United Parks & Resorts Inc 10-Q for FY2021 Q3

United Parks & Resorts Inc. (PRKS)

10-Q 2021-11-15 For: 2021-09-30

Added on April 07, 2026

About this 10-Q

United Parks & Resorts Inc filed this 10-Q on November 15, 2021, covering the quarter ended September 30, 2021 (FY2021 Q3).

Headline figures

Quarter ended September 30, 2021, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $521.21M; up 391.2% from $106.12M a year earlier
Net income: $102.1M; compared with a net loss of $79.24M a year earlier
Diluted EPS: $1.28; compared with -$1.01 a year earlier

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Delaware		27-1220297
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)
6240 Sea Harbor Drive Orlando, Florida		32821
(Address of principal executive offices)		(Zip Code)


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.01 per share	SEAS	New York Stock Exchange

Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐

Emerging growth company	☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

		Page No.
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS		1

PART I.	FINANCIAL INFORMATION	3

Item 1.	Unaudited Condensed Consolidated Financial Statements	3

	Unaudited Condensed Consolidated Balance Sheets	3

	Unaudited Condensed Consolidated Statements of Comprehensive Income (Loss)	4

	Unaudited Condensed Consolidated Statements of Changes in Stockholders’ (Deficit) Equity	5

	Unaudited Condensed Consolidated Statements of Cash Flows	7

	Notes to Unaudited Condensed Consolidated Financial Statements	8

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	24

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	38

Item 4.	Controls and Procedures	39

PART II.	OTHER INFORMATION	40

Item 1.	Legal Proceedings	40

Item 1A.	Risk Factors	40

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	41

Item 3.	Defaults Upon Senior Securities	41

Item 4.	Mine Safety Disclosures	41

Item 5.	Other Information	41

Item 6.	Exhibits	42

	Signatures	43

	September 30,			December 31,
	2021			2020
Assets
Current assets:
Cash and cash equivalents	$	553,570		$	433,909
Accounts receivable, net		86,513			30,410
Inventories		25,870			30,700
Prepaid expenses and other current assets		15,056			12,418
Total current assets		681,009			507,437
Property and equipment, at cost		3,344,208			3,272,705
Accumulated depreciation		(1,710,939	)		(1,611,745	)
Property and equipment, net		1,633,269			1,660,960
Goodwill		66,278			66,278
Trade names/trademarks, net		157,000			157,000
Right of use assets-operating leases		132,977			136,572
Deferred tax assets, net		24,565			22,847
Other assets, net		16,123			15,264
Total assets	$	2,711,221		$	2,566,358
Liabilities and Stockholders’ Equity (Deficit)
Current liabilities:
Accounts payable and accrued expenses	$	140,584		$	105,369
Current maturities of long-term debt		12,000			15,505
Operating lease liabilities		3,037			3,757
Accrued salaries, wages and benefits		22,368			10,781
Deferred revenue		173,431			130,759
Other accrued liabilities		55,426			50,950
Total current liabilities		406,846			317,121
Long-term debt, net		2,106,366			2,177,137
Long-term operating lease liabilities		117,582			120,144
Deferred tax liabilities, net		26,382			15,772
Other liabilities		42,568			41,987
Total liabilities		2,699,744			2,672,161
Commitments and contingencies (Note 9)
Stockholders’ Equity (Deficit):
Preferred stock, $0.01 par value—authorized, 100,000,000 shares, no shares issued or outstanding at September 30, 2021 and December 31, 2020		—			—
Common stock, $0.01 par value—authorized, 1,000,000,000 shares; 95,419,927 and 94,652,248 shares issued at September 30, 2021 and December 31, 2020, respectively		954			946
Additional paid-in capital		695,374			680,360
Accumulated deficit		(186,825	)		(371,800	)
Treasury stock, at cost (17,794,246 and 16,260,248 shares at September 30, 2021 and December 31, 2020, respectively)		(498,026	)		(415,309	)
Total stockholders’ equity (deficit)		11,477			(105,803	)
Total liabilities and stockholders’ equity (deficit)	$	2,711,221		$	2,566,358


☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

	For the Three Months Ended						For the Nine Months Ended
	September 30,						September 30,
	2021			2020			2021		2020
Net revenues:
Admissions	$	296,694		$	63,087		$	635,699	$	163,368
Food, merchandise and other		224,512			43,030			497,211		114,336
Total revenues		521,206			106,117			1,132,910		277,704
Costs and expenses:
Cost of food, merchandise and other revenues		37,977			9,298			87,092		23,555
Operating expenses (exclusive of depreciation and amortization shown separately below)		195,113			91,337			460,192		283,385
Selling, general and administrative expenses		53,617			24,335			128,271		72,393
Severance and other separation costs		—			2,581			1,582		2,655
Depreciation and amortization		36,306			38,052			109,111		114,006
Total costs and expenses		323,013			165,603			786,248		495,994
Operating income (loss)		198,193			(59,486	)		346,662		(218,290	)
Other (income) expense, net		(39	)		(2	)		156		(15	)
Interest expense		28,372			28,145			90,455		69,206
Loss on early extinguishment of debt and write-off of discounts and debt issuance costs		58,827			—			58,827		—
Income (loss) before income taxes		111,033			(87,629	)		197,224		(287,481	)
Provision for (benefit from) income taxes		8,936			(8,392	)		12,249		(20,696	)
Net income (loss)	$	102,097		$	(79,237	)	$	184,975	$	(266,785	)
Other comprehensive income:
Unrealized gain on derivatives, net of tax		—			—			—		1,559
Comprehensive income (loss)	$	102,097		$	(79,237	)	$	184,975	$	(265,226	)
Earnings (loss) per share:
Earnings (loss) per share, basic	$	1.29		$	(1.01	)	$	2.35	$	(3.41	)
Earnings (loss) per share, diluted	$	1.28		$	(1.01	)	$	2.31	$	(3.41	)
Weighted average common shares outstanding:
Basic		78,962			78,154			78,804		78,153
Diluted		79,950			78,154			80,065		78,153

	Shares of Common Stock			Common Stock			Additional Paid-In Capital			Accumulated Deficit			Accumulated Other Comprehensive (Loss) Income		Treasury Stock, at Cost			Total Stockholders' Equity (Deficit)
Balance at December 31, 2020		94,652,248		$	946		$	680,360		$	(371,800	)	$	—	$	(415,309	)	$	(105,803	)
Equity-based compensation		—			—			4,473			—			—		—			4,473
Vesting of restricted shares		130,834			1			(1	)		—			—		—			—
Shares withheld for tax withholdings		(41,271	)		—			(1,971	)		—			—		—			(1,971	)
Exercise of stock options		116,634			1			2,392			—			—		—			2,393
Net loss		—			—			—			(44,884	)		—		—			(44,884	)
Balance at March 31, 2021		94,858,445		$	948		$	685,253		$	(416,684	)	$	—	$	(415,309	)	$	(145,792	)
Equity-based compensation		—			—			5,634			—			—		—			5,634
Vesting of restricted shares		653,146			7			(7	)		—			—		—			—
Shares withheld for tax withholdings		(213,601	)		(3	)		(10,554	)		—			—		—			(10,557	)
Exercise of stock options		82,491			1			1,638			—			—		—			1,639
Net income		—			—			—			127,762			—		—			127,762
Balance at June 30, 2021		95,380,481		$	953		$	681,964		$	(288,922	)	$	—	$	(415,309	)	$	(21,314	)
Equity-based compensation		—			—			13,049			—			—		—			13,049
Vesting of restricted shares		14,945			—			—			—			—		—			—
Shares withheld for tax withholdings		(3,427	)		—			(171	)		—			—		—			(171	)
Exercise of stock options		27,928			1			532			—			—		—			533
Repurchase of 1,533,998 shares of treasury stock, at cost		—			—			—			—			—		(82,717	)		(82,717	)
Net income		—			—			—			102,097			—		—			102,097
Balance at September 30, 2021		95,419,927		$	954		$	695,374		$	(186,825	)	$	—	$	(498,026	)	$	11,477

