Published:
Cedar Fair Announces 2008 First Quarter Results
SANDUSKY, Ohio, May 6 /PRNewswire-FirstCall/ -- Cedar Fair Entertainment
Company (NYSE: FUN), a leader in regional amusement parks, water parks and
active entertainment, today announced results for the first quarter ended
March 30, 2008. Historically, first quarter results represent less than 5% of
the Company's full-year revenues.
Net revenues for the first quarter increased $10.4 million, or 35%, to
$40.4 million from $30.0 million in 2007. Operating results for the fiscal
first quarter of 2008 reflect five additional calendar days compared to last
year's first quarter. In addition, 2008 first quarter results benefited from
an early Easter/Spring Break season which fell during the second quarter in
2007.
"As part of our strategy for expanding the operating season at the newly
acquired parks, several of which are located in warmer climates, we were able
to open both Kings Dominion andCalifornia's Great America a week earlier than
in prior years to take advantage of the early spring holiday," said Dick
Kinzel, chairman, president and chief executive officer. In total, the number
of park operating days in the first quarter increased by 41 days when compared
with the first quarter of 2007. Of the additional park operating days, 22 are
attributable to the earlier park openings and the remaining 19 days are
related to having five extra days in the quarter compared to last year.
Operating results for the first quarter include normal off-season
operating, maintenance and administrative expenses at the Company's seasonal
amusement and water parks, and daily operations at Knott's Berry Farm,
Castaway Bay and Star Trek: The Experience. The operating loss for the first
quarter increased to $56.4 million from $50.9 million in 2007, primarily the
result of the additional five days in the current fiscal quarter. This
increase was slightly offset by the earlier park openings and a reduction in
costs at our Geauga Lake property which will operate exclusively as a water
park in 2008. "Only six of our 18 properties were in operation at the end of
the first quarter. The other parks, including our largest parks: Cedar Point
and Kings Island, located inOhio, andCanada's Wonderland inToronto, were in
the final stages of preparing to open for their operating seasons in April and
May," explained Kinzel. "These pre-season operating costs were in-line with
our expectations for the quarter."
Interest expense for the first quarter decreased 2% to $32.8 million
compared with $33.4 million in 2007, the net result of lower rates on the
Company's debt offset by an extra five days of interest expense in the current
quarter. A net credit for taxes of $44.8 million was recorded to account for
the tax attributes of the Company's corporate subsidiaries and publicly traded
partnership taxes during the first quarter of 2008 compared with a net credit
for taxes of $29.3 million in the same period a year ago.
After interest expense and provision for taxes, the net loss for the first
quarter ended March 30, 2008, totaled $43.8 million, or $0.81 per diluted
limited partner unit. For the first quarter ended March 25, 2007, the Company
reported a net loss of $55.1 million, or $1.02 per diluted limited partner
unit.
Cash and Liquidity
"We ended the first quarter of 2008 in sound financial condition in terms
of both liquidity and cash flow," said Kinzel. As of March 30, 2008, the
Company had $1.7 billion of variable-rate debt and $137.8 million in
borrowings under its revolving credit facilities. Of the total term debt,
$17.5 million is scheduled to mature within the next twelve months. Kinzel
also noted that credit facilities and cash flow from operations are expected
to be sufficient to meet working capital needs, debt service, planned capital
expenditures and regular quarterly cash distributions for the foreseeable
future.
2008 Operating Season
Commenting on the upcoming season Kinzel said, "While the first quarter is
not a meaningful part of our full-year financial performance, we are hopeful
that early-season trends will continue into the summer. We have made a
concentrated effort to add value to our season pass offerings, and as a result
sales are trending ahead of last year in both average unit price and total
passes sold. We also have a strong capital program in place for 2008 that
features a variety of new shows and attractions across all of our parks,
including five roller coasters, three thrill rides and 18 new live shows."
To date the Company has seven of its ten seasonal amusement parks in
operation and Cedar Point and Valleyfair are scheduled to open this weekend.
"It is no secret that the broader economy is not as healthy as it could be.
This is something we have been dealing with on a regional basis in the Midwest
for several years now with some good success. We believe our high quality
parks and resorts will continue to fulfill the need for entertainment with
families that don't want to travel long distances for vacation. Our employees
have worked hard to prepare the parks for opening and the feedback from
customers has been very positive. We are hopeful the outstanding value we
offer in a full day of entertainment will prove to be desirable this season
and for many years to come," concluded Kinzel.
