Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Apr. 02, 2023 | May 03, 2023 | |
Document and Entity Information | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Apr. 02, 2023 | |
Entity Registrant Name | Six Flags Entertainment Corporation | |
Entity File Number | 1-13703 | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 13-3995059 | |
Entity Address, Address Line One | 1000 Ballpark Way Suite 400, | |
Entity Address, City or Town | Arlington | |
Entity Address, State or Province | TX | |
Entity Address, Postal Zip Code | 76011 | |
City Area Code | 972 | |
Local Phone Number | 595-5000 | |
Title of 12(b) Security | Common stock, $0.025 par value per share | |
Trading Symbol | SIX | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 83,284,345 | |
Entity Central Index Key | 0000701374 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Apr. 02, 2023 | Jan. 01, 2023 | Apr. 03, 2022 |
Current assets: | |||
Cash and cash equivalents | $ 64,749 | $ 80,122 | $ 252,203 |
Accounts receivable, net | 45,462 | 49,405 | 86,461 |
Inventories | 41,016 | 44,811 | 39,161 |
Prepaid expenses and other current assets | 83,639 | 66,452 | 55,454 |
Total current assets | 234,866 | 240,790 | 433,279 |
Property and equipment, net: | |||
Property and equipment, at cost | 2,621,518 | 2,592,485 | 2,528,135 |
Accumulated depreciation | (1,380,846) | (1,350,739) | (1,280,969) |
Total property and equipment, net | 1,240,672 | 1,241,746 | 1,247,166 |
Other assets: | |||
Right-of-use operating leases, net | 156,376 | 158,838 | 184,643 |
Debt issuance costs | 2,230 | 2,764 | 4,365 |
Deposits and other assets | 20,272 | 17,905 | 10,779 |
Goodwill | 659,618 | 659,618 | 659,618 |
Intangible assets, net of accumulated amortization of $290, $284 and $266 as of April 2, 2023, January 1, 2023 and April 3, 2022, respectively | 344,158 | 344,164 | 344,182 |
Total other assets | 1,182,654 | 1,183,289 | 1,203,587 |
Total assets | 2,658,192 | 2,665,825 | 2,884,032 |
Current liabilities: | |||
Accounts payable | 43,513 | 38,887 | 65,652 |
Accrued compensation, payroll taxes and benefits | 14,417 | 15,224 | 22,444 |
Accrued insurance reserves | 34,032 | 34,053 | 32,423 |
Accrued interest payable | 27,527 | 38,484 | 33,217 |
Other accrued liabilities | 60,032 | 67,346 | 94,052 |
Deferred revenue | 152,096 | 128,627 | 185,094 |
Short-term borrowings | 170,000 | 100,000 | |
Short-term lease liabilities | 12,040 | 11,688 | 11,383 |
Total current liabilities | 513,657 | 434,309 | 444,265 |
Noncurrent liabilities: | |||
Long-term debt | 2,281,841 | 2,280,531 | 2,631,246 |
Long-term lease liabilities | 166,562 | 164,804 | 180,464 |
Other long-term liabilities | 28,477 | 30,714 | 10,502 |
Deferred income taxes | 162,973 | 184,637 | 133,264 |
Total noncurrent liabilities | 2,639,853 | 2,660,686 | 2,955,476 |
Total liabilities | 3,153,510 | 3,094,995 | 3,399,741 |
Redeemable noncontrolling interests | 521,395 | 521,395 | 522,067 |
Stockholders' deficit: | |||
Preferred stock, $1.00 par value | |||
Common stock, $0.025 par value, 280,000,000 shares authorized; 83,279,300, 83,178,294 and 86,248,545 shares issued and outstanding at April 2, 2023, January 1, 2023 and April 3, 2022, respectively | 2,082 | 2,079 | 2,156 |
Capital in excess of par value | 1,107,258 | 1,104,051 | 1,124,603 |
Accumulated deficit | (2,055,359) | (1,985,500) | (2,088,913) |
Accumulated other comprehensive loss, net of tax | (70,694) | (71,195) | (75,622) |
Total stockholders' deficit | (1,016,713) | (950,565) | (1,037,776) |
Total liabilities and stockholders' deficit | $ 2,658,192 | $ 2,665,825 | $ 2,884,032 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Apr. 02, 2023 | Jan. 01, 2023 | Apr. 03, 2022 |
Condensed Consolidated Balance Sheets | |||
Accumulated amortization of intangible assets | $ 290 | $ 284 | $ 266 |
Preferred stock, par value (in dollars per share) | $ 1 | $ 1 | $ 1 |
Common stock, par value (in dollars per share) | $ 0.025 | $ 0.025 | $ 0.025 |
Common stock, shares authorized (in shares) | 280,000,000 | 280,000,000 | 280,000,000 |
Common stock, shares issued (in shares) | 83,279,300 | 83,178,294 | 86,248,545 |
Common stock, shares outstanding (in shares) | 83,279,300 | 83,178,294 | 86,248,545 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 02, 2023 | Apr. 03, 2022 | |
Total revenues | $ 142,190 | $ 138,107 |
Operating expenses (excluding depreciation and amortization shown separately below) | 108,870 | 109,719 |
Selling, general and administrative expenses (including stock-based compensation of $3,314 and $4,225 in 2023 and 2022, respectively, and excluding depreciation and amortization shown separately below) | 44,247 | 39,257 |
Costs of products sold | 9,765 | 10,115 |
Depreciation and amortization | 29,114 | 29,049 |
Loss (gain) on disposal of assets | 2,435 | (2,100) |
Operating loss | (52,241) | (47,933) |
Interest expense, net | 36,302 | 37,530 |
Other income, net | (832) | (688) |
Loss before income taxes | (87,711) | (84,775) |
Income tax benefit | (17,852) | (19,113) |
Net loss attributable to Six Flags Entertainment Corporation | $ (69,859) | $ (65,662) |
Weighted-average common shares outstanding: Basic (in shares) | 83,207 | 86,197 |
Weighted-average common shares outstanding: Diluted (in shares) | 83,207 | 86,197 |
