Six Flags sets growth targets for 2028 at investor conference

Labor Efficiencies - Fire staff, make everyone do more work

Procurement - Order cheaper product. Your prize stuffed animal will be smaller, and likely missing an eye. You souvenir t-shirt might have a third arm hole, or might have the arms located at different heights. For food service this means Malk, assorted horse parts, and WWII Beans. (For the Simpsons fans)

Operational Calendar Changes - Cut hours.

It seems like anyone who has followed this industry for any amount of time, and especially the legacy Six Flags that went bankrupt, would look at all of this strategic synergy and know that none of it is good.

TheMillenniumRider:

Your prize stuffed animal will be smaller, and likely missing an eye. You souvenir t-shirt might have a third arm hole, or might have the arms located at different heights.

Are you saying that the tariff free items made in 'Merica that I am certain will be procured for the prizes are going to have quality issues?

Instead of “Great Reset” I think for many investors and surely park enthusiasts it’s going to quickly become known as the “Great Regret,” especially for legacy Cedar Fair investors who didn’t get out. As of 4pm today, the day after this “great investor announcement” the market isn’t buying what SIX is selling and the price is down 2.14 points (though the entire market is down, but still.)

Side note, this is interesting: “This “volume-first” approach will also support pricing power as parks become “comfortably crowded.”

Gunkey Monkey:

the market isn’t buying what SIX is selling and the price is down 2.14 points

I don't really know how to read that "streamlining, debt reduction, and reinvestment are prioritized" in the next 18 months, other than "profits are going to take a beating."

In general, the article is full of statements that ought to have been explored a little:

Christian Deekman, chief commercial officer, [the what now?] ... identified attendance and in-park spending as the two core growth drivers.

I mean, duh. I suppose this means "not hotels," but it kinda covers everything else.

...underperforming parks like Six Flags Magic Mountain and Six Flags Over Georgia compared to stronger performers like Knott’s Berry Farm and Carowinds

In other words, legacy SF was sucking wind?

While all parks will operate in the 2025 season, the company is evaluating potential asset sales, particularly of parks with limited growth upside. However, executives stressed that deleveraging does not depend on asset sales. Instead, the top 15 locations will be the core growth focus.

"We might sell some of our smaller parks, or we might just let them wither on the vine."

Six Flags expects to recapture 10 million lost visits by 2028, returning to pre-pandemic attendance levels. More than 80% of this growth will come from expanding the season pass base and increasing the frequency of visits. While per-capita revenue from season passholders is lower per visit...

This strikes me as sleight of hand. They'll get back to 2019 attendance, but more of it from season passholders. Which, because their per-visit revenues are lower, means revenues still won't (adjusted for inflation, etc.) match 2019 levels. Bigger crowds, less money!

This “volume-first” approach will also support pricing power as parks become “comfortably crowded.”

I have no idea what this means, or maybe I just think it's deluded. "We'll pack the parks first, and then raise prices to thin them back out again?" We've talked here before that the Legacy SF problem was they needed to improve service to bring people back, before they could raise prices accordingly - which means earnings would take a beating. I guess that's what the Great Reset is all about? Somehow I don't see it working any better this time around. Especially if:

Six Flags Entertainment plans to reduce operational costs by $60 million in both 2025 and 2026

Yes, yes, it's going to be by optimizing calendars and reducing redundancies, etc., not diminishing the customer experience. I'll believe that when I see it.

Prediction: by 2030 (if we're still a country by then, and if we're not just AI bots chatting with other AI bots), the mega parks are a separate chain, and the smaller ones are either spun off, sold, or closed.

Make Six Flags Great Again??

Matt Ouimet has his say on LinkedIn

"I struggled with whether or not to post this, but it is a real-world reminder that creating fun isn’t always fun. Those that are close to me know that I chose to retire from Cedar Fair before having to vote on the consolidation of SIX and FUN. I recognized that what was going to be required after the merger would be very different from the strategies that had worked for me previously and my sticking around would just make it harder on all involved. That was an intellectual take on my reason for leaving. What I am now admitting more publicly is that there was another concern that factored into my decision. I recognized that I wasn’t up to watching talented colleagues being asked to exit in order to achieve the cost synergies that were promised to investors. In recent days that parade of departures has stepped off. Several of the industry’s best are marching into the unknown on a timeline not of their choosing. Some could accuse me of getting old (true) and lacking the courage to do what was best for the investors, but I’ve made unpopular decisions before. This is different. It isn’t because the business or the individuals were performing poorly. This is purely math. It’s also not a surprise. This die was cast when the merger agreement was signed. I’ve said many times before that I don’t miss the business, but I do miss my former colleagues. True that!!!"

Matt Ouimet:

I recognized that I wasn’t up to watching talented colleagues being asked to exit in order to achieve the cost synergies that were promised to investors

Maybe we shouldn’t be promising cost synergies to investors, and instead promising an excellent experience to guests.

Matt Ouimet:
lacking the courage to do what was best for the investors

Again, shouldn’t we be focused on growing the business and providing a better product, not stripping down the business so that shareholders can make an extra buck?

Welcome to the end of limitless growth, either accept a well functioning business making money, and be happy with that, instead of stripping down the business to extract more profit which leads to its failure.