	Shares of Common Stock Issued			Common Stock			Additional Paid-In Capital			Accumulated Deficit			Accumulated Other Comprehensive (Loss) Income			Treasury Stock, at Cost			Total Stockholders' Equity (Deficit)
Balance at December 31, 2019		94,044,203		$	940		$	673,893		$	(59,479	)	$	(1,559	)	$	(402,903	)	$	210,892
Equity-based compensation		—			—			(3,601	)		—			—			—			(3,601	)
Unrealized gain on derivatives, net of tax expense of $254		—			—			—			—			704			—			704
Vesting of restricted shares		410,807			4			(4	)		—			—			—			—
Shares withheld for tax withholdings		(121,089	)		(1	)		(3,159	)		—			—			—			(3,160	)
Exercise of stock options		11,096			—			203			—			—			—			203
Adjustments to previous dividend declarations		—			—			1			—			—			—			1
Repurchase of 469,785 shares of treasury stock, at cost		—			—			—			—			—			(12,406	)		(12,406	)
Net loss		—			—			—			(56,519	)		—			—			(56,519	)
Balance at March 31, 2020		94,345,017		$	943		$	667,333		$	(115,998	)	$	(855	)	$	(415,309	)	$	136,114
Equity-based compensation		—			—			3,320			—			—			—			3,320
Unrealized gain on derivatives, net of tax expense of $318		—			—			—			—			855			—			855
Vesting of restricted shares		71,530			1			(1	)		—			—			—			—
Shares withheld for tax withholdings		(8,987	)		—			(154	)		—			—			—			(154	)
Exercise of stock options		818			—			15			—			—			—			15
Net loss		—			—			—			(131,029	)		—			—			(131,029	)
Balance at June 30, 2020		94,408,378		$	944		$	670,513		$	(247,027	)	$	—		$	(415,309	)	$	9,121
Equity-based compensation		—			—			3,484			—			—			—			3,484
Vesting of restricted shares		18,818			—			—			—			—			—			—
Shares withheld for tax withholdings		(1,999	)		—			(36	)		—			—			—			(36	)
Exercise of stock options		8,000			—			147			—			—			—			147
Net loss		—			—			—			(79,237	)		—			—			(79,237	)
Balance at September 30, 2020		94,433,197		$	944		$	674,108		$	(326,264	)	$	—		$	(415,309	)	$	(66,521	)

	For the Nine Months Ended September 30,
		2021		2020
Cash Flows From Operating Activities:
Net income (loss)	$	184,975		$	(266,785	)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation and amortization		109,111			114,006
Amortization of debt issuance costs and discounts		4,842			3,279
Loss on early extinguishment of debt and write-off of discounts and debt issuance costs		52,011			—
Deferred income tax provision (benefit)		8,892			(21,305	)
Equity-based compensation		23,156			3,203
Other, including loss on sale or disposal of assets, net		3,121			326
Changes in assets and liabilities:
Accounts receivable		(73,695	)		30,391
Inventories		4,938			(1,001	)
Prepaid expenses and other current assets		1,667			(742	)
Accounts payable and accrued expenses		27,969			6,856
Accrued salaries, wages and benefits		11,587			(3,375	)
Deferred revenue		58,643			24,973
Other accrued liabilities		1,287			3,659
Right-of-use assets and operating lease liabilities		314			418
Other assets and liabilities		(2,381	)		(1,552	)
Net cash provided by (used in) operating activities		416,437			(107,649	)
Cash Flows From Investing Activities:
Capital expenditures		(73,591	)		(75,715	)
Net cash used in investing activities		(73,591	)		(75,715	)
Cash Flows From Financing Activities:
Proceeds from issuance of debt, net		1,922,222			713,658
Repayments of long-term debt		(2,029,728	)		(11,629	)
Proceeds from draws on revolving credit facility		—			272,500
Repayments of revolving credit facility		—			(322,500	)
Purchase of treasury stock		(77,566	)		(12,406	)
Payment of tax withholdings on equity-based compensation through shares withheld		(12,699	)		(3,350	)
Exercise of stock options		4,565			365
Debt issuance costs		(23,142	)		(2,467	)
Other financing activities		(6,565	)		(1,861	)
Net cash (used in) provided by financing activities		(222,913	)		632,310
Change in Cash and Cash Equivalents, including Restricted Cash		119,933			448,946
Cash and Cash Equivalents, including Restricted Cash—Beginning of period		435,225			40,925
Cash and Cash Equivalents, including Restricted Cash—End of period	$	555,158		$	489,871
Supplemental Disclosure of Noncash Investing and Financing Activities:
Capital expenditures in accounts payable	$	22,094		$	33,925
Other financing arrangements	$	4,239		$	2,837

