Q4 2023 Six Flags Entertainment Corporation Earnings Call
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Operator: Good morning, ladies and gentlemen. Welcome to the Six Flags fourth quarter and full year 2023 earnings conference call. My name is Jason, and I will be your operator for today's call. During the presentation, all lines will be in listen only mode.
Speaker Change: Good morning, ladies and gentlemen, welcome to the six flags fourth quarter and full year 2023 earnings conference call.
Jason: My name is Jason and I will be your operator for today's call. During the presentation all lines will be in listen only mode.
Operator: After the speaker's remarks, we will conduct a question and answer session. If you have a question at that time, simply press star then the number one on your telephone keypad. If you would like to withdraw your question, please press the star number two. Thank you. I will now turn the call over to Evan Bertrand, Vice President, Investor Relations, and Treasurer. Good morning, and welcome to our fourth quarter and full year 2023 earnings call. With me is Selim Bassoul, President and CEO of Six Flags, and Gary Mick, our Chief Financial Officer. We'll begin the call with prepared comments and then open the call to your questions. Our comments will include forward-looking statements within the meeting of the Federal Security Committee. These statements are subject to risks and uncertainties that could cause actual results to differ materially from those described in such statements. The company undertakes no obligation to update or revise these statements.
Jason: After the Speakers' remarks, we will conduct a question and answer session. If you have a question at that time simply press Star then the number one on your telephone keypad, if you'd like to withdraw your question. Please press the star and number two.
Jason: Thank you I will now turn the call over to Evan Bertrand Vice President Investor Relations and Treasurer.
Evan Bertrand: Good morning, and welcome to our fourth quarter and full year 2023 earnings call with me is Selim Mitchell, President and CEO of six flags and Gary make our Chief Financial Officer.
Well begin the call with prepared comments and then open the call to your questions are.
Evan Bertrand: Our comments will include forward looking statements within the meaning of the federal Securities laws.
Evan Bertrand: Statements are subject to risks and uncertainties that could cause actual results to differ materially from those described in such statements.
Evan Bertrand: And the company undertakes no obligation to update or revise these statements.
Evan Bertrand: In addition, on the call, we will discuss non-GAAP financial measures. Investors can find both a detailed discussion of business risks and reconciliations of non-GAAP financial measures to Gap Financial Measures, and the company's annual reports, quarterly reports, and other forms of follow-up are furnished at the end. Before we begin, a brief remark on the pending merger with Theaterfare. As many are already aware, on January 31st... We filed with the SEC our definitive proxy relating to the upcoming shareholder meeting to consider the pending merger and related matters. Our shareholder vote is set for March 12. And we're targeting a closing in the first half of 2020. Our call today will focus on the results of the fourth quarter and the full year 2020. We will not be taking questions about the proposed merger between Six Flags and Cedar Fair or any of the associated proxy materials. Next time, I will turn the call over to, Good morning.
Evan Bertrand: In addition on the call we will discuss non-GAAP financial measures investors 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.
Evan Bertrand: Before we begin a brief remark on the pending merger with Cedar Fair.
As many are already aware on January 31st we filed with the SEC, our definitive proxy relating to the upcoming shareholder meeting to consider the pending merger and related matters. Our shareholder vote set for March 12, and we are targeting a closing in the first half of 'twenty 'twenty four.
Evan Bertrand: Our call today will focus on the results of the fourth quarter and the full year 2023.
Evan Bertrand: We will not be taking questions about the proposed merger between six flags Cedar fair or any of the associated proxy materials. At this time I will turn the call over to Selene.
Good morning.
Selim A. Bassoul: Thank you for joining our call. Before we begin, I want to express our excitement about the proposed merger with Cedar Falls. We feel that this compelling combination will deliver value to our guests, our investors, and to our employees. As a reminder... Our special shareholder meeting to approve the merger will be held on March 12th, so please cast your vote.
Selene: Thank you for joining our call.
Selene: Before we begin I want to express our excitement about the proposed merger with Cedar Fair Rich.
Selene: We feel that this compelling combination will deliver value to our guests.
Selene: Our investors and to our employees.
Selene: As a reminder.
Selene: Our special shareholder meeting to approve the merger will be held March 12. So please cast your vote.
Selim A. Bassoul: As we close the second fiscal year in my role as CEO, I am encouraged by the signs I am seeing that our premiumization strategy is working. I see a growing interest and engagement from families wanting to visit our park, including multi-generational families, such as grandparents with grandkids, college students, and young couples with babies.
Selene: As we closed the second fiscal year in my role as CEO I am encouraged by the science I am seeing it does all premium position strategy is working.
Selene: I see a growing interest and engagement from families wanting to visit our parks, including multi generational families.
Selene: And parents with Grandkids college students and young couples with babies.
Selim A. Bassoul: Our iconic brand is synonymous with thrills and adventure, which excites children and makes adults feel like children again. My 18-year-old daughter begs me every weekend to take her to the park, and she can't wait until she is tall enough to ride the Hero coaster. I see customers willing to spend more time and more money at our park. By reducing overcrowding and friction at guest choke points, we have become an easier company to do business with and an easier part to navigate, which creates a better environment for guests and employees. Our guests, on average, are spending over 40% more per visit than they were before the pandemic. Guests of all ages can enjoy a full day of personalized and immersive experiences, complete with events, meals, and attractions, while enjoying more comfort and convenience. We have added VIP lounges, more private cabanas, new kid areas with activities and rides, upgraded sit-down restaurants, and expanded our culinary offerings from delicious finger foods and local brews to salads. Vegan, Premium Ice Cream, Freshly Baked Pretzels, Korean Corn Dogs, and Kafta Kebab.
Selene: Our iconic brand is synonymous with thrills and adventure.
Selene: Which excites children and mixed adults feel like children again.
Selene: My eight year old begs me every weekend to take her to the park and she can't wait and she is until she is tall enough to ride the hero coasters.
Selene: I see customers willing to spend more time and more money in our parks.
Selene: By reducing overcrowding and friction.
Selene: Yes sure points, we have become an easier company to do business with and an easier path to navigate which creates a better environment for guests and employees.
Our guests on average are spending over 40% more per visit than they were before the pandemic guests.
Selene: Guests of all ages can enjoy a full day of personalized and immersive experiences complete was events meals and attractions, while enjoying more comfort and convenience.
Selene: We have added VIP lounges, more private cabanas, new kids areas with activities done right.
Selene: <unk> sit down restaurants, and expanded our culinary offerings from delicious finger foods and local crews to solids.
Selene: Premium ice cream freshly baked pretzel Korean corn dogs and cats, you're talking about.
Selene: Guests can chill in all sports bar and watch the game on our large TV screen or hang out in our air condition state of the art E gaming lounges with kids and adult can compete and play.
Selim A. Bassoul: Guests can chill in our sports bar and watch the game on our large TV screens or hang out in our air-conditioned, state-of-the-art e-gaming lounges where kids and adults can compete and play. Guests can enjoy new events and culinary-themed festivals like Oktoberfest, Kids' BooFest, and Flavors of the World, and our enhanced signature events like TriFest with new haunted houses built with iconic horror brands such These were a hit with guests this year. I am also encouraged to see the positive impact that streamlining our organization has had on empowering our employees and creating a culture of expediency, excellence, and ownership. I will share a personal experience. I have noticed new food trends, such as bubble tea, popping up in various upscale shopping malls. My first bubble tea ever was at our park, and it was delicious.
Selene: Guests can enjoy new events and culinary themed festival like Oktoberfest get spooked fast and flavors of the world.
Selene: And our enhanced signature events like Fright Fest with new hump to the houses built with iconic hotter brands such as saw and jewelry.
Selene: These were to hit a hit with guests this year.
Selene: I am also encouraged to see the positive impact that.
Selene: That streamlining our organization that's had on empowering our employees and creating a culture of expediency.
Selene: Excellence in ownership.
Speaker Change: I will share their personal experience.
Speaker Change: I have noticed new food trends, such as bubble to pop up in various upscale shopping malls.
Speaker Change: My first bubble tea every once in a park and it was delicious.
Selim A. Bassoul: I watched as our team skillfully constructed this wonderful, freshly prepared bubble tea using the best ingredients, the best mixture of flavors, and served with a smile. Employees feel more connected to the guests, and I see the pride they have in their work. We are also seeing encouraging signs in our financial Since 2021, we have grown guests per capita by 17%, reduced full-time headcount by over 30%, lowered cash expense in the face of historical levels of inflation, leveraged key partnerships to expand sponsorship revenues, and paid down over $300 million of debt. In 2023, food and beverage revenues grew in both units and average pricing, exceeding our attendance growth over the same period. We also made good progress rebuilding our past base using more targeted media, promotional pricing, and introducing our new Six Flags Plus subscription-style program in June 2023 with a more profitable balance of benefits and price. Our progress continues with 2024 passes, which through January are up double digits over 2020. That said, we fell short of our financial target, and we faced unforeseen challenges like historical levels of inflation, abnormally challenging weather, and supply constraints. We have also made missteps, and we have learned that not every element of our strategy is equally successful.
I watched as our team has skillfully constructed this wonderful freshly prepared bubble tea using the best ingredients best mixture, all flavors and served with a smile.
Employees feel more connected to the guests and I see the price they have in their work.
Speaker Change: We are also seeing encouraging signs in our financials.
Speaker Change: Since 2021, we have grown guest per caps by 17% reduced full time head count by over 30% lower cash expense in the face of historical low levels of inflation leveraged keep partnership to expand sponsorship revenues and paid down over $300 million of debt.
Speaker Change: In 2023, food and beverage revenues grew in both Gulf units and average pricing exceeding our attendance growth over the same period.
Speaker Change: We also made good progress rebuilding our pass base using more targeted media promotional pricing and introducing our new six flags plus subscription style program in June 20th century, with a more profitable balance of benefits and price.
Speaker Change: Our progress continues with 24 2024 passes which drew generally are up double digit.
Speaker Change: 2023.
That said, we fell short of our financial targets.
Speaker Change: We faced unforeseen challenges like historical levels of inflation.
Speaker Change: Normally challenging weather and supply constraint.
Speaker Change: We have also made missteps and we have learned that not every element of our strategy is equally successful.
Selim A. Bassoul: But we are able to pivot quickly, and we are leveraging our experience to continuously improve and explore new opportunities. We are optimizing our events calendar to focus on those we have seen the best return on, and exploring exclusive events and special access passes to drive monetization. And we have tested where and when customers are willing to pay for convenience. And we have invested in guest-facing technology to enhance guest experience and create new revenue streams. This includes adding Mobile Wallet and Tap and Pay, which now comprise 40% of all in-park transactions. Additionally, our new mobile app, which makes it easier for guests to order food on mobile devices.
Speaker Change: But we are able to pivot quickly and we are leveraging our experience to continuously improve and explore new opportunities. For instance, we are optimizing our events calendar to focus on those we have seen the best return.