Well, obviously he gets that, and bailed. I don't have an issue with pursuing growth, but for reasons I don't understand, this particular business seems to not understand that the product has to be good enough to pay a premium for in order to get that "value" out of it. I know Disney and Universal "fans" like to be all like "OMG teh budget cuts!!1!" but generally speaking they have always spent the money to make the product valuable to customers. (Admittedly, not so much in the Vivendi days for Universal.) The attractions are nothing without the people that run them and provide a great experience. You need both parts to make the product.

hambone:

I have no idea what this means, or maybe I just think it's deluded. "We'll pack the parks first, and then raise prices to thin them back out again?"

Their plan is to raise attendance at the underperforming parks, the volume as it were. Then when enough guests are in the park, they can raise prices on fast lane and earn more on in-park spend. The dynamic is that when it’s less busy, people buy less too.

I am skeptical that they will pick up 10 million visits (in the next 3 years) to return to pre-pandemic attendance because of the decades of reputational harm those underperforming Six Flags parks have endured. They essentially acknowledged this very difficult problem with Six Flags America- the park was beyond saving, in one of the largest metros.

“But don’t worry, we won’t have that reputation problem in LA, Atlanta, Chicago, New Jersey or Dallas!”

Hambone, your conjecture about the core versus non-core properties is a very real possibility if these guys don’t hit their targets. Regional parks have always been a volume business and if they can’t bring the volume back, the model just doesn’t work for a publicly traded company with hundreds of millions in land assets.

Cedar Points most attended season was still 1994 correct?

The attendance is what it is, do the most with what you’ve got and stop chasing attendance.

Additionally, stop chasing attendance away with your poor decisions and cost cutting.

I find so much armchair CEO’ing and enthusiast nitpicking regarding new SF.

Compared to old SF, things are light years better. Compared to United they are doing better, better numbers, better food, better pricing for what you get, and operations.

Disney and universal apples and oranges as always.

Compared to Kinzel era CF, also better in my opinion. Better food, better upkeep, better place making, better adjusting to trends than sticking head in the sand.

They have not completely lost everything Matt brought to the table. Also depending on GM some parks did better under Matt, and others still suffered their Kinzel fate.

See I am straight down the middle on new SF, having been to CP/ Dorney/ and GrAdv in the fall and both SFNE and SF GrAdV so far this year the amount of tangible change for good at legacy SF parks is amazing in just a year. The food overhaul done just so far, and the paint and polish, is truly something I thought would get cut. And people I talked to all noticed the positives and mood changes. Some parks who have not had Live E in ages have some new things. Has CP lost a stage and show yes. But they still have two new shows, and two new rides. And continual park upgrades, that Kinzel would of never done.

Do I think they are overconfident, and over optimistic yes. And GrAdv alone used to have 2 million more guest a year not long ago. And I think they can turn it around somewhat quickly, and people can definitely more afford a SF park than Disney or Uni. And SFA was always going to be a mess, worth more for the land, esp when own all the better parks around it now. Frontier City, was so underdeveloped by SF there is no saving it. With Hereschend just floating a 1 Bil loan for the PR parks, SF doesn’t have alot of options for buyers anymore too. So I don’t think where going to see anymore drastic closures or ride demolitions. And the capital they can no leverage for improvements can be implemented far better together then seperate.

Richard Zimmerman & Selim Bassoul:

Instead, the top 15 locations will be the core growth focus.

I'm genuinely curious which parks they consider their top 15 and the split between Legacy Six Flags/Legacy Cedar Fair those 15 would have.

I was thinking about this - my guess:

Cedar Point
Knotts
Canada's Wonderland
Carowinds
Kings Island
Kings Dominion (?)
SF Texas
SF Georgia
SF St Louis (?)
SF Great America
SF New England (?)
Great Adventure
Magic Mountain

and maybe two of:
Discovery Kingdom (??)
Dorney Park (???)
Worlds of Fun (???)
Valleyfair (????)

Also, I'm wondering where that leaves the standalone waterparks.

They reference the "top 15 locations" in the Attractions Magazine article. But in the slide deck, they also focus on Low Penetration Parks. Note that getting attendance at those parks to 50% of the attendance at High Penetration Parks would be in increase in about 10 million in terms of attendance. They need 6% compound annual growth in attendance and revenues to each their 2028 goals. Doesn't seem like a layup.

Slide deck from investor presentation:

https://s205.q4cdn.com/6539...tation.pdf

Sharpel007:

Disney and universal apples and oranges as always.

As never, really. Anything that competes for their dollars is another apple. Movie theaters, mini golf, spas, cruises, big theme parks... it's all hospitality. They all require the capital construct plus people to work. And sure, it might be better than legacy Six Flags, but come on, if that bar weren't so low there wouldn't have been a merger. They've been going in the wrong direction ever since the end of the "FUN Forward" initiative, and not where legacy Cedar Fair was.

Here are examples as to how the parks/companies respond to worries about competition for all discretionary forms of entertainment income:

Rides like Buzz Lightyear Space Ranger Spin and Web Slingers. Neither is a good "ride". Both are basically a video game. Those rides were direct responses to the increasing popularity of video games.

Disney Vacation Club.

Disney Cruises.

Universal City Walk and Disney Springs.

Cedar Point Sports Center and Disney's Wide World of Sports.

It’s hard to lump Disney or universal into that discussion though. They are media companies first, whereas cedar flags is a park company first.

https://www.ocregister.com/...residents/

This article says park presidents are being eliminated at all Six Flags parks.