NEW YORK, Aug. 3 /PRNewswire-FirstCall/ -- Six Flags, Inc. (OTC
Bulletin Board: SIXFQ) announced today its consolidated operating
results for the second quarter and six months ended June 30,
2009.(1) Three Month Results Total revenues of $302.1 million
decreased 13% from the prior-year quarter's total of $345.7
million, primarily reflecting reduced attendance and guest
spending. Attendance for the quarter was 8.0 million, down 8% from
8.6 million in the second quarter of 2008. The attendance reduction
was driven by a decline in group sales, reflecting cutbacks in
outings by companies, schools and other organizations, as well as
reduced complimentary and free promotional tickets. Mitigating the
attendance loss for the quarter was the timing of Easter, which
fell in April of this year and in March of last year. Guest
spending per capita of $36.70 for the quarter was down 4% from the
prior-year quarter's per capita guest spending of $38.34,
reflecting decreases in admissions, food and beverages, games and
merchandise. Included in the reduced guest spending is the impact
of a weaker Mexican peso and Canadian dollar in the current-year
quarter, affecting U.S. dollar translated results for the parks in
Mexico City and Montreal. Exchange rates accounted for
approximately one percentage point, or $0.54, of the guest spending
per capita decline for the quarter compared to the prior year
quarter. The second quarter was impacted by the overall negative
macroeconomic environment as well as the outbreak of the H1N1
"Swine" flu in Mexico, which resulted in the Mexico City park being
closed for thirteen days and also affected group outings at the
Texas parks due to school closures. Adverse weather compared to the
prior-year quarter had an additional adverse effect on the second
quarter results. Revenues for the quarter also were affected by a
decline in sponsorship, licensing and other fees of $4.7 million
compared to the prior-year quarter, driven by lower international
licensing and other fees, partially offset by increased sponsorship
revenue. Commenting on the Company's performance, Mark Shapiro,
President and Chief Executive Officer of Six Flags, Inc., said:
"Our decline in performance is a reflection of all that surrounds
Six Flags -- a severe recession, a balance sheet restructuring
process, the swine flu pandemic, adverse foreign currency impact at
our international parks and miserable weather, particularly at our
east coast parks. The trends of our July business have improved,
but nowhere near enough to put us back on pace to match last year's
full-season record setting performance." Cash operating expenses(2)
for the quarter were down 4% to $230.5 million from $239.7 million
in the second quarter of 2008, reflecting decreased marketing
expenses, due in part to the timing of expenditures, lower cost of
sales due to decreased in-park revenues, and favorable currency
impacts at the Mexico City and Montreal parks. Labor and benefits
costs for the quarter were slightly higher due to the impact of
minimum wage increases and an increased amount of cash-based
compensation and benefits expenses that were stock-based, and
therefore non-cash expenses, in the prior-year quarter. Non-cash
operating expenses of depreciation, amortization, stock-based
compensation and loss on disposal of assets increased $2.7 million,
or 7%, in the current-year quarter to $39.4 million, compared with
$36.8 million in 2008, driven by increased depreciation and loss on
disposal of assets, partially offset by reduced stock-based
compensation and benefits expenses. The Company's results from
continuing operations decreased to a loss of $97.7 million compared
with income of $127.6 million in the prior-year quarter. The
decrease of $225.3 million reflected a prior-year gain on debt
extinguishment of $107.7 million, $78.7 million of reorganization
items associated with the current-year quarter's chapter 11 filing
of Six Flags, Inc. ("SFI") and certain of its subsidiaries, $37.1
million reduction in income (loss) from operations due primarily to
reduced revenues partially offset by lower expenses, increased
other expense of $16.7 million primarily reflecting the termination
of an interest rate swap, and $11.7 million of reduced net interest
expense reflecting lower effective rates and the write-off of
discounts, premiums and deferred financing costs and cessation of
interest accruals on the Company's debt subject to compromise as a
result of the chapter 11 filing of SFI and certain subsidiaries on
June 13, 2009. See Recent Developments below. The prior-year gain
on debt extinguishment resulted from the exchange of certain senior
unsecured notes of SFI for new notes of the SFI subsidiary Six
Flags Operations, Inc. ("SFO"). The $78.7 million of reorganization
items directly associated with the chapter 11 cases consists of
$67.6 million of discounts, premiums and deferred financing costs
associated with debt subject to compromise and the balance
represents professional fees. Adjusted EBITDA for the quarter
decreased by $31.3 million, or 36%, to $56.3 million compared to
$87.6 million for the prior-year quarter, reflecting the impact of
reduced revenues partially offset by lower cash operating expenses.