Earnings per average common share outstanding: Basic (in dollars per share) | $ (0.84) | $ (0.76) |
Earnings per average common share outstanding: Diluted (in dollars per share) | $ (0.84) | $ (0.76) |
Park admissions | ||
Total revenues | $ 76,303 | $ 72,987 |
Park food, merchandise and other | ||
Total revenues | 52,786 | 54,269 |
Sponsorship, international agreements and accommodations | ||
Total revenues | $ 13,101 | $ 10,851 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Operations (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 02, 2023 | Apr. 03, 2022 | |
Condensed Consolidated Statements of Operations | ||
Stock-based compensation | $ 3,314 | $ 4,225 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands | 3 Months Ended | ||
Apr. 02, 2023 | Apr. 03, 2022 | ||
Condensed Consolidated Statements of Comprehensive Loss | |||
Net loss | $ (69,859) | $ (65,662) | |
Other comprehensive income, net of tax: | |||
Foreign currency translation adjustment | [1] | 916 | (4,085) |
Defined benefit retirement plan | [2] | 176 | 171 |
Change in cash flow hedging | [3] | (591) | 9,479 |
Other comprehensive income, net of tax | 501 | 5,565 | |
Comprehensive loss attributable to Six Flags Entertainment Corporation | $ (69,358) | $ (60,097) | |
[1] Foreign currency translation adjustment is presented net of tax expense of $0.1 million for the three months ended April 2, 2023, and net of tax benefit of $1.1 million for the three months ended April 3, 2022 Defined benefit retirement plan is presented net of tax expense of $0.1 million for the three months ended April 2, 2023 and April 3, 2022. Change in cash flow hedging is presented net of tax benefit of $0.2 million for the three months ended April 2, 2023 and net of tax expense of $3.1 million for the three months ended April 3, 2022. |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Comprehensive Loss (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | |
Apr. 02, 2023 | Apr. 03, 2022 | |
Condensed Consolidated Statements of Comprehensive Loss | ||
Foreign currency translation adjustment, tax expense (benefit) | $ 0.1 | $ (1.1) |
Defined benefit retirement plan, tax expense (benefit) | 0.1 | 0.1 |
Change in cash flow hedging, tax expense (benefit) | $ (0.2) | $ 3.1 |
Condensed Consolidated Statem_5
Condensed Consolidated Statements of Stockholders Deficit - USD ($) $ in Thousands | Common stock | Capital in excess of par value | Accumulated deficit | Accumulated other comprehensive loss | Total |
Beginning balance at Jan. 02, 2022 | $ 2,154 | $ 1,120,084 | $ (2,023,251) | $ (81,187) | $ (982,200) |
Beginning balance (in shares) at Jan. 02, 2022 | 86,162,879 | ||||
Increase (Decrease) in Equity (Deficit) | |||||
Issuance of common stock | $ 2 | 297 | 299 | ||
Issuance of common stock (in shares) | 87,702 | ||||
Stock-based compensation | 4,225 | 4,225 | |||
Payment of tax withholdings on equity-based compensation through shares withheld | (3) | (3) | |||
Payment of tax withholdings on equity-based compensation through shares withheld (in shares) | (2,036) | ||||
Net loss attributable to Six Flags Entertainment Corporation | (65,662) | (65,662) | |||
Net other comprehensive income, net of tax | 5,565 | 5,565 | |||
Ending balance at Apr. 03, 2022 | $ 2,156 | 1,124,603 | (2,088,913) | (75,622) | (1,037,776) |
Ending balance (in shares) at Apr. 03, 2022 | 86,248,545 | ||||
Beginning balance at Jan. 01, 2023 | $ 2,079 | 1,104,051 | (1,985,500) | (71,195) | (950,565) |
Beginning balance (in shares) at Jan. 01, 2023 | 83,178,294 | ||||
Increase (Decrease) in Equity (Deficit) | |||||
Issuance of common stock | $ 3 | (3) | |||
Issuance of common stock (in shares) | 104,660 | ||||
Stock-based compensation | 3,314 | 3,314 | |||
Payment of tax withholdings on equity-based compensation through shares withheld | (104) | (104) | |||
Payment of tax withholdings on equity-based compensation through shares withheld (in shares) | (3,654) | ||||
Net loss attributable to Six Flags Entertainment Corporation | (69,859) | (69,859) | |||
Net other comprehensive income, net of tax | 501 | 501 | |||
Ending balance at Apr. 02, 2023 | $ 2,082 | $ 1,107,258 | $ (2,055,359) | $ (70,694) | $ (1,016,713) |
Ending balance (in shares) at Apr. 02, 2023 | 83,279,300 |
Condensed Consolidated Statem_6
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Apr. 02, 2023 | Apr. 03, 2022 | Jan. 01, 2023 | |
Cash flows from operating activities: | |||
Net loss | $ (69,859) | $ (65,662) | |
Adjustments to reconcile net loss to net cash used in operating activities: | |||
Depreciation and amortization | 29,114 | 29,049 | |
Stock-based compensation | 3,314 | 4,225 | |
Interest accretion on notes payable | 278 | 278 | |
Amortization of debt issuance costs | 1,566 | 1,978 | |
Loss (gain) on disposal of assets | 2,435 | (2,100) | |
Deferred income tax benefit | (20,672) | (18,347) | |
Other | 30 | 5,220 | |
Decrease in accounts receivable | 7,426 | 11,535 | |
Increase in inventories, prepaid expenses and other current assets | (18,672) | (11,512) | |
Decrease (increase) in deposits and other assets | 2,834 | (4,600) | |
Decrease in ROU operating leases | 2,847 | 2,585 | |
Increase in accounts payable, deferred revenue, accrued liabilities and other long-term liabilities | 12,070 | 6,815 | |
Increase in operating lease liabilities | 1,977 | 2,161 | |