Speaker Change: While exploring exclusive events and special access passes to drive monetization.
Speaker Change: And we have tested where and when customers are willing to pay for a convenience and we have invested to enhance guest facing technology and create new revenue streams. This include.
Speaker Change: Adding mobile wallets, and tap and pay which now comprise 40% of all in park transactions.
Speaker Change: Our new mobile App, which makes it easier for guests to order food on marble mobile devices.
Selim A. Bassoul: New handheld point-of-sale devices providing greater flexibility to accommodate guests and enhance throughput, dynamic pricing, which has shown traction, extending the booking curve and capturing additional admissions revenue, and SixPay wristbands for Waterpark guests who don't want to carry their wallet or cell phone. I will discuss more exciting technological initiatives later on this call. We are guided by our mission to deliver an exceptional guest experience, and we believe this will deliver exceptional returns to our shareholders over time. With that, I would like to turn the call over to Gary to discuss the financial results for the course and the full year. Thank you, Selim, and good morning, everyone.
Speaker Change: New handheld point of sale devices, providing greater flexibility to accommodate guests and enhance throughput.
Speaker Change: <unk> pricing, which has shown traction extending the booking curve and capturing additional admissions revenue.
Speaker Change: And six Bay Wristbands for water Park guests, who don't want to carry their wallet or cell phone.
Speaker Change: I will discuss more exciting talking about technological initiatives later on this call.
Speaker Change: We are guided by our mission to deliver an exceptional guest experience and we believe this will deliver exceptional returns to our shareholders over time with that I would like to turn the call over to Gary to discuss the financial results for the courses and the full year.
Gary: Thank you Celine and good morning, everyone.
Gary Mick: I will start with attendance, revenue, and per capita, and then move to expenses and EBITDA for the quarter and the full year. I will then discuss our active pass-based metrics, select balance sheet items, and Capital Allocation, starting with the fourth quarter.
Gary: I will start with attendance revenue and per caps.
Gary: And then move to expenses and EBITDA for the quarter and the full year I will then discuss our active pass base metrics select balance sheet items.
Gary: And capital allocation.
Gary: Starting with the fourth quarter.
Gary: Total attendance was $4 3 million guests.
Gary Mick: 6% increase from 2022, driven by higher season pass and single day attendance during Friday. Revenue increased $13 million, or 5%, to $293 million, driven by higher attendance, partially offset by a decrease in total guest spending per capita of $0.96, or 1%. Admissions spending per capita decreased $1.44, or Four percent, offset by an in-park spending per capita increase of $0.48.
A 6% increase from 2020 to drill.
Gary: Driven by higher season pass and single day attendance during breakfast.
Gary: Revenue increased $13 million or 5% to $293 million driven by higher attendance, partially offset by a decrease in total guest spending per capita of 96.
Gary: Or 1%.
Gary: Admissions spending per capita decreased $1 44 sets, we're 4% off.
Gary: Offset by and in Park spending per capita increase of 48 cents or 2%.
Gary Mick: Yes, spending per capita decreased primarily due to lower revenue from memberships beyond the initial 12 month commitment period, what we call 13 plus, which is recognized evenly each month. 13 plus revenue was $12 million lower in Q4 2023 versus Q4 2022 due to the attrition of our legacy members. Excluding the impact of 13 plus revenue from both periods, which we believe is a better reflection of our average higher pricing in the fourth quarter and our in part monetization effort, guest spending per capita would have been higher than prior year by $2.35, or 4%, which includes an increase in admission spending per capita of $1.04, or 4%, and an increase in in-park spending per capita of $1.31. As a reminder, we made a strategic decision to discontinue the sale of new memberships in April 2022 due to the inclusion of rich benefits, difficulty to administer in the park, and drag on percaps and margins associated with this.
Gary: Guest spending per capita decreased primarily due to the lower revenue from memberships beyond the initial 12 month commitment period.
Gary: What we call 13, plus which is recognized evenly each month.
Gary: 13, plus revenue was $12 million lower in.
Gary: In Q4, 2023 versus Q4 2022 due to the attrition of our legacy members.
Gary: Excluding the impact of 13, plus revenue from both periods, which we believes that a better reflection of our average higher pricing in the fourth quarter and our in park monetization efforts guest spending per capita would have been higher than prior year by $2 35.
Or 4%.
Gary: Which includes an increase in admission spending per capita of $1 four.
Gary: Or 4% and an increase in in park spending per capita of $1 31.
Gary: <unk>, 5%.
Gary: As a reminder, we made a strategic decision to discontinue the sale of new memberships in April 2022, due to the inclusion of rich benefits difficulty to administer in the park and the drag on per caps in margins associated with this product.
Gary Mick: We launched the new Six Flags Plus in June of 2023 and plan to resume growth in the 13 plus base starting the second half. However, we expect to face 13 plus revenue headwinds in Q1 2024, which we estimate will be around 14. Moving on to cost, in fourth quarter 2023, we incurred $15 million of merger-related costs associated with the proposed merger. Cash operating costs, which includes cash operating and SG&A expense but excludes merger-related costs, increased by $12 million, or 8%, in the fourth quarter versus the prior year.
Gary: We launched the new six flags plus in June of 2023 and plan to resume growth in the 13 plus base starting in the second half of 2024.
Gary: However, we expect to face 13, plus revenue headwinds in Q1, 2024 that we estimate to be around $14 million.
Gary: Moving onto costs in fourth quarter, 2023, we incurred $15 million of merger related costs associated with the proposed merger with Cedar Fair.
Gary: Cash operating costs, which includes cash operating and SG&A expense, but excludes merger related costs increased $12 million or 8% in the fourth quarter versus the prior year.
Gary Mick: This increase was due to the following: First, higher attendance drove higher seasonal labor, cost of sales, and other variables. [inaudible] Additionally, we incurred incremental costs associated with new attractions and entertainment for our expanded fall events schedule. Third, we accelerated investments in guest-facing technology to ensure readiness for 2020. Lastly, higher inflation increased wages and... Adjusted EBITDA for the quarter was $98 million, essentially flat compared to fourth quarter 2022, which, as you recall, was a record, with higher costs offsetting higher. Moving on to 2023 full year results. Attendance increased by 1.8 million guests, or 9%, to 22.2 million. However, we estimate that adverse weather reduced full-year attendance by over 1 million. This includes rain and snow in California during spring break, followed by a record summer heat wave in Texas, and Rain or Threat of Rain in the Mid-Atlantic and Northeast.
Gary: This increase was due to the following factors first higher attendance drove higher seasonal labor cost of sales and other variable costs.
Gary: Second we.
Gary: We incurred incremental costs associated with new attractions and entertainment for our expanded fall events schedule.
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Gary: We accelerated investments in guest facing technology to ensure readiness for 2024.
Lastly, higher inflation increased wages and other operating costs.
Gary: Adjusted EBITDA for the quarter was $98 million essentially flat compared to fourth quarter 2022, which as you recall was a record.
Gary: With higher cost offsetting higher revenue.
Gary: Moving onto 2023 full year results.
Gary: Attendance increased by $1 8 million guests or 9% to $22 2 million.
Gary: We estimate that adverse weather reduced full year attendance by over 1 million guests.
Gary: This includes rain and snow in California during spring break followed by a record summer heat wave in Texas and.
Gary: Eight consecutive weekends.
Gary: Rain or threat of rain and the mid Atlantic and northeast after Labor day.
Gary Mick: Total revenue increased by $68 million, or 5%, driven by higher attendance and higher sponsorship revenue, partially offset by lower per capita. Total guest spending per capita decreased by $2.90, or 5%, driven by a decrease in admissions per capita of $2.56, or 7%, and a decrease in in-park capital of $0.34 or A decrease in Admissions Per Capita. The anticipated result of lower past pricing in the first three quarters of 2023 relative to 2022. In-park per cap decreased due to the higher mix of season-past attendance, partially offset by an increase in food and beverage sales in 2023 versus 2022. Driven by mobile food ordering, and new culinary offering for the full year. 13 plus membership revenue, impact on the year-over-year per-cap comparison. Regarding full-year costs, we incurred $38 million related to an upward revision of our self-insurance reserves in the second quarter of 2020, in addition to the $15 million of merger-related costs in the fourth quarter. Cash operating costs, excluding merger-related transaction costs and self-insurance reserve adjustments, increased by $61 million, or 8%.
Gary: Total revenue increased by $68 million or 5% driven by higher attendance and higher sponsorship revenue.
Gary: Partially offset by lower per capita spending.
Gary: Total guest spending per capita decreased by $2 94 five.
Gary: 5% driven by a decrease in admissions per capita of $2 56, 7%.
Gary: A decrease in in park capital.
Gary: Of 34, 1%.
Gary: The decrease in admissions per cap was the anticipated result of lower past pricing in the first three quarters of 2023 relative to 2022 when prices were significantly elevated.
Gary: In park per caps decreased due to the higher mix of season pass attendance, partially offset by an increase in food and beverage sales at 23 versus 2022.
Gary: Driven by mobile food ordering new culinary offerings, and our expanded events calendar.
Gary: For the full year.
Gary: <unk> plus membership revenue impact.
Gary: On the year over year per cap comparison was negligible.
Gary: Regarding full year costs, we incurred $38 million.
Related to an upward revision of our self insurance reserves in the second quarter of 2023 and.
Gary: In addition to the $15 million of merger related costs in the fourth quarter 2023.
Gary: Cash operating costs, excluding merger related transaction costs, and self insurance reserve adjustments increased by $61 million or 8%.
Gary Mick: The majority of expense growth occurred in the second half of 2023 and was caused by several factors, many of which we expect to normalize in 2025. [inaudible] We expect advertising spending in 2024 to be in line with 2020. Second, we incurred incremental expenses associated with the expanded events calendar, and plan to optimize events in 2024, which will help mitigate these costs. [inaudible] Accelerated Technological Initiatives, many of which we expect will help mitigate labor costs in 2020. And lastly, significant inflationary pressure, estimated to have cost us $50 million, partially offset by full-time headcount reductions and procurement, and Justin Iveda for full year 2023. $462 million, essentially flat.
Gary: The majority of expense growth occurred in the second half of 2023 and was caused by several factors many of which we expect to normalize in 2024.
Gary: First we increased advertising by $18 million in 2023, and an effort to help rebuild our active pass base, we expect advertising spending in 2024 to be in line with 2023.
Gary: Second we incurred incremental expense associated with the expanded events calendar, we plan to optimize events in 2024, which will help mitigate these cost increases.
Third.
Gary: We accelerated technological initiatives many of which we expect will help mitigate labor cost in 2024.
Gary: Lastly, significant inflationary pressure estimated to cost us $50 million, partially offset by full time head count reductions and procurement savings.
Gary: Adjusted EBITDA for full year, 2023 was $462 million essentially flat with 2022.