(1) Reported results from continuing operations for all periods
presented exclude the results of parks sold in prior years and the
park in New Orleans, Louisiana, which has been closed since August
2005 due to damage caused by Hurricane Katrina. (2) Cash operating
expenses are presented as costs and expenses excluding
depreciation, amortization, stock-based compensation and loss on
disposal of assets in the statement of operations data. Six Month
Results For the six months ended June 30, 2009 (the "First Half
2009"), total revenues decreased $59.9 million, or 14%, to $354.0
million from $413.9 million in the prior-year period, primarily
reflecting reduced attendance and guest spending. Attendance for
the First Half 2009 was 9.2 million, down 9% from 10.1 million in
the first six months of 2008. Reductions in group sales drove the
decline in attendance along with decreased complimentary and free
promotional tickets. Guest spending per capita of $36.44 for the
First Half 2009 was down 5% from the prior-year period's guest
spending per capita of $38.47, reflecting decreases in admissions,
food and beverages, games and merchandise. Included in the reduced
guest spending is the impact of a weaker Mexican peso and Canadian
dollar in the current-year period, affecting the U.S. dollar
translated results for the parks in Mexico City and Montreal.
Exchange rates accounted for approximately two percentage points,
or $0.83, of the guest spending per capita decline for the First
Half 2009 compared to the prior-year period. The overall negative
macroeconomic environment impacted the First Half 2009 performance.
In addition, attendance in Mexico and Texas was adversely affected
by the second quarter outbreak of the Swine flu. Also contributing
to the First Half 2009 attendance decline was the impact of adverse
weather compared to the prior-year period. Revenues for the six
months also were impacted by a decline in sponsorship, licensing
and other fees of $6.8 million compared to the prior-year period,
driven by lower international licensing and other fees, partially
offset by increased sponsorship revenue. Cash operating expenses
for the First Half 2009 were down 4% to $345.4 million from $361.5
million in the first six months of 2008, reflecting decreased
marketing expenses due in part to the timing of expenditures, lower
cost of sales due to decreased in-park revenues, and favorable
exchange rate impacts at the Mexico City and Montreal parks. Labor
and benefits costs for the six months were slightly higher due to
the impact of minimum wage increases, increased costs related to
the pension plan that was frozen in March 2006 and an increased
amount of cash-based compensation and benefit expenses that were
stock-based, and therefore non-cash expenses, in the prior-year
period. Non-cash operating expenses of depreciation, amortization,
stock-based compensation and loss on disposal of assets decreased
$0.7 million, or 1%, in the First Half 2009 to $78.7 million,
compared with $79.4 million in the 2008 period, driven by decreased
stock-based compensation and benefits expenses, partially offset by
increased depreciation and loss on disposal of assets. The
Company's loss from continuing operations increased from $23.7
million in the prior-year period to $237.5 million in the six
months ended June 30, 2009. The increased loss of $213.8 million
was driven by the prior-year debt extinguishment gain of $107.7
million, $78.7 million of reorganization items associated with the
current-year quarter's chapter 11 filing of SFI and certain of its
subsidiaries, $43.2 million reduction in income (loss) from
operations due primarily to reduced revenues partially offset by
lower expenses, increased other expense of $15.1 million reflecting
the termination of an interest rate swap, and $20.9 million of
reduced net interest expense reflecting lower effective interest
rates and the write-off of discounts, premiums and deferred
financing costs and cessation of interest accruals on the Company's
debt subject to compromise as a result of the chapter 11 filing.
Adjusted EBITDA for the First Half 2009 was a loss of $4.6 million,
a decrease of $39.1 million from the Adjusted EBITDA of $34.5
million for the first six months of 2008, reflecting the impact of
reduced revenues partially offset by lower cash operating expenses.