Decrease in accrued interest payable | (10,957) | (17,337) | |
Net cash used in operating activities | (56,269) | (55,712) | |
Cash flows from investing activities: | |||
Additions to property and equipment | (25,488) | (32,071) | |
Property insurance recoveries | 481 | 3,081 | |
Net cash used in investing activities | (25,007) | (28,990) | |
Cash flows from financing activities: | |||
Repayment of borrowings | (10,000) | ||
Proceeds from borrowings | 80,000 | ||
Payment of debt issuance costs | (970) | ||
Payment of cash dividends | (14) | ||
Proceeds from issuance of common stock | 299 | ||
Payment of tax withholdings on equity-based compensation through shares withheld | (104) | (3) | |
Reduction in finance lease liability | (247) | (201) | |
Net cash provided by financing activities | 68,679 | 81 | |
Effect of exchange rate on cash | (2,776) | 1,239 | |
Net change in cash and cash equivalents | (15,373) | (83,382) | |
Cash and cash equivalents at beginning of period | 80,122 | 335,585 | $ 335,585 |
Cash and cash equivalents at end of period | 64,749 | 252,203 | $ 80,122 |
Supplemental cash flow information | |||
Cash paid for interest | 46,209 | 52,157 | |
Cash paid for income taxes | $ 311 | $ 885 |
General - Basis of Presentation
General - Basis of Presentation | 3 Months Ended |
Apr. 02, 2023 | |
General - Basis of Presentation | |
General - Basis of Presentation | 1. General — Basis of Presentation We own and operate regional theme parks and water parks. We are the largest regional theme park operator in the world, and we are the largest operator of water parks in North America based on the number of parks we operate. Of the 27 parks we owned or operated as of April 2, 2023, 24 parks are located in the United States, two are located in Mexico and one is located in Montreal, Canada. The accompanying unaudited condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States ("U.S. GAAP"). Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed, or omitted, pursuant to the rules and regulations of the SEC. Our current fiscal year will end on December 31, 2023. This Quarterly Report covers the period January 2, 2023 – April 2, 2023 (“the three months ended April 2, 2023). The comparison period in the prior year covers the dates January 3, 2022 – April 3, 2022 (“the three months ended April 3, 2022”). The 2022 Annual Report includes additional information about us, our operations and our financial position, and should be referred to in conjunction with this Quarterly Report. The information furnished in this Quarterly Report reflects all normal and recurring adjustments that are, in the opinion of management, necessary to present a fair statement of the results for the periods presented. Results of operations for the three months ended April 2, 2023, are not indicative of the results expected for the full year. Our operations are highly seasonal, with approximately 70% - 75% of park attendance and revenues in a typical year occurring in the second and third calendar quarters of each year, with the most significant period falling between Memorial Day and Labor Day. Certain previously reported amounts have been reclassified to conform to the current year presentation. Inflation and Supply Chain Our operations can be impacted by increases in prices, whether caused by inflation or other economic drivers. Our business relies on a large number of seasonal workers. Our labor costs continue to increase due to shortages of qualified workers and competition from other employers. We continually seek to optimize and deploy our existing employees to both maximize revenue generating opportunities and provide the best guest experience. Hiring and retaining our workers continues to be a priority to avoid further labor shortages. Supply chain disruption has continued for many of the products and inputs that we use in our parks, including food, merchandise and replacement parts, causing costs to increase. We have continued to mitigate these impacts to the extent possible by passing these costs on to our customers when possible. a. Consolidated U.S. GAAP Presentation Our accounting policies reflect industry practices and conform to U.S. GAAP. The unaudited condensed consolidated financial statements include our accounts and the accounts of our wholly owned subsidiaries. We also consolidate the partnerships that own Six Flags Over Texas ("SFOT") and Six Flags Over Georgia (including Six Flags White Water Atlanta) ("SFOG," and together with SFOT, the "Partnership Parks") as subsidiaries in our unaudited condensed consolidated financial statements, as we have determined that we have the power to direct the activities of the Partnership Parks that most significantly impact their economic performance and we have the obligation to absorb losses and receive benefits from the Partnership Parks that can be potentially significant to these entities. The equity interests owned by non-affiliated parties in the Partnership Parks are reflected in the accompanying unaudited condensed consolidated balance sheets as redeemable noncontrolling interests . b. Income Taxes We recorded a valuation allowance of $97.6 million, $96.0 million and $107.8 million as of April 2, 2023, January 1, 2023 and April 3, 2022, respectively, due to