Q1 2022 Six Flags Entertainment Corp Earnings Call
Good morning, ladies and gentlemen, and welcome to the six flags Q1 2022 earnings Conference call. My name is Erica and I'll be your operator for today's call.
The presentation all lines will be in a listen only mode. After the speaker's remarks, we will conduct a question and answer.
If you have a question at that time simply press Star then the number one on your telephone keypad. If he would like to withdraw your question press the pound key.
I'll now turn the call over to Steve Purtell, Senior Vice President Investor Relations.
Good morning, and welcome to our first quarter of 2022 call with me is Chilean peso President and CEO of six flags, we will begin the call with prepared comments and then open the call to your questions. Our comments will include forward looking statements within the meaning of the federal Securities laws. These statements are subject to risks and uncertainties that could.
Cause actual results to differ materially from those described in such statements and the company undertakes no obligation to update or revise these statements. In addition.
Call, we will discuss non-GAAP financial measures.
You can find both a detailed discussion of business risks and reconciliations of non-GAAP financial measures to GAAP financial measures in the company's annual reports quarterly reports and other forms filed or furnished with the SEC.
At this time I will turn the call over to Felipe.
Good morning.
Thank you for joining our call.
Today, we will focus on three areas first I will provide an update on the improvements we are making in our parks second Steve will go into more detail about our financial results and our outlook for the remainder of the year.
Finally, I'll return to discuss our strategy and why we are excited about our future over both the short and long term.
Over the past few months, we have been executing quickly to improve the guest experience focusing on our largest part first and implementing the six objectives I highlighted on our last earning calls.
Objective number one improving our efficiency and convenience while it is early we are very pleased with our progress improving right throughput, which has increased our rights per guests per day metric that.
<unk> has consistently ranked as the number one determinant of guest satisfaction.
In my first 100 days I was shocked to learn that nearly 30% of the seats on our coasters at MTV Everytime. It train leaves the station because groups don't want to split up.
This was clearly inefficient and exacerbated our problem was long ride wait times.
To fix this issue we have implemented single rider lanes on our busiest days, allowing guests who are willing to write solo to move quickly through the line and fill the empty seats.
This has been tremendously well received by our guests as you can see on the social media.
Our guests have responded favorably to this change is also introduced skip the line passes for one right and each right.
Two.
Creating funds through employee friendliness.
One of our biggest guest complaint last year was the and the staffing of our parks.
To fix this issue this year, we began our recruiting efforts earlier in the season than was customary in the past.
I'm pleased to report that our staffing levels are greatly improved versus last year.
Bruce staffing of our parks together with our enhanced training efforts has empowered our team members to deliver exceptional guest service.
Sorry.
Improving bottom opinions, we have moved quickly to update the front gate experience at several of our large box, including entirely new entrances with a modern aesthetic normal ticket booths from the 19 eighties, our new front gate experience allow us to welcome our guests to the new and <unk>.
Prove six flags with a good first impression.
We have also worked diligently to improve our landscaping and renal many of our restaurants to modernize them and expand that capacity.
Finally, we have given many of our restaurants makeover by updating their equipment and enhancing there are pieces. This is an area very close to my heart.
For providing better quality food.
Our new executive chef and his team have done an amazing job re imagining our menus. There have we created improved version of our top selling item such as burgers and pizza and chicken tenders. They have created new healthier options like our Asian, consult and our rotisserie chicken.
And they have created delicious new items like our pan out of and Bad news.
The food quality of our new menu.
It's for fast superior to anything we've offered in the history of six flags and our guests have been excited about these improvements.
That being said I have been in the foodservice business for over two decades.
Note that quality food service is all about execution and consistency.
So our focus right now is to train the foodservice team at each of our local parts on how to deliver a new menu with speed.
We plan to integrate the new menu across our parks on a rolling basis through this operating season.
In addition, we are adding select premium brands in our parks like fat burn good Starbucks Costa coffee and tea and we are also focusing on coffee and we introduced our own brand of coffee shops coal coal roller coasters coffee.
All of which will further elevate our food and beverage experience and allow our guests to engage with familiar brands that they love.
Five offering more guest amenities.
Indirect response to guest feedback we have added extra benches and shade structures throughout our parks. So guests can sit and relax and patents can experience some quite time, while the children enjoy the park. We have also added more seating capacity dining area and improve the comp.
Political party dining table with seat cushions and overhead shaped.
Again as I learned from my Foodservice days.
It's often the little details like this that go along with toward delighting customers.
Small details can ruin 100% of the experience.
Those are huge I mean, it's you are working on is to upgrade our Wi Fi and cell coverage in all of our parks.
Finally objective number six.
Upgrading our guest facing technology and in particular, our mobile app.
We have begun adding digital screens in several of our last box that displace current wait times for rides and restaurants. This will help our guests blended activities and navigate our parks more efficiency.
Feedback has been very positive and we plan to roll this out across all of our parks by year end.
We're also working to upgrade our mobile app over the next few months to deliver a more seamless experience, including features such us providing data for guests to help them plan said they in the park in advance so before we get to a pot you can be planning this whole day for you.
Children your friends and your grandchildren.
Second we want to allow our guests to the reserve the parking spots the night before and to know the walking time from one right.
To restroom to another.
Improving access to the digital plus past just skip the line without the need to go through guest services.
And increasing usage of our mobile food ordering system. This is a huge opportunity for us.
Because today very few of our guests are using our mobile food ordering system and we believe that is huge opportunity there to make us more efficient and create a better guest experience through ordering food online.
We are also working on an interactive digital map that will help guests seamlessly navigate the pot, which should expect to start in 2023.
From what you were hitting them.
Innovation is core to the DNA of our new culture.
And we are committed to continuously adding new technologies to our parks to create a more seamless and enjoyable guest experience.
I am so proud of our team members for how quickly they implemented these changes.
It is a true testament to.
So as the benefits of decentralization and empowering our parks.
We are in the very early innings of transforming our in park experience.
But the signs of an improving guest experience are already becoming clear.
I'm pleased to report that for the first time in several reviews. Our guest satisfaction scores are trending upwards, which is encouraging to see.
Finally.
We have refocused our culture to prioritize the guest in everything we do.
And we fundamentally believe that by focusing all of our efforts on continuously improving the guest experience we will drive significant.
And sustainable earnings growth over time.
I will now turn the call over to Steve who will provide details about the quarter as well as the outlook for the remainder of the year, Steve back to you.
Thank you Shirley and good morning, everyone.
Total attendance for the quarter was $1 7 million gas a 25% increase from first quarter of 2021 Rep.
Revenue in the quarter was up $56 million or 68% to $138 million.
Because of our adoption of a new fiscal calendar in 2021, there are three additional days in first quarter 2021 during which we added tenants of 89000 guests.