Recent Developments On June 13, 2009, SFI, SFO, Six Flags Theme
Parks Inc. ("SFTP") and certain of SFTP's domestic subsidiaries
filed a voluntary petition for relief under chapter 11 of the
United States Bankruptcy Code in the United States Bankruptcy Court
for the District of Delaware (Case No. 09-12019). As a result, the
financial statements reflect the Company's status as debtor in
possession since that date. Commenting on the Company's
restructuring, Mr. Shapiro added: "As promised, the restructuring
of the Company's finances has not affected our in-park product
whatsoever. Our new rides and attractions are being very well
received; we are diligently containing costs; and our guest
satisfaction scores are at historic highs in the categories of
'overall satisfaction' and 'value for the money.' I am extremely
pleased with the guest experience we're delivering and the
attitude, passion and dedication of our employees. You'd never
believe we were in the midst of a financial reorganization after
spending a day in one of our parks. Further, our commitment to
providing the best in quality entertainment for the value-conscious
family, close to home, is and will forever be the signature of Six
Flags. Our restructuring process and the nation's economic
recession will pass and Six Flags will emerge healthy and more
energized on the other end." As of June 30, 2009, the Company had
unrestricted cash of $128.8 million available to pay administrative
claims (i.e., those capital expenditures and expenses that have
been incurred since the filing date) as well as liabilities from
before the filing date that have been approved for payment by the
Court. Based on the final orders by the Court with respect to the
use of cash, the Company does not currently expect it will require
debtor in possession financing during the chapter 11 proceedings.
It is expected that the Company's existing common and preferred
stockholders as well as certain unsecured creditors will have their
claims compromised by order of the Court. As a result of this
expected compromise, interest accruing after the filing date will
not be recognized as interest expense, except for interest on the
Company's Senior Secured Credit Facility dated May 25, 2007, which
is not expected to be compromised (although it is expected to be
replaced by the issuance of new debt and new common stock). About
Six Flags Six Flags, Inc. is a publicly-traded corporation
headquartered in New York City and is the world's largest regional
theme park company with 20 parks across the United States, Mexico
and Canada. Forward Looking Statements: The information contained
in this news release, other than historical information, consists
of forward-looking statements within the meaning of Section 27A of
the Securities Act and Section 21E of the Securities Exchange Act.
These statements may involve risks and uncertainties that could
cause actual results to differ materially from those described in
such statements. These risks and uncertainties include, among
others, Six Flags' ability to develop, prosecute, confirm and
consummate one or more chapter 11 plans of reorganization; the
potential adverse impact of the chapter 11 filing on Six Flags'
operations, management and employees; risks associated with third
parties seeking and obtaining court approval to terminate or
shorten the exclusivity period for Six Flags to propose and confirm
a plan of reorganization, to appoint a chapter 11 trustee or to
convert the cases to chapter 7 cases; customer response to the
chapter 11 filing; and the risk factors or uncertainties listed
from time to time in Six Flags' filings with the Securities and
Exchange Commission ("SEC") and with the U.S. Bankruptcy Court in
connection with Six Flags' chapter 11 filing. In addition,
important factors, including factors impacting attendance, local
conditions, events, disturbances and terrorist activities, risk of
accidents occurring at Six Flags' parks, adverse weather
conditions, general financial and credit market conditions,
economic conditions (including consumer spending patterns),
competition, pending, threatened or future legal proceedings and
other factors could cause actual results to differ materially from
Six Flags' expectations. Although Six Flags believes that the
expectations reflected in such forward-looking statements are
reasonable, it can give no assurance that such expectations will
prove to have been correct. Reference is made to a more complete
discussion of forward-looking statements and applicable risks
contained under the captions "Cautionary Note Regarding
Forward-Looking Statements" and "Risk Factors" in Six Flags' Annual
Report on Form 10-K for the year ended December 31, 2008, its
Quarterly Report on Form 10-Q for the quarter ended March 31, 2009,
its Current Reports on Form 8-K filed with the SEC on May 7, 2009
and July 23, 2009, and its other filings and submissions with the
SEC, each of which are available free of charge on Six Flags'
website http://www.sixflags.com/. Six Flags, Inc.