uncertainties related to our ability to use some of our deferred tax assets, primarily consisting of certain state net operating loss and other tax carryforwards, before they expire. The valuation allowance was based on our estimates of taxable income by jurisdiction in which we operate and the period over which our deferred tax assets were recoverable. Our projected taxable income over the foreseeable future indicates we will be able to use all of our federal net operating loss carryforwards before they expire. We classify interest and penalties attributable to income taxes as part of income tax expense. As of April 2, 2023, January 1, 2023 and April 3, 2022, we had no recorded amounts for accrued interest or penalties. c. Goodwill and Intangibles As of April 2, 2023, the fair value of our single reporting unit exceeded its carrying amount. We have one reporting unit at the same level for which Holdings common stock is traded and we believe our market capitalization is the best indicator of our reporting unit’s fair value. At April 2, 2023, we did not identify any triggering events that would require a full quantitative analysis to be performed. d. Long-Lived Assets We review long-lived assets, including finite-lived intangible assets subject to amortization, for impairment upon the occurrence of events or changes in circumstances that would indicate that the carrying value of the asset or group of assets may not be recoverable, “triggering event(s)”. Recoverability of assets to be held and used is measured by comparing the carrying amount of the asset or group of assets to the future net cash flows expected to be generated by the asset or group of assets. If such assets are not considered to be fully recoverable, any impairment to be recognized is measured by the amount by which the carrying amount of the asset or group of assets exceeds its respective fair value. Assets to be disposed of are reported at the lower of the carrying amount or fair value less costs to sell. As of April 2, 2023, we did not identify any triggering events that would require a quantitative analysis. e. Earnings Per Common Share We incurred a net loss for the three months ended April 2, 2023, and April 3, 2022. Therefore, diluted shares outstanding equaled basic shares outstanding for the purposes of determining loss per common share because their inclusion would be antidilutive. The computation of diluted earnings per share excluded the effect of 1,607,000 and 2,744,000 antidilutive stock options, restricted stock units and performance stock units for the three months ended April 2, 2023, and April 3, 2022, respectively. f. Stock Benefit Plans Pursuant to the Six Flags Entertainment Corporation Long-Term Incentive Plan (the "Long-Term Incentive Plan"), Holdings may grant stock options, stock appreciation rights, restricted stock, restricted stock units, unrestricted stock, deferred stock units, performance stock units, performance and cash-settled awards and dividend equivalent rights ("DERs") to select employees, officers, directors and consultants of Holdings and its affiliates. Periodically, we will grant performance stock units to key employees. These awards vest on attainment of specific objectives most often related to Adjusted EBITDA or recognized revenue over a defined period. As of April 2, 2023, we have not determined that it is probable that we achieve any of the specific objectives, and thus, we have not recognized any expense associated with any outstanding performance stock units. During the three months ended April 2, 2023, and April 3, 2022, stock-based compensation expense consisted of the following: Three Months Ended (Amounts in thousands) April 2, 2023 April 3, 2022 Long-Term Incentive Plan $ 3,284 $ 4,150 Employee Stock Purchase Plan 30 75 Total Stock-Based Compensation $ 3,314 $ 4,225 During the three months ended April 2, 2023, and April 3, 2022, we paid a nominal amount to employees with dividend equivalent rights for previously declared dividends due upon the vesting of the related shares of Holdings’ common stock. These dividends were declared prior to the suspension of dividend payments . g. Accounts Receivable, Net Accounts receivable are reported at net realizable value and consist primarily of amounts due from guests for the sale of group outings and multi-use admission products that allow for payment plans, such as season passes and memberships. We are not exposed to a significant concentration of credit risk; however, based on the age of the receivables, our historical experience and other factors and assumptions we believe to be customary and reasonable, we record an allowance for doubtful accounts. As of April 2, 2023, January 1, 2023 and April 3, 2022, we have recorded an allowance for doubtful accounts of $2.7 million, $4.1 million and $5.7 million, respectively, which is primarily comprised of estimated payment defaults under our membership program and multi-use admission products that allow for payment plans. To the extent that payments under our membership program and multi-use admission products have not been recognized in revenue, the allowance for doubtful accounts recorded is offset with a corresponding reduction in deferred revenue. h. Recently Adopted Accounting Pronouncements In March 