Specialist
Former SVP at SeaWorld Parks & Entertainment Inc
Agenda
- Key trends and developments in the North American theme park industry
- SeaWorld's (NYSE: SEAS) sensitivity to consumer confidence given resurgence of coronavirus cases in Florida and potential pullback in discretionary spending
- Attendance and admissions revenue trends given potential pricing challenges
- Medium- to long-term outlook
Questions
1.
Which key trends have you been following in the theme and amusement park industry? Could you contrast pre-coronavirus to present-day trends?
2.
What key data points are you tracking to give you pause or confidence in the industry’s recovery?
3.
How significant an uptick has there been in spending per capita? Is it enough to offset depressed attendance rates?
4.
Which amusement park players do you deem to be most-favourably and least-favourably positioned given the pandemic?
5.
What percentage of the cost base is the wildlife collection, on average?
6.
Have any of SeaWorld’s pre-coronavirus challenges been exacerbated by the pandemic?
7.
How does spending differ between local vs fly-in guests? You noted an uptick in spending per capita from the current attendance base which is more from the drive-to, local markets. How should we assess spending levels given that SeaWorld will be more reliant on the local market in the medium term?
8.
Do you expect the local market to remain one of the key drivers for SeaWorld attendance in the longer term, or will marketing investments or pricing adjustments be necessary to sustain these trends?
9.
Could you expand on occupancy limits and the implications for reaching break-even profitability? What could happen with the Virginia operation given there’s a 1,000-person occupancy cap on theme parks in Virginia, and assuming that the required number to break even exceeds that occupancy cap?
10.
How are you assessing maintenance costs on a daily, weekly or monthly basis, assuming the park isn’t generating revenues? Presumably the park grounds and rides still need maintenance even while they remain closed.
11.
There was recent news about SeaWorld security guards potentially unionising. What are the implications of this?
12.
What should we understand about SeaWorld’s response to its cost, working capital and CAPEX dynamics during a time of zero revenues? What are the implications for investment and what are the levers and potential CAPEX to keep SeaWorld’s offerings fresh, aside from deferring maintenance costs on some of the closed rides?
13.
How might smaller investments be a potential risk, assuming that the headliners ultimately drive attendance for parks? For example, I would assume that Disney World opening a Star Wars or a Harry Potter ride, would draw local, international and domestic consumers vs smaller rides.
14.
Could you outline the ticketing and pricing strategy and whether there is any potential near-term pricing power?
15.
Could you expand on the season pass strategy? Six Flags is offering a concession for time lost in 2020 to be validated for 2021. How might SeaWorld’s strategy compare to this?
16.
How are you assessing the dynamics between Hill Path Capital and SeaWorld’s management team? Do you have any thoughts around the CEO turnover? The press has indicated that Hill Path’s founder and Managing Partner Scott Ross, has caused some frustration with the C-suite.
17.
What are your expectations for SeaWorld’s C-suite?
18.
What can be drawn from the 2008 recession as a medium- to long-term performance indicator? How did SeaWorld’s cash flows react or how did the park perform relatively during the last downturn?
19.
What are some upside and downside scenarios over the next 12-18 months for SeaWorld?
20.
What time frame would you estimate for recovery to 2019 levels?