(Debtor-in-Possession as of June 13, 2009) Three and Six Months
Ended June 30, 2009 and 2008 (In Thousands, Except Per Share
Amounts) Statements of Operations Three Months Ended Six Months
Ended Data (1) June 30, June 30, -------- -------- 2009 2008 2009
2008 ---- ---- ---- ---- Revenue $302,078 $345,683 $353,978
$413,907 Costs and expenses (excluding depreciation, amortization,
stock-based compensation and loss on disposal of assets) 230,511
239,661 345,444 361,532 Depreciation 35,353 33,912 70,260 67,995
Amortization 234 280 458 560 Stock-based compensation 602 2,631
1,441 6,223 Loss (gain) on disposal of assets 3,227 (63) 6,540
4,591 ----- --- ----- ----- Income (loss) from operations 32,151
69,262 (70,165) (26,994) ------ ------ ------- ------- Interest
expense (net) 35,541 47,209 74,457 95,312 Equity in (income) loss
from operations of partnerships (460) (130) (649) 1,786 Net (gain)
on debt extinguishment - (107,743) - (107,743) Other expense 16,275
(420) 17,944 2,881 ------ ---- ------ ----- Income (loss) from
continuing operations before reorganization items and income taxes
(19,205) 130,346 (161,917) (19,230) Reorganization items 78,725 -
78,725 - ------ --- ------ --- Income (loss) from continuing
operations before income taxes (97,930) 130,346 (240,642) (19,230)
Income tax benefit (expense) 234 (2,753) 3,164 (4,474) --- ------
----- ------ Income (loss) from continuing operations (97,696)
127,593 (237,478) (23,704) Discontinued operations (948) (14,122)
(1,964) (14,976) ---- ------- ------ ------- Net income (loss)
$(98,644) $113,471 $(239,442) $(38,680) Less: Net income
attributable to noncontrolling interests $(17,536) $(20,562)
$(17,536) $(19,966) -------- -------- -------- -------- Net income
(loss) attributable to Six Flags, Inc. $(116,180) $92,909
$(256,978) $(58,646) ========= ======= ========= ======== Net
income (loss) applicable to Six Flags, Inc. common stockholders
$(121,616) $87,417 $(267,907) $(69,631) ========= ======= =========
======== Per share - basic: Income (loss) from continuing
operations applicable to Six Flags, Inc. common stockholders
$(1.24) $1.04 $(2.73) $(0.57) Discontinued operations applicable to
Six Flags, Inc. common stockholders $(0.01) $(0.14) $(0.02) $(0.15)
------ ------ ------ ------ Net income (loss) applicable to Six
Flags, Inc. common stockholders $(1.25) $0.90 $(2.75) $(0.72)
====== ===== ====== ====== Per share - diluted: Income (loss) from
continuing operations applicable to Six Flags, Inc. common
stockholders $(1.24) $0.72 $(2.73) $(0.57) Discontinued operations
applicable to Six Flags, Inc. common stockholders (0.01) $(0.09)
$(0.02) $(0.15) ----- ------ ------ ------ Net income (loss)
applicable to Six Flags, Inc. common stockholders $(1.25) $0.63
$(2.75) $(0.72) ====== ===== ====== ====== Amounts attributable to
Six Flags, Inc.: Loss from continuing operations $(115,232)
$107,031 $(255,014) $(43,670) Discontinued operations $(948)
$(14,122) $(1,964) $(14,976) ----- -------- ------- -------- Net
income (loss) $(116,180) $92,909 $(256,978) $(58,646) =========
======= ========= ======== Balance Sheet Data (In Thousands) June
30, December 31, Balance Sheet Data 2009 2008 -------- ---------
Cash and cash equivalents (excluding restricted cash) $128,838
$210,332 Total assets 2,957,023 3,030,129 Current portion of
long-term debt 295,488 253,970 Long-term debt (excluding current
portion) 858,487 2,044,230 Redeemable noncontrolling interests
373,469 414,394 Mandatory redeemable preferred stock 313,311
302,382 Total stockholders' deficit (635,942) (376,499) Leverage
Ratio (2) 6.60 5.91 Restricted Subsidiary Leverage Ratio (2) 4.74
4.11 Three Months Ended Six Months Ended June 30, June 30, --------
-------- 2009 2008 2009 2008 ---- ---- ---- ---- Other Data:
Adjusted EBITDA (3) $56,322 $87,601 $(4,616) $34,494 Weighted
average shares outstanding - basic 97,483 97,319 97,477 96,505
Weighted average shares outstanding - diluted 97,483 155,202 97,477
96,505 Net cash provided by (used in) operating activities $76,653
$61,897 $(38,700) $(27,649) The following table sets forth a
reconciliation of net income (loss) to Adjusted EBITDA and Free
Cash Flow for the periods shown (in thousands): Three Months Ended
Six Months Ended June 30, June 30, -------- -------- 2009 2008 2009
2008 ---- ---- ---- ---- Net income (loss) $(98,644) $113,471
