Annual General Meeting Transcript - FUN 2026-05-26

Operator

Ladies and gentlemen, thank you for standing by. My name is Desiree and I will be your conference operator today. At this time, I would like to welcome everyone to the Six Flags Entertainment Corporation 2026 First Quarter Earnings Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star followed by the number 1 on your telephone keypad. If you would like to withdraw your question, again, press the star one. I would now like to turn the call over to Six Flags Management for opening remarks. Go ahead, please.

Michael Russell, Head of Investor Relations

Good morning, and welcome to Six Flags Entertainment Corporation's first quarter, 2026 earnings conference call. I'm Michael Russell, Six Flags Head of IR. On the call with me today are John Riley, President and Chief Executive Officer, brian witherow and dave hoffman chief accounting officer and interim finance lead before we begin i would like to remind everyone that certain statements made during this call may be forward looking statements these statements are subject to risks and uncertainties that could cause actual results to differ materially from those described please refer to our earnings release and FCC filings for a discussion of those risks. Today's call will begin with prepared remarks from John, followed by Dave, after which John will return for closing remarks. We will then open the call for questions. With that, I'll turn the call over to John.

John Reilly, CEO

Thank you, Michael, and good morning. Before discussing the quarter, I want to address the leadership changes we announced this morning. We have made targeted adjustments across key areas of our senior leadership team. including finance, administration, and marketing, to better align our organization with our strategic priorities going forward. We thank Brian for his many years of service and contributions to this company. Dave Hoffman, our Chief Accounting Officer, will step in on a temporary basis to lead the finance organization. I am confident Dave will help make this a smooth transition. Since stepping into the role of CEO, I've worked with the team to take deliberate actions to strengthen the company's strategic and financial positioning, including the sale of non-core assets, monetization of excess land, and refinancing of our balance sheet. These actions, together with the leadership actions we are implementing, position us to execute against our core operating objectives. Turning to the quarter, we delivered meaningful year-over-year improvement driven by higher attendance, increased guest spending, and disciplined cost management. While the first quarter is seasonally limited with only a subset of parks open including our parks in California, Mexico, and Texas, the strong first quarter results demonstrate the resilience of our operating model and progress against our priorities. Before getting into the drivers of quarter, I do want to acknowledge that results benefited from the earlier timing of Easter and Spring Break, as well as more normalized operating conditions in California relative to the disruption that we experienced in the prior year. While these factors helped, first quarter performance also reflects the cumulative impact of the foundational work we have put in place over the past year. This includes the integration of our ticketing platforms, enhancements to our digital and commercial capabilities and operational improvements across our parks. Together, these efforts are driving measurable gains in consumer engagement and demand. A key component of that progress has been our decision to allocate additional resources to our revenue management efforts, supported by enhancements to our consumer-facing digital platforms. As part of this initiative, we have embedded pricing and revenue management expertise into the organization and redesigned our platforms to better guide guests toward the best value for their needs. In the first quarter, we saw the benefits in higher conversion rates, improved capture, and increased migration toward higher value season pass products. New for 2026, we've introduced regional access benefits across select pass tiers, allowing guests to visit multiple parks within a defined region. This new regional pass offering is gaining traction as guests are demonstrating a clear preference for greater flexibility and broader access, driving product upgrades, and increased cross-park visitation. We are encouraged by the early response, including improved pass sales trends, a more favorable product mix, and strong guest interest in visiting more than one park. The regional pass has also enabled us to enter the core of the season with a larger and more engaged pass and membership base which we expect will support visitation and spending through the peak operating period once guests arrive at our parks we saw strong in-park spending trends during the quarter reflecting the earlier timing of the knots boysenberry festival a hypercap event as well as improved food and beverage offerings and higher park utilization driving incremental ancillary spent. To restore localized decision making, we have reintroduced park presidents at our largest parks. We've done this to improve accountability, accelerate decision making, and drive greater consistency across the portfolio. We remain disciplined in our capital allocation. Our priority is to invest in parks that offer the highest returns, particularly at our larger properties with a focus on enhancing the guest experience through targeted investments in rides food and beverage and the overall environment residual free cash flow will be directed toward operations and toward debt reduction as an extension of this strategy we have completed the sale of select parks and progressed on the sale of non-core land assets these actions are expected to enhance margins, sharpen focus, and improve returns to shareholders. With that, I'll turn the call over to Dave. Dave?

