Six Flags has released its first-quarter earnings for 2020 and updated its response to COVID-19.
Six Flags parks have been closed in the USA since the middle of March because of the coronavirus pandemic. The company expects to reopen its parks on a geographical basis as local conditions allow.
Q1: Theme park closures can cancellations
Revenue in Q1 in 2020 was down 20% compared to Q1 in 2019. Revenue in 2020 was $103 million, a decrease of $26 million. This was driven primarily by a decrease in park attendance because of the sudden closure due to COVID-19.
Guest spending per capita rose in Q1 to $56.60, an increase of $8.12. This is mainly due to higher spending by day-guests and guests who continued to renew their 12-months memberships on a monthly basis.
A number of cost-saving measures were introduced when Six Flags theme parks were closed. Some discretionary capital projects that were planned for 2020 have been deferred or eliminated.
The net cash outflow of Six Flags whilst its parks are closed is expected to be between $30-$35 million per month on average.
The company is working with its season pass holders to extend their usage privileges. Members have been given the choice to suspend payments on their membership or to carry on paying to receive higher-tier benefits.
Mike Spanos, President and CEO of Six Flags said that the company has “taken steps to prepare for the extreme-downside scenario of a prolonged minimal revenue business, including actions to maximize our liquidity and reduce cash outflows.”
He continued, saying that “Our strong operating results in the quarter prior to the pandemic-driven suspension of operations demonstrate the health of our brand and the success of our targeted single-day pricing strategy and productivity initiatives.”