In addition, this year, the Easter holiday, which affects the timing of spring break in many of our markets occurred later in April shifting approximately 201000 guests from the first quarter into the second quarter.
This increase of the tenants is driven primarily by the higher number of operating days in the first quarter of 2022 compared to 2021, which was negatively impacted by pandemic related closures and restrictions, particularly our parks in Mexico and California.
Total guest spending per capita increased $19 or 34% versus first quarter of 2021.
Admission spending per capita increased $10 or 31% and in park spending capital increased $9 or 39%.
The increase in admission spending per capita compared to 2021 was driven primarily by higher realized ticket prices for both single day tickets and the active pass base as well as by higher revenue from memberships beyond the initial 12 month commitment period.
Approximately $5 a day admissions per capita gain was due to a higher realized ticket prices driven by early progress on our revenue management initiatives, including our new premium pricing strategy.
The remaining $5 in admissions per capita was driven by higher membership revenue.
This is due to the fact that membership revenue was not recognized in first quarter of 2021 from members, whose home park was closed due to the pandemic.
So while the admissions per cap, we reported their first quarter of 2022 is representative of our normalized first quarter performance going forward.
The year over year growth is exaggerated due to the negative impact of a membership accounting in the first quarter 2020, 'twenty one admission per cap.
The increase in in park spending per capita compared to 2021 reflected our improved assortment of in park offerings are in part pricing initiatives and strong consumer trends.
We experienced higher spending across all categories, including sales of food Flash pass and retail.
On the cost side cash operating and SG&A expenses versus 2021 increased by $23 million or 19%, primarily due to the fact that several of our parks, we're not operating in the first quarter of 2021.
Excluding the price they were not operating in first quarter of 2021, our cash operating and SG&A expenses were lower year over year in the quarter as we have eliminated fixed costs through streamlining our organization and our park operators have become more efficient.
Since our park operations were impacted during the first half of 2021 by pandemic related closures and capacity limitations at certain parks. We believe it is instructed to also compare our results to 2019, which had a similar operating calendar 2022.
Relative to 2019, our first quarter of 2022 revenue increased by $10 million or 8%.
This increase was driven by a $15 or 54% increase in admissions per capita and a $12 or 58% increase in in park per capita.
Higher spending was offset by a 22% decline in attendance and a reduction in sponsorship and international licensing revenue.
Our first quarter cash operating expenses and SG&A decreased slightly versus 2019, largely due to the optimization of seasonal labor at our parks to adjust for lower attendance levels less dollar spent on advertising and a leaner corporate overhead structure.
Adjusted EBITDA for the quarter was a loss of $16 million compared to a loss of $46 million in first quarter 2021, primarily due to the higher attendance at our parks higher per capita spending and our efforts to operate more efficiently.
Compared to first quarter 2019, adjusted EBITDA improved by $16 million as a result of higher revenue and lower costs.
Our active pass base as of April three 2000, 2022 compared to three point.
It's comprised of $3 6 million pass holders, representing a decline of 12% versus the same time last year.
This included $1 8 million members and $1 8 million traditional season pass holders.
We have discontinued selling new memberships topical will discuss shortly.
For that reason going forward, we will only report the total active pass base.
Deferred revenue as of April three 2022 was $185 million down $60 million or 25% compared to first quarter of 2021.
The decrease was primarily due to the deferral of revenue last year from Jess whose benefits were extended from 2020 into 2021 due to the pandemic.
Total capital expenditures for the quarter net of insurance recoveries were $29 million.
We expect our full year 2022 capital spend to be slightly higher than 2021 with a balanced approach between several exciting new roller coasters and an increased emphasis on implementing guest facing technology and amenities in our parks.
Our liquidity position as of April 3rd was $712 million. This.
This included $406 million of available revolver capacity excuse me $460 million of available revolver capacity net of $21 million of letters of credit and $252 million of cash.
We expect to use cash from our balance sheet in July to pay down a portion of the 7% secured notes due in 2025.
Over the next 12 months to 18 months, we plan to further pay down debt and look to Opportunistically refinance our 2024 maturities.
However, we may also engaged from time to time to buy back shares Opportunistically if market conditions create a dislocation in our stock price.
Before I pass the call back to Celine I would like to provide an update on our pricing strategy and current trends.
We recently introduced a new season pass offering with three pricing tiers.
As a result, we discontinued selling new memberships.
Our membership offering was made redundant by our new season pass offering so we consolidated the two programs to simplify our overall product architecture.
While our existing members can maintain their memberships as long as they continue making monthly payments the new season pass program or buys new pass holders the opportunity for a truly premium we experienced at the highest tiers as well as the ability to purchase add ons and to enhance each visit.
Because we are no longer selling memberships with their monthly payment plans and we are charging higher price points for our new season passes we expect our active pass base decline over time.
We continue to test, our new pricing and promotional programs with the ultimate goal of maximizing our profitability.
It is still quite early in the process and most of our parks are not yet open full time. However, we are pleased with the early results based on our initial learnings we've decided to lean even more heavily into pricing and expect this will further lower our attendance.
Put this into context in 2019, we had approximately 3 million non paying guests that attendant to one of our various free programs are.
Our paid attendance was just under $30 million.
We have now deliberately eliminated almost all non paid attendance and year to date, our attendance is trending down approximately 20% from the paid attendance levels achieved in 2019.
In addition, we are facing approximately $80 million and cost headwinds in 2022 relative to 2019.
$40 million of these headwinds are related to labor wage rates and $20 million relates to our annual bonus accrual both of which we've called out in previous earnings calls.
The remaining $20 million relates to inflation and other input costs throughout our park operations, which accelerated over the past two months.
While we were able to successfully offset these cost headwinds in the first quarter through cost savings programs, we expect to see some impact on our cost structure in the subsequent three quarters of the year.
Finally, we continue to expect our 2022 adjusted EBITDA to be higher than our 2019, adjusted EBITDA driven by higher per capita spending and lower attendance.
This will give us a sustainable new base upon which to grow. So we expect this will help us improve our guest experience and maximize our profits over time.
Overall, we are encouraged by the initial improvements we're seeing in revenue and profitability and the value creation that will come from implementing our premium innovation strategy.
We feel we are well positioned to delight, our guests and to reward our shareholders over the long term.
Now I will pass the call back over to Sally.
Thank you Steve.
Our last call I talked about our decision to pursue a premier musicians, such which entails improving the guest experience and charging prices that are in line with the value we deliver our guests.
40 years, our primary objective was growing attendance.
Yes, while attendance is an important performance metric for our business. It's only one of many different variables that impact our bottom line.
Going forward, we are changing the way, we think about our business, we will no longer prioritize any one individual metric such as attendance per capita spending or active pass base.
Our primary objective will be optimizing profits.