2020, FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting (“Update 2020-04”), which provides optional expedients and exceptions for applying U.S. GAAP principles to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. The amendments in Update 2020-04 apply only to contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform. The expedients and exceptions provided by the amendments do not apply to contract modifications made and hedging relationships entered into or evaluated after December 31, 2022, except for hedging relationships existing as of December 31, 2022, that an entity has elected optional expedients for and that are retained through the end of the hedging relationship. The provisions in Update 2020-04 are effective upon issuance and can be applied prospectively through December 31, 2022. Interest on the Second Amended and Restated Credit Facility accrues at an annual rate based on LIBOR. |
Revenue
Revenue | 3 Months Ended |
Apr. 02, 2023 | |
Revenue | |
Revenue | 2. Revenue Revenues are recognized when control of the promised goods or services are transferred to our customers in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services. Sales and other taxes we collect concurrent with revenue-producing activities are excluded from revenue. Incidental items that are immaterial in the context of the contract are recognized as expense. The following tables present our revenues disaggregated by contract duration for the three months ended April 2, 2023, and April 3, 2022, respectively. Long-term and short-term contracts consist of our contracts with customers with terms greater than one year and less than or equal to one year, respectively. Sales and usage-based taxes are excluded from revenues. Three Months Ended April 2, 2023 Sponsorship, Park Food, International Merchandise Agreements and (Amounts in thousands) Park Admissions and Other Accommodations Total Long-term contracts $ 4,861 $ 540 $ 6,763 $ 12,164 Short-term contracts and other (a) 71,442 52,246 6,338 130,026 Total revenues $ 76,303 $ 52,786 $ 13,101 $ 142,190 Three Months Ended April 3, 2022 Sponsorship, Park Food, International Merchandise Agreements and (Amounts in thousands) Park Admissions and Other Accommodations Total Long-term contracts $ 3,951 $ 782 $ 6,528 $ 11,261 Short-term contracts and other (a) 69,036 53,487 4,323 126,846 Total revenues $ 72,987 $ 54,269 $ 10,851 $ 138,107 (a) Other revenues primarily include sales of single-use tickets and short-term transactional sales for which we have the right to invoice. Long-term Contracts At January 1, 2023, $33.5 million of unearned revenue associated with outstanding long-term contracts was reported in "Deferred revenue," of which $12.2 million was recognized as revenue for long-term contracts during the three months ended April 2, 2023. As of April 2, 2023, we had $152.1 million of deferred revenue of which the total unearned amount of revenue for remaining long-term contract performance obligations was $42.8 million. At January 2, 2022, $58.7 million of unearned revenue associated with outstanding long-term contracts was reported in "Deferred revenue," of which $12.2 million was recognized as revenue for long-term contracts during the three months ended April 3, 2022. As of April 3, 2022, we had $185.1 million in deferred revenue, of which the total unearned amount of revenue for remaining long-term contract performance obligations was $59.0 million. As of April 2, 2023, we expect to recognize estimated revenue for partially or wholly unsatisfied performance obligations on long-term contracts of approximately $54.6 million in the remainder of 2023 , $17.7 million in 2024 , $9.3 million in 2025 , $7.1 million in 2026 , and $12.8 million in 2027 and thereafter. |
Long-Term Indebtedness
Long-Term Indebtedness | 3 Months Ended |
Apr. 02, 2023 | |
Long-Term Indebtedness | |
Long-Term Indebtedness | 3. Long-Term Indebtedness Credit Facility As of April 2, 2023, our credit facility consisted of a $350.0 million revolving credit loan facility (the “Second Amended and Restated Revolving Loan”) and a $479.0 million Tranche B Term Loan facility (the “Second Amended and Restated Term Loan B”) pursuant to the amended and restated credit facility that we entered into in 2019 (the “Second Amended and Restated Credit Facility”) and further amended in both April 2020 and August 2020. As of April 2, 2023 and January 1, 2023, we had $170.0 million and $100.0 million outstanding under the Second Amended and Restated Revolving Loan (excluding amounts reserved for letters of credit in the amount of $21.0 million as of each respective period end). As of April 3, 2022, we had no amounts outstanding under the Second Amended and Restated Revolving Loan (excluding amounts reserved for letters of credit in the amount of $21.0 million). Interest on the Second Amended and Restated Revolving Loan accrues at an annual rate of LIBOR plus an applicable margin with an unused commitment fee based on our senior secured leverage ratio. As of April 3, 2022, the Second Amended and Restated Revolving Loan unused commitment fee was 0.625% . The Second Amended and Restated Revolving Loan will mature on April 17, 2024. As of April 2, 2023, January 1, 2023 and April 3, 2022, $479.0 million was outstanding under the Second Amended