Six Flags Announces 1st Quarter Revenue

[Colonel Mustard]

http://biz.yahoo.com/prnews/080417/nyth005.html?.v=101

I know there will always be Red Zone Haters out there, but you have to admit that this is promising. They've been learning the reigns for two years now, now I think this year they are going to be pushing the envelope a little bit, before settling down into a solid business plan next season.

Your thoughts on this?

[cycamps]

I just can't believe they continue to do better. With the state of the economy, you'd think profit would fall due to the expense of people having to travel to the park. However, not everyone has to travel a long distance like I do. I'm excited to see Six Flags eventually turn a profit.

[Bob O]

For a different taqke on SF's outlook you can read this
http://www.washingtoncitypaper.com/blog ... agging-12/

This seems to me to be just a accounting difference due to Easter coming early which helps this quarter, but will hurt next quarter when they lose the easter bump. And increased revenue because they have raised prices ALL over the parks. And since this only covers %5 of the season attendance it doesnt mean much in the overall outlook of the company, which of course will blame weather if things arent positive.

I hope the company has a great year, so we can get improvements in our park, but right now I dont see much positive for the company with its MASSIVE debt and pending lawsuits on the horizons. With rough economic times for many people, it isnt the year to screw your guests even more with higher priced parking/extra money for lockers etc. They should trying reduce some prices to show they are trying to be family friendly.

[Colonel Mustard]

Yeah, I always keep up with that blog just because the guy who writes it is a complete moron. He doesn't seem to know the difference between a period and a Comma. (Read closely to understand that)

[Bob O]

I dont read blogs with the midset of a english teacher, just to get different view points on a topic.

[CoasterDude12-2]

Hopefully SF will be run into the ground. It's hard to make money if you keep raising prices. Eventually, their target market (families) will figure out, "Hey, we can save money and still have tons of fun if we go to a waterpark instead".


While it's true there's few people on the planet that annoy me more than Shapiro, I realize that he's in a tough situation. Red Zone is a first timer in the theme park industry, and they thought kiddie attractions ad small coasters with tons of marketing (Tony Hawk, Batman) were enough to yield a nice profit. So, when that didn't work, they needed to suck everything out of their existing customers.


Then, all of a sudden, indoor waterparks came in to the picture. Gurnee, Utica, Arlington Heights, etc. all have amazing waterparks that weren't around a few years ago. SF got competition from a demographic they were hoping to lure.


Coupled with that, gas is now almost $4 a gallon, and should top that by summer. I just got a car, and I haven't even bought insurance yet because I NEVER drive it. No one wants to drive however long to go to a SF park. So what does Mr. CEO do? He sells almost all waterparks, and struggling theme parks instead of giving them a couple years to turn them around. SF still has massive debt, and no market whatsoever in Europe, Houston, Buffalo, Denver, Washington, or Columbus. People in these markets aren't going to drive to another one just for a SF park.

And then there was New Orleans. That totally isn't SF fault. It was just an unlucky event that ended in shit for SF. That wasn't the only storm, less people are going to go on a cold, rain soaked day than a mild sunny day.


But gas could be $1.50, New Orleans could never have had a major tragedy, and waterparks could have not taken such popularity, and Red Zone could not have inherited SF $2 billion debt, and the company STILL would not be profitable. Assume a family of 2 adults, 2 kids over 54", and a 2 year old enter SF, but their tickets at the gate, and decide to spend a day...

Parking $25, "No way are we walking across the lot".

4 Adult Tickets at $54.99 each = $220 + tax

These people haven't even stopped being searched, and have already spend $250.

Now, they are told they can't bring their food in the park. So, they go back to their car, and leave it.

You just spent $250 bucks, and SF thanks you by not allowing you to even bring in outside food.

Alright, now the dad and the older kids want to ride American Eagle, while Mommy and Baby go to Wiggles World. It's 10:10, and it takes about 10 minutes at a good pace to get to the back of the park, but it's worth it becuase no one really goes there that early.

