead those days as well.

I was shocked that this time, it honestly seemed like it really was the weather.

The problem with blaming the weather for poor financial performance is that they don’t do anything to improve this. The high majority of the parks lack infrastructure and attractions to entertain guests comfortably in rainy conditions or extreme heat Plus, I think in recent years, they have trained their customers not to come on a questionable weather day because of the way they operate on those days In the past operations was better on those days

It’s just not a good business plan to depend on perfect weather to make money. if it’s not raining it’s too hot these days. And there are more comfortable entertainment options.

Add to that all the water rides closing over the last few decades.

super7*:

The high majority of the parks lack infrastructure and attractions to entertain guests comfortably in rainy conditions or extreme heat

Even if a seasonal amusement park built a larger than normal number of indoor attractions that is still not enough for the average customer to avoid going to a primarily outdoor attraction on a subpar weather day.

Can anyone name a park outside of Disney with a significant number of indoor attractions to get people out of the elements?

...and even then, you have to get between them. Epcot's attractions are nearly all indoors, but I've still melted into the pavement getting between them.

Universal and Nickelodeon Universe have plenty of indoor attractions as well.

The show parks (BGW, Dollywood, SDC) also obviously have more ways to avoid the weather.