$(239,442) $(38,680) Discontinued operations 948 14,122 1,964
14,976 Income tax (benefit) expense (234) 2,753 (3,164) 4,474
Reorganization items 78,725 - 78,725 - Other expense 16,275 (420)
17,944 2,881 Net (gain) on debt extinguishment - (107,743) -
(107,743) operations of partnerships (460) (130) (649) 1,786
Interest expense (net) 35,541 47,209 74,457 95,312 Loss (gain) on
disposal of assets 3,227 (63) 6,540 4,591 Amortization 234 280 458
560 Depreciation 35,353 33,912 70,260 67,995 Stock-based
compensation 602 2,631 1,441 6,223 Third party interest in EBITDA
of certain operations (4) (15,245) (18,421) (13,150) (17,881)
------- ------- ------- ------- Adjusted EBITDA $56,322 $87,601
$(4,616) $34,494 Cash paid for interest (net) and debt issuance
costs (15,956) (68,598) (62,920) (100,267) Capital expenditures
(net of property insurance recoveries) (29,930) (42,055) (66,914)
(72,211) Cash dividends and taxes (1,461) (2,389) (2,920) (9,881)
------ ------ ------ ------ Free Cash Flow (5) $8,975 $(25,441)
$(137,370)$(147,865) ====== ======== ========= ========= NOTES
----- (1) Revenues and expenses of international operations are
converted into U.S. dollars on a current basis as provided by U.S.
generally accepted accounting principles ("GAAP"). (2) Under the
terms of the $400,000,000 12 1/4% Senior Notes of Six Flags
Operations, Inc. ("New Notes"), we must disclose on a quarterly
basis the Leverage Ratio and Restricted Subsidiary Leverage Ratio,
both as defined in the terms of the New Notes. (3) Adjusted EBITDA,
a non-GAAP measure, is defined as income (loss) from continuing
operations before discontinued operations, income tax expense
(benefit), reorganization items, other (income) expense, net gain)
loss on debt extinguishment, equity in operations of partnerships,
interest expense (net), amortization, depreciation, stock-based
compensation, (gain) loss on disposal of assets minus interests of
third parties in EBITDA of the three parks (see Note 4 below), plus
our interest in the Adjusted EBITDA of one hotel and Dick Clark
Productions, which are less than wholly owned. The Company believes
that Adjusted EBITDA provides useful information to investors
regarding the Company's operating performance and its capacity to
incur and service debt and fund capital expenditures. The Company
believes that Adjusted EBITDA is used by many investors, equity
analysts and rating agencies as a measure of performance. In
addition, Adjusted EBITDA is approximately equal to "Consolidated
Cash Flow" as defined in the indentures relating to the Company's
senior notes. Adjusted EBITDA is not defined by GAAP and should not
be considered in isolation or as an alternative to net income
(loss), income (loss) from continuing operations, net cash provided
by (used in) operating, investing and financing activities or other
financial data prepared in accordance with GAAP or as an indicator
of the Company's operating performance. Adjusted EBITDA as defined
in this release may differ from similarly titled measures presented
by other companies. (4) Represents interest of third parties in the
Adjusted EBITDA of Six Flags Over Georgia, Six Flags Over Texas and
Six Flags White Water Atlanta, plus our interest in the Adjusted
EBITDA of one hotel and Dick Clark Productions, which are less than
wholly owned. (5) Free Cash Flow, a non-GAAP measure, is defined as
Adjusted EBITDA less (i) cash paid for interest expense net of
interest income receipts, and debt issuance costs (ii) capital
expenditures net of property insurance recoveries and (iii) cash
dividends and taxes. The Company believes that Free Cash Flow is
used by many investors, equity analysts and rating agencies as a
measure of performance. Free Cash Flow is not defined by GAAP and
should not be considered in isolation or as an alternative to net
income (loss), income (loss) from continuing operations, net cash
provided by (used in) operating, investing and financing activities
or other financial data prepared in accordance with GAAP or as an
indicator of the Company's operating performance. Free Cash Flow as
defined in this this release may differ from similarly titled
measures presented by other companies. DATASOURCE: Six Flags, Inc.
CONTACT: Media, Sandra Daniels, +1-212-652-9393; or Investor
Relations, William Schmitt, +1-203-682-8200 Web Site:
http://www.sixflags.com/
Copyright