The family gets to county fair only to realize it's a ghost town. Nothing's open at all, and a few rides they knew were there last year, are gone.

"Oh, sorry man. This part of the park ain't open till 'leven"

Now for $250, you have from the gate to the car, and back, now to county fair, and done nothing.

Now the family decides to go to Southwest Territory, becuase Eagle and Wiggles World won't be open for another 45 minutes. Dad and the kids wait in line for Viper, while mommy and baby sit down. There's almost nothing for small children to do that's not in county fair, save for Looney Tunes National Park.

A couple hours pass, and the hellish start gives way a bit. The family is now in county fair, the thrill seekers waiting 30 minutes for Eagle, the others enjoy themselves in Wiggles World. But, now they've got sort of a problem.

"I'm hungry, says one of the kids".

"Me too, but I don't feel like walking to my car". "Let's just go to Red Robin."

They enter Red Robin, noticing the prices are around $6 for kids meals and $10 for adults.

So let's say they spend $35. They didn't have to, they weren't forced, but they didn't feel like walking back to their car from county fair.

After their meal, they head toward the Yukon Territory and head toward Ragin' Cajun and Jesters Wild Ride. They wait an hour for Cajun, and decide they've had enough of waiting in line. They decide only to ride flat rides, and small children's rides.

Fast Forward to closing, and this family has had enough. They drive home on I-94, they can only do 45 on the highway, and it takes 2 hours to get home. They stop for gas, and spend $60.00 to fill it up.

They see a small waterpark, just opening up by their house. It has lost of water rides, and even a few flat ride-esque rides. They have had enough of spending the day at Sf. They spent over $300 when the waterpark would have been just over $50. These guys are never coming back. I fail to mention, these guys also bought a $10 locker, and spent $3 on putting their stuff on the Eagle, Viper, and Eagle again. And no, they didn't even ride the Dark Knight



So, SF has millions in debt, less assets, less means of making capital, and desperately attempting to appeal to families. But, by raising their prices, and not changing their policies to benefit families, but rather to alienate them. The only pro family thing SF has done is end smoking at the parks. SF has millions of debt, and the mis-management by Shapiro, Snyder, and Red Zone will eventually cause SF to be sold.




Cedar's Point Great America by 2010.


Longest Post. Ever.

[Colonel Mustard]

Or On the Other Hand...

Assume a family of 2 adults, 2 kids over 54", and a 2 year old enter SF, buy their tickets at the gate, after being smart enough to bring a Coke Can to get ten dollards off, and decide to spend a day...

Parking $15, "But Dad do we have to walk across the lot" "It's twenty feet across the road, excercise is good for you billy"

4 Adult Tickets at $44.99 each = $179.96 + Tax.

Now, they are told they can't bring their food in the park. So, they go back to their car, and leave it. Obviously because they were dumb enough not to even look at anything pertaining to the park. Online and in the stuff they got when they parked where it said you can't bring food into the park, not to mention general knowledge becuase VERY few parks or other places of entertainment will let you bring in your own food.

Alright, now the dad and the older kids want to ride American Eagle, while Mommy and Baby go to Wiggles World. It's 10:10, and it takes about 10 minutes at a good pace to get to the back of the park, but it's worth it becuase no one really goes there that early.

The family gets to county fair only to realize it's a ghost town. Nothing's open at all, That scary ride that the kids are afraid of, and the ride that the mother claimed she would never go on again because it ruined her favorite fanny pack are gone. Oh well, they think, that gives them room to add new cool stuff next year!