Gary Mick: Our active pass base as of December 31st, 2023 comprised 5 million passes. [inaudible] As you will recall, our active pass base at the end of third quarter 2023 was 23% higher than the prior year third quarter. A sequential drop in prior year comparison from 3rd quarter to 4th quarter is primarily due to First, timing of our past promotions, which were focused in the third quarter of 2023 around labor, is being focused in the fourth quarter of 2022 during our November cyber. Second, there was a difference in the expiration date of our gold season pass between 2022 and 2020. 2022 gold passes were valid through the entire year, inspired in early January of the following... 2023 Gold Passes expired in early October ahead of Fright, and are not included in the 20. Deferred revenue as of December 31st, 2023 was $128 million, down 1 million or 1% compared to the prior year on our last earnings call.
Our active pass base as of December 31, 2023 comprised 5 million pass holders flat with last year.
Gary: As you will recall, our active pass base at the end of the third quarter 2023 was 23% higher.
Gary: In the prior year third quarter.
Sequential drop in prior year comparison from third quarter to fourth quarter is primarily due to two factors first.
Gary: As the timing of our past promotion, which was focused in the third quarter 2023 around labor day versus being focused in the fourth quarter and 2022 during our November cyber sale.
Second there was a difference in the exploration date of our cold season pass.
Gary: Between 2022 and 2023.
Gary: 2022 gold passes were valid.
Gary: Through the entire year.
Expiring early January of the following year.
Gary: 2023 gold passes expired in early October ahead of Fright Fest and are not included in the 2023 year and past balance.
Deferred revenue as of December 31, 2023 was $128 million down $1 million or 1% compared to the prior year.
Gary: On our last earnings call.
Gary Mick: Deferred revenue at the end of third quarter 2023 was up 17% over the prior year third. The sequential drop in the prior year comparison from 3rd to 4th quarter is largely due to the two factors I just discussed, coupled with the transition of membership deferred balances to 13 plus revenue due to the discontinued legacy. We have made many changes to our past strategy over the past two years in an effort to find the right product mix and balance. Despite our active past base and deferred revenue balance being essentially flat versus the prior year, we feel the progress we have made on new season past sales and its encouraging data as we assess our outlook for 2024. As Selim mentioned, since the start of selling in late August through the end of January 2024, past sales are up double digits over the prior year, driven by an increase in both units. CapEx spend, net of insurance recoveries, was $61 million in the fourth quarter, an increase of $23 million compared to the third quarter. Whole year 2023 CapEx was $171 million, an increase of $59 million driven by investments in our park infrastructure, events, rides, and guest spaces. Total liquidity as of December 31st was $377 million.
Gary: Deferred revenue at the end of the third quarter 2023 was up 17% over the prior year third quarter the sequential drop in the prior year comparison from third to fourth quarter largely due to two factors.
Gary: Just discussed coupled with the transition of membership deferred balances to 13 plus revenue due to the discontinued legacy membership passes.
Gary: We have made many changes to our past strategy over the past two years in an effort to find the right product mix and balance of pricing and benefits.
Gary: Our active pass base and deferred revenue balance being essentially flat versus the prior year. We feel the progress we have made a new season pass sales and Thats encouraging data point.
Gary: As we assess our outlook for 2024.
Gary: As Selim mentioned since the start of selling in late August through the end of January 2020 for pass sales were up double digits over prior year, driven by an increase in both units and pricing.
Gary: Capex spend net of insurance recoveries was $61 million in the fourth quarter, an increase of $23 million compared to the fourth quarter 2022.
Gary: Full year 2023, Capex was $171 million.
Gary: An increase of $59 million driven by investments in our park infrastructure.
Speaker Change: Right yes.
<unk> technology.
Speaker Change: Total liquidity as of December 31 was $377 million, which.
Gary Mick: includes $299 million of available revolver capacity, net of $21 million in letters of credit, plus $78,000. We feel we have sufficient capacity to pay down the remaining 57 million of unsecured notes due July 2020, a combination of free cash flow and In May of 2023, we increased our total revolver capacity from $350 million to $500 million, providing greater flexibility to pay. Since 2021, we have used $311 million of free cash flow to pay down debt, inclusive of $38 million in financing fees OID. We expect to continue using free cash flow to pay down debt until we achieve our target net leverage ratio three to four times.
Speaker Change: <unk> $299 million of available revolver capacity net of $21 billion.
Speaker Change: Letters of credit plus $78 million of cash.
Speaker Change: We feel we have sufficient capacity to pay down the remaining $57 million of unsecured notes due July 2024, using a combination of free cash flow and revolver capacity.
In May of 2023, we increased our total revolver capacity from $350 million to $500 million.
Speaker Change: Providing greater flexibility to pay down debt.
Speaker Change: Since 2021, we've used $311 million of free cash flow to pay down debt inclusive of $38 million in financing fees OID and redemption premiums.
Speaker Change: We expect to continue using free cash flow to pay down debt until we achieve our target net leverage ratio ratio of three to four times adjusted EBITDA.
Selim A. Bassoul: Now, I will turn it back. Thank you, Gary. Now, I would like to discuss why we are excited about the 2024 season. First, 2024 season pass sales are off to a strong start. We are selling a higher mix of platinum and diamond passes as well as more add-on products like the all-season dining and all-season flash pass. Thank you. We are leveraging technology and automation to improve operational efficiency and safety. For example, our new AI integrated aquatic vigilance system, which will provide real-time monitoring and improved response times to help drive down labor costs and improve safety in our water. Our upcoming chat AI guest services web feature will be able to answer a large portion of guest questions and resolve the request, reducing the need to transfer to a live agent and LiveRide wait times to better manage the flow of guests with better accuracy and visibility.
Now I will turn it back over to John.
John: Thank you Gary.
John: Now I would like to discuss why we are excited about this 24 season.
John: First 2020 for season pass sales are off to a strong start we are.
Our selling a higher mix of platinum and diamond passes as well as more add on products like the all season dining and all season Flash pass.
John: Second.
John: We are leveraging technology and automation to improve operational efficiency and safety.
John: For example.
Our new AI integrated aquatic vigilant system, which will provide real time monitoring and improve response times to help drive down labor costs and improved safety in our water parks.
John: Our upcoming chat AI guest services, what feature will be able to answer that a large portion of the questions and resolve the request, reducing the need to transfer to a live agent.
John: And live ride wait times to better manage the flow of guests with better accuracy and visibility.
Selim A. Bassoul: Third, we are bolstering our revenue streams through technological innovation and operational enhancement, in Food & Beverage, who are expanding mobile app food ordering to more restaurant locations and are introducing new web-based QR code ordering, who are placing QR codes in high-visibility dining areas so guests can use mobile ordering without needing to download the app, and who are introducing self-serve kiosks. These sleek, modern, and easy-to-use kiosks have a proven track record in the restaurant industry for increasing throughput, reducing customer wait times, and driving higher average spending by enticing customers to do more customizations and add-ons. We launched a new automated photo capture technology, which provides guests with a personalized media library of their right photos, making them simple and easy to purchase, which will provide an additional revenue stream and help create a more memorable experience.
John: Third we are bolstering our revenue streams through technological innovation and operational enhancements.
John: And food and beverage, while expanding mobile app food ordering two more restaurant locations and are introducing new web based QR code ordering.
John: Our place and QR codes in high visibility dining areas. So guests can use mobile ordering without needing to download the app.
John: While introducing self serve kiosks.
The sleek more modern and easy to ski asked have a proven track record in the restaurant industry for increasing throughput, reducing customer wait times and driving higher average spending by enticing customers to do more customization and add ons.
John: And retail.
John: We launched a new automated photo capture technology, we provide which provides guests with a personalized media library of right photos, making some simple and easy to purchase which will provide an additional revenue stream and helped create a more memorable experience.
Selim A. Bassoul: We are also planning to revamp our merchandise strategy with new, higher quality and more desirable apparel, thanks to new partnerships with premium vendors and, in part, our new speedy automated toll plazas, which will help expedite the entry process, cut down on seasonal labor at the gate, and provide additional revenue. In group sales, we restructured our sales team late in 2023 by moving them out of corporate and back to the parks, enabling a more focused and localized operation. We are seeing positive signs, with early bookings pointing to solid growth in 2025. And our final reason to be excited about 2024 is the lineup of exciting, immersive experiences. This includes our new Savannah Sunset Resort and Spa Luxury Glamping Experience at Six Flags Great Adventure, where guests will enjoy sweeping views of our 350-acre safari and participate in up-close animal encounters. They are also planning the most exciting year yet for FriFest, who are amping up the thrills with new haunted houses.
John: We are also planning to revamp our merchandise strategy with new higher quality and more desirable apparel.
John: Thanks to new partnership with premium vendors.
John: In parking.
John: Our new speed, our new speedy automated toll plaza, which will help expedite the entry process cut down on seasonal labor at the gate and provide additional revenue.
John: In group sales, we restructured our sales team late in 2023 by moving them out of corporate and back to the Pax, enabling a more focused and localized operation.
John: We are seeing positive signs with early bookings pointing to solid growth in 2024.
John: And our final reason to be excited about 2024 is the lineup of exciting immersive experiences.
John: This includes our new Savannah, Sunset resort and Spa luxury glamping experience at six flags, great adventure, where the guests will enjoy sweeping views or street 50 acres spotty and participate in up close animal encounters.
John: We are also planning the most exciting year, yet for Fright Fest.
Who are amping up the thrills with new haunted houses scare zones, and other new hair raising attraction.
Selim A. Bassoul: Care Zones and other new hair-raising attractions to take the fear factor to a new level. This will include more IP branded houses, which were a big hit this past year, and, of course, new rides and attractions. The anchor of a great amusement park is its rides, and we have always been known for having the most and best in the industry. We previously announced we were kicking up capital through 2026 to bring a wide spectrum of new attractions targeting every member of the family. And we are following a different strategy than what has been done in the past, with a focus on putting the right tribe in the right place at the right time. For 2024, we'll have a new dino off-road adventure at Six Flags over Texas, which will bring you face-to-face with life-size animatronic dinosaurs, new steam town theming at Six Flags America, where the past meets the future and will include the all-new steamwhirler ride, an exciting family ride with four rotating arms, and a new DC Kids universe at Fiesta Texas.
John: To take the fear factor to a new level.
John: This will include more IP branded houses, which were a big hit this past year.
John: And of course, new rides and attractions.
John: The anchor of a great amusement park is its rights and we have always been known for having the most and best in the industry.
John: We previously announced we're kicking up capital through 2026 to bring a wide spectrum of new attractions targeting every member of the family.
John: And we are following a different strategy.
John: What has been done in the past with a focus on putting the right right in the right place at the right path.
John: For 2024, we will have a new Dino off road adventure at six flags over Texas, which bring you face to face with Lifesize I need my throat dinosaurs.