Pete we made a conscious decision of trading off attendance for yield.
We feel very good about the strategy and we are encouraged by the momentum.
But there are many ways to achieve short term profitability and that is not our goal.
Our goal is to deliver sustainable earning growth overtime and.
And we believe the way to optimize profit in a sustainable manner is to continuously improving the guest experience. So as that will be our main focus.
This is a transition year for our company.
As a result, we are running less efficiently than we would like.
However, we will learn how to operate in this new environment and make improvements that will benefit us in the future.
Our new optimizations, such as a big departure from our historical strategy of selling seasons passes at low prices in order to upsell guests from single day tickets to season passes.
Raising price is no easy task for a company that has strained customers for decades to expect big discounts and that has already been some pushback from guests who are reluctant reluctant to pay our highest higher prices.
But we strongly believe that if we execute on our goals to dramatically improve the guest experience over time, we will recapture a portion of our lost attendance despite the higher prices.
There will be certainly bumps along the way, but we are confident that this approach will position us to deliver higher long term profitability in a sustainable manner and to increase the value of our six flags brands.
Based on what I've seen in my first six months on the job I believe six flags is well positioned to delight, our guests and to create significant value for our shareholders.
In the near term my optimism is based on a few factors.
First.
Growing consumer demand for local out of home entertainment.
U S consumers are eager to get back out and enjoy real world experiences with their families and friends and.
And we believe six flags sits squarely in the middle of everything a consumer is looking for right now our.
Our venues are extremely safe.
The votes and provide ample room for social distancing.
And they offer great value for the time, you spent part versus any other entertainment out there.
Second our.
Our guest satisfaction scores are trending upward and are now exceeding pre pandemic levels.
Elevated guest experience will allow us to sustain the higher guest spending levels as we move through 2022 into 2023 and beyond.
So we.
We have reduced our fixed costs and are diligently scaling our variable costs based on expected attendance.
This will allow us to increase our EBITDA margin. Despite the cost headwinds that we face today was inflation and wages.
Over the long term I am optimistic for several reasons.
First we have a unique value propositions.
Our combination of thrill rides and entertainment for the entire family provides a truly unique experience and an affordable form of entertainment that is resilient even in difficult economic periods.
I spent a lot of time visiting our parks.
This past weekend I wasn't the four hours and I was thrilled to see the number of families and strollers.
This is a fast growing segment of our strategy as mom with kids parents and grandparents are known to spend more dollars in our parks with their kids and grandkids.
Second.
<unk> are located in each of the top 11 markets in the U S, giving us access to the most lucrative markets around the country.
Several of these markets are also in some of the fastest growing regions of the country, expanding our addressable market and providing a healthy economic backdrop for our business.
Sure.
And most importantly.
It's about.
Of people.
We have a talented and dedicated team to execute our strategy.
Since I became CEO in November our team has really stepped up to the challenge of Reinvigorating This company.
And together, we have created a customer obsessed culture.
In addition, our team exhibited tremendous resiliency.
During a very challenging period over the past two years the strength of our people is truly why I'm confident that our future is bright.
We believe we have the right strategy.
The right culture, and the right team to take our performance to the next level there.
There are many exciting opportunities ahead, and I look forward to updating you on our progress as we improve the guest experience and increase our profitability.
Allow me to share a few some recognition we have been bestowed upon recently.
Late in 2021 Forbes.
Ranked us America's best among America's best employers.
In 2022, Forbes again ne.
Named US one of the best employers for diversity.
Recently.
S eight today.
Basically has an award called Reader's choice.
And we won 10 best Rollercoaster of 2022.
Three of our Waterpark made best Reader's choice.
To date in 2022.
Amusement today a leading.
Trade magazine.
Recently in 2022 gave us the golden ticket towards of best of the best.
For this I am very proud.
Of not only the recognition that our customers and our guests.
<unk> selected us as the readers choice.
And the fact that we are ranked among the best companies to work for year after year, but I'm very happy being recognized for our diversity.
And that our guests and our employees are stepping up.
As a REIT.
Imagining our company.
Does this.
I would like to open the call for any questions. Thank you.
As a reminder to ask a question you will need to press star one on your telephone to withdraw your question press the pound key.
We can pass the Q&A roster.
Your first question comes from the line of Steve <unk> with Stifel.
Yeah.
Hey, guys good morning good.
Good morning, Steve.
Good morning, Celine. So you just look at the helm now for let's call. It six months or so and I'm wondering if you put any more thought into how youre thinking about the long term.
The growth potential of this company and it seems like you guys are now, saying that 22, EBITDA should be higher than 2019 and no debt.
Makes sense and that should set a baseline moving forward, but once we kind of get that baseline.
Wondering maybe if you can.
If you can help us think about how we should think about.
EBITDA growth moving forward based on the changes youre, making to your operating strategy. Thanks.
Steve Let me address that.
You can think about it.
Several ways.
Think about.
What what is the maximum guest experience, we would like to provide.
Because it's a direct group.
Our relationship with.
In correlation to what the guest is willing to spend so I'm going to take this question a little bit more on the mind of all of us.
Is to say what do you see the future. So allow me to take a few minutes on this.
One.
Issue is today, if you're going to be spending and now we're waiting to get your food in any of our food outlet.
Youre not going to order food again, youre going to say I didn't come spend an hour here.
20 minutes to get into the restrooms 45 minutes to get into the parking block 45 minutes to get through the entrance it ruined everything and the spending goes down we believe there is a certain level.
A number when we share all our parks, we believe that as the numbers.
That we believe is the highest optimum attendance, we would like to see across the part in the years to maintain the highest.
Guest experience now.
That number can vary.
To date, if you think about the.
The past few years, we've been running roughly.
$30 million a.
A little bit short when you take the freebie tickets.
<unk> 29, and a half to 30 million attendees.
It was.
Treating our parks, our guest schoolwork down we believe that short of that.
It should be.
A number that will be more comfortable and I don't have that number but it's going to be I believe at least 10% to 15% short of that number to create that.
Ultimate experience that people want to have so as I walk the park today.
And you saw how quickly.
Our guest experience I'm not talking only our internal I can share it on Facebook on Yelp on trip advisor on Google reviews, all help trend up trended up very quickly because we have limited our attendance in our park by raising the price of the ticket and eliminated the freebies under discount and the.
The all dining all seasons dining meals that brought a certain type of people on our part and clubbed out.
And created choking points everywhere so.
So I believe we don't know that number exactly what it is we're testing. It I think this year is going to tell us, but do you have an optimum number I gave you roughly a little bit what it's going to be.
We believe that our customers are willing to pay more for that experience.
So.
<unk>.
Give me most probably buy a few more quarters I will be able to tell you roughly what is our optimal attendance would like to have.
Okay. That's.
That's great color Selim.