"Excuse me, Sir" The dad asks a Sweeper.
"Yes?"
"Why is everything closed?"
"Oh, I'm sorry, Sir, the Back part of the park, all of county fair, doesn't open until 11 am, but other areas like Southwest Territory, and Yukon Territory will both be open"
"Oh, Shoot, well let's go ride something in Southwest Territory"

Now the family decides to go to Southwest Territory, becuase Eagle and Wiggles World won't be open for another 45 minutes. Dad and the kids wait in line for Viper, while mommy take a ride on the river rocker, which small children can ride if accompanied by an adult.

A couple hours pass, The family is now in county fair, the thrill seekers are waiting 30 minutes for Eagle, the others enjoy themselves in Wiggles World. But, now they've got sort of a problem.

"I'm hungry, says one of the kids".

"Me too, but I don't feel like walking to my car". "Let's just go to Johnny Rockets"

"Hang on," The Wife says to the husband. "I'm going to grab a fruit cup for our two year old at the Yummy Yummy Cafe, can you meet us back here? I think one of the wiggles shows is going to start soon?"

"Sure!"

The others enter Johnny Rockets noticing the prices are around $6 for kids meals and $10 for adults.

So let's say they spend $32. They didn't have to, they weren't forced, but they didn't feel like walking back to their car from county fair.

After their meal, they head toward Mardi Gras and head toward Ragin' Cajun and Jesters Wild Ride. They wait an hour for Cajun, and decide they've had enough of waiting in line. They decide only to ride flat rides, and small children's rides, I can't speak for the hypothetical family, but up until I was about 9 we did that anyway. The numerous selections include Caousel, Tower, Dodge, Condor, Balloons, Crawler, Gig, Fling, Revolution, Raceway, Fun Machine, Triple Play, River Rocker, Chubasco, and Ricochet.

Fast Forward to late afternoon, the family is starting to get tired. The little ones especially are ready to get off their feet. As they are walking by the pictorium they hear the announcment that the doors are about to close for Marvin the Martian in the Third Dimension so they jump in the theatre to enjoy a little 3-D fun. But the kids are still pooped. Just down the way is a theatre with three different shows in it. Mom, who is prepared with her map and Guide and Show Schedule notices that "Show Stoppin" is about to start, so they sit and watch the 45 minute show, while enjoying some 4 dollar cotton candy paid for by their loving father.

The two year old fell asleep, and the mom is starting to get tired to so they head to first aid, so the two year old can have a little nap, and mom can put up her feet, while Dad and the kids try some of the other more daring but not terrifying rides like Whizzer, Dark Knight, Demon, Giant Drop and others. They join up with the Mom and Two-year old reinvigorated from his nap and continue riding.

It's the end of the night and they've decided to see "Bugs Bunny's Starlight Spectacular" with a short show featuring the looney tunes, followed by a parade! But the kids are hungry again, so before the show, the family stops at Aunt Marthas and has a wholesome, although highly processed meal. So they stop and watch the show and enjoy the dancing and singing. After the parade passes by, Dad realizes that the line for the funnel cake place just went way down, so he jumps in line to get one. He and his family sit and laugh, and talk about their day, watching the final riders on Whizzer. They exit the park as the carousel song plays in the background.

Wow dad, that was so much fun, one of the kids says.
"I was really impressed with how clean the park was, I was here a few years ago and it was a mess" Mom says.
"Do you think I'll be tall enough to ride Raging Bull next year, dad?" the other kid says.
"maybe, hey, if everyone enjoyed it so much, what would you guys think about season passes for next year as an early christmas gift?"
"YAY! WOOHOO!"
"Maybe you and the kids can go for father's day sweetheart" the mom says, picturing three or four completly noise-free days at home...

They drive home on I-94, they can only do 45 on the highway, and it takes 2 hours to get home. They stop for gas, and spend $60.00 to fill it up.

The Only ride that they rode in this scenario that had lockers was Eagle, but Since mom wasn't riding, she was able to take their stuff for them before they got in line anyway, so that doesn't matter.

Now, admittadly this was a little optimistic. Not everything would go as planned, but a tiny hitch or two, isn't enough to totally ruin someone's day unless they have some other problems.