	For the Three Months Ended September 30,
	2021						2020
	Net Income		Shares		Per Share Amount		Net Loss			Shares		Per Share Amount
	(In thousands, except per share amounts)
Basic earnings (loss) per share	$	102,097		78,962	$	1.29	$	(79,237	)		78,154	$	(1.01	)
Effect of dilutive incentive-based awards				988							—
Diluted earnings (loss) per share	$	102,097		79,950	$	1.28	$	(79,237	)		78,154	$	(1.01	)

Years Ending December 31:	(In thousands)
Remainder of 2021	$	3,000
2022		12,000
2023		12,000
2024		12,000
2025		239,500
Thereafter		1,874,000
Total	$	2,152,500

	Nine Months Ended September 30,
	2020
Derivatives in Cash Flow Hedging Relationships:	(In thousands)
Loss recognized in accumulated other comprehensive (loss) income	$	(370	)
Amounts reclassified from accumulated other comprehensive (loss) income to interest expense	$	2,501

	2020 Restructuring Program
	(In thousands)
Liability as of December 31, 2019	$	—
Costs incurred		2,658
Payments made		(2,513	)
Liability as of December 31, 2020	$	145
Costs incurred		—
Payments made		(145	)
Liability as of September 30, 2021	$	—

	For the Three Months Ended
	September 30,						Variance
	2021			2020			#			%
Summary Financial Data:	(In thousands, except per capita data)
Net revenues:
Admissions	$	296,694		$	63,087		$	233,607		NM
Food, merchandise and other		224,512			43,030			181,482		NM
Total revenues		521,206			106,117			415,089		NM
Costs and expenses:
Cost of food, merchandise and other revenues		37,977			9,298			28,679		NM
Operating expenses (exclusive of depreciation and amortization shown separately below)		195,113			91,337			103,776			113.6	%
Selling, general and administrative expenses		53,617			24,335			29,282			120.3	%
Severance and other separation costs		—			2,581			(2,581	)	NM
Depreciation and amortization		36,306			38,052			(1,746	)		(4.6	%)
Total costs and expenses		323,013			165,603			157,410			95.1	%
Operating income (loss)		198,193			(59,486	)		257,679		NM
Other income, net		(39	)		(2	)		(37	)	NM
Interest expense		28,372			28,145			227			0.8	%
Loss on early extinguishment of debt and write-off of discounts and debt issuance costs		58,827			—			58,827		NM
Income (loss) before income taxes		111,033			(87,629	)		198,662		NM
Provision for (benefit from) income taxes		8,936			(8,392	)		17,328		NM
Net income (loss)	$	102,097		$	(79,237	)	$	181,334		NM
Other data:
Attendance		7,226			1,562			5,664		NM
Total revenue per capita	$	72.13		$	67.94		$	4.19			6.2	%
Admission per capita	$	41.06		$	40.39		$	0.67			1.7	%
In-park per capita spending	$	31.07		$	27.55		$	3.52			12.8	%