John: News teams down theming at six flags America, whereas the past meets the future and we will include the all new steam order right and exciting family right with four rotating arms.
John: A new DC gets you diverse I'd suggest that Texas.
Selim A. Bassoul: This young, family-friendly environment will bring adventures to our youngest thrill-seekers. A new ride, like the fan-favorite Giga Discovery at both Six Flags Great America and in St. Louis. A teen-favorite ride that creates unique thrill experiences. This ride has been very successful in our other, The surfer at Six Flags over Georgia, an intense ride of 144 feet high, 60 miles per hour, and almost 600 feet of track, complete with a splash zone, and the Super Boomerang at Six Flags Great Adventure.
John: This junk family friendly environment will bring adventures to our youngest thrill seekers.
John: And Youre right like the fan favorite Giga discovery and both six flags, Great America and in St. Louis <unk> favorite tried that creates unique thrill experiences. This right has been very successful in our other parks.
John: The surfer at six flags over Georgia, Georgia, and intense right of 144 feet high 60 miles per hour and almost 600 feet of track complete with the Splash stone.
John: And the Super Boomerang at six flags, great adventure at Triple Tower launch coaster withstand moments, which we expect to open in time for its 15th anniversary celebration.
Selim A. Bassoul: It's a triple tower launch coaster with 10 air moments, which we expect to open in time for its 50th anniversary celebration. We operate in a highly competitive market where customers have the choice of many diverse entertainment options. To compete for our share of the discretionary leisure wallet requires continued smart investment in our guest innovations, immersive experiences, and premium park offerings. This keeps us on our toes, and we don't take anything for granted. I want to finish with two big surprises for me this past past. First, we were awarded the best and brightest company to work for in 2023 in Dallas and in the nation. Given all the challenges executing this strategy, I truly did not expect it. When you think of all the great companies in Dallas and in the U.S., it's an honor, and it's quite humbling.
John: We operate in a highly competitive market with customers have the choice of many diverse entertainment options.
John: To compete for our share of the discretionary leisure wallet requires continued smart investments in our guest innovations immersive experiences and premium offerings.
John: This keeps us on our toes and we don't take anything for granted.
I want to finish with two big surprises for me this past year.
First.
John: Is being awarded the best and brightest companies to work for in 2023 in Dallas and in the nation.
John: Given all the challenges executing this strategy I truly did not expected.
John: When you think of all the great companies in Dallas and in the U S. It's an honor and it's quite humbling.
Operator: It is a testament to the great leadership we have at our park. I am grateful for our employees who are fully dedicated and willing to work hard to create a great experience. This is a very competitive environment, and we have to continue to be the best each and every day. [inaudible] is being part of the largest digital alliance in our industry. This is a credit to our Chief Digital Officer and his team. We are proud to partner with great innovators such as Google, Dell, Pure Imagination, Fuel, Snowflake, and HCL Tech to bring the latest technology to our parks, transforming the amusement park experience to be more personalized, immersive, and memorable. With that, operator, would you please open the call for any questions? Thank you. We will now begin the question and answer session. To ask a question, you may press star then 1 on your touch-tone phone. If you are using a speakerphone, please pick up your handset before pressing the keys.
John: It is a testament to the great leadership, we have at our parks.
John: I am grateful for our employees, who are fully dedicated and willing to work hard to create a great experience. This is a very competitive environment and we'll have to continue to be the best each and everyday.
John: Second.
John: As being part of the largest digital alliance and our industry.
John: This is a credit to our chief digital officer and his team.
James Lloyd Hardiman: To withdraw your question, please press star then 2. At this time, we will pause momentarily to assemble our roster. Our first question comes from James Hardiman from Citi. Please go ahead. Hey, good morning.
James Lloyd Hardiman: Thanks for taking my call. So, Selim, you laid out all the reasons why you're excited about 2024. I guess I should presumably interpret that as you think there should be some top-line growth here. I don't know if you want to sort of put some broad numbers around that.
Speaker Change: Okay. So.
Speaker Change: He laid out all the reasons why you're excited about 2024.
I guess I should presumably interpret that as you think there there should be some some topline broke here I don't know if you want to sort of put some broad numbers around that but I guess as I drill down a little further if we look back to 2022 you had big.
James Lloyd Hardiman: But I guess, as I drill down a little further, if we look back to 2022, you had big per-cap growth, right? Big pricing growth, but attendance declined, I think, more than that. 2023 was sort of the reverse, right?
[noise] per cap growth right big pricing growth, but attended declined I think more than that 2023 was sort of the reverse right. You had followed attendance growth. But then you know some modest per cap declined as we think about 2024, you know what's the growth I'll go look like it it shouldn't be a more.
Selim A. Bassoul: You had solid attendance growth, but then, you know, some modest per-capita declines. As we think about 2024, you know, what will the growth algo look like? Should it be a more balanced approach to revenue growth where we can see both attendance and per-capita grow in a year? Thanks. Well, thank you, James. Thank you so much for the call.
Speaker Change: Balanced.
Speaker Change: Approach to revenue growth, where we can see both attendance and per capita outgrown his ear.
Speaker Change: Well. Thank you. Thank you so much for school, so I as you know.
Selim A. Bassoul: So I, as you know, we are not providing guidance. However, I will tell you that. The difference between 2022 and 2023 is simply the fact that we refocused on building the active base. And we ended up saying, okay, it was a matter of recalibrating our pricing, rejiggering our membership. You will know in 2022 we had stopped it, stopped the legacy members, and in June or July, we reentered the Six Flags Plus membership. So we were working on reactivating and rebuilding the base. We also spent money on media, talking about advertising and media, talking about all the things we put in. We had to launch this new membership, and we had to push it. We also spent a lot of energy on technology. We also went to where we tried to say we needed to go after food service and retail. So. We tried to change our food ordering, mobile food ordering penetration, which was low, and we spent a lot of money on this, a lot of resources. We went after alcohol penetration.
Speaker Change: We are not providing guidance.
Speaker Change: However.
Speaker Change: I would tell you with that.
The difference between 2022 and 2023.
Speaker Change: Simply.
Speaker Change: Fact.
Speaker Change: Re re focused on building the active base.
Speaker Change: And we ended up saying, okay. It was a matter of Reed.
Speaker Change: Recalibrating our pricing.
Speaker Change: Rejiggering, our membership was you, Illinois in 2022, we had.
Speaker Change: Stopped it stopped to legacy members and Ian.
Speaker Change: Oh July rudiments, the six flags plus membership.
Speaker Change: So we were working on re activating the rebuilding the base. We also spend money on media talking about advertising and media talking about all the things we put in we had to launch this new membership and we had to push it up we also spend a lot of energy on technology.
Speaker Change: We also.
Speaker Change: When where do we try to say we needed to go after food service and retail <unk>.
Speaker Change: So we.
Speaker Change: We tried to change our.
Speaker Change: Pud altering mobile food ordering penetration, which was a little.
Speaker Change: We spend a lotta money on this a lot of resources we.
Speaker Change: We went after alcohol penetration.
Selim A. Bassoul: We went after transaction per hour. And then we went into what I call the daily dining plan and the seasonal dining plan. As you remember, in 2022, we eliminated it, and we relaunched it, a much more win-win for us and for our guests. And then there were a lot of renovations with bars and coffee shops.
Speaker Change: We went after the transaction per hour.
Speaker Change: And then we went entered why I called the daily dining plan and the season dining plan as you.
Speaker Change: As you remember in 2022, we eliminated it and re re launched.
Speaker Change: Much more win win for us and for our guest.
Speaker Change: And then there were a lot of innovation was bars and coffee shops.
Selim A. Bassoul: So I look at this, and I say the emphasis has been on food service, and there was a lot of resources spent. Now, some of the things that we did not do well. So we did not do well in 2023 as we launched a lot of new events, to be launched, tons of events. So if you remember, we had a calendar in the fourth quarter of 2022 when we said, let's go back and ramp up events, and we went, we kicked off Viva La Fiesta, Flavors of the World, Summer Vice Celebration, Eats and Islands, Eat and Beats, and I can keep It did not drive additional season passes, some of them.
Speaker Change: So I look at this and I said the emphasis has been on food service and there was a lot of resources spent nope some of the things that we did not do well.
Speaker Change: So we did not do well in.
Speaker Change: In 2003, as we launch a lot of new events.
Speaker Change: So we launched.
Speaker Change: Tons of prevent so if you remember when it calendar in the fourth quarter of 2022, when you say, let's go back and ramp up events.
Speaker Change: And we went we kicked off people off yes, the flavors of the world Some advice celebration.
Speaker Change: <unk> Islands, Eaton beats and I can keep on doing on and realized and we had fireworks and thrown shop and realized that not all of those events turned out.
Speaker Change: So realize that.
Speaker Change: It did not drive additional season passes some of the <unk>.
Selim A. Bassoul: We also realized that they were cannibalizing other things we were doing in the park, longer operating hours. Staffing those events cost us a lot of money. It meant power.
Speaker Change: We also realized that they were cannibalizing other thing we're doing in the park.
Speaker Change: Longer operating hours staffing those events cost of a lotta money and manpower and.
Selim A. Bassoul: And now we're streamlining in 2024 to say what works and what didn't work. So a lot of experimentation in 2020, three versus 2022 in rebuilding the base. And part of it was pricing. Bartofis was offering more perks like the event.
And now we're streamlining in 2024 to say what works and what didn't work.
Speaker Change: So a lot of experiment in 2020.
Speaker Change: Free versus 2022 in rebuilding the base and part of it was pricing.
Speaker Change: But the fish was offering more perks like the events.
Selim A. Bassoul: And at this moment, going into 2024, a lot of learning is happening in 2022 and 2020 straight. So that's why I'm excited about 2024. Got it. And then maybe, sort of a separate question.
Speaker Change: And at this moment going into 2024, a lot of learning sort of happened in 2022 and 2023.
Speaker Change: So that's why I'm excited about 2024.
Speaker Change: Got it and then maybe.
Speaker Change: Sort of a separate question one of the things I've been asked a lot over the past few months. This isn't a merger question, but I think it maybe came up as a result of the merger.
James Lloyd Hardiman: One of the things I've been asked a lot over the past few months, this isn't a merger question, but I think it maybe came up as a result of mergers. What's the proper level of investment in your business? If I look at, you know, whether it's OpEx or CapEx, relative to your closest peer, right? Whether or not you team up with them, the level of investment has historically been lower. So, you know, maybe 44% OpEx as a percentage of sales versus 48% at your peer. CapEx has been, well, CapEx this year was about 12% of sales, but historically, you've been in that high single-digit range. Your closest peer has been more in that, you know, 14% range historically.
Speaker Change: What's the proper level of investment in in your business. If I look at you know, whether it's opex or capex.
Speaker Change: Relative to your closest tier right, whether or not you keep up with them. The level of investment has has historically been left so you know maybe 44% opex as a percentage of sales versus 48% after Pierre.