The company will host a conference call with analysts today, May 6, 2008,
at 2:00 p.m. Eastern Time, which will be web cast live in "listen only" mode
via the Cedar Fair web site (www.cedarfair.com). It will also be available
for replay starting at approximately 5:00 p.m. ET, Tuesday, May 6, 2008, until
11:59 p.m. ET, Tuesday, May 20, 2008. In order to access the replay of the
earnings call, please dial 1-800-406-7325 followed by the access code 3870676.
Cedar Fair is a publicly traded partnership headquartered inSandusky,
Ohio, and one of the largest regional amusement-resort operators in the world.
The Company owns and operates 11 amusement parks, six outdoor water parks, one
indoor water park and five hotels. Amusement parks in the company's Northern
Region include two inOhio: Cedar Point, consistently voted "Best Amusement
Park in the World" in Amusement Today polls and Kings Island; as well as
Canada's Wonderland, nearToronto; Dorney Park, PA; Valleyfair, MN; and
Michigan's Adventure, MI. In the Southern Region are Kings Dominion, VA;
Carowinds, NC; and Worlds of Fun, MO. Western parks inCalifornia include:
Knott's Berry Farm;California's Great America; and Gilroy Gardens, which is
managed under contract. Also included in that region is Star Trek: The
Experience, aLas Vegas-based interactive adventure.
Some of the statements contained in this news release constitute forward-
looking statements. These statements may involve risk and uncertainties that
could cause actual results to differ materially from those described in such
statements. Although the Company 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 general economic conditions, competition for consumer leisure time
and spending, adverse weather conditions, unanticipated construction delays
and other factors could affect attendance at our parks and cause actual
results to differ materially from the Company's expectations. In addition,
risks and uncertainties concerning the acquisition of the Paramount Parks
include, but are not limited to the ability of the Company to combine the
operations and take advantage of growth, savings and synergy opportunities.
Cedar Fair, L.P.
SUMMARY STATEMENTS OF OPERATIONS
FIRST QUARTER
(unaudited)
Three Months Ended Twelve Months Ended
(In thousands except per unit) 3/30/08 3/25/07 3/30/08 3/25/07
Net revenues:
Admissions $17,599 $11,332 $558,412 $462,288
Food, merchandise and games 17,696 13,973 363,778 309,105
Accommodations and other 5,107 4,694 75,186 66,050
Total net revenues 40,402 29,999 997,376 837,443
Cash operating costs and
expenses 90,493 76,378 660,501 549,198
Adjusted EBITDA (a) (50,091) (46,379) 336,875 288,245
Depreciation and amortization 6,183 4,318 132,488 91,547
Impairment loss on fixed assets - - 54,898 -
Equity-based compensation 130 185 521 390
Operating income (loss) (56,404) (50,882) 148,968 196,308
Interest expense 32,801 33,405 144,883 115,358
Loss on early extinguishment
of debt - - - 4,697
Other (income) expense (615) 120 (1,470) (799)
Income (loss) before taxes (88,590) (84,407) 5,555 77,052
Provision (credit) for taxes (44,808) (29,283) (1,296) 18,195
Net income (loss) $(43,782) $(55,124) $6,851 $58,857
Weighted average units
outstanding - diluted 54,330 54,129 55,088 54,892
Per limited partner unit:
Net income (loss) - diluted $(0.81) $(1.02) $0.12 $1.07
Cash distributions declared $0.475 $0.47 $1.90 $1.88
Balance Sheet Data:
Total assets $2,475,263 $2,530,747
Total debt 1,856,616 1,883,425
Total partners' equity 175,321 326,148
(a) Adjusted EBITDA represents earnings before interest, taxes,
depreciation, and certain other non-cash costs. Adjusted EBITDA is not
a measurement of operating performance computed in accordance with
generally accepted accounting principles (GAAP) and should not be
considered a substitute for operating income, net income or cash flows
from operating activities computed in accordance with GAAP. We believe
that adjusted EBITDA is a meaningful measure of park-level operating
profitability because we use it for measuring returns on capital
investments, evaluating potential acquisitions, determining awards
under incentive compensation plans, and calculating compliance with
certain loan covenants. Adjusted EBITDA may not be comparable to
similarly titled measures of other companies.
This press release and prior releases are available on the Cedar Fair
Entertainment Company website at www.cedarfair.com.
SOURCE Cedar Fair Entertainment Company
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