Six Flags Entertainment (FUN) 8-KSix Flags Entertainment Corporation Reports 2024 Third Quarter Results; Announces New Long-range Strategic Objectives

“We delivered solid results in our first quarter as a combined company and are encouraged by the continued momentum we see in the business,” said Six Flags President and CEO Richard A. Zimmerman. “While extreme weather and other operating disruptions at critical points during the third quarter impacted our financial results, consumer demand for our parks remained strong during normalized operating conditions. The strength of our business and considerable demand for our parks was particularly evident over the past five weeks, when attendance was up more than one million visits compared to combined legacy Cedar Fair and legacy Six Flags attendance over the same period last year. Our Halloween and other special events continue to produce some of our biggest days of the year, demonstrating the differentiated and compelling family entertainment that our parks offer.

“Since completing the Merger, we have been finding ways to operate more efficiently and reducing unnecessary costs while still delivering a high level of guest service,” continued Zimmerman. “By the end of 2024, we expect to have delivered $50 million of run-rate cost synergies, and we are already taking steps to achieve the remaining $70 million of anticipated cost savings by the end of calendar year 2025. While we intend to invest back into our parks to enhance the guest experience and drive attendance growth, we are focused on funding those efforts with additional cost savings across the portfolio, allowing us to retain 100% of the realized synergies.”

The $506 million increase in net revenues reflects the impact of an 8.5 million-visit increase in attendance and a $16 million increase in out-of-park revenues, partially offset by the impact of a $1.43, or 2%, decrease in in-park per capita spending. The 8.5 million-visit increase in attendance included a 9.2 million-visit increase resulting from attendance at the legacy Six Flags parks following the Merger, offset in part by 460,000 fewer visits at the legacy Cedar Fair parks as a result of the fiscal calendar shift in the third quarter of 2024. The remaining 200,000-visit decrease in attendance at the legacy Cedar Fair parks was due to extreme weather and related operating disruptions during the quarter at multiple parks, including the impact of Hurricane Beryl in July, Hurricane Debby in August, and Hurricane Helene in September.

Of the $1.43 decrease in in-park per capita spending, $0.77 was related to the impact of in-park per capita spending at the legacy Six Flags parks, with the remaining decrease attributable to a planned decrease in average season pass pricing and a higher mix of season pass visitation at the legacy Cedar Fair parks. These per capita headwinds at the legacy Cedar Fair parks were partially offset by improved in-park guest spending on food and beverage and extra-charge products, including Fast Lane, at the legacy Cedar Fair parks. The $16 million increase in out-of-park revenues included $21 million contributed by legacy Six Flags operations, offset by a $5 million decline in third quarter out-of-park revenues from legacy Cedar Fair operations due to the fiscal calendar shift.

sold at the legacy Six Flags parks, and the remainder of which was driven by an increase in food and beverage costs at the legacy Cedar Fair parks.

Depreciation and amortization expense in the third quarter of 2024 totaled $145 million, an increase of $79 million compared with the three months ended Sept. 24, 2023. The increase included $95 million of depreciation expense that was attributable to legacy Six Flags, partially offset by the impact of a change in interim depreciation methodology for legacy Cedar Fair. During the third quarter of 2024, the Combined Company also recognized a $5 million loss on retirement of fixed assets and a $42 million non-cash charge related to the impairment of goodwill at the Schlitterbahn parks.

Net interest expense for the quarter totaled $82 million, an increase of $46 million compared to the prior-year third quarter. The increase reflected $39 million of interest incurred on debt acquired in the Merger, incremental revolver borrowings in the third quarter, and the impact of the full redemption of the 2025 senior notes with a new $1.0 billion senior secured term loan facility. The refinancing events during the third quarter also resulted in a loss on early debt extinguishment of $2 million, representing consent payments on the 2025 senior notes.

During the three months ended Sept. 29, 2024, the Combined Company recorded a provision for taxes of $43 million, compared to a provision of $51 million for the third quarter of 2023. The decrease in provision was primarily attributable to lower pre-tax book income relative to the comparable period and certain discrete tax effects associated with the Merger, partially offset by non-deductible executive compensation and state and local income taxes.

Based on preliminary operating results, attendance for the Combined Company over the five-week period ended Nov. 3, 2024, totaled 6.5 million visits, a 20% increase compared with combined attendance for legacy Cedar Fair and legacy Six Flags over the same five-week period last year. The strong demand in October also helped produce an increase in sales of 2025 season passes. Over the past five weeks, sales of season passes and memberships across the combined company were up 60,000 units, or 8%, compared to combined legacy Cedar Fair and legacy Six Flags sales over the same period last year, bringing year-to-date unit sales up 2% over this same time last year.