Capex has been well capex with your with about 12% of sales, but historically you've been in that high single digit range. Your closest peer as it's been more than that you know 14 per cent range. Historically, so how do I think about that as we move forward is there a need.
James Lloyd Hardiman: So how do I think about that as we move forward? Is there a need to increase investment to sort of, quote unquote, catch up? Or do you think there are just structural differences in sort of how you versus your peers would need to invest? Robert.
Speaker Change: To increase investment to to sort of quote unquote catch up or do you think they're just structural differences in in sort of how you versus your peers would need to invest.
Speaker Change: Robert.
Speaker Change: Okay.
James Lloyd Hardiman: Thanks. Yeah, hi, James, Gary. So we don't, we don't comment on the merger in that sense. And we're operating our business this year, you know, as if the merger is not going to happen.
Robert: Yeah, Hi, James Scary.
Robert: So we don't we don't comment on the merger in that sense and we're upgrading our business this year.
Speaker Change: You know as as if the merger is not going to happen.
James Lloyd Hardiman: We're assuming, of course, that it is, but we're running our business as we always would. So when you look at the investment in CapEx historically, as you mentioned, it's been in the single digits, eight, and nine percent of revenue. And we have increased it, as you saw, this year by 12%. And we plan to increase it by 24 and 25, because we do need it. Proof that Guest Offerings and Rides Marketable Capital and Food and Beverage. Just to clarify, though, you say increased cat food back in 24 and 25. Is that above the 12% that we saw in 23? Or is it just, you know, higher than it's historically been?
Speaker Change: Of course that it is but we are running our business as we always wood right.
Speaker Change: So when you look at the investment on Capex historically as you mentioned, it's been in the single digits eight nine per cent of revenue.
Speaker Change: And so we have increased it as he saw this year at 12% and we plan to increase it in 24 and 25, because we do need to improve that guest offerings and rides marketable capital with food and beverage retail.
Speaker Change: Just to clarify though you.
Speaker Change: You say increased capex.
Speaker Change: In 24, and 25 is that above the 12% that we saw in twenty-three.
Speaker Change: Or is it just similarly higher than it has historically been and then sort of similar question on Opex like where does that go from here. It sounds like you think that that the growth and opex. Unlike twenty-three can be maybe less than the growth in sales, but maybe not clarified.
James Lloyd Hardiman: And then sort of similar question on OPEX, like, where does that go from here? Sounds like you think that the growth in OPEX, unlike 23, can be maybe less than the growth in sales, but maybe clarify. Yeah, so in terms of, It's similar to what we announced in the last quarter earnings call. James?
Speaker Change: Clarify.
Speaker Change: Yeah, so in terms of.
Speaker Change: It's similar to what we announced in the last quarter earnings call James.
James Lloyd Hardiman: You know, we're going to run around 2 to 2.20 for 2024. That's the anticipated spend. That includes maintenance, by the way. Any thoughts on the OPEX side?
Speaker Change: We're gonna run around two to 224 2024, that's anticipated spend at that point.
Speaker Change: That includes maintenance by the way.
Speaker Change: Any thoughts on the Opex I've.
James Lloyd Hardiman: In this case, we're looking at, as Selim pointed out, we spent quite a bit on events. And as we look to reduce the events that are not ROI accretive, we anticipate the expenses will come down. We don't, of course, have an idea as to the inflation impact of this. Can I give a little bit more flavor on OPEX, please? I'm going to break it down into four fully defined buckets.
James: Oh it it in this case, we're looking at is saline pointed out the we spent quite a bit on events and as we look to reduce the events that are not our ally accretive we anticipate the expenses will will come down we don't of course have an idea as to the inflation.
Speaker Change: Impacted can I give a little bit more flavor onto opec's. Please.
Break it down into four four truly buckets the.
Selim A. Bassoul: The bucket number one is we spent a lot of money on events and advertising in the third and fourth quarter. So let's talk about events. We'll most probably streamline the event, and we'll have a lot less spending on the event because we figured out the one that works and the one that doesn't work.
Speaker Change: The buckets number one is we spent and the third and fourth quarter of a lotta money on events in advertising.
Speaker Change: So let's talk about the events so will most probably streamline the event and we will have a lot of spending on the event of course figured out the one that's the worst and one doesn't work.
Selim A. Bassoul: On advertising, we'll expect to have flat advertising as we maximized, and we found that advertising and media promotion was very effective. So this level of advertising will be flat in 2024. However, we'll probably continue to invest in technology as we continue to have resources for creating, still we have three elements. We are investing in and will continue investing in self-serving kiosks, AI in 2024, and some retail initiatives that include technology. But that's not really, I call it a slightly bump up from where we were in 2024. But the biggest, the largest, last bucket that will probably be a problem for us and we have to figure out is wages.
Speaker Change: Advertising expect to have a flat advertising S. We maximized and we found that there are three times in media promotion was very effective. So this level of advertising it will be flopped in 2020 Ford. However continued to most probably invest in technology as we continue having resources.
Speaker Change: In creating still we have three elements, we are investing in continuing invesque self serving kiosks.
Speaker Change: I.
And 2024, and some retail initiative that includes technology, but that's not really I call. It slightly a bump up from where we went in 2004, but the biggest the losses lost buckets that most probably will be a problem for us and we have to go to his wages.
Selim A. Bassoul: So what's happening is kicking off in 2024 is what I call state-mandated minimum wages that have now kicked out across minimum wages. So now they are all coming in. Almost 90% of the states are now mandating, they issued those mandates somewhere in, most probably 2018, 2019.
Speaker Change: So what's happening is kicking up in 2024 is what I call state mandated minimum wages that have now kicked out in 2024 across.
Speaker Change: Minimum wages. So now they are all coming in almost 90% of the state's up now mandating you know they issued those mandates somewhere in.
Speaker Change: In most probably 2018 2019, I remember when I was at the Middle beat all the restaurants were worried about their.
Selim A. Bassoul: I remember when I was at Middleby, all the restaurants were worried about their wages going up, and then it was a delayed process. And it all hits in 2024. It will hit the industry, it will hit the restaurant business, and the hospitality industry, where the labor rate, the hourly labor rate, and minimum wages are going up.
Speaker Change: Their wages going up and then it was a delayed process.
Speaker Change: And it all hits in 2024, it will hit the industry. It will hit the restaurant business, the hospitality, where labor rates hourly labor rate was minimum wages are growing up. So this most probably will be the biggest issue we have to deal with going into 2024, right. We have tremendous focus on on reducing our costs. James There's no question that works.
Selim A. Bassoul: So this probably will be the biggest issue we have to deal with going into 2024. Right, we have tremendous focus on reducing our costs, James, there's no question of that whatsoever. But these other upside factors that James has mentioned make it difficult to predict as well. Got it. That's a great color.
Speaker Change: Whoever but these other upside factors of between this mentioned make make it difficult to protect us I remember.
Speaker Change: Got it that's a great color thanks, Gary excellent.
James Lloyd Hardiman: Thanks, Gary. Thanks, Link. The next question comes from Steve Wesneski from Stiefel. Please go ahead.
Speaker Change: The next question comes from Steve Lesniewski from Stifel. Please go ahead.
Steven Moyer Wieczynski: Yeah, guys, good morning. So I want to ask James a question, maybe his first question there is a little bit differently. And look, Selim, I know you're not going to give specific guidance for this year, but, you know, I'm trying to understand how you guys are thinking about per caps. You know, look, obviously, there are shifts in attendance in the attendance mix. But, you know, look, if we sit here a year from now, I guess the simple question is, you know, our per capita, both on the attendance and in park side, do you think you can grow those over 2023? Yes, Steve, that's a great question. In-park spend has not been an issue for us.
Yeah, Hey, guys. Good morning, So I I Wanna ask James question, maybe his first question, they're a little bit differently and look slim I know, you're you're you're not gonna give specific guidance for the sheer but you.
Steven Moyer Wieczynski: You know trying to understand how you guys are thinking about per caps. You know look obviously, there's there's shifts in attendance and independents mix, but you know look at we sit here a year from now I guess the simple question is you know our our per caps both on the attendance in in Parkside. You know do you think you can grow those.
Steven Moyer Wieczynski: Over 2023.
Speaker Change: Yes, Steve that's a great question and park spend has not been an issue for us It will grow and at school. If you take so we need to start focusing on something where we haven't done as good of a job.
Going through it because nowhere and there should be well is what you called the 13th plus.
Selim A. Bassoul: It will grow, and it will grow. If you take, so we need to start focusing on something where we haven't done as good of a job going through it, because now we're underserved very well, which is what you call the 13 plus members. And maybe I'll turn it over to Gary a little bit to discuss the 13 plus and the impacts of 13 plus on what's happening in 2023 and why the numbers. So if we start taking away 13 plus from the equation, you've seen that our per cap has grown in PARCC. And maybe I turn it over to Gary. Just in general, to answer the question on 2024 per capita, both admissions and in PARCC, we anticipate to be elevated over 2023.
Speaker Change: Members, and maybe I'll turn it to get it a little bit to discuss asserting plus and the impacts of searching plus on what's happening in 2023 and why the numbers. So if we start taking way searching plus from the equation you've seen that out put a cap is grown in park.
Speaker Change: And maybe I turn it over to Gary to go at its amendment no. Thanks, Thanks, Saline and Great question, Steve and just in general to answer the question on 2024 per caps, both admission and in park, we anticipate.
Gary: To be elevated over 2023, if you'd take out the 13 plus is Selim just mentioned from the.
Gary: The fourth quarter are both admissions and in Parker up like let's say an average of 4%.
Gary: So almost all of our products that we are pricing into 24 are priced with it when they increase over prior year. The thing we do we do actually like the 13 plus revenue stream. It is a subscription based revenue stream. So once the 13 plus member gets beyond the 12th month initial commitment period the revenue.
Selim A. Bassoul: If you take out the 13 plus, as Selim just mentioned, the fourth quarter, both admissions and in-park are up, like, let's say an average of four percent. So almost all of our products that we are pricing into 24 are priced with an increase over the prior year. The thing that we do, we do actually like the 13 plus revenue stream. It is a subscription-based revenue stream.
Gary: Flows in monthly.
Gary: What what makes a Q1 and Q4 difficult in terms of analyzing the per caps is that it's time based right. It's recognized monthly as opposed to our season pass base, which is recognized and an activity or business per pass.
Gary Mick: So once the 13 plus member gets beyond the 12 month initial commitment period, the revenue flows in monthly. What makes Q1 and Q4 difficult in terms of analyzing the per cap is that it's time-based, right? It's recognized monthly as opposed to our season pass base, which is recognized in an activity sense or business per pass.
