Cedar Fair Entertainment Company (FUN), a leader in regional amusement parks, water parks and active entertainment, today announced results for the first quarter ended March 30, 2014. Historically, first quarter results represent less than 5% of the Company’s full-year net revenues as the vast majority of its parks and facilities are closed during this quarter. As a result, the Company typically operates at a loss during this period.
“We are pleased with our early-season trends through the end of April, which for the most part normalizes our operating calendar for the Easter and spring break holidays,” said Matt Ouimet, Cedar Fair’s president and chief executive officer. “Comparable-park net revenues through April are up approximately $7 million over the same four-month period last year. We have experienced strength in all aspects of our business, including early-season pass sales and group event bookings. At the parks that have been operating, attendance and in-park guest per capita spending are also trending higher than this time last year. Based on our record performance in 2013 and these strong early-season trends, we remain confident in our ability to execute on our long-term strategy and expect 2014 to be another record year for Cedar Fair.”
Ouimet concluded by stating, “With eight of our parks now open, we are seeing first-hand the excitement our guests are experiencing as they leave this winter’s snowy, cold weather behind and create new memories with their families and friends.”
Stay tuned after the break for a complete breakdown of Cedar Fair’s earnings report.
For the first quarter ended March 30, 2014, Cedar Fair’s net revenues decreased 3% to $40.5 million, compared with $41.8 million in the first quarter ended March 31, 2013. The decrease was entirely driven by the timing shift of the Easter and spring break holidays which occurred in the second quarter of 2014 compared with the first quarter of 2013 and was in line with the Company’s expectations. This was partially offset by a strong performance at Knott’s Berry Farm, the Company’s only year-round park, during the first quarter.
Operating costs and expenses for the first quarter of 2014 were $106.7 million, an increase of $4.0 million from the prior-year quarter, and were also in line with the Company’s expectations. The increased costs for the quarter were largely due to budgeted increases in maintenance expense as the Company continues to invest in the infrastructure of its parks.
The net loss for the quarter totaled $83.5 million, or $1.51 per diluted LP unit, compared with a net loss of $109.1 million, or $1.95 per diluted LP unit, for the first quarter a year ago. The first-quarter 2013 net loss included a $34.6 million charge related to the Company’s March 2013 refinancing.
Cash Flow and Liquidity Remain Strong
As of March 30, 2014, the Company had $618.9 million of variable-rate term debt (before giving consideration to fixed-rate interest rate swaps), $902.0 million of fixed-rate debt, $55.0 million borrowed under its revolving credit facilities and $8.9 million of cash on hand. The Company believes its credit facilities and cash flows are sufficient to meet working capital needs, debt service, planned capital expenditures and distributions for the foreseeable future.
The Company also announced today the declaration of a cash distribution of $0.70 per LP unit. The distribution will be paid on June 16, 2014, to unitholders of record as of June 4, 2014. This distribution reflects the Company’s strong performance and growth strategy and is consistent with its targeted record annualized distribution rate of $2.80 per LP unit for 2014.
“Our investments to enhance the overall guest experience continue to be a key driver of our success,” added Ouimet. “For example, the launch of Banshee, a world-record-breaking roller coaster at Kings Island, resulted in the best opening weekend in that park’s 43-year history. Beyond our strong capital program, we have many initiatives, including new live entertainment, increased culinary options and improved merchandise offerings, that we believe will further enhance the guest experience.
“Based on early-season trends and our confidence in our business model, we currently anticipate net revenues for the full-year 2014 to be in the range of $1.16 billion to $1.19 billion and Adjusted EBITDA is anticipated to be in the range of $435 million to $450 million,” said Ouimet. “We also remain on track to achieve our FUNforward long-term growth goal of $450 million in Adjusted EBITDA at least one, if not two years, earlier than our original target of 2016.”