	For the Three Months Ended September 30,					For the Nine Months Ended September 30,					Last Twelve Months Ended September 30,
	2021		2020			2021		2020			2021
	(Unaudited, in thousands)
Net income (loss)	$	102,097	$	(79,237	)	$	184,975	$	(266,785	)	$	139,439
Provision for (benefit from) income taxes		8,936		(8,392	)		12,249		(20,696	)		2,420
Loss on early extinguishment of debt and write-off of discounts and debt issuance costs^(a)		58,827		—			58,827		—			58,827
Interest expense		28,372		28,145			90,455		69,206			122,156
Depreciation and amortization		36,306		38,052			109,111		114,006			145,651
Equity-based compensation expense ^(b)		13,076		3,484			24,331		3,203			28,595
Loss on impairment or disposal of assets and certain non-cash expenses^(c)		1,291		131			4,978		1,551			10,614
Business optimization, development and strategic initiative costs ^(d)		2,307		3,698			5,654		5,997			6,925
Certain investment costs and other taxes ^(e)		56		433			472		1,095			421
COVID-19 related incremental costs^(f)		13,560		2,024			17,928		5,969			20,767
Other adjusting items^(g)		451		438			304		(9,461	)		(3,802	)
Adjusted EBITDA ^(h)	$	265,279	$	(11,224	)	$	509,284	$	(95,915	)	$	532,013
Items added back to Covenant Adjusted EBITDA as defined in the Debt Agreements:
Estimated cost savings⁽ⁱ⁾												7,400
Other adjustments as defined in the Debt Agreements⁽^j)												15,873
Covenant Adjusted EBITDA ⁽^k)											$	555,286

Period Beginning	Period Ended	Total Number of Shares Purchased⁽¹⁾⁽²⁾		Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs⁽²⁾		Maximum Number (or Approximate Dollar Value) of Shares that May Yet Be Purchased Under the Plans or Programs⁽²⁾
July 1, 2021	July 31, 2021		415	$	45.64		—	$	237,594,184
August 1, 2021	August 31, 2021		1,206	$	52.09		—		237,594,184
September 1, 2021	September 30, 2021		1,535,804	$	53.92		1,533,998		154,877,404
			1,537,425				1,533,998	$	154,877,404

Exhibit No.		Description

4.1		Indenture, dated as of August 25, 2021, by and among SeaWorld Parks & Entertainment, Inc., the guarantors party thereto, and Wilmington Trust, National Association, as trustee (incorporated by reference to Exhibit 4.1 to the Registrant’s Current Report on Form 8-K filed on August 26, 2021 (File No. 001-35883))

10.1		Restatement Agreement, dated as of August 25, 2021, by and among SeaWorld Parks & Entertainment, Inc., SeaWorld Entertainment, Inc., the subsidiary guarantors party thereto, the financial institutions list on the signature pages thereto, J.P. Morgan Chase Bank, N.A., as Administrative Agent, as Collateral Agent, as Issuing Bank and as Swingline Lender. (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed on August 26, 2021 (File No. 001-35883))

31.1*		Certification of Periodic Report by Chief Executive Officer under Section 302 of the Sarbanes-Oxley Act of 2002

31.2*		Certification of Periodic Report by Chief Financial Officer under Section 302 of the Sarbanes-Oxley Act of 2002

32.1*		Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

32.2*		Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

101.INS*		Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

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101.CAL*		Inline XBRL Taxonomy Extension Calculation Linkbase Document.

101.DEF*		Inline XBRL Taxonomy Extension Definition Linkbase Document.

101.LAB*		Inline XBRL Taxonomy Extension Label Linkbase Document.

101.PRE*		Inline XBRL Taxonomy Extension Presentation Linkbase Document.
104		The cover page from the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2021 has been formatted in Inline XBRL.

*		Filed herewith.

		SEAWORLD ENTERTAINMENT, INC.
		(Registrant)


Date: November 15, 2021		By: /s/ Elizabeth C. Gulacsy
		Elizabeth C. Gulacsy
		Chief Financial Officer and Treasurer
		(Principal Financial Officer)


Date: November 15, 2021		By: /s/ Christopher C. Yarris
		Christopher C. Yarris
		Chief Accounting Officer
		(Principal Accounting Officer)

Date: November 15, 2021	Signature:	/s/ Marc G. Swanson
		Marc G. Swanson
		Chief Executive Officer
		(Principal Executive Officer)

Date: November 15, 2021	Signature:	/s/ Elizabeth C. Gulacsy
		Elizabeth C. Gulacsy
		Chief Financial Officer and Treasurer
		(Principal Financial Officer)