Gary: So you know while we have the headwind in Q1 silly that we mentioned regarding the 13 plus it really is just a function of a past about it by 12. So as we sell more 2024 season passes that of course replaces the revenue from 13, plus but that revenue goes into differed in the first part of this year it doesn't get.
Gary: Nice until the parks actually open so there's a tiny difference between those two.
Gary: But we do.
Gary: We do appreciate 13 bus revenue the guests loved the monthly payment option. They are most loyal guests and we appreciate the cash flow and the and the slower months. So the six plus it Selim launched last year that will start rolling off being in the 12 month commitment period and will actually roll into 13, plus in the second half of the year.
Gary Mick: So, you know, while we have the headwind in Q1, Selim, that we mentioned regarding the 13 plus, it really is just a function of a pass divided by 12. So as we sell more 2024 season passes, that, of course, replaces. The revenue from 13 plus, but that revenue goes into deferred in the first part of this year. It doesn't get recognized until the parks actually open. So there's a timing difference between those two.
Gary: Which will help.
Gary: You know rebuild that base.
Gary: So so far my cadence perspective, it seems like one Q is obviously the the the the toughest comparison you talked about the 14 million headwinds. So you know you're per caps, especially the attendant side will probably be you know down Q1and then from there he kind of eases and gross through the year I kind of thinking about it the right way, yes. It you you haven't exactly okay.
Steven Moyer Wieczynski: But we do, you know, we do appreciate 13 plus revenue; the guests love the monthly payment option. They are most loyal guests, and we appreciate the cash flow in the slower months. So the six plus that Selim launched last year will start rolling off being in the 12 month commitment period and will actually roll into 13 plus in the second half of the year, which will help rebuild that. So from a cadence perspective, it seems like 1Q is obviously the toughest comparison.
Gary: [noise] Slim like a bigger picture question I'm not sure what you'll you'll say here, but like you know this is a business there was supposed to do.
Gary: Whenever EBITDA level, you Wanna throw out there you guys have talked about before but a number that is you know much higher than where your run rating. Today. So you know look I I guess the simple question is is you're you're pre musician strategy. You know finally, all comes together attendants normalizes [noise].
Gary Mick: You talked about the $14 million headwind. So, you know, your per cap, especially on the attendance side, will probably be down in 1Q. And then from there, it kind of eases and grows through the year. Am I thinking about it the right way?
Gary: You know what what level of and you don't get an exact number but you know what level of EBITDA do you know do you eventually C six flags getting too.
Steven Moyer Wieczynski: Yes, you have it exactly. OK. And then, Selim, look, a bigger picture question. I'm not sure what you'll say here, but look, you know, this is a business that was supposed to do whatever EBITDA level you want to throw out there that you guys have talked about before, but a number that is, you know, much higher than where you run the rating today. So, you know, look, I guess the simple question is, has your premiumization strategy finally come together? As attendance normalizes, you know, what level of, and you don't have to give an exact number, but, you know, what level of EBITDA do you eventually see Six Flags getting to? Excellent question!
Speaker Change: Excellent question.
Speaker Change: I think this is being most probably.
Speaker Change: I'm Gonna do.
Speaker Change: To me a culpa here, because I enders tomato, the cost and complexity of the transformation.
Speaker Change: We had to change a lot of things we had to change the culture from attendance to yield from.
Speaker Change: From a corporate centralization to park decentralization, some federal layers of management realism.
Speaker Change: Only.
Speaker Change: We had to most probably change our democratic is a little bit and increase the presence of families and all parks.
In addition.
Speaker Change: I have to tell you that was surprising to me.
Speaker Change: It was <unk>.
Speaker Change: How much <unk> and calcified systems.
Speaker Change: That we had you know.
Speaker Change: Computer system, you are P system point of sale that were you know Ciara M system pure system that tour how to integrate them evolve we had no choice to be successful we have to use modern glommed based tools that allow us to react.
Selim A. Bassoul: I think this has been most probably. I'm going to do a mea culpa here because I underestimated the cost and the complexity of the transformation. We had to change a lot of things, who had to change the culture from attendance to yield, from corporate centralization to party centralization, several layers of management, not only. We probably had to change our demographic a little bit and increase the presence of families in our parks. In addition, I have to tell you that it was surprising. It was. How many old and calcified systems do we have?
Speaker Change: And change was agility and execute Archer strategy.
Speaker Change: Cheap.
Speaker Change: Literally in 2024, and 2025, what I call a.
Speaker Change: Chief above average outcomes below average cost.
Speaker Change: And the way I look at that is.
Speaker Change: If you remember.
Speaker Change: I had spoken about it.
Speaker Change: Last year early last year.
Speaker Change: I started figuring out that the original projection or for of what you call. The 710 million was.
Selim A. Bassoul: that we had in our computer system, ERP system, CRM system, and POS system that were hard to integrate and evolve. We had no choice. To be successful, we have to use modern, cloud-based tools that allow us to react, and Change with agility, and Execute Our Strategy, to achieve what I call, in 2024 and 2025, achieve above average outcomes at below average cost. And the way I look at that is If you remember, I spoke about it last year, early last year. I started figuring out that the original projection of four of what we call the 710 million was not achievable, given it was not achieved by the end of 2024. So I went back, and I said I needed two more years.
Speaker Change: It was not achievable given.
Speaker Change: It was not achieved by end of 2024.
So I went went back and I said I needed to.
Speaker Change: Two more years, if you remember I would say I would like to start looking at 2025 and 2026.
Start the Cheeping those numbers.
Speaker Change: And that's what I'm feeling comfortable about.
Speaker Change: Okay, Great. That's that's very good color. Thank you guys. So much.
Speaker Change: The next question comes from Thomas Yea from Morgan Stanley. Please go ahead.
Thomas L. Yeh: Thanks, So much I wanted to ask about the past sales painting in January Gary you mentioned, some timing impact related since four Q like keeping it flat in January number relatively clean. So now we're on an apples to apples basis, and we're seeing more unit growth even on higher blended pricing is that a fair characterization.
Speaker Change: <unk>.
Gary: I, Yeah I will.
Selim A. Bassoul: If you remember, I said I would like to start looking at 2025 and 2026, start achieving those numbers, and that's what I'm feeling comfortable about. Okay, great. That's a very good color.
Gary: [noise] simply say that are 2024 season passes.
Gary: Ah Thomas our our up double digits over that same period prior year.
Gary: Okay.
Gary: The through the end of January yeah.
Gary: The specifics twenty-four past sales relative to the 20th the right one.
Gary: Yeah, we we just we use it holistic vote, we use the period of Holistically Thomas.
Steven Moyer Wieczynski: Thank you guys so much. The next question comes from Thomas Yeh from Morgan Stanley. Please go ahead. Thanks so much.
Gary: Okay, I understand yeah, and then Ah apologies in advance for country any more on detection class membership revenue dynamic, but I guess you know excluding that you highlighted the underlying 4% isn't maybe the right way to think about like mine is that <unk>.
Thomas L. Yeh: I wanted to ask about the past sales pacing into January. Gary, you mentioned some timing impact related to 4Q, keeping it flat. Is the January number relatively clean? So now we're on an apples-to-apples basis, and we're seeing more unit growth even on higher blended pricing. Is that a fair characterization?
Expectations for that and he see it now because of the pricing stabilizing Moore and your strategy can add.
Gary: Lining out a little bit more I think that's a fair outlook.
Gary: Outlook in terms of an expectation on the core yeah, Yes, I I think that's fair. It's early in the year, you know to to make a long term prediction, but based on what initiatives, we laid out on our commentary and flame is talked about.
Gary Mick: Yeah, I will simply say that our 2024 season passes, Thomas R, are up double digits over the same period prior. Okay, that goes through the end of January, is specific to 24 path sales relative to the 23 ones. Yeah, we just use it holistically. We use the whole period holistically.
Gary: We feel that's a reasonable expectation that broke habits.
Speaker Change: Okay helpful. And then just last one from me.
Speaker Change: On whether I I know you mentioned some headwind the obviously and there were clear handling this through in a year, but nothing very specific therefore Q.
Thomas L. Yeh: Okay, understood. Yeah, and then apologies in advance for torturing you more on the 13 plus membership revenue dynamic. But I guess, you know, excluding that, you highlighted the underlying 4% is maybe the right way to think about a trend line.
Speaker Change: Whether net bad guy in the corner.
Speaker Change: Report in and maybe any commentary on the weather conditions that you were seeing in February in January that would be helpful.
Yeah. Thanks for that question and yes, whether whether impacted us in in two ways.
Gary Mick: Is that expectation for that as you see it now because of the pricing stabilizing more and your strategy kind of lining out a little bit more that that's a fair outlook in terms of an expectation on the core? Yes, I think that's fair.
Speaker Change: It is the we mentioned eight weekends of continuous rain or a threat of rain post labor day weekend and of course Fright Fest 80 per cent of our EBIT pretty much comes out of October.
And from the mid Atlantic all the way to Montreal, all of our parks were under the threat of rain or it actually did rain <unk>.
Thomas L. Yeh: It's early in the year, you know, to make a long-term prediction, but based on what initiatives we laid out in our commentary and Selim has talked about, we feel that's a reasonable expectation of Brookhaven. Okay, helpful. And then just last one for me.
Speaker Change: Four seven out of those eight days.
Speaker Change:
Speaker Change: We calculate we lost about 150000 of attendance at those areas more about $10 million of revenue in Q4.
Speaker Change: So in one sense I'm I'm proud of the effort state parks and our team did did.
Speaker Change: To generate the 98 million because we had the weather headwind of $10 million of revenue and we had the 13 plus 12. So we we went into it.
Gary Mick: On weather, I know you mentioned some headwinds. Obviously, there were clear headwinds through the year, but nothing very specific to 4Q. Was weather a bad guy in the quarter just reported? And maybe any commentary on the weather conditions that you were seeing in February and January would be helpful.
Speaker Change: $22 million down and turn it to revenue and ended up 13 million up so.
All in all good performance and that is the strength of Fright Fest.
Speaker Change: At our other locations. So when we added the I P 100 houses this year and increased investment.
Speaker Change: The attendants lift.
Gary Mick: Yeah, thanks for that question. And yes, weather has impacted us in two ways. We mentioned eight weekends of continuous rain or threat of rain post Labor Day weekend. And of course, Fright Fest, 80% of our even if it pretty much comes out of October, and from the Mid-Atlantic all the way to Montreal, all of our parks were under the threat of rain, or it actually did rain, for seven out of those eight days.
Speaker Change: And the revenue lift above prior year came from the Fright Fest Ooh first in October Fest that we laid out at the other parks that were not so much affected by weather. So.
Speaker Change: That gives us just real excitement about the same time period in 2024, and Celine is increasing the investment in Fright Fest as you mentioned and we're adding more IP more excitement more haunted houses.
Speaker Change: It's gonna be a blast.
Speaker Change: Great. That's helpful contacts thank you.