So let's try to think positively people. And realize that not everyone spends their day at Six Flags exactly like you do.

To Finale this post, I'd like to point out that the man who writes the blog that Bob O posted works for a Newspaper, and it's a newspaper run blog. If the guy didn't bother to learn basic mechanics and works for a newspaper, how can I possibly trust anything he puts before me. If he didn't bother to learn his own trade, how can you possibly trust any of the stuff he puts in front of you, not to mention trust he did the research to back it up?

[rasslin]

They could/can be profitable!

The number one reason this type of operation isn't profitable is seasonality. Being able to produce income for less than half a year. The resulting employee turnover, hiring, retraining and vetting process costs a fortune before you've produced income at the beggining of every season. The second big cost disadvantage is new equipment, but at least those are capital investments and can be offset in tax breaks. These rides and areas could also have corporate sponsers that generate revenue to help cover the cost of reinvestment in new rides.

A redesign of the existing property which includes retail mall space, lodging and winter attractions, convention/meeting areas maybe even timeshare/condo development would mean a year round operation. It would mean year round operating costs too, but it would mean much more in profits. They have the space and they have the option of more space just south of the park.
There are tax incentives and the Gurnee area is becoming a great alternative to Chicago for conventions. And land is far less expensive here than in other markets.

Renting spaces for true restaurant and retail operators would be easier if it were a year round operation, and that would provide a set income in rent including common area maintenance fee's and no food handling headaches. It would be good for us too, since SFGAM is pretty bad when it comes to food.

When I worked in Las Vegas it was also seasonally affected except in reverse. Most people don't think of Vegas being seasonal, but it is. People don't go there from Oct. through Feb. because they are saving for the holiday and then paying off the holiday debt. There's also the extremely hot summer months when people also visit less often. This is why Vegas now has so many diverse attractions on every property.
They had to provide something for everyone to continue the income stream. Six Flags will have to do the same, and it appears they are heading in that direction.

Mark Shapiro is no dummy. I think given a chance in a decent economic environment, they will overtake Disney as a theme destination.

[Bob O]

I would like rasslin to explain how SF is going to overtake disney as a theme park destination. Lets see how a company with poorly run parks and massive debt is going to out peform and out do a company that has a great financial record, characters that are beloved worldwide and has parks that are worldwide destinations.

And while Colonel Mustards scenario would be good news for SF, the history show's that Coaster Dude's scenario is much more likely to be the correct one.

[Colonel Mustard]

I don't think that Six Flags will ever, or should ever take over Disney. Six Flags caters to a different Market. Disney Started as one guy who thought, hey I'll build a theme park. I mean walt was great and creative, and an innovator, but he had zero business sense whatsoever, so he surrounded himself with people who did. The Opposite is true for Six Flags. The folks at Six Flags already know how to run parks...at least park by park, i'm not sure if the same can be said for corporate, but hey, do you think that the CEO of McDonalds could run a restaurant, I doubt it.

Six Flags needs to turn around and give people a reason to come to the parks now, by slowly VERY SLOWLY building up that great financial record, work with DCPI to create some characters and stories that will attach to peoples hearts.

There is no need for Six Flags parks to become Destinations like Disney. Maybe one or two of them sure, but not the whole chain.

And by the way, the only difference between my Scenario and CoasterDudes was that the people in it Weren't total a$$holes. Both familes had the same amount of people in the same age group, Both Familes had the same opportunities at the park, I did admit that my scenario was a little optimistic, downtimes happen on Rides, and even food and merch locations, but in the end that shouldn't matter, the people in my scenario choose to have fun instead of dwelling on every negative aspect that they possibly could. If you go in anything in your life with a negative attitude, you will have a negative experiance, that's just a fact. If you go in with a positive attitude, you will more then likely have a positive experiance.

The notable exception being if you get struck by lightening.