Question would be you mentioned in your prepared remarks, you have got.
Some pushback from.
Certain yes, so if you started to push prices higher.
I'm just wondering was that pushback.
Not material or is.
He was the pushback coming from some of your lower yielding guess so no.
Honestly youre not almost say this the wrong way, but youre not overly upset if they don't.
Don't come back because this is essentially part of your strategy change. So let me give you I can address that the.
The pushback has come back from.
Basically three areas.
Specifically one.
We have a big.
I'm not a big I would say a number of guests.
Once a monthly plan.
Meaning.
Want to pay monthly and we have eliminated that monthly plan.
Uh huh.
And we are rethinking about that and we want those people to be in jabil to enjoy that bulk we'd like this type of customer but for whatever reason our monthly plan. The way it was done before which is through our membership had too many things attached to it too heavy discounting a meal plans free parking no blackout.
<unk> heavy discount on retail heavy discount on crude so we stopped it we grandfathered whoever is in it and we said we're going to stop that but I think we need to rethink about a monthly plan.
Is it is catering to that segment of our guest that we'd like to continue paying monthly and we are rethinking about that and I think we're.
Putting plans together to introduce something this summer.
So that will most probably take care of that of those people, who we lost just because they would rather pay on installments.
We will reintroduce that that's an easy is solved we had the lag we'll get these captured a big portion of those people. The second part of our customers are customers, who like to come and eat out part.
Neil.
All seasons.
Dining meal.
Which is attached with the season pass that.
Dining meal was highly unprofitable.
Very unprofitable for us.
And it was shocking everybody else. So we have a part of our population that I can name around.
10% of our guests like the dining plan.
And I can tell you the numbers it was around $80.
For the full year for the full season, and it's included lunch and dinner for the fall season, and free drink free meals free snack.
Very very.
The expense run and shocked everything.
So those people would come in and they can have.
Several of those and sometimes.
They will most probably abuse the system.
As you've seen online and it created a lot of choking point for those people coming in and regulators who came to Ito Park All day long and then room to expand if somebody who came in on a single day ticket was their family who paid a lot of money to come in paid parking and came in and now.
They have 45 minutes to an hour waiting to get a meal, while those other people off.
Shocking the line for $80 for the whole season, So that's gone.
And those people are most probably upset I see it on the social media and upset about that so if we want to introduce a dining plan. It has to be taught to visit.
Third is.
A number of people who came on a freebie.
Meaning.
Bring a friend alone.
And we had a lot of those in 2019, there were over 3 million free tickets.
I don't want three tickets free tickets people renal data those people don't spend any money in our parks.
They come for free they come in they don't even buy a bottle of water.
So from that perspective, I don't want to have them both out of the three components.
Off with <unk>.
We've seen our attendance.
<unk> now.
<unk> addressed one of them because I think it's fair to Andrew's monthly plan will most probably rethink whether were introduced the dining plan it seasonal or not what are known as exclusive but it's going to be completely changed from what people expect because I want to avoid the talking points.
So from that perspective.
We are tweaking, where we're going but I will tell you the <unk> the <unk>.
We'll get a better guest have gone up significantly.
Our guest satisfaction score is fantastic.
And we are re imagining the industry not only six flat because the whole industry is about attendance.
Unfortunately wall Street analyst.
Everybody investors, saying, how much how many people came to your park and I think there was a condition.
To create that.
That means to show higher attendance.
And it's complicated the business it complicated the way.
Our employees, we're delivering the service.
Our accounting it's complicated.
Security and safety.
So anecdotally I'm going to leave you with the last note on this.
Our safety incidents compared to last year are down by 80% I'm talking security item, where people would get into argument in the parks.
By 80%.
Okay. Thank you that's terrific color really appreciate it.
Thank you.
Your next question comes from the line of James Hardiman with Citi.
Hey, good morning.
Thanks for taking my call.
And I appreciate all the all the new color right. Because this is such a new strategy.
I think a lot of us have been sort of struggling to put the pieces together and so.
We we have a full quarter of results, albeit sort of an incomplete time of year seasonally.
But then all of the anecdotal commentary is really helpful, but I want to make sure I understand at least some of what you've given us today. So.
If we compare first quarter results for 2019 attend.
Attendance was up more than our down I should say more than 20% per caps are up more than 50% margins were up pretty dramatically versus 19.
I think I heard how you sort of.
Lay out the shape of things to come over the course of this year is that youre going to lean into pricing even more.
And so a 10.
It might come down by even more per caps might go up by even more.
But maybe sort of margins are going to be tougher to grow it at the same rate that you did.
In the first quarter, but then maybe beyond this year you get back some of that attendance and you get back some of that margin.
So I guess the first question is is that is that a decent summary of how you see things going in the next few quarters and in the next few years.
James Hey, I'm going to turn it over to Steve, but I'm going to add a few things one.
There is a lag as you mentioned between people recognizing the beautiful <unk> I'm going to talk about it.
I'm Gonna most probably hopefully talk about beautification on one of your questions and I'm going to tell you what you've done and good vacation and specific details.
And there is a lag between people, who say, okay Selim raise the price.
What am I getting for so first I told you I will talk about the number of new rides, we have coming in the parks I'm going to talk about all the things that we've been winning and then I will tell you anecdotally what I am seeing given the fact that I am very vague.
Extremely pushing on the last 5% of excellence and we will talk cubic example, without but I'm going to turn it to Steve to address specifically, what we see from a little bit of forward looking.
Steve back to you. Thank you James and thanks for the question I just have to mentioned I understand that the web link didn't work at the beginning of the call and maybe it went live 10 minutes late if you missed any portion of the first part of the call. It is available on our website, where you can hear the full recording.
To go to your specific question James.
Youre looking at.
The year lay out as you said, we're going to lean more into two pricing and yield versus attendance and per capita again, we see in Q1 is quite dramatic growth over last year. Just to remind you are $5 of that is of that growth is due to the.
Membership accounting so that the Q1 per cap does represent what we will see going forward assuming that we have the same membership profile a year from now but the growth rate over last year is exaggerated if you take $5 off that's probably more representative of the growth rate.
Going forward you typically do see per caps decrease from Q1, because the membership accounting impact is less pronounced than the higher attendance quarters, and we have water parks opening up.
So while we do expect them to remain at elevated levels not quite to the same degree I'm looking at costs. We did call out that we have these cost headwinds.
We have taken to the wage increases over 2019, which we called out to be about $40 million impact we had the bonus and we have the other inflationary increases of another $20 million, which we're going to work to offset we were able to do that in Q1 successfully but.
Likely that we will see those impacts in the net.
Three quarters would not be able to fully offset but I think if you look at that.
If you look at the attendance being down from so far this year, 20% paid.
Paid basis, that's the trend we're seeing early in the year and we still have 85% of your tenants left after April but.