Speaker Change: [noise]. The next question comes from and Zaffino from Oppenheimer. Please go ahead.
Gary Mick: We calculate we lost about 150,000 in attendance at those areas or about 10 million in revenue in Q4. So, you know, in one sense, I'm proud of the efforts that Parks and our team did to generate $98 million because we had the weather headwind of $10 million in revenue, and we had the $13 plus of $12 million, so we went into it, you know, $22 million down in terms of revenue and ended up $13 million up, all in all, a good performance and that is the strength of Fright Fest at our other location. So when we added the IP haunted houses this year and increased investment, The attendance list and the revenue lift above the prior year came from the Fright Fest, Boo Fest, and October Fest that we laid out at the other parks that were not so much affected by weather.
Right.
Zaffino: What sort of question on on season passes I'm. So sorry can you maybe help us understand.
Zaffino: What may be the <unk>.
Zaffino: What each cohort is doing as far as you know you're getting more diamond sales have you noticed any sort of meaningful change in in the buckets between the highest tier passes lowest tier passes and maybe what you're kind of scene I just wanted to demand for each of them.
Speaker Change: Yeah, Thanks, again, and good morning [noise].
Speaker Change: We we.
Speaker Change: We have a promotion going on right now in the parks that are preparing to open up which is we are offering the diamond level benefits. If you purchase at the platinum base and so at this stage of our promotional period, we have a healthy increase in the higher tier passes.
Speaker Change: Okay. So you're supposed to take up something much better year over year that happens.
Speaker Change: Yeah.
Speaker Change: And then as far as the operating calendar at any intentions to curtail the operating calendar and I know in the in the past and the previous management team that was sort of pushed to do that and then there was maybe an expansion in the calendar after that.
Ian Alton Zaffino: So, you know, that gives us just real excitement about the same time period in 2024, and Selim is increasing the investment in Fright Fest, as he mentioned, and we're adding more IP, more excitement, more haunted houses, is going to be a part of it. Great. That's helpful context. Thank you. The next question comes from Ian Zaffino from Oppenheimer. Please go ahead.
Speaker Change: How are you guys now I'm thinking about the operating calendar and maybe the opportunity to kind of curtailed.
Speaker Change: Less profitable, where the money losing days thanks [noise].
Speaker Change: The operating calendar.
Speaker Change: Be very much the same as it as it was in 2023.
Ian Alton Zaffino: Great. What sort of question on season passes so far? Can you maybe help us understand? Maybe what maybe each cohort is doing, as far as you know, you're getting more diamond sales. Have you noticed any sort of meaningful change in the buckets between the highest tier passes, the lowest tier passes, and maybe what you're kind of seeing as far as demand for each of them? Yeah, thanks, Ian. And good morning.
Speaker Change: The thing that will be different is the events that we are hosting at our respective parks. During the days that they are open so on days, where we did an event and it was marginally attended in the prior year, we will still be open, but we won't invest that much in the event on those days.
Speaker Change: Okay. Thank you very much.
Speaker Change: Our next question comes from Robert around from Keybanc Capital. Please go ahead.
Robert: Hi, Thank you for taking my questions, maybe a quick follow up on kind of the year to date trends your thing, but I know we had some weather in February but I kinda wanted to ask it in the context of maybe any commentary you can give us on what you're seeing in Mexico, I know that has an outsize impact in the first quarter and can sometimes you know skew what we're seeing domestically.
Gary Mick: We, we have a promotion going on right now in the parks that are preparing to open up, which is we are offering diamond level benefits if you purchase at the platinum base. And so at this stage of our promotional period, we have a healthy increase in the higher tier, Okay, so take-up has been much better year over year. Yeah.
Robert: That Mexico continues to do very well and is certainly helpful to the Q1.
Robert: In the in the U S. We are actually down for operating days due to weather versus the same period. So let's go to the we call. It. The first eight weeks ended February 25th.
Ian Alton Zaffino: And then as far as the operating calendar is concerned, any intentions to curtail the operating calendar? And I know in the past, under the previous management team, that was sort of a push to do that. And then there was maybe an expansion of the calendar after that. How are you guys now thinking about the operating calendar and maybe the opportunity to kind of curtail the less profitable or money-losing calendar? The operating calendar will be very much the same as it was in 2023.
Robert: We we lost four operating days against a first quarter last year that had bad weather. So why there's still a factor, but it's really early it's the smallest part of our season.
Robert: At this stage, where we're not concerned.
Speaker Change: Thank you and and maybe I can ask one about Saudi Arabia project, you know any updates you can give their under the deal filings indicate opening in spring 2025.
Gary Mick: The thing that will be different is the events that we are hosting at our respective parks during the days they are open. So on days where we did an event and it was marginally attended in the prior year, we will still be open, but we won't invest that much in the event. Okay, thank you very much.
Speaker Change: Think we should be thinking about from a modeling perspective, and how that might flow through.
First of all we're very excited about the solar project, it's going to be the largest.
Speaker Change: Most immersive park in the World in fact, it will be the world's largest park I have visited there have been deaths, we're working our partners.
Ian Alton Zaffino: Our next question comes from Robert Aurand from KeyBank Capital. Please go ahead. Hi, thank you for taking my questions. Maybe a quick follow-up on kind of the year-to-date trends you're seeing. I know we had some weather in February, but I kind of wanted to ask it in the context of maybe any commentary you can give us on what you're seeing in Mexico.
Speaker Change: Contractors and our team are working around the clock in fact I was there recently and they are working almost 24 seven and.
Speaker Change: And we are expecting to open it.
In the first quarter by this time next year.
Speaker Change: And we're excited I think what is exciting about it is in this case. It is not only were licensing the park.
Robert Samuel Aurand: I know that it has an outsized impact in the first quarter and can sometimes skew what we're seeing domestically. Mexico continues to do very well and is certainly helpful to Q1. In the U.S., we are actually down four operating days due to weather versus the same period last year, so let's go to what we call the first eight weeks ended February 25th. We lost four operating days compared to the first quarter last year that had bad weather. So weather is still a factor, but it's really early.
Speaker Change: But we are also gonna manage and operate the park and we are Finalising the agreement with us could deal with self Saudi partner and I think everything is moving forward to be advisory theft. It should be our first time, where we operate the park.
Speaker Change: Don't don't so we're very excited about that.
Speaker Change: Thank you.
Speaker Change: Again, if you have a question. Please press Star then one.
Speaker Change: Our next question comes from Chris Maraca from Deutsche Bank. Please go ahead.
Chris Jon Woronka: A good morning, guys snakes for taking all the questions. So far wanted to kind of this is this is really kind of our customer mix or behavior question is it possible for you guys kind of bucket out maybe broadly what what happened to a customer. So you go back and look at twenty-three versus 22.
Gary Mick: It's the smallest part of our season. At this stage, we're not. Thank you. And maybe I can ask one about the Saudi Arabia project, you know, any updates you can give there. I know the deal filings indicate opening in spring 2025.
Robert Samuel Aurand: Is there anything we should be thinking about from a modeling perspective, and how that might flow through? First of all, we're very excited about the Saudi project. It's going to be the largest, most immersive park in the world. In fact, it will be the world's largest park.
Chris Jon Woronka: Two if somebody who's on our unlimited food Neil Neil.
That didn't like reoccur last year to that person come back to the park and then you know kind of secondarily some of the some of the past programs that expired that you you replaced with with new plans.
Selim A. Bassoul: I have visited there. I've been there. We're working, our partners and our contractors and our team are working around the clock. In fact, I was there recently, and they were working almost 24-7, and we're expecting to open in the first quarter by this time next year. And we're excited. I think what is exciting about it is that, in this case, not only are we licensing the park, but we are also going to manage and operate the park. And we are finalizing the agreement with Qadiyah, who's our Saudi partner, and I think everything is moving forward to add value there. It will be our first time operating a park we don't own.
Chris Jon Woronka: Did you see those customers come back to you in a different way or did they drop out or day debate move up a plan or moved down a plan anyway, just think about that at a high level. Thanks.
Speaker Change: Yeah, we we we do not divulged to stay at all we have not divulge within the past, but I can give you some flavor about it.
Speaker Change: I think the flavor has been we've learned something which is interesting for us we've run some good stuff. That's happened. So some of our members that's where some of the people want to go in membership ended up in season passes it's off season passes up.
Robert Samuel Aurand: So we're very excited about that. Thank you. Again, if you have a question, please press star, then 1.
Speaker Change: Are single day ticket has been up to in 2023, we feel good about it.
Speaker Change: I think what has been interesting for us what you've learned.
Chris Jon Woronka: Our next question comes from Chris Woronka from Deutsche Bank; please go ahead. Hey, good morning, guys. Thanks for taking all the questions so far.
Speaker Change: And I don't know if it's in the industry wide or it's only for us.
Speaker Change: When it trains.
Speaker Change: On a Saturday.
Speaker Change: You don't expect those people to come on a Sunday, meaning meaning of humans set Saturday and you say, okay. It's beautiful Sunday.
Chris Jon Woronka: I wanted to kind of, this is, this is really kind of a customer mix or behavior question. Is it possible for you guys to kind of bucket out, maybe broadly, what happened to a customer as you go back and look at 23 versus 22? If somebody was on an unlimited food meal pass that didn't reoccur last year, did that person come back to the park?
Speaker Change: People have made plans.
Speaker Change: So we tend to lose those people when weather is bad on a Saturday.
Speaker Change: So my expectation would be will make it up on the following day. If you were not coming on a Sunday you come into the following day and they did not show up.
Speaker Change: So for us.
We we have been impacted by what the significantly and it's something that could I T does it I did not anticipate that business when I became seal it was not as big of a factor in his today. So going forward in 2024, who are working on a program and read that affects mostly single day ticket, let's put it this way which is a.
Chris Jon Woronka: And then, you know, kind of secondarily, some of the past programs that expired that you replaced with new plans? Did those, you know, did you see those customers come back to you in a different way? Or did they drop out?
Selim A. Bassoul: Or did they move up a plan or move down a plan? Anyway, just think about that at a high level. Thanks. We do not divulge this information.
Speaker Change: Very healthy profitable high emotion part of our business and we are working on a program that we're launching in most probably soon that I wouldn't be able to talk about that most probably.
Selim A. Bassoul: We have not divulged it in the past, but I can give you some flavor about it. And I think the flavor has been, we've learned something which is interesting for us. We've learned some good stuff that happened. So some of our members that were, some people wanted to go on membership ended up on season pass. So our season pass is up.
Speaker Change: Guarantees for a single day ticket against what those so.
Speaker Change: So we're putting the element of it and it's very exciting it'll be.
Speaker Change: [noise] unique it will never ever been done in the industry would be the first to most probably launch something for a single day ticket to take away the impact of what the.
