Like Six Flags, Cedar Fair has cut part-time employees, reduced hours and pay for full-time ones, slashed management pay and is lining up more sources to borrow money, if needed.Cedar Fair has taken several steps to help the company's finances during the shutdown of its parks.
The Ohio-based theme park chain said that it had $26 million in cash on hand at the end of last month, with $190 million available under its revolving credit facility, net of $15 million of outstanding letters of credit, according to its press release. Cedar Fair reported that its current cash burn rate is between $25-35 million per month, after its cost-cutting measures.
Although Cedar Fair has laid off or not hired its usual crew of part-time and seasonal workers, it is still paying its salaried employees 75 percent of their pay, with full-time hourly employees getting 30 hours of pay per week. CEO Richard Zimmerman is taking a 40 percent pay cut while other executives are getting the 25 percent pay cut, effective April 27. Cedar Fair also is not paying its board of directors "until business conditions improve." Nor will the company be issuing quarterly distributions to its unitholders.
Finally, Cedar Fair has "suspended all advertising and marketing expenses, and reduced general and administrative expenses and other park-level operating expenses to better align with the disruption in operations while still remaining in readiness position to reopen parks," according to the press release. If the closures extend deep into the year, the company said that it is prepared to adopt additional cost-cutting and cash-saving measures, as well as to secure additional liquidity.
"As we work to ensure the safety and well-being of our employees, guests and business partners from the effects of COVID-19, it's important we also embrace measures that will ensure our financial flexibility through this difficult period," Zimmerman said. "After social distancing recommendations by the authorities are lifted, we look forward to opening our parks as soon as reasonably possible. The actions we are announcing today help put us in a better position to do so as we navigate the unknown environment ahead."Tweet
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