So as you have it the year might shake out.
James Let me know Peco, Steve Let me come back and give you some more flavor about pricing.
I have to congratulate seaworld and Cedar fair for how they have maintained better pricing integrity is enough. So even with our new pre memorization strategy will remain around 25% to 30% below them.
On average across every one of ours, whether it's single day ticket to season pass they are we at a below them.
And.
I need to most probably get through that gap that I need to close so we didn't close all that gap already with our price increase and we anticipate to close the gap may be some with and maybe this summer or maybe you are getting of next year, because we have most.
<unk> taken.
Fees on all of our guests and we are a little bit coy of taking another price increase maybe just shift maybe if were bowled well do it again, a second time this year if not for short towards the end of the year, we're going to take and catch up with our competitors.
<unk> or our other I don't want to call them competitors, because ultimately we don't compete in many of the markets but against our.
Our industry peers, who have done a tremendous job in getting the integrity of the pricing. So we have room, another 20% to 30% just to catch up to them.
That is all really good color and then just maybe one more follow up here.
So when you talked about sort of the optimal attendance.
And if I'm doing the math right youre talking down 10% to 15%.
Versus the 2019 number adjusted for the free tickets right. So you know if it was $33 million in 2019 30 million paying and then 10% to 15% lower than that so we're in that sort of down 20% range.
I guess I use that just making sure that math is right, but b what does that allow you to do on the cost side. It seems that many fewer customers.
There should naturally be some meaningful cost offsets that allow you to sort of dig into some of the cost inflation that Steve talked about.
Yes.
I can take that question as well. So we are definitely looking at our labor hours in the park, which is the staffing levels. We can adjust based on attendance. So when we have this.
Just more manageable volume of attendance and enables us to scale back on security because we're having less incidents in the parks as we are able to look at a.
Our restaurants are stores that are open and also the hours that they're helping because the attendance pattern is also changing with the different guest profile. So the parks they empty out early or late earlier in the evening and people may arrive at different times during the day, which has enabled us to scale back that biggest cost we have which is the seasonal labor.
Then you see the impact from it during Q1.
Okay.
I think the other part I would like to talk about is literally.
Providing.
If you upgrade as we upgrade our.
Experience.
I start with a couple of things.
One.
Let's start with beverages.
Our beverage program I'm talking beyond Coke.
And sort of.
Im talking about alcohol, we just know I wasn't the park again most of that day.
And I spent a.
Five hours in the park with our team.
Toss that we'll talk about that I'll talk about my strolling in what my guess told me because they recognize who I am as I walk in the prior been there quite a bit.
People know me if they stop Nuomi as I work with our team members and I've told them improve this endpoint into this and all that they stopped coming at me and telling me how they enjoy box on mothers' day.
What's was fantastic it was.
Today, we have just put in.
Tasks can you Buck.
Fantastic.
Pass it touch shape it has.
Fans. It has this thing to it and it's opening up by Memorial Day weekend.
This bar can fit most probably 40 people sitting there and you're watching the royal close to going and there is a shade. We are doing a lot more alcohol serving adults can come in little children run around you can get it.
And Mohit <unk>.
Margherita.
And enjoy initiate being missed it enjoying and sitting which we did not do before.
We did not do this.
Talking about coffee.
We are putting coffee in phase III.
And we know that coffee in phase III is a good thing that attracts our people we've seen the growth of coffee and we need to embark on a complete coffee and upgraded hot and cold drinks that gives us a better experience.
So for me I see those are tremendous opportunities to grow the other opportunity to grow is the ability to move.
Move people around to gives them an experience when did an impulse buy on our merchandising.
Impulse buy an all flash passes.
On Sunday, there was a group of four two.
Two brothers and two friends they were for sitting in our all Star Cafe.
And I said.
So to ask them, how do they get absolutely speed instead of just moved from Denver.
It was the first time in the park and they just opened.
Exotic car dealership to sell exotic car dealership.
And they came to the park.
And they told me what the luck of the park. They came in Sunday is the only day and they all our partners in that business. They wanted to take an escape and they came.
And they enjoy the fact that immediately whether the part cat 6000 people or 20000 people, they're going to buy a flash pass.
They bought the flash pump they.
They said Selim I wanted flash Bob I said, how would you think feed them a plasma delightful it will not come to your parks was other flash Bob I think flash, but it was easy for them. It was the only QR code. They got the QR code then they were eating.
And they all the chicken tenders and burgers.
And some of them had to be one of them had a shake and I asked him how was the food they said tremendous.
Tremendous.
I loved the Burger, it's fresh it's surprised unexceptional the chicken tender they raved about the chicken tender and those are.
What I call very foodie type people and I was very proud of what they say this is type of clientele I want they come in they bought the flash pass they came in they order food on our table. They had milkshake the head it would be if they had all of that and they ate and then.
One of them showed me his back.
Both in terms of our new T shirts, we have tremendous retail merchandising.
Great job and they were excited about that this is the type of customers I want for friends and brothers.
And grandparents and mom.
And young family to enjoy a park and spend money and I think we have a propensity to extend the money. If the experience is good those people they came and they would chalk in line I bet you. They will most probably runaway they said I'm not coming back.
And I was delighted to see those type of customers coming in and I think its yield I want people to be able to spend more money you only spend more money in a part if your mood is good it should not frustrated and struggling and fighting other people and people pushing you to get their food and teenagers coming in and shop.
In between you and cutting lines.
This is the thing we have to change.
And we're doing it very fast, but this is not the way to cloud used to be I'm, sorry to say so it might take us a few quarters to get there. Thank you. Thank you very much.
I'm running too long on this but I want to give the flare.
No that's great stuff and I think everybody appreciates the picture of your Medicare So much appreciate it. Thanks guys. Thanks, James Thank you.
Your next question comes from the line of David Katz with Jefferies.
Hi, good morning, everyone. Thanks for all the detail I appreciate you taking my question.
Thank you David.
Pardon me so.
Do you have.
Could just talk about margins and whether there might be.
Target Notionally that you have as to where we could land right because there's so much change on the one hand, there. There's obviously cost pressures that Stephen talked about a bit on the other.
Where should this be sustainably long term some aspirational targets.
So this is Steve.
We don't have a target margin, but I would say our target is to grow revenue faster than costs, each year, and we expect our margins to be higher than in 2019.
As you've seen from Q1, we were able to grow revenue faster than costs, and we expect that to be the case going forward.
Alright, I think David I don't want we don't want to allude to this question, but certainly for US it's still too early we might need.
A couple of quarter, we know that we've given you somewhat of a indication that our EBITDA will be higher than 2019 give us a couple of more quarter. Because we are like you moving too many pieces right now the only thing I can tell you that cap you know the spending per guest is up significantly up but let's us.