Six Flags today also announced the core objectives of its new long-range plan designed to deliver on the full growth potential of the Combined Company. In many cases, the new objectives represent the natural extension and evolution of strategic initiatives that contributed to the success of legacy Cedar Fair.

Six Flags also noted that as part of Project Accelerate, it has established a new annual unlevered pre-tax free cash flow target of at least $800 million by 2027. Management believes the sustained level of free cash flow growth necessary to achieve this target can be achieved by increasing annual attendance to more than 55 million guests and expanding full-year Modified EBITDA margins(2) to more than 35%, all of which would support the Combined Company’s goal of reducing Net Total Leverage(5) to less than 3.5x Adjusted EBITDA by the end of 2027. Doing so will help position Six Flags to drive sustained, profitable growth and considerable value for its shareholders.

As previously announced, Six Flags Entertainment Corporation will host a conference call with analysts starting at 10 a.m. ET today, Nov. 6, 2024, to discuss its recent financial results. Participants on the call will include Six Flags President and CEO Richard Zimmerman and Executive Vice President and CFO Brian Witherow.

Investors and all other interested parties can access a live, listen-only audio webcast of the call on the Six Flags Investors website at https://investors.sixflags.com under the tabs Investor Information / Events & Presentations. Those unable to listen to the live webcast can access a recorded version of the call on the Six Flags Investors website at https://investors.sixflags.com under Investor Information / Events and Presentations, shortly after the live call’s conclusion.

Some of the statements contained in this report (including the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” section) that are not historical in nature are forward-looking statements within the meaning of the federal securities laws, including Section 27A of the Securities Act of 1933, as amended,

and Section 21E of the Securities Exchange Act of 1934, as amended, including statements as to our expectations, beliefs, goals and strategies regarding the future. Words such as “anticipate,” “believe,” “create,” “expect,” “future,” “guidance,” “intend,” “plan,” “potential,” “seek,” “synergies,” “target,” “will,” “would,” similar expressions, and variations or negatives of these words identify forward-looking statements. However, the absence of these words does not mean that the statements are not forward-looking. Forward-looking statements by their nature address matters that are, to different degrees, uncertain. These forward-looking statements may involve current plans, estimates, expectations and ambitions that are subject to risks, uncertainties and assumptions that are difficult to predict, may be beyond our control and could cause actual results to differ materially from those described in such statements. Although we believe that the expectations reflected in such forward-looking statements are reasonable, we can give no assurance that such expectations will prove to be correct, that our growth and operational strategies will achieve the target results. Important risks and uncertainties that may cause such a difference and could adversely affect attendance at our parks, our future financial performance, and/or our growth strategies, and could cause actual results to differ materially from our expectations or otherwise to fluctuate or decrease, include, but are not limited to: general economic, political and market conditions; the impacts of pandemics or other public health crises, including the effects of government responses on people and economies; adverse weather conditions; competition for consumer leisure time and spending; unanticipated construction delays; changes in our capital investment plans and projects; anticipated tax treatment, unforeseen liabilities, future capital expenditures, revenues, expenses, earnings, synergies, economic performance, indebtedness, financial condition, losses, future prospects, business and management strategies for the management, expansion and growth of the Combined Company’s operations; failure to realize the anticipated benefits of the merger, including difficulty in integrating the businesses of legacy Six Flags and legacy Cedar Fair; failure to realize the expected amount and timing of cost savings and operating synergies related to the merger; legislative, regulatory and economic developments and changes in laws, regulations, and policies affecting the Combined Company; acts of terrorism or outbreak of war, hostilities, civil unrest, and other political or security disturbances; and other risks and uncertainties we discuss under the heading “Risk Factors” within Part II, Item 1A of the Quarterly Report on Form 10-Q for the quarter ended June 30, 2024, in legacy Cedar Fair’s Annual Report on Form 10-K, in legacy Six Flags’ Annual Report on Form 10-K and in the other filings we make from time to time with the SEC. Readers are urged not to place undue reliance on these forward-looking statements, which speak only as of the date of this document and are based on information currently and reasonably known to us. We do not undertake any obligation to publicly update or revise any forward-looking statements to reflect future events, information or circumstances that arise after publication of this document.