SEAWORLD CONTINUES TO face declining attendance numbers, reporting 353,000 fewer visitors in the first half of 2017 than during the same time last year.
SeaWorld continues to face declining attendance numbers as the company reported 353,000 fewer visitors in the first half of 2017 than during the same time last year.
Some analysts called the company’s second-quarter earnings released Tuesday a disappointing surprise considering 2017 was expected to be a year of growth after the company has dealt with the aftermath of the “Blackfish” anti-captivity 2013 documentary.
“We clearly still have an ongoing revenue issue at two of our three SeaWorld parks — Orlando and San Diego,” SeaWorld Parks & Entertainment CEO Joel Manby told shareholders during Tuesday’s conference call.
In the latest earnings report, SeaWorld generated $373.8 million in revenue, falling short of analysts’ expectations of about $394 million, according to Reuters. The company also warned its debt rating or outlook could be downgraded by credit rating agencies.
The company reported a net loss of $175.9 million for the second quarter as admission revenue fell $340 million for the first half this year compared to $361 million — a nearly 6 percent decline— from the same period last year.
The company’s leader blamed the attendance drop on a decline in domestic U.S. and international visitors, public-perception issues in California and competition.
“We believe we’re on the right path; it will take time,” Manby told shareholders during the meeting as the company announced it will increase national marketing to get its message out and implement cost-saving measures that were not detailed.
By the market’s close Tuesday, SeaWorld stock dipped 7 percent to $12.76 a share.
A glimmer of success from Tuesday’s conference call was the company bringing in more visitors who live within 300 miles of the park. Annual passholders rose 15 percent, Manby said.
“We can own value,” Manby said of the Orlando tourism market. “Our competitors are very, very strong but they’re also very expensive.”
But analyst Tuna Amobi warned revenues from pass holders could be a “doubleedged sword” since the company often sold them at discounted rates.
There have been reports that SeaWorld hired the investment banking advisory firm, Evercore, according to sources cited recently by Deal Reporter. Deal Reporter said SeaWorld may have hired an outside financial adviser to explore selling the park.
Manby did not address the sale rumors or mention Evercore during Tuesday’s meeting, which Amobi said surprised him.
“It probably reflects the challenge to attempt any sale under the circumstances,” Amobi said.
In June, SeaWorld debuted Kraken Unleashed, a virtual-reality roller coaster where riders wear headsets and use the new Spot Saver system to reserve ride times.
The theme park also extended the dates for its night laser and fireworks show Electric Ocean this summer — “That’s a real winner,” Manby said.
Analyst Bob Boyd said he expects SeaWorld to continue evolving toward thrill riders and focusing more on locals than tourists.
There was room in Orlando’s tourism industry for SeaWorld to grow and it could indeed be profitable, Manby told investors.
But Amobi expressed doubt at the park’s chances of rebounding attendance this year.
“We believe there’s a lot of heavy lifting that needs to be done in a year or two in order to stabilize operations,” he said. “The question to us — how much decline could the second half (of the year) see?”
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