The Daily Item, Sunbury, PA


March 15, 2014

Attendance slips at SeaWorld parks, but company reports record annual earnings

— ORLANDO, Fla. — Attendance dipped at SeaWorld parks during the final three months of 2013, but the Orlando-based theme-park operator said it still posted record earnings in its first year as a public company.

SeaWorld President and Chief Executive Officer Jim Atchison said the lingering controversy spawned by the anti-captivity documentary “Blackfish” has not harmed the fortunes of SeaWorld Entertainment Inc.

“We have seen no impact on the business,” Atchison told analysts during a conference call to discuss SeaWorld’s fourth-quarter earnings.

The furor surrounding “Blackfish” peaked in late 2013, when it aired repeatedly on CNN and prompted a host of high-profile musical acts to pull out of concerts at SeaWorld Orlando. The fallout has continued this year, with a California lawmaker recently filing legislation to bar captive-killer-whale shows in that state.

But Atchison said the company’s six SeaWorld-branded theme parks — which include SeaWorld Orlando, Aquatica and Discovery Cove in central Florida — combined to post their best-ever fourth-quarter attendance, outperforming the company’s other five parks “by a considerable margin.” And he said SeaWorld hasn’t seen any shifts in surveys about consumers’ plans to visit.

Among individual parks, SeaWorld Orlando was an especially strong performer, he said, churning out record revenue on the strength of “Antarctica: Empire of the Penguin,” which opened last spring.

Still, it was a soft quarter for the company overall. Smaller crowds at the company’s other parks helped pull chainwide attendance down 1.4 percent from a year earlier, to 4.5 million visitors.

SeaWorld operates several regional parks that close during the winter, and the company typically operates at a loss during the first and fourth quarters. But its fourth-quarter loss of $13.5 million was 54 percent larger than its loss during the fourth quarter of 2012.

Total revenue, however, climbed 3 percent for the quarter to $272 million, as SeaWorld raised prices for food, tickets and merchandise and as visitors bought more in its parks.

“2013 was all about pricing, and we pushed the pricing lever pretty hard,” said SeaWorld Chief Financial Officer Jim Heaney.

And even with the deeper quarterly loss, SeaWorld said that 2013 — a year highlighted by an initial public stock offering in April — was a banner one.

SeaWorld said it rang up a company record of almost $1.5 billion in revenue in 2013, an increase of 3 percent from 2012. And it said adjusted earnings before interest, taxes, depreciation and amortization — which the company uses as a measure of its core performance — rose 6 percent to $439.1 million, another record.

Total attendance dropped 4.1 percent to 24.4 million visitors. But SeaWorld made more money from the visitors it did draw, as per-guest revenue leapt 7 percent to $62.43.

SeaWorld’s bottom-line profit shrank 35 percent for the year, to $50.5 million, partly because of costs incurred during its IPO.

Company executives predicted that attendance would begin to grow again this year as SeaWorld opens attractions in nine of its 11 parks. Next week also marks the launch of SeaWorld’s $10 million “Sea of Surprises“ 50th-anniversary celebration, an 18-month campaign that will include new evening killer-whale shows, additional animal encounters and more entertainment in the SeaWorld marine parks in Orlando, San Diego and San Antonio.

The company projected that sales would grow 2 percent to 4 percent this year, while earnings will rise 3 percent to 6 percent.

Big announcements could be coming soon, Atchison said: SeaWorld is negotiating with potential partners for expansion projects, including international theme parks. He estimated it would take SeaWorld 2 1/2 to 4 1/2 years to build and open a new park once a deal has been struck.

SeaWorld is “now focused on really talking to specific partners in specific locations,“ he said. “We’ll be excited to share some news in the not-too-distant future.”

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