See where we get we are still working on attendance with slots program in terms of the monthly plan that we need to institute.
And we need to understand also.
As the season goes into full swing.
We want to understand some of our parks have not yet opened.
So I need to get a flavor of what's going to happen, what's going to happen on a waterpark, what's going to happen too because and I'll walk through the park, let's take an example in our order parts. We just bought and it was very difficult to get 2000 brand new.
Lounge chairs.
So for me I don't know about all of you for me if I'm Gonna go see four times as somewhat to a waterpark I want to have a reserve seat I want to be able if I have my daughter, Who's 60 at all I wanted to be able to watch and obviously and not fight with everybody putting that tunnel is similar to a hotel at June .
To drive me Crazy when I go to a very expensive resort and now I have to get up at six in the morning. So I can put a book or put a toll on the chip.
Now if I don't put that.
I don't have a chair at the pool, well I came to it is ought to be on the beach. So there is not so.
So what we're doing now we are basically saying, we're going to charge for our chairs.
At the prime location.
So we're going to Institute, a new program with we're going to base. It gives you the experience that you would like to come in and you want to be days, you're going to upgrade the reserve chairs, which we've never done before youre going to come in painful chairs and paper Cabana, we increased our cabana. So all is moving is the guests that are going to accept painful.
I don't know, but youre not going to be sitting in that area unless you pick up your chair and Gabon us we've already paid.
Cabana, but we've increased them significantly we're elevating the experience on a waterfront, but all of this is dynamic.
Activities and pricing that we are testing thing thats never been tested.
We've never charged for chairs.
Season pass can come in and then you can put somebody can put 10 towels and never use the chat.
But then we had rules we can't take the Towels award and it created a lot of issues in our park today, we're putting chairs and youre going to be paying for the reserve you deserve.
So allow us a few more quarters to be able to give you a much better idea of where we are but everything we're trying to do is monetize in the fairway in the way you and me and our family expect to go to our water parks for example.
And we will have attendance coming too so we'll change our system. So I can go to you you were sitting in your chair watching your children enjoying the park and your own chairs and then.
I'm going to have an attendant come and say how can I serve you with the new system, that's being launched.
In the next months, so I can take all of those while you are sitting in your chair comfortably and annual renting umbrella umbrella for ramp so it's new for US. It's all dynamic I'm, sorry, I'm not being able to give you a specific number but it's all been done in the last I believe me Ive been here six months and we are changing almost every paradigm shifts towards.
Doing in this company.
I understood is there.
You know it is you do take the unusual step of referencing a couple of your other competitors in the marketplace.
Is there some reference you might be willing to make with respect to where.
Are there profitability.
Might be.
<unk>.
Is that maybe an aspirational level, we could talk about and I frankly, I wanted to sneak in one other detailed question, which was I know you've talked about the satisfaction scores have you given us a relative progress as to how much they have gone up.
We have no, but I don't know if Paul.
I think no I don't think we should come out in our at our peers with their profitability I think we.
Expect to be growing our margins over time, when you look at our guest satisfaction scores.
I can tell you that they are above pre pandemic levels now we have a scale from one to 10 that we have inside of our parks, where we've been doing the same surveys year. After year. So we have a very consistent baseline to look at so that's very encouraging.
Also managing to look at the social media and all the different sites and looking at the sentiment and we have seen the positive sentiment grow each month since January .
And.
In fact this.
The positive sentiment has gone over 90%.
In April .
When you look at.
The positive versus negative comments.
That's quite a bit higher than it was even just six months ago. So we feel very good about that so we can use Facebook for example in December 'twenty. One it was 73% positive 27% negative to date in March 2022, it's 91% positive, 9% negative and a huge change just in Facebook 18.
Percent improvement just in the few months.
And in by March we will not yet fully implemented with all the changes. So I can't give you that though I can tell you also on Twitter Twitter was 59% in December positive, 41% negative who are now 87% positive 13% negative.
Yes.
That's great. Thank you so much.
Sure.
Your next question comes from the line of Ian Zaffino with Oppenheimer.
Hi, great.
Just very quickly I just wanted to kind of you know a key in on some of the food you know you're talking about the Empanadas and and yeah as you know.
How long are you going to be thinking about.
The food business is this going to be increased take rate.
Is it going to be increased price I mean, it's probably could be both right.
How do we think about that as far as take rate versus price and.
Any other kind of color there.
As you kind of premium is the food offering thanks.
I think I think about a value.
And everybody understands value.
Value comes with space simple at the end, we still offer.
Mostly our business is fast food.
You're not still people go to impart they don't expected filet mignon.
Okay do you expect a decent burger a good hot dog.
Hey, good.
Chicken tenders are good pizza.
Those are most probably remain our major components of what people want to eat it's fast it's finger food they can get back on the rights and enjoyed the ride in the park.
The components of food is going to be the following.
Of course, when you go to a ballpark or do you go to a game or you go food.
Food is not cheap we are trying to create value value comes in many ways value comes.
We will never be able to offer a $2 hotdogs away Costco doesn't I wished I could would not setup infrastructure and cost wise to do that and people don't expect that coming to our parks or any parks or any ballpark for that reason, but.
They expect if theyre going to come that it should be consistently good product.
It should be fast it should be hot it should be all beef and be sizable.
<unk>.
We expect our pizza, if I'm going to give you a pizza it tends to be a very good size pizza real cheese, and the best tomato sauce, youre going to get people understand value.
So and it has to be fresh.
Hum.
Us.
I know that people will buy a good food if it adds value and I've seen that happen in the chain business.
The chain business, you still have what I call. The quick serve Macdonald the Burger King offering.
A decent burger, but took the growth what's happened a five guys.
Shake shack.
Berger.
Hub Daddy I can name many burger chains that have gone up fast Burger Johnny rockets.
Come up and been able to price a lot more than what our regular burger and people paid it even though it's not a gourmet burger, but the value was there to offer a burger to that cost $708.
I think we are.
Looking the same approach to elevate the game no. The other approach is alcohol. The other a pulse is coffee and beverages desserts.
Is part of our business that gives people it's hot in the summer.
Want to have more ice cream.
And we have not optimized to isolate people love ice creams.
The other thing we need to do is put cuts. We don't have we don't go to you you are in line or you're stalling I don't have those standing location, because we did not have the system. The handheld device that allowed us to take orders.
And so we're putting all of that technology. So I can go to you. So if you are sitting in line in a REIT that can come through and why you're sticking we can get it stick over in ice cream.
But today I Couldnt I could not do it we are constrained by our technology to be able to go through the park, we have a system and labor and Cogs and now we're putting that together, so I'm, putting a lot of technology in our food to create that value.
Alright, great. Thank you very much for the color. Thank.
Thank you.
Your next question comes from the line of Chris <unk> with Deutsche Bank.
