Six Flags Entertainment Corp/OLD (SIX)·Q4 2023 Earnings Summary

Executive Summary

• Q4 2023 revenue was $293.0M, diluted EPS was -$0.27, and Adjusted EBITDA was $98.2M; attendance rose 6% to 4.3M, while total guest spending per capita declined 1% YoY due to legacy membership attrition .
• Reported net loss was driven by $15M in merger-related transaction costs and higher cash operating costs (inflation, higher variable costs, new events, and digital initiatives); Adjusted EBITDA was essentially flat YoY .
• Management emphasized continued progress on its premiumization strategy and early strength in 2024 pass sales (“ahead of last year”), highlighting technology partnerships to enhance the in-park experience .
• External reports indicate an EPS miss versus Street expectations; S&P Global consensus was unavailable via our tool. The pending merger with Cedar Fair (vote Mar 12, 2024) and anticipated H1 2024 close are key catalysts .

What Went Well and What Went Wrong

• What Went Well

  • Attendance increased 6% YoY to 4.3M; revenue grew 5% YoY to $293M, supported by higher season pass and single-day ticket attendance during Fall events .
  • In-park spending per capita rose 2% YoY (+$0.48) on higher food & beverage and attractions spend; average ticket pricing also improved .
  • CEO: “We have laid the groundwork long-term for profitable growth… new innovative rides, immersive experiences, and… technological innovations that will create a more seamless in-park experience” .

• What Went Wrong

  • Net loss of $22M vs net income of $10M prior year, driven by $15M merger-related transaction costs and higher cash operating costs; diluted EPS was -$0.27 vs $0.12 prior year .
  • Total guest spending per capita fell 1% YoY, primarily due to fewer 13+ legacy memberships; CFO commentary cited ~$12M lower “13+” monthly revenue in Q4 vs prior year .
  • Inflation increased wages and other operating costs; impairment ($23.0M) and loss on disposal ($9.6M) also weighed on operating results .

Financial Results

Quarterly Performance vs Prior Periods and External Estimates

Note: S&P Global consensus was unavailable via our tool; external expectations reported by media outlets are shown for context .

Q4 Segment Revenue Breakdown (YoY)

KPIs Across Recent Quarters

Guidance Changes

No formal quantitative guidance ranges were provided; management highlighted early-season pass momentum and merger timing .

Earnings Call Themes & Trends

Management Commentary

• CEO message: “We have laid the groundwork long-term for profitable growth… new innovative rides, immersive experiences, and… technological innovations that will create a more seamless in-park experience, drive guest spending and improve operational efficiency” .
• Strategy progress: Since 2021, guest spending per capita up 17%, cash expense lowered despite inflation, expanded sponsorship, paid down debt .
• 2024 setup: “Early success in sales of our 2024 passes, which are ahead of last year, and should provide a solid foundation as we head into the core operating season” .
• Technology partnerships named on the call to support personalization and immersion (Google, Dell, Snowflake, HCL Tech) .

Q&A Highlights

• Membership dynamics: CFO noted “13+” legacy membership revenue was ~$12M lower YoY in Q4 due to attrition, contributing to per-capita declines .
• Cost structure: Inflation increased wages and other operating costs; variable costs rose with higher attendance and expanded events .
• Weather impact: Management estimated adverse weather reduced full-year attendance by over 1M guests (context from external transcript coverage) .
• Technology/guest experience: Management emphasized partnerships and tech initiatives aimed at a more seamless in-park experience and higher guest spend .
• Merger: Company declined to take detailed questions on the pending Cedar Fair merger during the call; reiterated vote and expected close timing .

Estimates Context

• S&P Global consensus data was unavailable via our tool for SIX (mapping error); as a result, we cannot present S&P consensus for Q4 2023.
• External media reported an EPS miss (actual -$0.27 vs expectations ~$0.27) and revenue near ~$292.6M; we anchor our comparisons to the company’s actuals and note external commentary for context .
• Given higher costs (inflation, events, digital investments) and legacy membership attrition, near-term Street estimates may need to reflect pressure on per-capita metrics and operating expenses despite attendance momentum .

Key Takeaways for Investors

• Attendance momentum combined with in-park spending resilience supports top-line stability; however, legacy membership attrition weighed on admissions and per-capita metrics in Q4 .
• Cost inflation and event/digital investments constrained profitability; Adjusted EBITDA stayed flat YoY despite revenue growth, signaling margin sensitivity to cost mix .
• Early strength in 2024 pass sales and premiumization initiatives are constructive for the core season; management expects a more seamless, tech-enhanced guest experience to drive spend .
• The merger with Cedar Fair is a key 2024 catalyst (vote Mar 12; expected H1 close), with potential synergies and portfolio diversification; track regulatory approvals and integration updates .
• Weather variability remains a structural risk for attendance; management cited notable adverse impacts in 2023, underscoring operational contingency needs .
• Near-term trading: External reports of an EPS miss and merger costs could pressure sentiment; medium-term thesis hinges on premiumization execution, pass momentum, cost discipline, and merger synergies .

Sources

• Q4 2023 8-K and Exhibit 99.1 (press release, statements, reconciliations) .
• Q3 2023 8-K and Exhibit 99.1 (trend analysis) .
• Q2 2023 8-K and Exhibit 99.1 (trend analysis) .
• Earnings call transcript coverage (Yahoo/Insider Monkey, Seeking Alpha, Motley Fool, YouTube reference) .
• Merger announcement and timeline .