Six Flags Second Quarter Results Are In

[GAcoaster]

All discussion of the call and announcements here.

 

This should be interesting after the stock took a 44% plunge today. At one point the stock dropped to 25 cents a share before closing at 48 cents a share...

[Thunderbolt]

All discussion of the call and announcements here.

 

This should be interesting after the stock took a 44% plunge today. At one point the stock dropped to 25 cents a share before closing at 48 cents a share...

 

Shapiro and the board should be fired and disbanded. Their performance has been nothing short of disgraceful. Even PKS managed to eek out a profitable quarter and make their dividend payments ON TIME. You can blame Burke for the debt, but adjusting revenues to remove the massive expansion showed PKS to be profitable until 9/11. Why would a financially strapped company purchase a Hollywood Studio (which NOBODY in Hollywood wanted) that's completely unrelated to your core business? DCP lacks any IP relevant with SIX's target audience. Buying a Hollywood Studio is an easy way to go broke. Ask Matsushita and Vivendi. Shapiro's 2006 price-gouge and budget cuts cluster[freak] has caused irreparable harm to this company and attendance has declined ever since.

 

2008 may be a make or break year for Red Zone and Six Flags. If gas prices continue to increase as expected, and the park continues to bleed customers despite price reductions, the company is in deep trouble. Six Flags has already sold off a multitude of parks, and recently divested itself of American Adventures in Marietta, GA. SIX's market cap and stock price continue to fall (though shares have hugging the $0.45 mark recently; risking a de-listing). 2008 Season Pass sales are down. Increases in first quarter attended is largely attributed to earlier openings (including the expanded "Holiday In The Park") and reduced ticket pricing. The company missed the May 15th dividend disbursement. What path is left for the company to take outside of bankruptcy? Six Flags doesn't have many more assets it can sell, especially at a price where it's worth it. Six Flags Over Texas and Over Georgia are limited partnerships, and operated under contract to Six Flags. Selling Great Adventure or Great America would effectively send the banks into disarray (and call in those loan markers), as those are the most profitable links in the chain. Nobody wanted Magic Mountain. What's left to sell? Six Flags America? You can bundle the rest of the parks together and probably not get $400M. With the current market-cap, it would be cheaper to acquire the company outright and assume the debt. If an attendance spike doesn't offset the reduced revenue, I don't know what the company can do to right this ship. Six Flags could look quite different after a Chapter 11 filing, and not in any way I'd like to see it.

Edited July 17, 2008 by Thunderbolt

[GAcoaster]

Chapter 11 could be the best thing for the company. Look at a company like K-Mart. They filed for chapter 11, re-organized, and became string enough that they purchased Sears.

 

With the stock price so low, the company is a prime takeover target, and a private equity firm or a foreign investor could buy the whole company for a song right now. Snyder could even buy out the company and take it private.

[GAcoaster]

Wow, the stock made quite a rebound today on this news.

 

From the Washington Business Journal:

 

Six Flags stock on roller coaster

Washington Business Journal - by Jeff Clabaugh Staff Reporter

 

Six Flags Inc. Thursday forecast its first-ever full year of positive cash flow, sending its battered stock up as much as 81 percent -- its biggest one-day gain since going public in 1996.

 

Thursday’s gain came one day after its shares plummeted 44 percent in its heaviest day of trading in two years.

 

Six Flags, controlled by Washington Redskins owner Daniel Snyder, has been cutting losses; last month, hoping to blunt potential effects of a slowing economy and inflation, it cut admission costs at its parks by as much as half.

 

“The quality of our product remains at an all-time high virtually across the board,” Six Flags chief executive Mark Shapiro said in a statement Thursday. “Our performance to date has positioned us to be free cash flow positive for the first time in the history of the company.”

 

Six Flags stock has lost more than 85 percent of its value in the last year and, even with Thursday’s rally, still trades at under $1 a share. The amusement park chain had a market value of over $1 billion two years ago. That has fallen to just $80 million this year.

 

Six Flags shares (NYSE: SIX) were up 35 cents to 83 cents per share in afternoon trading.

 

I should have bought as many shares as I could have yesterday afternoon when they dropped so low! Having seen the performance of the parks first hand and heard the glowing reviews from people on websites who have always been Six Flags haters, I'm not surprised if the turnaround is finally here.