Hey, good morning, guys I appreciate all the details and color so far.
You know what.
First quarter really impressive per cap spend understand the.
Attendance strategy the pricing strategy question.
As you get into peak summer and you open all the parks in <unk>, maybe skews a little bit to the Sunbelt right. Do you think the strategy is there any way to get any kind of early indication whether the strategy of pricing resonates with some of the parks in the.
More markets, where maybe population growth has changed a little bit in.
General demographics, or you know, maybe a little bit less favorable.
I think I think that if premium amortization statue works everywhere. So.
Let's talk about literally what drives our business that will drive our business as our top.
Six to seven parks.
Those six seven parks have already been out in open and we're seeing the optimization working now when you're talking about a smaller parts you might be right. We might have to do a little bit more dynamic pricing, but then we can offset it about a lot of cost down but think about a business 72, 8% of our business is run by our biggest parks and so far we.
<unk> been seeing the polymerization work on our biggest park now than it might be one or two parts with we're not going to be able to get to where we are exactly but thats less of a concern because they are not as big of a driver, but I think <unk> will work everywhere, maybe not to the same extent extent as it could work in Los Angeles.
Or in New Jersey or in San Antonio.
Or Dallas, but I would say.
We are pushing premium musician and we're willing to take the brunt of having lower attendance to create the brand and the willingness to come there that we're committed to the strategy. So I think one thing we should not be doing is suddenly.
Stop short after a couple of quarter and start discounting again.
So we're not going to do that we're going to continue saying we are a premium brand. We are a premium brand and we're going to continue across all our parks to do that there might be some dynamic pricing, but everything is going to go up and the value is going to go up and we're investing in the small part the same way we're investing in the Big Park was doing the purification all our smallpox.
We're doing all the work we're doing in our water parks across the board we're doing the all that.
Restaurant, restroom and restaurant upgrades and food upgrading all our parks.
I think we're going to see people willing to pay more to be in our parks.
Okay very helpful. Thank thank Selim and I guess, if we just look at it first quarter and again, that's really not the.
The full example, yet but.
When we think about per caps in park is there any way to break that down between what was pricing on menu items of retail and what was just kind of transaction count.
Chris I could take that is it was mainly.
Pricing revenue management initiatives in the parks. The one caveat I'd say is we did introduce the one day flash pass with the QR codes. So that was a new product offering which enhanced our revenue, but by and large.
Other items are.
Pricing and premium amortization of our offerings.
Okay very helpful. Thanks, guys.
Thank you.
Your next question comes from the line of Barton Crockett with Rosenblatt Securities.
Okay. Thanks for taking the question.
I guess.
One thing that I wanted to get your opinion on your stocks and stocks in the sector are really trading like.
There is one or maybe all three things coming at you.
First would be that.
There is some type of Colgate pull forward, that's unsustainable either in the.
The amount of money that people are studying in parks or the number of people coming to parks.
Two that maybe there is some type of a recession coming.
And <unk>.
Three that maybe there is some type of COVID-19 wave coming back that could affect attendance.
I was wondering if you could talk about your perspective on that do you see anything.
That would lend any substance to that or not.
Hey, Barton, it's Steve So I. Thank you for your thinking about <unk>.
Fears of recession our industry.
The regional theme park industry has been shown to be very resilient I think if you look at the OE or nine timeframe. Our attendants went down only 6% and if you look at what people are tending to cut back on and that type of environment would be vacation to air travel hotels, and we're really a regional destination that people drive to.
So if people don't go on their vacations, you do have that trade down effects because they still want these things with their kids in the summer.
You look at the what we've seen in our parks as far as in park spending being up as much as it is there's really no indication that people are feeling the pinch from the recession.
I think the.
All of the stimulus money and those types of things have kind of broaden their course I don't see that we're seeing the pent up demand.
That might be a concern that that will go away because a lot of our products have already been opened for the past year only in Submarkets are we kind of opened Werent opened this time last year. So I do think we feel really good about the way we're set up for basically any scenario that may happen. This time.
What about Covid I mean does that.
Cases are up does that have any impact on some markets in California that have been sensitive to that in the past.
I think that.
Please go ahead go ahead.
I say I think that we're learning to live with the virus and that.
Yes.
The case counts up you see the severity is quite low and I think people are just.
We're learning how to live within that environment, and they are still going out and.
You do see people.
Why did they have experiences theyre coming off of Covid, where they are kind of turning their focus to buying goods.
For their homes, but now you see kind of a reversal of that and people wanted to get back out and enjoy experiences and we don't think that will change.
I think the combination if that's the case.
No data on that I'm, just Boston, saying it from different perspective, if you if you look at two things.
This summer that I believe we haven't seen it yet so it's not something it's just anecdotally from me. If you believe gas prices have gone up and you're worried about cool that you were not going to be on a plane because mastercard off you're not going to be we are in the perfect environment to be outdoor and come in and again as type of entertained.
<unk> spent eight hours on our part for what you spend per hour, we are among the cheapest entertainment.
You will get out there and people are going to go out and I think they're going to go to outdoor so I believe if thats. The case, we should be benefiting a lot from people coming to the parks just because if you don't want to drive because of gasoline prices have gone through the roof.
And airlines cut back a lot of flights and driving more demand to fjord flights and more money I would say.
We have a big chance this summer to reap a lot of benefits.
We haven't seen it I don't want to say that as data predicting that but I bet. If I asked about we should be seeing an uptick.
Given those two trends.
Outdoor.
COVID-19 gives back.
Strongly.
Our door and gasoline prices in air fare tickets and not traveling they said, let's come spend a day in the park.
Okay.
That's helpful and then just separately.
Just curious if it was weather notable as an impact positive or negative in the quarter.
Hey, Barton, we always have weather.
So.
It's never perfect the way, we'd like at the base. So we don't really call out the weather impact.
Okay.
Alright, thanks, guys.
Thank you.
Your next question comes from the line of Paul Golding with Macquarie capital.
Thanks, so much and thanks, so much for the color.
I was wondering if you could remind us a bit about what the new yield opportunities will be through the app enhancements you mentioned.
QR code for taking orders.
We've heard about mobile food ordering.
Pilots I'm just wondering if you could highlight what new e-commerce opportunities might be as you enhance the app and then I have a feel of it. Thank you. So let's start first with the breakdown what monetizing opportunities parking where now we've put in a lot of preferred parking that before we used to give parking for free Xr's clause.
System parking has become a coveted.
Item. So we have preferred parking so parking is a new item for us it becomes a driver.
Flash passes and single Rider Lane was a QR code is another area for us of of monetization.
Other than tickets.
And admissions and seasons passes certain food becomes.
Our search monetization as we introduce more menu items better mine your items and we've raised prices number four is retail our retail stores are beautiful the our retail merchandise I have to give credit and.