and Restated Term Loan B. Interest on the Second Amended and Restated Term Loan B accrues at an annual rate of LIBOR plus 1.75% . In June 2019, we entered into three separate interest rate swap agreements with a notional amount of $300.0 million (the “June 2019 Swap Agreements”) and, in August 2019, we entered into two separate interest rate swap agreements with a notional amount of $400.0 million (the “August 2019 Swap Agreements”) . These swaps were entered into to mitigate the risk of an increase in the LIBOR interest rate on the Second Amended and Restated Term Loan B by exchanging the floating LIBOR rate for a negotiated fixed rate. On March 24, 2022, we terminated the August 2019 Swap Agreements. The June 2019 Swap Agreements expire in June 2023. The Second Amended and Restated Term Loan B now consists of only floating rate debt. As of April 2, 2023, the applicable interest rate on the Second Amended and Restated Term Loan B was 6.60 % . The Second Amended and Restated Term Loan B will mature on April 17, 2026. 2024 Notes, 2025 Notes and 2027 Notes In June 2016, Holdings issued $300.0 million of 4.875% senior unsecured notes due 2024 and, in April 2017, issued an additional $700.0 million of senior unsecured notes due 2024 (together, the “2024 Notes”). In April 2017, Holdings issued $500.0 million of 5.50% senior notes due 2027 (the "2027 Notes"). In April 2020, SFTP issued $725.0 million of 7.00% senior secured notes due 2025 (the “2025 Notes”). As of April 2, 2023, $949.5 million of the 2024 Notes, $365.0 million of the 2025 Notes, and $500.0 million of the 2027 Notes, were issued and outstanding. Interest payments of $23.1 million for the 2024 Notes are due semi-annually on January 31 and July 31 of each year. Interest payments of $12.8 million for the 2025 Notes are due semi-annually on January 1 and July 1 each year. Interest payments of $13.8 million for the 2027 Notes are due semi-annually on April 15 and October 15 of each year. Long-Term Indebtedness Summary As of April 2, 2023, January 1, 2023 and April 3, 2022, the principal balance of our long-term debt consisted of the following: As of (Amounts in thousands) April 2, 2023 January 1, 2023 April 3, 2022 Second Amended and Restated Term Loan B $ 479,000 $ 479,000 $ 479,000 Second Amended and Restated Revolving Loan 170,000 100,000 — 2024 Notes 949,490 949,490 949,490 2025 Notes 365,000 365,000 725,000 2027 Notes 500,000 500,000 500,000 Net discount (1,859) (2,138) (2,972) Deferred financing costs (9,790) (10,821) (19,272) Total debt $ 2,451,841 $ 2,380,531 $ 2,631,246 Less short-term borrowings (170,000) (100,000) — Total long-term debt $ 2,281,841 $ 2,280,531 $ 2,631,246 Fair-Value of Long-Term Indebtedness As of April 2, 2023, January 1, 2023 and April 3, 2022, the fair value of our long-term debt was $2,423.8 million, $2,284.3 million and $2,660.5 million, respectively. Recent Events On April 26, 2023, the Company launched a private offering of up to $800 million aggregate principal amount of senior notes. Concurrently, the Company commenced a cash tender offer (the “Tender Offer”) for any and all outstanding 2024 Notes. The consideration offered for each $1,000 principal amount of the 2024 Notes was $1,000.50 (the “Purchase Price”), plus accrued and unpaid interest, for any an all notes validly tendered by 5:00 p.m. New Your City time, on May 2, 2023. On May 3, 2023, the Company completed the private sale of $800 million in aggregate principal amount of 7.25% senior unsecured notes due 2031 (“2031 Notes”) at an offering price of 99.248% of the principal amount thereof. Net of the original issuance discount and debt issuance costs, the Company received net proceeds of $784.0 million. Concurrently with the closing of the 2031 Notes, the Company amended its existing senior secured credit facility to, among other things, (i) establish a $500 million replacement revolving credit facility maturing in May 2028, which was previously scheduled to expire in April 2024 (ii) maintain the same interest rate margins on borrowings under the replacement revolving credit facility as are currently in effect, while reducing the fee on unused revolving commitments to 0.5% , stepping down to 0.375% upon achieving a senior secured leverage ratio of less than 1.25 :1.00, (iii) replace LIBOR as the interest rate benchmark for borrowings under the senior secured credit facility with Term SOFR, (iv) modify the maximum senior secured leverage ratio that the Company must maintain to 4.50 :1.00 for the four fiscal-quarter periods ending on or about December 31, 2022, March 31, 2023, and June 30, 2023, 4.25 :1.00 for the four fiscal-quarter period ending on or about September 30, 2023, and each four fiscal-quarter period thereafter through the four fiscal-quarter period ending on or about June 30, 2024, and 3.75 :1.00 for the four fiscal-quarter period ending on or about September 30, 2024, and each four fiscal-quarter period thereafter, and (v) make certain other changes to the covenants and other terms of the senior secured credit facility. Also on May 3, 2023, the Company announced that $892.6 million, or 94.0% of the aggregate principal amount of the 2024 notes were validly tendered pursuant to the Tender Offer. Net cash proceeds from the 2031 Notes, together with other available cash, including borrowings under our revolving credit facility, were used to pay the Purchase Price, plus accrued and unpaid interest. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Loss | 3 Months Ended |
