Attendance grew at Six Flags' theme parks in 2023, but increased cost led to lower income, the company reported today.
More than 22 million guests visited Six Flags parks in 2023, up 9% from 2022, the company said. However, guest spending dipped 5%, to $61.03 per visitor last year, driven by a 7% drop in admission spending per capita. Six Flags attributed the drops to lower average prices on seasonal passes resulting in a higher percentage of visitors using those passes rather than higher-priced day tickets.
Total revenue was up 5% for the year, to $1.426 billion, but net income dropped 66%, to just $39 million. Six Flags attributed that drop in part due to a $38 million charge in self-insurance reserves, plus $15 million in merger-related transaction costs. Excluding those, Adjusted EBITDA was basically flat, rising $1 million to $462 million for the year.
"As we close out our second year pursuing our premiumization strategy, we are encouraged by the progress we have made to date," Six Flags President and CEO Selim Bassoul said. "Since 2021, we have grown guest spending per capita by 17%, lowered cash expense in the face of historical levels of inflation, leveraged key partnerships to expand sponsorship revenue, and paid down debt," said Selim Bassoul, President and CEO. “Looking ahead to 2024, we have seen 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."
Six Flags is merging with Cedar Fair, in a deal expected to close by this summer. While Cedar Fair's CEO will run the new company, it will retain the Six Flags name.
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We need to run a "Theme Park Apprentice"-style contest where the brief is to design a new park using attraction names from theme park CEOs' earnings-statement buzzwords, such as "premiumization."
Because even those would be better than "Project 305."
This is about what is to be expected by reducing pass prices. Unfortunately, with the emphasis placed on season long products, many regional parks have created a customer base that expects a low cost per visit, which makes it hard to raise prices without scaring customers off. It's going to be interesting to see where the industry goes from here, especially with both companies struggling as they head into the merger.
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"premiumization strategy" - ROFL. Yet they lowered season pass prices that led to lower percap spending. Way to speak out of both ends Bassoul.
"Since 2021, we have grown guest spending per capita by 17%, lowered cash expense in the face of historical levels of inflation, leveraged key partnerships to expand sponsorship revenue, and paid down debt,"
In other words, we've stripped pretty much all value out of the parks, stopped investing in them as we prepared for the merger with Cedar Fair, and used all available reserves to pay down debt and eliminate liabilities. We took a Wal Mart and turned it into a Dollar Tree, and called it "premiumization" because we're charging a $1.50 for everything.