[JetsDevs4Lyf]

I was thinking the same thing. It would seem from reading about and visiting the parks that things there are headed in the right direction, and I have wanted to buy some shares in the last few years but money has been kind of tight. I think now could be a decent buying time for SIX if one can stay with things for the long hall because I truly think things will turn around for the company's financial situation. I'm just hoping it comes along before a major takeover is proposed that Snyder cannot refuse!

[29yrswithaGApass]

:smile$:

[Thunderbolt]

Snyder is a "managing partner". He can't stop the sale of SIX no more than Burke could, if the other major investors want out.

 

"Cash Positive" != Profitability

 

[JetsDevs4Lyf]

Good point I though they were set up differently but you are right on there. I am just afraid as to what would happen if a foreign company swooped in and bought up Six Flags. I would not want to loe any part of whatwe have going on right now.

[Winfield]

Something odd is going on....Shapiro keeps barking nothing but positives in terms of cash flow yet the stock does not show anything really positive. Shapiro is either lying or something big in terms of the results is going to happen on the 4th that proves all of the investors wrong.

[GAcoaster]

We'll see soon enough. It seems like they're on the right track, and after looking at trip reports from all over the country from Six Flags parks and from Cedar Fair parks, it looks like SF is having greater success getting people through the gates than CF has had so far this summer. And with their track record of getting money from those guests once they are inside the parks, it seems like they hit on the right combo.

[Thunderbolt]

Cedar Fair has reported an uptick in attendance. We'll see their earnings report on August 5th.

 

As for Six Flags, I'm sure those $1 locker fees are coming in handy. I'd LOVE to hear an analyst question that revenue stream on the conference call. No doubt SIX will refuse to answer it. I don't think a statement of "Cashflow Positive" will matter much without a timeline for profitability.

[29yrswithaGApass]

Either there is a glitch in Yahoo Finance's stock reporting program or Mr.Shapiro is dancing in the streets this morning!

[Thunderbolt]

Either there is a glitch in Yahoo Finance's stock reporting program or Mr.Shapiro is dancing in the streets this morning!

 

If those numbers were true; he'd be canonized! Even I would salute him.

[Winfield]

If those numbers were true I could take a nice vacation since I would actually have an amazing return on investment.

[29yrswithaGApass]

From AP

 

Ahead of the Bell: Six Flags

Consumer spending will be key when Six Flags reports 2nd-qtr earnings

Monday August 4, 6:21 am ET

 

NEW YORK (AP) -- Regional theme park operator Six Flags Inc. is expected to report second-quarter earnings after the market closes on Monday and its performance may give investors a look at the strength of consumer spending.

 

The combination of soaring gas prices, economic uncertainty, tighter credit and rising unemployment have led many Americans to cut back on their summer travel plans. The potential effect on Six Flags, which is a short drive away for many of its visitors, is unclear.

 

The New York-based company has said it expected year-to-date attendance to flatten by the end of May. Six Flags also noted that it had seen a surge in one-day online ticket sales, possibly driven by promoted discounts.

 

In one sign of potential weakness, Six Flags said last week that its board did not declare a third-quarter dividend to the holders of its preferred income equity redeemable shares.

 

During the past year, Six Flags' stock has dropped from a high of $4.24 last August to touch a low of 25 cents in mid-July.

[29yrswithaGApass]

Source: Six Flags

 

Six Flags Announces Second Quarter Results

Monday August 4, 9:00 am ET

- Second Quarter Adjusted EBITDA Increases 52% to $87.6 million

- Six Month Revenues Up 5%; Operating Costs and Expenses down 5%

- Six Month Adjusted EBITDA Improves by $45.4 million

 

NEW YORK, Aug. 4 /PRNewswire-FirstCall/ -- Six Flags, Inc. (NYSE: SIX - News) announced today its operating results for the second quarter and six months ended June 30, 2008. (1)

 

Three Month Results

 

Total revenues of $345.7 million increased 1% over the prior-year quarter, while total attendance declined 3% to 8.6 million, reflecting the timing of Easter, which was in the first quarter of 2008 versus the second quarter of 2007. On a year-to-date basis, attendance through June 30, 2008 was unchanged at 10.1 million.

 

Revenue growth for the second quarter reflected growth in sponsorship, licensing and other fees, which increased $5.2 million over the prior-year period to $14.5 million. This growth, combined with the increased guest spending, resulted in a 3% increase in total revenue per capita to $40.02 in the current quarter from $38.72 in the second quarter of 2007.

