Six Flags 2007 Q1 Conference Call Notes

To summarize some important notes by CEO Mark Shapiro:

* "Retaining better guest-facing employees. There's more and more competition out there these days. You can get a job at Starbucks which pays a lot of money and gives you a lot of benefits...we need to be competing on that level."

* We've established a guest service mantra -- so every employee knows their mission, it's four-pronged":

1) Cleanliness
2) Friendliness
3) Speed of Service
4) Safety

* "When it comes to the look and feel of our parks as it relates to the guest experience, we need to get back to theming. Investing in theming. These parks are about imagination and different worlds and fantasies and they're about story-telling. And that's on our agenda this year -- pretty much right at the top. And as I said, we need to make the rides and retail initiatives much more experiential."

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Other important notes:

* 7 parks receiving insfrastructure upgrades this year. Next two years, infrastructure upgrades to rest of the parks.

* Six Flags Television and Six Flags Radio. Outfitting parks with radio and television capabilities. To market messages, play content, and sell advertising. Can be regionalized to certain park areas.

* Company being much more selective in job hiring due to increased wages. Decreased reliance on international employees.

* Arcade machines transformed to debit system.

* Pricing for VIP program to be raised in certain markets due to increased demand.

* Magic Mountain's Metro is expected to return to operation before the end of the 2007 season but will not be themed to Thomas the Tank Engine because "our partnership with Hit Entertainment, they really want to keep Thomas on the ground, he's not an elevated train. Of course we want to respect their brand attribute, so we're not going to play with that." (Quote Mark Shapiro)

* Wiggles World and Thomas Town won't be coming to Magic Mountain in 2008.

* $14 million reduced loss in fixed assetts reflected by the writing off/removal of "obsolete rides and attractions":

- Psyclone @ SFMM
- Trailblazer @ SFGAm
- Free Fall @ SFOG
- Stuntman's Freefall @ SFNJ
- Riptide @ SFNJ
- Chaos @ SFNJ
- The Tilt @ SFA
- Jambo @ SFDK
- Spider @ SFNE
- Tempest @ SFFT
- OVNI @ La Ronde

* The Johnny Rockets introduced at four parks this year are now the highest grossing food stores in the chain.

* Pizza sales have increased dramatically since the introduction of Papa John's last season.

* KRAFT Foods and Six Flags announce a corporate marketing alliance.

To listen to the recording click here.

*** Edited 5/10/2007 10:02:54 PM UTC by kRaXLeRidAh***

Sounds like he knows what he is doing. I know its early in the season but I am liking SF a lot more already.

It all still sounds good to me. :)

Imagine if Shapiro is successful in turning around Six Flags, which I actually think he might be able to do. Then we'd have to find ourselves a different whipping boy. Nahhhhh.... ;)

Triple Play @ SFGAm shouldn't be on that list of removed rides. It is put back together and operating this season.

Apparently an increase in minimum wage in Mass. counts as a "wage increase" for SFNE.

My 2 cents: Yeah, the wages are higher here at SFMM than the min.. Also, I noticed that they hired far more friendly people than I ever encountered before.

Not concerned about Metro returning in 2007. It's pointless to have it SBNO the entire summer - when it's needed, just to reopen it for the dead Nov & Dec months. Now, if they can get it open for Fright Fest and turn it into an scare ride, that's a different story. Otherwise, just wait until spring 08. They could certainly use nicer looking parking lot trams first.

Noticed Flashback not mentioned as being written off. Curious omission. I really do hope they remove it from the park asap, probably too late in the season to start the removal. *** Edited 5/12/2007 12:28:59 AM UTC by DBJ***

So what about guests happiness levels? Let's tycoon this thing :) And wow, safety is #4!

Geez, I can't wait for Holidayworld next friday!

Someone asked if it made sense to use the food franchises, and, well, there's your answer. I'd be willing to bet that a Chic-fil-A will make more than a non-branded stand selling the exact same thing.

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DBJ said:

Noticed Flashback not mentioned as being written off. Curious omission. I really do hope they remove it from the park asap, probably too late in the season to start the removal.

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My assumption is that Flashback was technically "written off" years ago when it stopped operating entirely. It is evident the park had no intention of reopening the thing, but also did not have an adaquete infrastructure budget each season to have it dismantled.

According to the park's PR, Flashback will be removed sometime during the park's winter operating schedule, as the park's resources are currently being put to use on the guest experience and prepping for the summer season.

A lot of good news here. I am surprised about the Trailblazer. Wasn't that a fairly new ride? (then again, my perception of fairly new is pretty long due to my age ;)) Oh well.

Nice to see they are raising the wages and upping the hiring standards. The less reliance on international workers is good too. I think a lot of companies are starting to see that the international workers in customer contact positions can do more harm than good in customer experience.

I'd go to SFMM just to ride Metro....although I'd probably take a lap or two on Tatsu while I was there... ;)

THe *only* issue I had was putting safety fourth. I thought "safety first" was like a mantra or something? ;)

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* Pricing for VIP program to be raised in certain markets due to increased demand.

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I guess that means there are plenty of families willing to drop $1000 for a day at SF. So much for them pricing things too high. ;)

It'll be interesting to see which markets have had the high demand.

^ I would think Gradv and SFNE are 2 of them.

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rollergator said:
THe *only* issue I had was putting safety fourth. I thought "safety first" was like a mantra or something? ;)

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Safety is first, last, and always at Six Flags! ;)

Mark Shapiro on Mad Money talks with Cramer

http://videoplayer.thestreet.com/?clipId=1373_10356532&channel=Cramer+Executive+Interviews&cm_ven=YAHOO&cm_cat=&cm_ite=&puc=yahoo&ts=1179147525694

Since when is a Gravity Works Skyscraper (Tempest at SFFT) an "obsolete attraction"?

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Jeff said:
Someone asked if it made sense to use the food franchises, and, well, there's your answer. I'd be willing to bet that a Chic-fil-A will make more than a non-branded stand selling the exact same thing.

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I'd want to know where the Maverick Chik-fil-A stacks up at the end of season comparatively in the company...it's location is to die for!!

But Chik-Fil-A will *not* be open on Sundays, per their company policy. Does make me wonder about the choice of Chik-Fil-A as a *partner* in the food service aspect...

Six Flags guest service mantra sounds a lot like Cedar Fair's cornerstones of Safety, Service, Cleanliness, Courtesy and Integrity.