Apr. 02, 2023 | |
Accumulated Other Comprehensive Loss. | |
Accumulated Other Comprehensive Loss | 4. Accumulated Other Comprehensive Loss Changes in the composition of Accumulated Other Comprehensive Loss ("AOCL") during the three months ended April 2, 2023, were as follows: Accumulated Cumulative Other Translation Cash Flow Defined Benefit Income Comprehensive (Amounts in thousands) Adjustment Hedges Plans Taxes Loss Balances at January 1, 2023 $ (33,145) $ 5,337 $ (39,385) $ (4,002) $ (71,195) Net current period change 772 — — 144 916 Amounts reclassified from AOCI — (787) 234 138 (415) Balances at April 2, 2023 $ (32,373) $ 4,550 $ (39,151) $ (3,720) $ (70,694) Reclassifications out of AOCI during the three months ended April 2, 2023 and April 3, 2022: Amount of Reclassification from AOCI Three Months Ended Component of AOCI Location of Reclassification into Income (Loss) April 2, 2023 April 3, 2022 Amortization of (gain) loss on interest rate hedge Interest (benefit) expense $ (787) $ 1,117 Income tax expense (benefit) 196 (281) Net of tax $ (591) $ 836 Amortization of deferred actuarial loss and prior service cost Operating expenses $ 234 $ 229 Income tax benefit (58) (57) Net of tax $ 176 $ 172 Total reclassifications $ (415) $ 1,008 |
Derivative Financial Instrument
Derivative Financial Instruments | 3 Months Ended |
Apr. 02, 2023 | |
Derivative Financial Instruments | |
Derivative Financial Instruments | 5. Derivative Financial Instruments Derivative assets and derivative liabilities that have maturity dates equal to or less than twelve months from the balance sheet date are included in “Prepaid expenses and other current assets” and “Other accrued liabilities,” respectively. Derivative assets and derivative liabilities that have maturity dates greater than twelve months from the balance sheet date are included in “Deposits and other assets” and “Other long-term liabilities,” respectively. On March 24, 2022, we terminated the August 2019 Swap Agreements for net cash proceeds of $7.4 million. The swap agreements were used as economic hedges against rising interest rates and had been designated as cash flow hedges prior to termination. We recorded the gain on settlement in accumulated other comprehensive loss in the amount of $7.7 million which will be amortized through September 2024 when the Second Amended and Restated Term Loan B matures. Derivative assets recorded at fair value in our condensed consolidated balance sheets as of April 2, 2023, January 1, 2023 and April 3, 2022, respectively, consisted of the following: Derivative Assets (Amounts in thousands) April 2, 2023 January 1, 2023 April 3, 2022 Derivatives Not Designated as Hedging Instruments Interest rate swap agreements — other current assets $ 4,610 $ 6,135 $ — Interest rate swap agreements — other non-current assets 3,225 4,446 3,996 $ 7,835 $ 10,581 $ 3,996 Derivative liabilities recorded at fair value in our condensed consolidated balance sheets as of April 2, 2023, January 1, 2023 and April 3, 2022, respectively, consisted of the following: Derivative Liabilities (Amounts in thousands) April 2, 2023 January 1, 2023 April 3, 2022 Derivatives Not Designated as Hedging Instruments Interest rate swap agreements — other accrued liabilities $ 6,253 $ 8,476 $ 4,250 Interest rate swap agreements — other long-term liabilities 4,859 6,224 7,512 $ 11,112 $ 14,700 $ 11,762 Losses before taxes on derivatives not designated as a cash flow hedge of $0.1 million were presented in “Interest expense” in the condensed consolidated statement of operations for the three months ended April 2, 2023. Gains and losses before taxes on derivatives designated as hedging instruments were presented in “Interest expense, net” in the condensed consolidated statements of operations for the three months ended April 2, 2023, and April 3, 2022: Gain (Loss) Gain (Loss) Reclassified from Recognized in AOCL AOCL into Interest Expense, Net (Amounts in thousands) 2023 2022 2023 2022 Interest rate swap agreements $ — $ 11,540 $ 787 $ (1,117) Total $ — $ 11,540 $ 787 $ (1,117) As of April 2, 2023, we expect to reclassify net gains of $3.2 million, currently recorded in AOCL, into “Interest expense, net” within the next twelve months. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Apr. 02, 2023 | |
Commitments and Contingencies | |