I commend our procurement for our retail merchandise looks superb so from that perspective, those are truly the areas I see beyond admission that we're focusing on.
And I think we're hitting on.
For the areas that would be a good driver for us.
Great.
In terms of any costs you may be incurring as part of this the transformation I was wondering if there was anything meaningful on the cost base.
We should be keeping an eye on or expect to come out at some point as you.
As you deploy and settle on some of these enhancements. Thank you. So so part of it is capex buffer opex. So.
<unk> of Opex, Okay, our biggest.
Headwind is truly inflation and wages those are most probably the one that Steve talked about.
In terms of a few items as you know we are rolling out a ERP system. We are trying to make sure that it's rolled out correctly, we are putting all new Pos system in all of our parks and our being able to hold the handheld devices.
We're in the process of putting sensors throughout parks. So we can do real time with just installed all of those.
<unk>.
Digital unique digital screens outdoor screen that gives you real time in our park on rides in restaurants, we're rolling that up but I think a lot of it is capex that you've already incurred and we're going to continue to incur some of the opex. So I don't see much.
Major things in 2022 that will most probably be surprised beyond the headwind of inflation.
Inflation on buying ketchup cups.
Sure.
<unk>.
<unk> Mayo, what you just talked about that so we have a food cost and.
Waste utilities due to this has been up and wages I think there's nothing else that we have not expressed in this and we have talked about I think Steve gave those numbers and what they say.
Alright, thank you.
Thank you.
Your next question comes from the line of Dan Jenkins with Credit Suisse.
Hey, How's it going.
Hi, Ben on the cost on the cost side, you listed kind of three areas of optimization in the quarter seasonal labor advertising and then leaner corporate overhead.
And then you also called out the $80 million of headwinds that you feel in 'twenty two versus 19, I guess conceptually why would it make sense that you could offset those in <unk>, but not for the remainder of the year I guess, just one very large range of outcomes that you could help us bracket it a little bit.
Hey, Ben it's Steve.
Look at the Q1, that's our seasonally smallest quarter. So the overall costs.
<unk> for the whole quarter.
As you go into the year and all of our parks are open.
The amount of parts there with the wages become a bigger component of our overall cost base. So the fixed cost changes, we made will be less pronounced.
We also don't spend that much.
Advertising that type of thing in Q1, So I think it's just we're looking ahead and saying that as our volume of cost of goods go up.
And our labor hours go up that we could have it could be more difficult to offset all of those inflationary increases.
Okay. That's helpful.
And then on the price side I think Selim you mentioned, if I heard you correctly potentially taking another price hike this year.
Can you just kind of dive into the data points you are looking at that make you comfortable doing that either whether they are internally with your current customer base and kind of elasticity or external I think you've mentioned.
Potentially what peers are doing but would love to explore that.
I think I think honestly there is room to grow top pricing.
The question is when.
Do we do it again in <unk>.
One thing, helping us is all our customer and guests understand that inflation is everywhere.
Do we do.
Do it again remember we've done.
Core <unk> is a significant change.
And for our guests and the pricing.
While we are still below our competitor.
Other industry players not competitors industry players for our guests it's a big.
Leap with what <unk> done.
The question is do we go ahead in the midst of.
Inflation for our guests from gasoline prices going up.
Everything gone up in the hands of hurting their discretionary income to take another price and so it's just a decision point, we're going to do it but we don't know when.
So the question is.
We're thinking thing should we.
Goes through the years, let people enjoys a beautiful station, let them come to the park enjoy and see what we've done and enjoy.
Rawlings to France.
Talk about that I wanted to talk about that and give me a monopoly and been talking about that.
France is a section in the park in Dallas, That's beautiful and there are many of them around all our parks. They are different names to them, but they've been entered investor not taken care off and it was just a passage way.
In Dallas.
This in the park, France is a shaded area was beautiful trees. It has a a makeup all port.
Port French Fort.
And there was nothing there so what we've done we've put in a lot of flowers, who put in both French French flag, we reinvigorated. The fourth we went and put cannons on top of the Port and then.
We ended up putting flowers benches, and French music and we're opening up now.
The French pastry shop, French lathi and Ben Yes.
That was where I was there on Sunday.
And people were sitting enjoying this significantly.
The question is.
And I enjoyed it I sat there with them and talk to many of the guests sitting in France, and they said Selim. Thank you for bringing it back this is fantastic for us. So the question is.
So do we.
Uh huh.
Today again go take a price increase which we can we can we'll facing inflationary pressure like everybody else or should we let people enjoy.
All of those and say now I am willing to come back and do that so what do we do for US we've done it first without purification. So are these prices that verification now, we're letting people and Joe I am more leaning towards doing it more and most probably sometime in later summer to take prices.
If youre asking me maybe its a long way to answer the question, but I'm, giving you what's going on in my mind and the mind of our senior leadership team and our park President is to say Opportunistically. We can this is dynamic prices, we can take day to day, but our biggest opportunity now and then is to focus on our own.
Operating hours, our efficiency, our seasonal labor and then pricing will occur again this year, but the timing will be.
Leaning toward more.
Later in the year.
That's what we've done.
That's super helpful. One last one.
Might be helpful. I don't know if you guys have the data at your fingertips, but there's kind of two things going on one is the channel mix shift you mentioned.
Not 3 million Freebies and the park in 2019, the other is kind of a like for like <unk>.
Increase in ticket pricing, if we look versus 19 how.
How much of the per cap uplift.
Whatever data you have or that's total spending or admissions, but how much of that is kind of a mix from removing different channels and how much of that is pricing growth could take another customer if that makes sense.
The growth we see is all from pricing the channel hasn't changed that much I'd say the park mix the mix between single day tickets and season pass holders is that changed.
It's purely pricing that youre seeing.
But we like it.
If you had 3 million freebies, I mean isn't that almost 1000 basis points of price right. There on the per cap. If you take out 3 million people who weren't paying.
When I was talking about price I was talking about the price of the ticket itself back to Yelp the debt.
Yeah, you're right. If you have a free ticket that brings down your average yields.
Right. So the mix of people that you don't okay, maybe we can catch up offline I appreciate it. Thank you very much.
<unk>.
And there are no further questions in queue at this time I will turn the call back over to management for closing remarks.
So I want to thank everybody for the time and the questions and the engagement with US. Thank you very much I want to thank you for your continued support and I remain very pleased that six flags is uniquely positioned to create fun answering thrilling memories for all.
Take care and we hope to see what our parks. This summer and we hope to have an investor day sometime in the next few quarters to show you all what you've done at the parks and again. Thank you for all of US have been Blessed day Bye bye.
This concludes today's conference call. Thank you for participating you may now disconnect.
Yes.
Okay.
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Yes.
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