Selim A. Bassoul: Our single day ticket price has been up to in 2023. We feel good about it. I think what has been interesting for us, what we've learned... And I don't know if it's industry-wide or it's only for us, when it trains on a Saturday. You don't expect those people to come on a Sunday, meaning, meaning if you miss that Saturday, and you say, okay, it's a beautiful Sunday. People have made plans, so we tend to lose those people when the weather is bad on a Saturday. So my expectation would be we'll make it up the following day. If you were not coming on a Sunday, you come in the following day, and they did not show up for us.
Speaker Change: Those guests.
Speaker Change: Okay very helpful. Thanks Lily.
Speaker Change: This concludes our question and answer session I would like to turn the conference back over to Celine bustle for any closing remarks.
Celine Bustle: I want to say first thank you on behalf of the six o'clock team. We appreciate your continued support.
Celine Bustle: And I want to take a few minutes to add a little bit to recap a little bit some of what I'm talking about I'm sure. There's a lot of thing going on and I want to take a minute to talk about.
Celine Bustle: Our accomplishments in the last two years, but most of them, probably where we're going in 2024 and I was preparing a few handwritten notes to wrap up our conversation cause a lot of things happening exciting things happening in 2024 for us.
Celine Bustle: So you're probably looking out of accomplishment in the past two years.
Selim A. Bassoul: We are, we have been impacted by what, significantly, and it's something, a criterion that I did not anticipate in that business when I became CEO; it was not as big of a factor as it is today. So going forward in 2024, we are working on a program, and with that, we affect mostly single-day ticket travel, let's put it this way, which is a very healthy, profitable, high-mar And we are working on a program that we're launching probably soon that I will be able to talk about that probably guarantees a single day ticket against Waterford. So we are putting that element into it, and it's very exciting. It will be unique. It will never have been done in the industry before.
We did.
Celine Bustle: Three things that I'm very proud of.
Celine Bustle: One.
Celine Bustle: We basically <unk>.
Celine Bustle: Change our culture from output to outcome.
Celine Bustle: And that means we created a culture of ownership.
Celine Bustle: Accountability and performance.
Celine Bustle: And I'm very proud to say that our team responded well to the most of the parks and Ah corporate.
Celine Bustle: However, as I mentioned earlier I underestimated.
Celine Bustle: And the estimated.
Celine Bustle: The cost and complexity of the transformation.
Celine Bustle: We had to change the culture from attendance to yield.
Celine Bustle: From centralization to decentralization.
Celine Bustle: For many layers of management the company was bloated honestly, because we expected maybe the result of pandemic to last longer and people stopped it and literally realise very quickly in 2022 that.
Selim A. Bassoul: We'll be the first to probably launch something for our single day ticket to take away the impact of weather from those guests. Okay, very helpful. Thanks, Selim. This concludes our question and answer session. I would like to turn the conference back over to Selim Bassoul for any closing remarks.
Celine Bustle: The result of 2021.
Celine Bustle: Different.
Celine Bustle: Dan.
Speaker Change: We tried to.
Speaker Change: Create the beautiful patient premiumization trying to attract multi generation, it's probably not parks.
Selim A. Bassoul: I want to say first, thank you on behalf of the Six Flags team; we appreciate your continued support. I want to take a few minutes to add a little bit to recap a little bit some of what we talked about. I'm sure there are a lot of things going on, and I want to take a minute to talk about our accomplishments in the last two years, but most of all, where we're going in 2024. And I was preparing a few handwritten notes to wrap up our conversation because there are a lot of things happening, exciting things happening in 2024 for us. So if I look at our accomplishments in the past two years,
Speaker Change: We're also the second element.
Speaker Change: Is we know that.
Speaker Change: Create.
Speaker Change: Seamless.
Speaker Change: Cause somebody's teens, we needed to go after the choking points.
Speaker Change: And that needed innovation it need.
Speaker Change: Technology.
Speaker Change: We had no choice.
Speaker Change: And and that we implemented a lot of things we implemented what I call guests facing technology. When we knew that if I gave you.
Speaker Change: Convenience and value you will pay me for that convenience and value.
Speaker Change: That's the resolve to pass speedy games. So it has been very promising so far where it's a toll gate. When you come in you don't have to go through a man to a booth toll booth and you go in seamless theme parks.
Selim A. Bassoul: We did. Three things that I'm very proud of. One.
Selim A. Bassoul: We basically changed our culture from output to outcome. And that means we created a culture of ownership, accountability, and performance. And I'm very proud to say that our team responded well to this, both at the parks and at corporate. However, as I mentioned earlier, I underestimated the cost and complexity of the transformation.
Speaker Change: I gave you an ability to come to our restaurant now.
Speaker Change: Start using self serving kiosk what'd you can customize two aunts degree your burger or the.
Speaker Change: Even your pizza.
Speaker Change: Contenders.
Speaker Change: And people are paying us for us.
Speaker Change: So we understand that indulgence.
Speaker Change: Comes only if you're willing to create convenience ease of doing business and value.
Selim A. Bassoul: We had to change the culture from attendance to yield, from centralization to decentralization. There were many layers of management, the company was bloated, honestly, because we expected maybe the result of the pandemic to last longer, and people staffed it. And literally, we realized very quickly in 2022 that the result of 2021 was different.
Speaker Change: And in that case, we are focused on those three things convenience value.
Speaker Change: And ease of doing business.
Speaker Change: And that's why I'll put a cap was continue growing in 2024 2020 520 26.
Speaker Change: We also in technology, we had attacked labor.
Speaker Change: And to that extent, we are automating.
Speaker Change: Many of our functions.
Selim A. Bassoul: [inaudible] We tried to create the beautification of premiumization, trying to attract multi-generation families to our park. We also have a second element: we know that to create a seamless customer experience, we needed to go after the choking point. And that needed innovation. It needed technology. We had no choice.
Speaker Change: And we are lucky that AI.
Speaker Change: And our I T team has embraced it very strongly.
We are now using a I.
Speaker Change: In many parts of our business.
Speaker Change: From our customer service.
Speaker Change: To our personalizing, our guest experiences to improving operational efficiencies.
Speaker Change: To basically using yeah, I based safety measures.
Speaker Change: That's in our water parks.
Speaker Change: Affecting our life guards, who are they it's a very tough jump she just.
Selim A. Bassoul: And in that, we implemented a lot of things. We implemented what I call guest-facing technology, where we knew that if I gave you convenience and value, you would pay me for that convenience and value. That's the result of our speedy gate, which has been very promising so far, where it's a toll gate where you come in, you don't have to go through a manned toll booth, and you go in seamlessly into our park.
Speaker Change: And very expensive to train and hire and get.
Speaker Change: The third element.
Speaker Change: That I'm very proud about.
Speaker Change: Is the change you've done.
Speaker Change: I have to say.
Speaker Change: I want to say, thank you put our investors who stood by US. Thank you for our analyst. Thank you for our board.
Speaker Change: That allowed me to focus on profitability.
Speaker Change: And not revenue as our top priority.
Selim A. Bassoul: I gave you the ability to come to our restaurant now and start using self-serving kiosks where you can customize to an nth degree your burger order, even your pizza, your chicken tenders, and people are paying us for us. So we understand that indulgence comes only if you're willing to create convenience, ease of doing business, and value. And in that case, we are focused on those three things: convenience, value, and Ease of Doing Business.
We have changed our business model, reflecting his strategic shifts.
Speaker Change: And the market condition and I've challenges.
Speaker Change: We are totally focused on increasing out EBITDA.
Speaker Change: Our martians.
Speaker Change: And when I'm only doing it.
Speaker Change:
Speaker Change: The fact that we are providing better value for our guests.
Speaker Change: In that case.
Speaker Change: We faced tremendous inflation.
Speaker Change: Since I took over the job.
Speaker Change: Right. After it took over the job the Ukraine War started we had not only inflation, we had supply chain constraints.
Selim A. Bassoul: And that's why our per capita will continue growing in 2024, 2025, and 2026. We also, in technology, have to attack labor. And to that extent, we are automating many of our functions, and we are lucky that AI and our IT team have embraced it very strongly. We are now using AI in many parts of our business, from our customer service to personalizing our guest experiences to improving operational efficiencies, to basically using AI-based safety measures. That's in our author part, affecting our lifeguards who are very, it's a very tough job, teachers, and very expensive to train and hire and get.
Speaker Change: Second we had what the climate change that occurred J roughly for US those are not excuses, well, just saying when when you're doing a major transformation.
Speaker Change: And your compounded on top of it was wasn't on inflation.
Speaker Change: It was tough.
Speaker Change: No.
Speaker Change: Putting this behind us.
Speaker Change: The transformation is yielding great great benefits.
Speaker Change: We are very pleased about it for almost at the end of it.
Speaker Change: We have another more most probably a year to complete it and I'm very confident that.
Speaker Change: By 20 and of 22nd half of 2024.
Speaker Change: And 2020 526, who are back contract to what we promised.
Selim A. Bassoul: The third element that I'm very proud of is the change we've made. And I have to say, I want to say thank you to our investors who stood by us. Thank you for our analysts. Thank you for our board, which allowed me to focus on profitability and Knot Revenue as our top priority. We have changed our business model, reflecting a strategic shift in the market conditions and our challenges. We are totally focused on increasing our EBITDA.
Speaker Change: Our investors to be.
Speaker Change: Very exciting times and I want to thank all of you.
Speaker Change: For.
Speaker Change: Making us better I know you've asked a lot of good question tough questions and.
Speaker Change: And we've gone through some great twins and some mistakes we've made.
Speaker Change: But we've learned the missteps have made us better than we are a great company going forward.
Speaker Change: Thank you.
Speaker Change: The conference has now concluded.
Speaker Change: Thank you for attending today's presentation you may now disconnect.
Selim A. Bassoul: Out of motion, and we are only doing it. All right, the fact that we're providing better value for our guests. In that case, we have faced tremendous inflation since I took over the job. Right after I took over the job, the Ukrainian war started. We had not only inflation, we had supply chain constraints. Second, we had weather and climate change that occurred very roughly for us. Those are not excuses.
Speaker Change: [music].
Speaker Change: Mmm.
Selim A. Bassoul: We are just saying that when we were doing a major transformation and you compounded on top of it with weather and inflation, it was tough. Now, we're putting this behind us. The transformation is yielding great, great benefits, and we are very pleased about it. We're almost at the end of it. We have another one, most probably a year to complete it, and I'm very confident that by the end of the second half of 2024, and 2025 and 2026, we are back on track to what we promised our investors. Very exciting times, and I want to thank all of you for making us better. I know you've asked a lot of good questions, tough questions, and we've gone through some great wins and some mistakes we've made. But we've learned the missteps have made us better, and we are a great company going forward.
Speaker Change: Mmm.
Speaker Change: [music].
Speaker Change: Yeah.
Speaker Change: [music].
Selim A. Bassoul: Thank you. The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.
Mmm.
Speaker Change: [music] [noise].
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Speaker Change: