11 Nov 2019
Cedar Fair on course for 'best year' after Q3 results reflect 'strong' consumer demand
BY Andy Knaggs
North American theme park operator Cedar Fair Entertainment Company, which owns and operates 11 amusement parks and five water parks in the territory, has filed Q3 and year-to-date financial results that show increased revenues and Adjusted EBITDA, but reduced net income.
Having acquired the Schlitterbahn water parks this year, the company's figures include an additional "same-park/same-week" basis, which excludes the Schlitterbahn contribution. According to this, Cedar Fair's net revenues in Q3 were up by 7 per cent on 2018; the full revenue figure (ie including Schlitterbahn) was a record US$715m (€645m, £556m), which is up 8 per cent, or US$51m (€46m, £39.7m) on Q3 2018.
Year-to-date preliminary net revenues (through 3 November 2019) were also a record for the company: US$1.37bn (€1.24bn, £1.07bn), an increase of US$113m (€102m, £87.9m), or 9 per cent. On the same-park basis, the preliminary net revenues were US$1.33bn (€1.2bn, £1.03bn), up US$71m (€64m, £55.2m) or 6 per cent.
The Adjusted EBITDA, which Cedar Fair said is the most meaningful measure of its operating results, increased by 5 per cent to US$355m (€320m, £276m) in Q3, compared to the third quarter in 2018, while the nine month EBITDA was US$450m (€406m, £350m), compared to US$400m (€361m, £311m) last year.
Net income, however, took a hit during Q3 2019, totalling US$190m (€171.4m, £147.8m), compared to US$213m (€192m, £165.7m) in Q3 2018. Income was hit by a number of factors, said Cedar Fair, including a re-measurement of US dollar-dominated debt held at its Canadian property, which saw a US$6m (€5.4m, £4.7m) net charge to earnings for foreign currency, compared to a US$13m (€11.7m, £10.1m) net benefit to earnings in 2018. There were also acquisition costs, and higher labour costs driven by wage-rate increases, it said.
Cedar Fair president and CEO, Richard A. Zimmerman, said the company was "well on the way" to making 2019 its best ever year.
"Our strong results to date have been driven by solid growth in in-park per capita spending while entertaining a record number of guests, particularly during our peak summer months.
"This strong consumer demand reflects the quality of our business model and our long-range plan that focuses on broadening the guest experience through more immersive attractions and entertainment."
Zimmerman added that there was much more to come in 2020, saying: "When our gates open next spring, guests can expect new rides or attractions at all of our parks."
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