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United Parks & Resorts Inc. (SEAS)·Q4 2023 Earnings Summary

Executive Summary

  • Q4 2023 delivered record attendance (5.0M) and record in-park per-capita, but revenue was flat (-0.4% y/y to $389.0M) and diluted EPS fell to $0.62 on higher operating expenses; Adjusted EBITDA was $150.4M (-2.1% y/y) .
  • Management cited adverse weather, peak-period calendar shift, and admissions mix as primary headwinds; in-park spending strength and pricing power persisted, with in-park per-capita up 1.5% to a record $33.96 .
  • The Board recommended a new $500M share buyback program (subject to non-Hill Path shareholder approval), alongside governance amendments linked to Hill Path voting and future related-party transactions .
  • 2024 outlook: “meaningful growth and new records in revenue and Adjusted EBITDA,” with bookings trending ahead for group sales and Discovery Cove, and all new rides scheduled to open before peak summer season, positioning near-term catalysts around attractions openings and pass base momentum .

What Went Well and What Went Wrong

What Went Well

  • Record Q4 attendance and record in-park per-capita; management emphasized pricing power and revenue strategies: “we delivered record attendance and record in park per capita spending despite adverse weather impacts… demonstrating the effectiveness of our revenue strategies, our pricing power and the strength of consumer spending in our parks.” — Marc Swanson, CEO .
  • Strategic expansion execution: SeaWorld Abu Dhabi opened and is “performing ahead of expectations,” broadening brand reach and adding high-margin international services revenue tailwinds .
  • Forward pipeline confidence: “We expect meaningful growth and new records in revenue and Adjusted EBITDA for 2024,” with bookings trending ahead for 2024 group sales and Discovery Cove, and all new attractions scheduled pre-peak season .

What Went Wrong

  • Profitability compression: diluted EPS decreased to $0.62 from $0.76 and net income fell $9.0M y/y, driven primarily by higher operating expenses; revenue dipped slightly on admissions mix pressure despite per-capita strength .
  • Weather and calendar headwinds: management estimates ~75k Q4 attendance lost and >370k for the full year, notably concentrated in Florida during peak periods, plus an unfavorable calendar shift .
  • Admissions per-capita declined 2.6% y/y in Q4 due to product mix, partially offset by in-park per-capita growth; Adjusted EBITDA down 2.1% y/y .

Financial Results

MetricQ2 2023Q3 2023Q4 2023
Revenue ($USD Millions)$496.0 $548.2 $389.0
Net Income ($USD Millions)$87.1 $123.6 $40.1
Diluted EPS ($USD)$1.35 $1.92 $0.62
Adjusted EBITDA ($USD Millions)$224.2 $266.4 $150.4
Operating Income ($USD Millions)$155.4 $203.3 $89.3
Net Cash from Operations ($USD Millions)$184.6 $163.6 $106.5
KPIQ2 2023Q3 2023Q4 2023
Attendance (Millions)6.1 7.1 4.96
Total Revenue per Capita ($)$80.80 $76.90 $78.42
Admission per Capita ($)$43.96 $42.05 $44.46
In-Park Per Capita ($)$36.84 $34.85 $33.96
Q4 Year-over-YearQ4 2022Q4 2023
Revenue ($USD Millions)$390.5 $389.0
Net Income ($USD Millions)$49.0 $40.1
Diluted EPS ($USD)$0.76 $0.62
Adjusted EBITDA ($USD Millions)$153.7 $150.4
Attendance (Millions)4.94 4.96
Total Revenue per Capita ($)$79.10 $78.42
Admission per Capita ($)$45.63 $44.46
In-Park Per Capita ($)$33.47 $33.96
Cash Flow & CapexQ2 2023Q3 2023Q4 2023
Free Cash Flow ($USD Millions)$108.776 $74.925 $35.841
Capital Expenditures ($USD Millions)$75.829 $88.631 $70.618
Balance Sheet SnapshotDec 31, 2022Dec 31, 2023
Cash & Equivalents ($USD Millions)$79.196 $246.922
Total Assets ($USD Millions)$2,325.787 $2,625.046
Deferred Revenue ($USD Millions)$169.535 $155.614
Total Long-Term Debt incl. Current ($USD Millions)$2,137.500 $2,125.500
Stockholders’ Deficit ($USD Millions)$(437.664) $(208.216)

Notes:

  • SEAS/PRKS press release exhibits include detailed reconciliations and definitions of Adjusted EBITDA, Covenant Adjusted EBITDA and Free Cash Flow .

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
RevenueFY 2024Not provided“Expect meaningful growth and new records in revenue” Raised (qualitative)
Adjusted EBITDAFY 2024Not provided“Expect meaningful growth and new records in Adjusted EBITDA” Raised (qualitative)
New Attractions Timing2024Not providedAll new rides/attractions scheduled to open before peak summer season New detail
Group/Discovery Cove Bookings2024Not providedBookings trending ahead of prior year (groups and Discovery Cove) Positive update
Share Repurchase AuthorizationN/APrior authorization remaining ~$38.5M as of 9/30/23 Board recommends $500M buyback, subject to non-Hill Path shareholder approval New program
Governance (Hill Path)N/APrior Stockholders AgreementAmendment adding proportional voting and disinterested approvals for acquisitions/related-party transactions (effective upon approvals and repurchases) Strengthened safeguards

