SeaWorld Entertainment said weather again affected park attendance in the third quarter, but the company proposes to mitigate its effects going forward.
On Wednesday, SeaWorld reported third-quarter attendance of 7.1 million, down about 2.8% from the same quarter last year. Revenue was down 3%, to $548.2 million, and net income was down 8.2%, to $123.6 million.
CEO Marc Swanson attributed the downturn in part to “unusual and significantly adverse weather in our peak operating season across most of our markets.” If it weren’t for weather, attendance would have been “much better” than it was, Swanson said.
In the second quarter, heat, rain and smoke from Canadian wildfires impacted most markets where SeaWorld operates. In the third quarter, executives attributed weather impacts to heat and rain.
A financial analyst asked Swanson about SeaWorld’s plans to lessen the impact of weather going forward, especially in the light of the Six Flags-Cedar Fair merger. One of the expected benefits of the merger, the companies said, was “to mitigate the impact of seasonality” and have “a more balanced presence in year-round operating climates.”
According to Swanson, SeaWorld is looking at more shade structures around its parks to combat the heat. The company is also considering more indoor experiences.
For example, Jewels of the Sea: The Jellyfish Experience — an indoor, interactive aquarium — will open in SeaWorld San Diego next year.
Swanson also pointed to drink refill programs in parks, enabling customers to buy a refillable cup and enjoy low-cost refills during their visit.
“It’s something that we’ll continue to work on,” Swanson said.
CFO Jim Forrester addressed the other end of the spectrum: when days turn cooler. SeaWorld said the slides and pools at its its water parks are heated to keep guests comfortable.
And, he said, in storm-prone locations, the company considers park hours so guests can get a full day in the park before and after thunderstorms.
Swanson also addressed investment in theme parks. An analyst asked his opinion on investment in light of Universal Orlando Resort’s third theme park, Epic Universe, opening in 2025, and Disney’s recent announcement that it will spend $60 billion on parks over the next ten years.
“We welcome the investment,” said Swanson, saying that SeaWorld’s product is differentiated in the Orlando market.
The company is also committed to opening something new in each of its parks each year to drive attendance, he said.
Source: Read Full Article