Brian Witherow, CFO

Thanks, John. For the first quarter, attendance increased 4%, per capita spending increased 6%, and net revenue increased 12% compared to the prior year. Through April, which normalizes for the Easter shift, trends in attendance and revenue remain positive. Our teams also delivered strong cost control, with first-quarter operating costs down meaningfully year-over-year. Taken together, we drove a $48 million improvement in adjusted EBITDA, reflecting improvements across demand, guest spending, and cost discipline. Performance was driven by pricing and product structure changes, improved marketing and messaging, and strong in-park operations. Consistent with John's remarks, we are seeing the impact of our pricing and revenue management initiatives contributing to improved pricing and product mix. This is reflected in the 3% increase in admissions per capita and the 10% increase in in-park product per capita spending, achieved alongside attendance growth, underscoring the quality of demand. We strengthened our balance sheet during the quarter through refinancing, improved liquidity, and extending maturities. May and June are key selling periods for our season pass and membership products, and we expect greater visibility into full season trends as we move through those months. Finally, we completed the sale of select non-core parks during the quarter and have provided additional details within the earnings release to assist with modeling those disposals. As we think about the first quarter, it's important to keep a few factors in mind. Results benefited from timing and more normalized operating conditions in California. It's also important to remember that only a portion of our parks are open in the first quarter. As such, the quarter represents approximately six to eight percent of full year attendance and revenues, and the company usually operates at a loss in the first quarter because most of our seasonal parks are closed. As a result, we would caution against extrapolating first quarter performance to the full year. Lastly, we are not providing formal earnings guidance or long-term targets at this time. Instead, we are focused on consistent execution across the operating levers that drive long-term value. We believe investors are best served by transparency around demand trends, per capita spending, cost discipline, liquidity, and capital structure, areas where have strong visibility and are already seeing progress. While we're not providing guidance, we remain committed to regular, transparent communication. As the season unfolds and visibility improves, we will continue to provide clear, qualitative context around performance trends, key initiatives, and progress against our strategic priorities. With that, I'll turn the call back over to John.

John Reilly, CEO

Thanks, Dave. Before we move to closing remarks, I'll ask Brian to share a few brief comments.

Brian Witherow, CFO

Thanks, John. As this is my final earnings call, I want to say what an honor it has been to serve as the CFO of Six Flags and our predecessor company, Cedar Fair. Over the last 31 plus years, I've had the opportunity to work with an incredible group of colleagues, execute numerous M&A transactions, including the most important merger in our industry, and lay the foundation for the future of the new Six Flags. I'm proud of everything we've accomplished during that time. And I'm confident that Six Flags is well positioned to continue to succeed and provide engaging and entertaining experiences for our guests for years to come. John?