 

Increases in per capita guest spending, which grew $0.67 to $38.34, a 2% increase over the per capita guest spending of $37.67 for the second quarter of 2007, reflected higher food and beverage, rentals, admissions, parking and retail revenues.

 

Commenting on the Company's performance, Mark Shapiro, President and Chief Executive Officer of Six Flags, Inc., said: "Our performance reflects the growing momentum behind this Company after two years of repositioning our brand and reinventing the guest experience. While we still have a considerable portion of our season in front of us, I'm encouraged by the results, especially in the current economic climate."

 

The Company's net results from continuing operations improved by $150.7 million to income of $108.7 million from a loss of $41.9 million in the prior-year quarter. The income growth reflects a net gain from debt extinguishment of $107.7 million associated with the June 16, 2008 exchange of new senior unsecured notes issued by a subsidiary of the Company (the "New Notes") for certain Six Flags, Inc. senior unsecured notes. The Company's net results also benefited from a $21.3 million reduction in operating costs and expenses, which decreased from $297.7 million in the prior-year second quarter to $276.4 million for the current-year quarter. Also included in the net income from continuing operations for the second quarter was a reduced minority interest in earnings primarily due to the Company's purchase of its partner's interest in Six Flags Discovery Kingdom in July of last year.

 

Adjusted EBITDA for the quarter improved by $30.1 million, or 52%, to $87.6 million compared to $57.5 million for the prior-year quarter. (2)

 

Six Month Results

 

For the six months ended June 30, 2008 (the "First Half 2008"), total revenues increased $19.6 million, or 5%, to $413.9 million from $394.3 million in the prior-year period.

 

First Half 2008 total revenue per capita increased $1.98, or 5%, to $41.04 from $39.06 in the prior-year period, reflecting increased per capita guest spending and sponsorship, licensing and other fees. Increased per capita guest spending of $1.13, or 3%, to $38.47 from $37.34 in the prior-year period was driven by increased admissions, food and beverages, rentals, retail and parking revenues. Sponsorship, licensing and other fees increased $8.6 million, or 50%, to $25.9 million, reflecting growth in international licensing fees and management fees.

 

Operating costs and expenses, including cost of sales, depreciation, amortization, stock-based compensation and loss on fixed assets, decreased $25.5 million to $440.9 million for the First Half 2008, compared to $466.4 million in the 2007 period. The key drivers of the change were reduced marketing expenses ($16.0 million), and lower labor and third party services costs ($8.1 million).

 

Net loss applicable to common stock for the First Half 2008 was $66.3 million, or $0.69 per share, compared to a net loss applicable to common stock of $226.9 million, or $2.40 per share in the prior-year period. The decreased net loss in the First Half 2008 of $160.6 million reflects the net gain on debt extinguishment of $107.7 million, increased revenues of $19.6 million, reduced operating costs and expenses of $25.5 million and reduced net interest expense of $9.9 million.

 

Adjusted EBITDA for the First Half 2008 of $34.5 million improved by $45.4 million over the prior-year period Adjusted EBITDA loss of $10.9 million, reflecting increased revenues and reduced operating costs and expenses.

 

Mr. Shapiro added: "We're building long-term value by creating new diversified revenue streams while maintaining efficient cost and capital expenditure programs. The track we're on through July positions us to be free cash flow positive this year for the first time in the Company's history."

 

Cash and Liquidity

 

As of June 30, 2008, the Company had $66.3 million in unrestricted cash and $86.8 million available (after reduction for outstanding letters of credit of approximately $28.2 million) on its $275 million revolving credit facility.

 

The Company previously announced that its Board of Directors determined not to declare and pay quarterly dividends on its outstanding PIERS for the quarters ended May 15, 2008 and August 15, 2008. Under the terms of the PIERS, dividends are not required to be paid currently. The Company's deficit in stockholders' equity, the overall state of the financial markets and the fact that unpaid dividends accumulate on an interest-free basis, were factors the Board of Directors considered in reaching its decision.

 

Conference Call

 

The Company will host a teleconference for analysts and investors today at 5:00 PM Eastern. Participants in the call will include President and Chief Executive Officer, Mark Shapiro, and Executive Vice President and Chief Financial Officer, Jeffrey R. Speed.

 

The teleconference will be broadcast live to all interested persons as a listen-only Web cast on http://investors.sixflags.com/. The Web cast will be archived for one year.