[Bob O]

When families decide to go to the park on the spur of the moment, which happens alot, they shouldt have to plan on everything in advance, and if they havent been to the park in a few years they will likely get rattled because so much has changed, be it lockers/amount of food that may be brought in/pay to skip privileges etc. , which all affects the bottom line and will not make for a happy customer who will return often when they add up at the end of the day how much they spent

I talk to alot of people where I work, all who make a very decent middle class wage and do vacation/visit area's all over the country. And while they do enjoy some of the rides at SF that are great, I do hear many complaints regarding the price of things at SF, be it parking/admission/food etc.. And after I hear complaints about guest behavior, i hear more complaining than anything about the cost of everything and about being nickel and dimed to death. And when they compare the price to value received they say it isnt worth it, that they would be better off spending there money elsewhere. Be it somewhere In the area, or on a vacation somewhere else. And I cant disagree with that logic at all. The price is worth it to me because I love riding coasters, but for many who arent into as much as us, they have many other places to spend there entertainment dollar.

And I agree that SF cant take over from disney, but they have alot they can learn from a entertainment company like Disney. Sf would have been much better off if they had been taken over by someone with theme park experience, and not a moron like snyder who has no idea what he is doing in this type of business, and while Shapiro came from disney, he was in the ESPN area and not the creative area of the company.

What SF needs is what disney has had in the past, a creative guy to help run the parks/create character's etc and a money guy to make it all work out. Disney had that with Walt, and his brother Roy, and then later with Eisner and Frank Wells. And now with Iger and people like Lassiter from Pixar besides all the in house people from imagineering.

[forddude1416]

Yeah because all of the disney stock holders LOVED Eisner...

I remember a time, way back in the 70's, some hotel chain with no experience of owning/operating amusement parks wanted to build their own parks. Yeah they really screwed up something fierce because they had no experience.

Honestly, Six Flags is just a business. That's it. It's a different kind of business from say owning a Sears or a Hooters but the whole goal is to make more money than your spending. Everyone is complaining that Shapiro is all about the money. Wouldn't you be if your business was 3 BILLION in the hole?

Now about the spur of the moment family things, I really can't think of any family who says "its 10am, who all wants to go to six flags?!" The families that I know usually plan it out a week in advance or a couple of days in advance. Regardless of this pointless trivia, what really is any different?

Most people with an I.Q. Bigger than their shoe size know that prices go up, maybe every year in fact. A quick call to the info center or using these new fangled interwebs would let you know. And again, most people know that you cant take your full size scooby doll on there so that point is a bit moot. Also, most people know you can't bring in outside food or beverages into a theme park. You really don't give the average human much credit in your scenarios do you?

Now yeah, I agree guest behavior is very much appalling and I would LOVE to see 4x the amount of security there. Nothing pisses me off more then line jumpers and people talking way too loud and cussin.

In reality though, SFC is doing all it can to help stabilize its losses right now. Yes they are inexperienced in theme parks but sometimes a bit of inexperience can go a long way. Instead of overdoing things and acting like "we've done this before so it must work now", they are taking a steady but careful approach. That is why I actually bought stock in Six Flags. I believe in this new management that much.

[Bob O]

Actually most parks provide a free space/bin to put the scooby doll you just won while in the park when you get on the ride, and don't force you to pay for a locker.
And alot of parks let you bring in water to the park(as SFGAM did before last year), and also let you bring in snacks(as SFGAM did before last year). And while at wdw i've seen families bring in soft sided cooler's that did contain food/drinks.
Do families decide at 10:00am to go to SF, not likely unless they live close by and have season pass's. But I know people that decide in a day or two in advance to go to SF due to nice weather and then don't plan the visit to the park like th D-Day Invasion of WW2.

And these polices of trying to get every single dime no matter what has to be done wont help stabilize the companies bottom line.
I think they are right in trying to emphasize the families, but you don't inspire repeat business when you make in unaffordable for these same families.