John Reilly, CEO

Thank you, Brian. We appreciate your contributions and we wish you our best. Turning to the quarters ahead, we are entering the most important part of our operating season with encouraging early momentum, particularly around consumer demand. And we're excited about our new park offerings our 2026 capital program is highlighted by the addition of tormenta the world's tallest dive coaster at six flags over texas as well as the return of montezuma at knott's berry farm one of the park's iconic attractions meanwhile we're focused on the family market at six flags great adventure in new jersey with the first phase of a new boardwalk area and at Six Flags Magic Mountain north of Los Angeles with the introduction of Looney Tunes Land, a fully reimagined themed area that will be the home of our Looney Tunes characters, including Bugs Bunny, Daffy Duck, and others. These park enhancements are aimed at expanding our addressable audience and complementing the park's core thrill business. At Kings Island, our new Phantom Theater experience blends immersive storytelling, animatronics, and multi-sensory effects to create a highly engaging indoor attraction. And earlier this week, we announced plans to expand the entertainment offerings at three parks, including a reimagined lineup of summertime shows at King's Dominion, and the return of Holiday in the Park at Six Flags Great Adventure and Six Flags Over Georgia. These are strategic decisions based on thorough analysis and consumer research. Strategically, these types of offerings broaden our reach. They allow us to attract guests who may not typically visit during our traditional operating season while reinforcing the value of our season pass and membership programs by extending the number of meaningful use opportunities throughout the year. As our seasonal parks have begun to open, we are encouraged by the positive trends we are seeing in both consumer demand and operational execution. While we are still early in the season, the momentum we are building reflects the actions we've taken across pricing product design and park level execution as we move through the year we're mindful of several dynamics including more competitive comparisons related to last year's marketing activity promotional cadence and early cost synergy benefits these are factors we understand well and have planned for and they are embedded in how we are managing the business going forward against this backdrop we remain focused on discipline execution. We believe the underlying improvements we've made across demand generation, monetization, and cost control position us well to navigate these dynamics and continue building momentum through the balance of the season. More importantly, we believe these actions are strengthening the foundation of the business in a way that supports sustainable growth, margin expansion, and long-term value creation. Operator, that concludes our prepared remarks. Dave and I are ready for questions.

Operator

Thank you. We will now begin the question and answer session. If you have dialed in and would like to add a question, please press star 1 on your telephone keypad to raise your hand and join the queue. If you would like to withdraw your question, simply press star 1 again. If you were called upon to ask your question and are listening via speakerphone in your device, please pick up your handset to ensure that your phone is not on mute when asking your question. Again, press star one to join the queue. And our first question comes from the line of Ben Chayken with Mizuwo. Your line is open.

Ben Chayken, Analyst — Mizuho

Hey, good morning. Thanks for taking my question. And Brian, you know, best of luck. It's been great. On the operating day strategy, the operating days year to date, down year over year, I would imagine part of the strategy, that's part of the strategy to help control costs.

John Reilly, CEO

I guess, how do you think about operating days for remainder of the year and other opportunities to control costs and then one quick follow-up thanks sure uh ben this is john and uh and i'll start out here so we approach this this issue we'll approach this with q1 for example we were adding days in mexico city well and then going forward

David Hoffman, Chief Accounting Officer

i'll turn this over to dave this is dave um so you read the the 24 day reduction in q1 And we expect to remove another 16 days in Q2 and then add. So overall, you know that.

Ben Chayken, Analyst — Mizuho

Okay, that's very helpful. And then just one question on kind of the 1Q and the year-to-date. I know you mentioned in the prepared remarks that Easter, I believe you said, was a benefit to 1Q. I think just stepping back and thinking historically, I would imagine that Easter being earlier was a marginal headwind to the year-to-date attendance numbers, just given the seasonality around park openings, I guess. Is that correct, like that logic? And then if so, how much do you give up to kind of like have a ballpark or a round number of what that impact was on a year-to-date standpoint, recognizing that you said it was a benefit to 1Q specifically?

John Reilly, CEO

Yeah, I don't know that we would characterize the timing of it as a headwind at all. I think it can be a headwind when it's very early, like in March. give us, you know, give us confidence, navigate it through.

Ben Chayken, Analyst — Mizuho

Understood. Thank you.

Operator

Next question comes from the line of Steve Wysinski with Stifel. Your line is open.

Steve Wysinski, Analyst — Stifel

Hey, guys. Good morning. So, John, I want to ask about the cost structure. I mean, that was a pretty big surprise in the quarter. And, you know, look, I understand there are gives and takes in terms of year-over-year comparability. But, you know, wondering if you can help us think about the longer-term margin opportunity in terms of what you kind of see as you work your way into that job, John. I would say especially now with some of the lower margin parks removed from the portfolio.

John Reilly, CEO

Yeah, thanks, Steve. So the cost work that we've been able to execute on is part of a plan that we've implemented in the company, including organizational change there while supplementing. We did benefit somewhat from changes that were made in 25, reducing the overall for a net reduction. We see considerable opportunity on the procurement front. We've engaged, and then we have big vendors encouraging, but we have a lot of – and then, you know, there's a number of other initiatives. And then to conclude, I would just look in 2025, we feel that we have, and to be at 27%, we've said before, is not –

Steve Wysinski, Analyst — Stifel

Okay, thanks for that, John. And then the second question I want to ask about the, you know, the entire park portfolio at this point. I mean, obviously, you guys have sold a number of parks over the past couple months. And I'm wondering, as you kind of look across the portfolio, you know, at this point, you know, John, if you see other opportunities to, you know, whether it's sell or shut down underperforming parks, and, you know, then maybe help us think about what, in your mind, the optimal number of parks, you know, is eventually going to look like over the longer term.

John Reilly, CEO

Yeah, thanks. So, the – we executed on what we said we would, which is the – and then we have – so, we've executed on what we said. I think it's important to say if you're buying a pass, if you're thinking about a pass, for people who want to come in, we're seeing the benefits of focus. The more we can focus that.

Steve Wysinski, Analyst — Stifel

Okay, great.

Operator

Next question comes from the line of James Hardiman with Citi. Your line is open.

James Hardiman, Analyst — Citi

Hey, good morning. Thanks for taking my questions. Wanted to start out by saying, Brian, it's been a pleasure working with you and learning from you through the years. Want to say you'll be missed and good luck with the next chapter. So, sure thing. And then, so following up on sort of the previous line of questioning, the slimmed down portfolio, looks like from some of the disclosures here, you're losing about 10 to 11% of attendance, only about 6% of EBITDA. Maybe help us think through the cash flow implications of that slimmed down portfolio, both quantitatively if you can give us sort of updated numbers in terms of capex and interest and taxes but then qualitatively right that that renewed focus on the parks that really move the needle i'm assuming you can now dedicate more of the capex budgets to to what's left and and hopefully what could get sort of those incremental returns and and ideally drive incremental upside from what's left. But maybe walk us through some of those items.

John Reilly, CEO

So, James, this is John. We did provide a table in the earnings release that walks you through that quarter by quarter, because we know that's something that will be important as you model our performance. You're correct, and I think we had it on the earlier question.

David Hoffman, Chief Accounting Officer

I think generally accurate gives us more flexibility. i guess i would just reiterate some of the numbers james we're still expecting 425 to 450 million of capex for the first quarter and we expect in for the year and that's before consideration of

James Hardiman, Analyst — Citi

a significant uh income tax refund that we claimed on the most recent that's all uh really helpful color and then i guess specifically as we think about the 2q opportunity you know looking back to last year that's that's really when when sort of the wheels fell off um obviously on the attendance side you guys had impossibly difficult weather as we think about late may and into june but also on the cost side if memory serves you really leaned into marketing with a significant amount of discretionary spending in the second quarter is there a way to think about once we lap those two items obviously we we won't really know what the weather is until we get there but is there a way to think about, I don't know, operating costs year over year in the second quarter or as a percentage of sales. However you guys think about it, you know, what's the cost opportunity in 2Q and where would you like to see the active pass base heading into the second half? Obviously that was another big part of why the second half of last year was such a struggle just being so far behind in active pathways. Thanks.

John Reilly, CEO

Sure, James, this is John, and I'll take that. So although we won't, we aren't going to guide, it's number one, underway to embrace target. Executing on that, on the comments that we made at the beginning of the call to your marketing part is, yes, there was a big spend in marketing last year. One of the facts I'm going into Q2 in terms of our, The other thing I would mention is, and it's important to spend for us, mention the marketing and the maintenance. We think about the sum of the helpful color.

James Hardiman, Analyst — Citi

Thanks, John, and good luck from here.

Operator

Next question comes from the line of Patrick's Calls with Shuri Securities. Your line is open.

Speaker 12

Great, thank you. Good morning, everyone. Question for you regarding past sales. When I look at the comparable 1Q earnings release from a year ago, and I'm just trying to match things up sort of apple to apples to figure out how they're going, the KPR metric in a year ago press release was that the five-week period ending May 4th, 2025, season pass sales were up 6%. I don't think when you say in this most recent quarter, active pass base up 6%, that's an apples to apples. Do you have an apples-to-apples metric that we can compare to that five-week period that you said a year ago to help us understand how recent past bills are trending? And I apologize if it—go ahead, sorry.

John Reilly, CEO

Yeah, we don't have that prepared, like a five-week view on that for you.

Speaker 12

But what I would say is, back to the issue, the membership has a higher—the more we lap the— um and then uh going back to capex correct me if i'm wrong i think you said you know this year not so much change but how do we think about like a run rate here you know i think you're running like 400 million you know after this year once those passes you know you're not so excuse me those parks are um uh no longer um uh being operated or are being used by uh your pass members you know how do we think about sort of the run rate again after this year capex thank you so in terms of the path it could be it could be at 450 for this year you're not going to guide long range on it but for now is it it would be uh re-priority okay that makes sense thank you next question

Speaker 2

comes from the line of lazy dog with goldman sachs your line is open hi good morning thanks for taking the question i want to echo brian it's been great to work with you really appreciated your help all the years. So good luck with the next chapter. In terms of, I'd love to just touch on the consumer for a second. You know, there's been a lot of cross currents for the last few months. You know, we've got higher gas prices for the consumer, yet your per cap trends have looked really good the last two quarters, but maybe some of that, you know, shoulder season comparability. So maybe it would be great just to hear from you what you're seeing there on the ground consumer-wise?

John Reilly, CEO

Yeah, this is John, Lizzie. Thanks for the question. We're focused on what we can control. And, you know, for us, we're not really able at this point to attribute performance trends. And the reasoning is we think there's a lot of opportunity. And so the work that we mentioned before that we're doing, upgrading to where we see the real opportunity is to execute well against that increase our capabilities going forward in that area the marketing changes that we've mentioned today that the opportunity there our focus is execution focusing on what we can change what we can do and we've got our heads in the course we'll monitor got it and then appreciate

Speaker 2

you're not giving guidance at this point for the year but high level it'd be great to just get a refresh on how you're thinking about the kind of building blocks for this year and in terms of particularly like the attendance recapture opportunity and how you're kind of balancing that in terms of um per caps so yes uh demand generation is profitably and uh the initiatives we have underway we believe there's further thank you next question comes from the line

Speaker 5

of dated cats with jeffries your line is open thanks uh for taking my question good morning everybody uh brian appreciate all the time and attention uh and all the best um i i wanted to take just a little bit deeper into the regional pass uh which is you know interesting in a good way uh i mean to ask um you know what data you've looked at or what trends you've looked at and can we potentially interpret this as you know a step in the direction you know of a more specific set of passes you know across the system over time yeah this is john i'll uh so in terms of the

John Reilly, CEO

regional pass you know the program um in the future i think i think what i would say is the regional past we have there's considerable opportunity but the uh has been introduced uh when you think about it for example who's a past member and that has a tremendous how we think

Speaker 5

about our catchment areas are okay uh thank you and then and one quick follow-up uh the park presidents um can you just provide a little more color on those were those you know people who had sort of worked with the parks before um you know people within the parks who were elevated um you know did they come from other parks i'm i'm just curious and i i imagine the answer is some version of all of the above, and I'm curious just a little more color on that.

John Reilly, CEO

You're right. It's all of the above. We're really pleased with the talent level we have there at the Parks with Park Presidents and also our Parks with Park Managers. It's one of the things we're committed. We have people who rejoined us from a competitor, but in most cases, internally was... Thank you very much.

Operator

And again, if you would like to add a question, press star, then the number one on your telephone keypad. Our next question comes from the line of Arpin Kacharian with UBS. Your line is open.

Speaker 7

Hey, good morning. This is Rob Henry on for Arpinay. I wanted just to go back to the past product. It seems like you might have kind of turned the corner there with units up 6%. Can you just give me any color on pricing and maybe mixtures that you're seeing within the past product?

John Reilly, CEO

If you look at the, you know, we have the silver pass. We have monitoring and adjusting where we need to in terms of price or promotional strategy to optimize the distribution across. People are willing to do improvements we've seen because we have revenue management, the merchandising, the consideration.

