SEAWORLD SEES REVENUE PLUMMET
First quarter results reflect only 2 weeks of closures; no opening dates set, but company begins preparing
With all 12 of its parks closed since mid-march due to the ongoing coronavirus pandemic, Seaworld Entertainment saw its overall revenue and attendance sink 30 percent during the first quarter, the company reported Friday.
The economic blow was not a surprise given the unprecedented closure. The question was just how big a loss the Orlando-based company would be facing. With no planned reopening date, the company’s second-quarter results will likely be much gloomier. The firstquarter results captured just two weeks of the shutdown.
In all, revenue dropped by $67 million, to $153.6 million, compared with the first three months of 2019, while Seaworld’s net loss for the quarter grew by 53 percent to $56.5 million. And 1 million fewer people passed through turnstiles at Seaworld parks, bringing attendance to 2.3 million for the quarter.
Without the onslaught of the coronavirus, Seaworld could have been looking at a record-breaking quarter, the company suggested in its quarterly report. For the first two months of 2020, attendance increased by 9 percent to a record 1.9 million guests compared with the first two months of 2019, and reve
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nue shot up 12 percent to $120.6 million, also a record, Seaworld said.
“While the world is experiencing an unprecedented global health crisis that has impacted nearly everyone on the planet, we are confident in the resiliency of our business, our ability to weather this crisis and that we will emerge an even stronger company,” said Marc Swanson, Seaworld’s interim CEO.
While Swanson said there is no reopening date, which could vary among the various parks in the Seaworld portfolio, the company is looking ahead to the time when it can restart operations as it speaks with local, state and federal officials. Among the steps being explored are increased sanitation, masks and temperature checks for employees, a reservation system, and social distancing for park guests. Shows featuring the park’s marine mammals could still take place, possibly with seating limited to every other row, Swanson said in a Friday morning call with analysts.
It’s likely that first up for reopening would be the Seaworld park in San Antonio, followed by its Florida parks, Swanson noted. No mention was made of San Diego, presumably because of California’s stricter protocols for reopening compared to Texas and Florida. Once the company is officially allowed to reopen, it would take about two to three weeks to gear up, Swanson said.
“We’re going to open when it makes sense for us, assuming that’s within the green light period, obviously,” Swanson said. “Our surveys suggest there is a pretty strong pent-up demand for people who say they are likely or very likely to come visit a park when it opens.”
Before the shutdown, the company had nearly finished construction of its new lineup of attractions, including the Emperor dive coaster that was supposed to debut this spring in San Diego.
“Depending on when we are allowed to reopen, we will make a decision as to whether the unfinished projects are completed for the 2020 season or pushed into 2021,” Swanson said.
Since the park closures, the company has furloughed 95 percent of its workers and announced last month it was raising $227.5 million through a private offering to help tide it over during much leaner times. With no income now coming in from any of its parks, Seaworld is facing a net outflow of up to $25 million every month even as it continues to cut costs and preserve cash, the company reported in a filing with the Securities and Exchange Commission. The company, though, says it believes it will be able to sustain that through the final quarter of 2021.
Seaworld is not alone in the economic pain it is currently suffering. The Walt Disney Co., in its first earnings report since having to close its parks worldwide, reported this week that the hit to its operating income from its parks, resorts and cruises was $1 billion.
While the Seaworld parks had been enjoying a rebound in attendance and overall revenue in the last couple of years, they have yet to recover entirely from the steady declines they experienced in the years after the 2013 release of the anticaptivity documentary “Blackfish.” The company also has undergone considerable turmoil among its top leadership, with its fourth CEO since 2014 quitting last month in a clash with the board.
Although it could be some time before amusement parks are able to reopen, in San Diego, Seaworld, along with Legoland and the San Diego Zoo, are already crafting a plan for how they will resume operations in a safe manner.
Still a work in progress, their plan calls for temperature and wellness checks for employees, masks for guests and workers, reduced capacity at the parks, a 6-foot separation for entry and ride queues, protective shields at food stations, and regularly disinfecting ride vehicles and touchpoints.