Earnings Call Themes & Trends

TopicPrevious Mentions (Q-2: Q2’23)Previous Mentions (Q-1: Q3’23)Current Period (Q4’23)Trend
Weather/macro headwindsSignificant adverse weather; construction delays caused in-park venue closures; impacted attendance and in-park spending Unusual heat/rain in peak season; revenue/attendance would have been up low-single digits after adjusting for calendar shift ~75k Q4 attendance lost; >370k full-year attendance lost due to weather; unfavorable calendar shift Persistent headwind, quantified; management expects recovery over time
Pricing power & per-capitaPer-capita up; record in-park per-capita ($36.84); admissions per-capita up YTD In-park per-capita record ($34.85); total per-capita flat y/y; cost discipline improved EBITDA margin y/y In-park per-capita record ($33.96); total per-capita -0.9% y/y on admissions mix Durable pricing power; admissions mix offsets present
Bookings/pass baseGroup bookings revenue up vs 2022/2019; strong pipeline 2024 revenue bookings trending up double-digits for groups and Discovery Cove; launch of best pass benefits program 2024 bookings trending ahead for groups and Discovery Cove; positive pass base trajectory implied Improving booking trends; pass strategy supportive
New rides/attractionsSeaWorld Abu Dhabi opened, ahead of expectations Partial 2024 line-up announced (Penguin Trek, Phoenix Rising, Loch Ness refurbishment, etc.) Full list detailed across parks; all scheduled pre-peak season Execution underway; timing aligned with peak demand
International expansionAbu Dhabi opening; ahead of expectations Continued momentum “Performing ahead of expectations” reiterated Positive
Cost managementElevated labor costs; SG&A up; Adjusted EBITDA -1.2% YTD “Improved adjusted EBITDA margin” y/y; cost initiatives ongoing into 2024 Higher operating expenses drove net income decline; Adjusted EBITDA down 2.1% y/y Mixed: initiatives vs near-term expense pressure

Sources: Company 8-K press releases and exhibits; Q4 IR presentation posted .

Management Commentary

  • “In the fourth quarter we delivered record attendance and record in park per capita spending despite adverse weather impacts… and an unfavorable calendar shift… We estimate that weather related and calendar shift impacts reduced attendance by approximately 75,000 visits in the fourth quarter and… over 370,000 visits for the full year.” — Marc Swanson, CEO .
  • “In 2023 along with our partners we successfully opened our first SeaWorld park outside of the United States in Abu Dhabi… performing ahead of expectations.” — Marc Swanson .
  • “We are excited about our plans for 2024… our new rides and attractions are all currently scheduled to open before the peak summer season… We expect meaningful growth and new records in revenue and Adjusted EBITDA for 2024.” — Marc Swanson .

Q&A Highlights

  • The call featured IR, CEO Marc Swanson, and Interim CFO Jim Forrester, with questions from Truist, Citi, Morgan Stanley, and KeyBanc focused on weather impacts, pricing power, bookings, cost initiatives, and capital allocation .
  • Management reiterated quantification of weather impacts and confidence in bookings and 2024 attraction timing, clarifying that admissions mix drove per-capita pressure while in-park per-capita remained strong .
  • Capital allocation questions centered on the proposed $500M buyback and governance amendments; management highlighted disinterested shareholder approvals and proportional voting mechanisms for Hill Path affiliates .

Estimates Context

  • S&P Global (Capital IQ) Wall Street consensus estimates were unavailable via our SPGI tool for SEAS in this period due to a mapping issue; as a result, we cannot provide definitive consensus comparisons for Q4 2023 (EPS or revenue).*
  • Implication: Given revenue slightly below prior year and EPS/Adjusted EBITDA declines versus Q4 2022, and management’s strong 2024 outlook, we would expect the Street to refine near-term attendance assumptions (weather normalization) and maintain/improve per-capita and bookings-driven trajectory; explicit consensus revisions depend on updated analyst models and are not available here .
    *Values retrieved from S&P Global were unavailable due to mapping constraints.

Key Takeaways for Investors

  • Per-capita resilience remains the core earnings engine; admissions mix moderated headline revenue despite record in-park per-capita, but strategy and pricing power are intact .
  • Weather quantified and likely transient; bookings and attraction timing provide visibility into a stronger seasonal ramp for 2024, supporting management’s outlook for record revenue and Adjusted EBITDA .
  • Cash balance strengthened ($246.9M at year-end) with stable long-term debt, providing flexibility for capex and buybacks; FCF moderated in Q4 on higher capex but pipeline investment underpins 2024 growth .
  • Governance enhancements linked to Hill Path reduce potential conflicts and align voting with disinterested shareholders, a positive for minority holders ahead of the proposed $500M buyback vote .
  • Near-term catalysts: pre-summer ride openings, pass program benefits, group/Discovery Cove bookings, and the buyback approval; monitor Florida weather, admissions mix, and cost trajectory into peak season .
  • Without SPGI consensus, focus on sequential improvements: watch Q1/Q2 traffic normalization and margin progression versus Q4 cost pressure; sustained per-capita gains should support estimate resets once Street updates models .

Sources and documents read:

  • Q4 2023 8-K Item 2.02 with Exhibit 99.1 press release and detailed financial tables .
  • Q3 2023 8-K Item 2.02 press release and tables .
  • Q2 2023 8-K Item 2.02 press release and tables .
  • Q4 2023 earnings call transcript (web sources) .
  • IR materials posting for Q4 2023 investor presentation .