Speaker 7

That's really helpful, Collar. And then just kind of as a follow-up, on the specified part, you know, it looks like it's a bit of a tailwind here in Q1, given that there was a bit of a drag on EBITDA. It seems like given kind of the table that you've laid out, you know, kind of the rest of the year might be a bit of a headwind with the last EBITDA there. And so is that still kind of fair to think about in that way or how should we consider that as we move forward?

John Reilly, CEO

That cost is included in the Q1 results. And we've mapped out the impact for you and would presumably be in Q1 of 2027.

Speaker 7

Okay, great. Thank you.

Operator

Next question comes from the line of Chris Waronka with Deutsche Bank. Your line is open.

Chris Waronka, Analyst — Deutsche Bank

Hey, good morning, guys. And Brian, appreciate all the guidance and insights over the years. So all the best. I was hoping we could maybe talk for a minute about marketing. And I know that your plans are fluid and they're long-term and you're going to adjust and adapt. But John, maybe just a thought or two on kind of where you are this year versus where you think you can get through in terms of reach and effectiveness of some of the marketing changes things like going more social media and bringing in some um you know some some partners and some sponsors just you know like where you are in that process and do we get more benefit this year next year do you think yeah i would i would answer that by saying one we applied learnings from lessons that that that we identified from 2025, including how we were presenting our retail message.

John Reilly, CEO

We were marketing our passes on the websites and also in terms of, that said, this is the key growth lever for this company, at least in the near term, in terms of demand generation, in terms of evolving our brand, in terms of properly leveraging emerging channels.

Chris Waronka, Analyst — Deutsche Bank

And that's precisely the reason that we're bringing uh amy martin ziegenfuss on okay okay that's uh that's great to hear john and just as a follow-up um and we think when we think about your properties you've obviously gotten through a slug of non-core sales um you're working on some land land parcels it sounds like um but but questions on hotels uh you know you have two what i would think would be very core hotels at knots and cedar points then you have kind of a handful of other smaller hotels in the surrounding areas, or should we think about those as being core, longer term, or possibly not?

John Reilly, CEO

We like the synergy of the lodging business, especially in terms of bringing people in from drive markets. We have research that supports that, that even in regional parks, there's a wind from a longer drive.

Chris Waronka, Analyst — Deutsche Bank

Okay. Very good. Thanks. Thanks, John. Thank you.

Operator

And our last question today comes from Eric Wald of Texas Capital Security. Third night is open.

Eric Wald, Analyst — Texas Capital

Thank you. Good morning. I guess two questions. First, kind of going back on the question a couple ago on pricing. I know you mentioned that kind of the pricing around the passes and daily is kind of dynamic and kind of you're driving it based on demand. But as you start the season, can you give us a sense of kind of what's embedded in kind of the pricing of the daily and past prices versus last year to start the season?

John Reilly, CEO

So the pricing versus last year, we're – a lot of the growth that we're seeing is from the trade-up in the tiers and from the movement into membership because it's a higher – it's not necessarily – we really want to bring people back a suite of benefits descendants. We want to grow – and that's the balance. The principle lifts from the – Got it.

Eric Wald, Analyst — Texas Capital

And then as you kind of enter this with the core season, maybe give us a sense of the hire environment you're seeing out there in terms of availability, wage rates compared to last year and how that plays into your plans and staff appropriately at the manor ramps.

John Reilly, CEO

Our team is doing an excellent job staffing the parks as we move into Memorial Day weekend. Like many other things we've mentioned, we take an agile approach. and if there's one position like lifeguards. Thank you.

Operator

That's the question and answer session. I'll now turn it over to Michael Russell for closing remarks.

Michael Russell, Head of Investor Relations

Hey, we appreciate you joining us today. Our next earnings call will be in August when we report our financial results for the 2026 second quarter. That concludes our call today, Ezra. Thank you, everyone.

Operator

Ladies and gentlemen, that concludes today's call. Thank you all for joining. You may now disconnect.