 

About Six Flags

 

Six Flags, Inc. is the world's largest regional theme park company with 20 parks across the United States, Mexico and Canada. Founded in 1961, Six Flags has provided world class entertainment for millions of families with cutting edge, record-shattering roller coasters and appointment programming with events like the popular Thursday and Sunday Night Concert Series. Now 47 years strong, Six Flags is recognized as the preeminent thrill innovator while reaching to all demographics -- families, teens, tweens and thrill seekers alike -- with themed attractions based on the Looney Tunes characters, the Justice League of America, skateboarding legend Tony Hawk, The Wiggles and Thomas the Tank Engine. Six Flags, Inc. is a publicly-traded corporation (NYSE: SIX - News) headquartered in New York City.

 

Forward Looking Statements:

 

The information contained in this news release, other than historical information, consists of forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Securities Exchange Act. These statements may involve risks and uncertainties that could cause actual results to differ materially from those described in such statements. These risks and uncertainties include, among others, Six Flags' success in implementing its new business strategy. Although Six Flags 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 factors impacting attendance, such as local conditions, events, disturbances and terrorist activities, risk of accidents occurring at Six Flags' parks, adverse weather conditions, general economic conditions (including consumer spending patterns), competition, pending, threatened or future legal proceedings and other factors could cause actual results to differ materially from Six Flags' expectations. Reference is made to a more complete discussion of forward-looking statements and applicable risks contained under the captions "Cautionary Note Regarding Forward-Looking Statements" and "Risk Factors" in Six Flags' Annual Report on Form 10-K for the year ended December 31, 2007, which is available free of charge on Six Flags' website http://www.sixflags.com

 

 

1 Reported results from continuing operations for all periods presented

exclude park operations in Buffalo, New York; Columbus, Ohio; Concord,

California; Denver, Colorado; Houston, Texas; Oklahoma City, Oklahoma;

Sacramento, California; and Seattle, Washington. These parks have been

classified as discontinued operations. As of April 6, 2007, the sales

of all of the above-named parks were completed. Also excluded from

continuing operations for all periods are results from our park in New

Orleans, Louisiana, which has been closed since August 2005 due to

damage caused by Hurricane Katrina. During the current-year second

quarter, the Company decided that it will not resume operations in New

Orleans and has classified the park as a discontinued operation.

 

2 See the following tables and Note 2 to the tables for a discussion of

Adjusted EBITDA and its reconciliation to net income (loss).

 

 

 

Six Flags, Inc.

Three and Six Months Ended June 30, 2008 and 2007

(In Thousands, Except Per Share Amounts)

 

Statements of Operations (1) Three Months Ended Six Months Ended

June 30, June 30,

-------------------- -------------------

2008 2007 2008 2007

---------- --------- ---------- --------

Revenue $345,683 $343,629 $413,907 $394,281

 

Costs and expenses (excluding

depreciation, amortization,

stock-based compensation

and (gain) loss on fixed assets) 239,661 261,070 361,532 389,248

Depreciation 33,912 33,543 67,995 66,977

Amortization 280 326 560 576

Stock-based compensation 2,631 1,957 6,223 4,407

(Gain) loss on fixed assets (63) 830 4,591 5,165

---------- --------- ---------- --------

 

Income (loss) from operations 69,262 45,903 (26,994) (72,092)

---------- --------- ---------- --------

 

Interest expense (net) 45,527 50,047 91,979 101,904

Minority interest in earnings 20,562 24,504 19,966 14,531

Equity in operations of investees (130) 221 1,786 518

Net (gain) loss on debt

extinguishment (107,743) 11,103 (107,743) 11,103

Other (income) expense (420) 85 2,881 190

---------- --------- ---------- --------

 

Income (loss) from continuing

operations

before income taxes 111,466 (40,057) (35,863) (200,338)

Income tax expense (2,753) (1,880) (4,474) (2,195)

---------- --------- ---------- --------

 

Income (loss) from continuing

operations

before discontinued operations 108,713 (41,937) (40,337) (202,533)

 

Discontinued operations (14,122) (3,451) (14,976) (13,416)

---------- --------- ---------- --------

 

Net income (loss) $94,591 $(45,388) $(55,313) $(215,949)

========== ========= ========== ========

Net income (loss) applicable to

common stock $89,099 $(50,880) $(66,298) $(226,934)

========== ========= ========== ========

Per share - basic:

Income (loss) from

continuing operations $1.06 $(0.50) $(0.53) $(2.26)

Discontinued operations $(0.14) $(0.04) $(0.16) $(0.14)

 

---------- --------- ---------- --------

Net income (loss) $0.92 $(0.54) $(0.69) $(2.40)

========== ========= ========== ========

 

 

Per share - diluted:

Income (loss) from

continuing operations $0.72 $(0.50) $(0.53) $(2.26)

Discontinued operations $(0.09) $(0.04) $(0.16) $(0.14)

---------- --------- ---------- --------

Net income (loss) $0.63 $(0.54) $(0.69) $(2.40)

========== ========= ========== ========

 

 

 

Balance Sheet Data

(In Thousands)

 

Balance Sheet Data June 30, 2008 December 31, 2007

------------- -----------------

Cash and cash equivalents

(excluding restricted cash) $66,269 $28,388

Total assets 3,044,960 2,945,319

 

Current portion of long-term debt 169,771 18,715

Long-term debt (excluding current

portion) 2,118,088 2,239,073

 

Redeemable minority interests 434,360 415,350

Mandatory redeemable preferred stock 286,186 285,623

 

Total stockholders' deficit (293,038) (252,620)

 

Consolidated Leverage Ratio (2) 4.11 N/A

Restricted Subsidiary Leverage Ratio (2) 5.91 N/A

 

 

 

Three Months Ended Six Months Ended

June 30, June 30,

------------------- -----------------

2008 2007 2008 2007

Other Data: ------- ------- ------- --------

Adjusted EBITDA (3) $87,601 $57,519 $34,494 $(10,934)

Weighted average shares

outstanding - basic 97,319 94,708 96,505 94,680

Weighted average shares

outstanding - diluted 155,202 94,708 96,505 94,680

Net cash provided by (used in)

operating activities $61,897 $26,158 $(27,649) $(73,202)

 

 

 

The following table sets forth a reconciliation of net income (loss) to

Adjusted EBITDA for the periods shown (in thousands):

 

 

Three Months Ended Six Months Ended

June 30, June 30,

------------------- ------------------

2008 2007 2008 2007

------- ------- ------- --------

 

Net income (loss) $94,591 $(45,388) $(55,313) $(215,949)

Discontinued operations 14,122 3,451 14,976 13,416

Income tax expense 2,753 1,880 4,474 2,195

Other (income) expense (420) 85 2,881 190

Net (gain) loss on debt

extinguishment (107,743) 11,103 (107,743) 11,103

Equity in operations of investees (130) 221 1,786 518

Minority interest in earnings 20,562 24,504 19,966 14,531

Interest expense (net) 45,527 50,047 91,979 101,904

(Gain) loss on fixed assets (63) 830 4,591 5,165

Amortization 280 326 560 576

Depreciation 33,912 33,543 67,995 66,977

Stock-based compensation 2,631 1,957 6,223 4,407

Third party interest in EBITDA

of certain operations (4) (18,421) (25,040) (17,881) (15,967)

 

-------- ------- ------- --------

Adjusted EBITDA $87,601 $57,519 $34,494 $(10,934)

========= ========= ========= =========

 

 

NOTES

 

(1) Revenues and expenses of international operations are converted into

U.S. dollars on a current basis as provided by U.S. generally

accepted accounting principles ("GAAP").

 

(2) Under the terms of the $400,000,000 12 1/4% Senior Notes of Six Flags

Operations, Inc. ("New Notes"), we must disclose on a quarterly basis

the Leverage Ratio and Restricted Subsidiary Leverage Ratio, both as

defined in the terms of the New Notes.

 

(3) Adjusted EBITDA, a non-GAAP measure, is defined as income (loss) from

continuing operations before discontinued operations, income tax

expense (benefit), other (income) expense, net (gain) loss on debt

extinguishment, equity in operations of investees, minority interest

in earnings (losses), interest expense (net), amortization,

depreciation stock-based compensation, (gain) loss on fixed assets

minus interests of third parties in EBITDA of the four parks, plus

our interest in the Adjusted EBITDA of one hotel and Dick Clark

Productions, which are less than wholly owned. The Company believes

that Adjusted EBITDA provides useful information to investors

regarding the Company's operating performance and its capacity to

incur and service debt and fund capital expenditures. The Company

believes that Adjusted EBITDA is used by many investors equity

analysts and rating agencies as a measure of performance. In

addition, Adjusted EBITDA is approximately equal to "Consolidated

Cash Flow" as defined in the indentures relating to the Company's

senior notes. Adjusted EBITDA is not defined by GAAP and should not

be considered in isolation or as an alternative to net income (loss),

income (loss) from continuing operations, net cash provided by (used

in) operating, investing and financing activities or other financial

data prepared in accordance with GAAP or as an indicator of the

Company's operating performance. Adjusted EBITDA as defined in this

release may differ from similarly titled measures presented by other

companies.

 

(4) Represents interest of third parties in the Adjusted EBITDA of Six

Flags Over Georgia, Six Flags Over Texas, Six Flags White Water

Atlanta, and Six Flags Discovery Kingdom (formerly Six Flags Marine

World, which we purchased in July 2007), plus our interest in the

Adjusted EBITDA of one hotel and Dick Clark Productions, which are

less than wholly owned.

 

 

 

 

--------------------------------------------------------------------------------

Source: Six Flags, Inc.

[southview2]

Um, I dont understand all that mumbo jumbo. Lol, Can some one break it down? Did we do good or bad?

[29yrswithaGApass]

Even though attendance dipped 3%, Six Flags made a $94.6 million profit for the second quarter. This compared to loss of $45.4 million in the second quarter of 2007. The gains were attributed to reduced operating costs and a slight rise in revenue.

 

This is good news.

[JetsDevs4Lyf]

Certainly is good news. Anything coming in is good news for them at the moment with the financial situation what it is.

 

I'm looking forward to the conference call alter on this afternoon to hear what is talked about

Edited August 4, 2008 by JetsDevs4Lyf

[southview2]

Even though attendance dipped 3%, Six Flags made a $94.6 million profit for the second quarter. This compared to loss of $45.4 million in the second quarter of 2007. The gains were attributed to reduced operating costs and a slight rise in revenue.

 

This is good news.

 

 

Thanks! Well now I hope stock will go up up and away! ;]

[JetsDevs4Lyf]

I found the comment about being free cash flow positive for the first time in company history to be quite interesting as that would certainnly be at least somewhat favorable for the company. Any first time step would be a big one now!

 

Just got done listening to the conference call. Nothing out fo the ordinary it would seem went on here. A few typical questions asked during the Q&A segment. I kind of missed part of the end but somehow Cedar Fair got thrown into the mix in the end of the questions segment. I'll have to re-listen to the end of the conference call after it is converted for posting on the website. Other that than the highlights were the possibility of the free cash flow positive end year for the company that they are looking at. The pre-sale online sales were mentioned again with it being stated that 3rd and 4th Quarter online group pre-sale numbers were looking positive already. Mentioned were the facts that the company is well within reach of a number of its goals originally set out in their three year plan when taking over the company. This should be a good sign I would imagine, and the answers given regarding some of those goals seemed satisfactory to those questioning them. Additionally it was mentioned that as with most entities this year, energy costs were higher than in years past due to higher fuel costs, and also the slumping dollar against foreign currencies which complicates things at the Mexican and Canadian ventures. This is just a brief overview of what I heard and I got into the call a bit late unfortunately, but will relisten to it this evening.

Edited August 4, 2008 by JetsDevs4Lyf

[29yrswithaGApass]

Here's the Disclosure Statement from Six Flags summarizing the 2Q meeting:

 

SIX FLAGS PROVIDES UPDATED STRATEGIC OUTLOOK

--------------------------------------------

 

 

New York, NY - August 4, 2008 - Following this morning's release of results for

the quarter and six months ended June 30, 2008, Mark Shapiro, President and CEO

of Six Flags, Inc. (NYSE: SIX) and Jeffrey R. Speed, Executive Vice President

and CFO, hosted a webcast conference call to discuss the Company's results and

provide an updated evaluation of the Company's strategic progress.

 

"Not only are we seeing the re-emergence of the Six Flags brand, but we are also

beginning to yield the economic benefits of being the world's premier regional

theme park company," Mr. Shapiro said. "Despite a difficult economic

environment, through July we have witnessed solid revenue growth while at the

same time reducing our operating expenses by improving the efficiency and

effectiveness of our marketing and labor investments."

 

Mr. Shapiro and Mr. Speed expanded on the Company's performance for 2008 and its

strategic implications:

 

o For the quarter ended June 30, 2008, the Company increased revenues 1%

over the prior-year quarter, despite the shift in timing for Easter, which

was in the first quarter of 2008 versus the second quarter of 2007.

Adjusted EBITDA for the quarter improved by $30 million, or 52%,

reflecting the revenue growth as well as reduced advertising and operating

expenses.

 

o For the six months ended June 30, 2008, the Company increased revenues 5%

over the prior-year period. Attendance for the six months was flat

compared to the prior year first half. Adjusted EBITDA for the six months

improved by over $45 million.

 

o The Company's corporate sponsorship business combined with new

international licensing opportunities has generated solid revenues to

date, resulting in the Company increasing its revenue target for 2008 by

10%, from $51 million to $56 million. Design and development of Six Flags

Dubailand is proceeding and the project is on pace for a 2011 opening.

 

o Cash operating expenses (i.e., costs and expenses excluding depreciation,

amortization, stock-based compensation and gain or loss on fixed assets)

decreased for the quarter and six months ended June 30, 2008 by $21

million, or 8%, and $28 million, or 7%, respectively, reflecting reduced

marketing and full-time labor costs, seasonal labor efficiencies from an

automated labor scheduling system that the Company has expanded throughout

its parks, and the removal of inefficient rides and attractions.

 

o For the month of July 2008 --- historically the most significant month in

the operating season --- the Company indicated that attendance increased

over July 2007 and revenue growth trends continued. However, the Company

cautioned that due to the calendar shift, it will lose two weekdays of

full park operations later in the third quarter compared to the prior year

period. It expects to largely recover the lost attendance from those days

with additional operating days in October and November as well as with

Halloween falling favorably on a Friday this year.

 

o Through the end of July, year-to-date sales of season pass units were up

approximately 100,000 units, or 5%, while group sale bookings were stable

compared to the prior year period.

 

The Management team concluded the call by reiterating the Five Key Strategic

Objectives for their three-year turnaround plan established upon their arrival

in early 2006; each of which is on track to be realized in the current year.

These strategic objectives were summarized as follows:

 

1. First and foremost: clean-up the parks and improve the overall guest

experience; reposition the brand by diversifying the product

offering. For the second consecutive year, the Company's key guest

satisfaction scores are at or above record highs.

 

2. Become free cash flow positive,(1) which has not been achieved in

the Company's history. For 2008, if the Company maintains its

current trends with regard to revenues and cost control, the Company

should be free cash flow positive with an Adjusted EBITDA nearing

$280 million.

 

3. Achieve total revenue per capita of at least $40, or 20% cumulative

growth from 2005. With approximately 1% guest spending growth and

$56 million of sponsorship and licensing revenues, this objective is

within reach this year.

 

4. Create and grow new high margin and low capital sponsorship and

licensing businesses and achieve annual revenues in excess of $50

million. For 2008, management is currently targeting revenue of $56

million.

 

5. Operate at a profit margin for Modified EBITDA(2) of at least 30%.

If the Company sustains its current trends and achieves its target

of being free cash flow positive for the year, then its Modified

EBITDA margin will likely top the 30% margin objective.

 

Shapiro concluded: "Six Flags is expanding as an entertainment company by

identifying new revenue streams while simultaneously revitalizing its core

business. This has been the fundamental objective of our turnaround plan. Our

momentum through July indicates that the strategy is taking hold with long-term

value being the endgame."

 

One good thing to hear in the conference call is that Six Flags does not have any plans to sell any of its excess land (especially in today's real estate market). I am still holding out hope that someday GA will use some of that land to add a hotel and become the Six Flags Great Adventure Resort! (Year-round of course!)

[Railer]

Global Warming will take care of that for us. I think GA will be year round in my lifetime.

[JetsDevs4Lyf]

Check and Mate on that one

 

I would like the park to stay open. We get less and less major snow storms and real cold spells each year, it would be no real problem. I think though that before the park considers being year-round they would need a few more indoor attractions to ensure that they would have enough to do for visitors that didn't want to be outside for a long time. Shows would also have to come back to the empty arenas.

[RobertDavid]

Check and Mate on that one

 

I would like the park to stay open. We get less and less major snow storms and real cold spells each year, it would be no real problem. I think though that before the park considers being year-round they would need a few more indoor attractions to ensure that they would have enough to do for visitors that didn't want to be outside for a long time. Shows would also have to come back to the empty arenas.

 

 

Indoor attractions inside themed buildings or mountains or something attractive. PLEASE, no more big gray warehouses.