Commitments and Contingencies | 6. Commitments and Contingencies Partnership Parks We have guaranteed the obligations of the general partners of those partnerships to (i) make minimum annual distributions (including rent) of approximately $85.6 million in 2023 (subject to cost of living adjustments) to the limited partners in the Partnership Parks (based on our ownership of units as of April 2, 2023, our share of the distribution will be approximately $38.1 million) and (ii) make minimum capital expenditures at each of the Partnership Parks during rolling five-year periods, based generally on 6.0% of the Partnership Parks’ revenues. Pursuant to the 2023 annual offer to purchase limited partnership units tendered by the unit holders (the "Partnership Park Put") in May 2023, we purchased 0.149 limited partnership units from the Texas partnership for $0.3 million. As we purchase additional units, we are entitled to a proportionate increase in our share of the minimum annual distributions. The maximum unit purchase obligations for 2023 at both parks is approximately $521.4 million, representing approximately 68.5% of the outstanding units of SFOG and 45.9% of the outstanding units of SFOT. The agreed price for units tendered in the Partnership Park Put is based on a valuation of each of the respective Partnership Parks (the "Specified Price") that is the greater of (a) a valuation for each of the respective Partnership Parks derived by multiplying such park’s weighted average four-year EBITDA (as defined in the agreements that govern the partnerships) by a specified multiple ( 8.0 in the case of SFOG and 8.5 in the case of SFOT) and (b) a valuation derived from the highest prices previously offered for the units of the Partnership Parks by certain entities. In light of the temporary suspension of operations of the parks due to the COVID-19 pandemic in March 2020, which would have caused the value of the Partnership Park units to decrease in 2021 and thereafter, we adjusted our annual offer to purchase these units to set a minimum price floor for all future purchases. Pursuant to the new minimum price floor, the Specified Price for the Partnership Parks, if determined as of April 2, 2023, is $409.7 million in the case of SFOG and $527.4 million in the case of SFOT. As of April 2, 2023, we owned approximately 31.5% and 54.1% of the Georgia limited partner interests and Texas limited partner interests, respectively. Our obligations with respect to SFOG and SFOT will continue until 2027 and 2028, respectively. We incurred $20.6 million of capital expenditures at the Partnership Parks during the 2022 season and intend to incur approximately $18.3 million of capital expenditures at these parks for the 2023 season, an amount in excess of the minimum required expenditure. Cash flows from operations at the Partnership Parks will be used to satisfy the annual distribution and capital expenditure requirements, before any funds are required from us. The Partnership Parks generated approximately $73.0 million of cash in 2022 in operating activities, after deduction of capital expenditures and excluding the impact of short-term intercompany advances from or payments to Holdings. As of April 2, 2023, January 1, 2023 and April 3, 2022, we had total loans receivable outstanding of $288.3 million from the partnerships that own the Partnership Parks, primarily to fund the acquisition of Six Flags White Water Atlanta and to make capital improvements to the Partnership Parks and distributions to the limited partners in prior years. Redeemable noncontrolling interests represent the non-affiliated parties’ share of the assets of the Partnership Parks that are less than wholly-owned: SFOT, SFOG and Six Flags White Water Atlanta, which is owned by the partnership that owns SFOG. As of April 2, 2023, redeemable noncontrolling interests of the SFOG and SFOT partnerships was $280.2 million and $241.2 million, respectively, which approximates redemption value. Insurance We maintain insurance of the types and in amounts that we believe are commercially reasonable and that are available to businesses in our industry. The majority of our current insurance policies expire on December 31, 2023. We generally renegotiate our insurance policies on an annual basis. We cannot predict the level of the premiums that we may be required to pay for subsequent insurance coverage, the level of any self-insurance retention applicable thereto, the level of aggregate coverage available or the availability of coverage for specific risks. Legal Proceedings While certain legal proceedings and related indemnification obligations to which we are a party specify the amounts claimed, these claims may not represent reasonably possible losses. Except as noted below, given the inherent uncertainties of litigation, the ultimate outcome of these matters cannot be predicted at this time, nor can the amount of possible loss or range of loss, if any, be reasonably estimated, except in circumstances where an aggregate litigation accrual has been recorded for probable and reasonably estimable loss contingencies. A determination of the amount of accrual required, if any, for these contingencies is made after careful analysis of each matter. The required accrual may change in the future due to new information or developments in each matter or changes in approach such as a change in settlement strategy in dealing with these matters. Putative Securities Class Action Lawsuit In February 2020, two putative securities class action complaints were filed against Holdings and certain of its former executive officers (collectively, the “defendants”) in the U.S. District Court for the Northern District of Texas. On March 2, 2020, the two cases were consolidated in an action captioned Electrical Workers Pension Fund Local 103 I.B.E.W. v. Six Flags Entertainment Corp., et al. , Case No. 4:20-cv-00201-P (N.D. Tex.) (the “Electrical Workers litigation”), and an amended complaint was filed on March 20, 2020. On May 8, 2020, Oklahoma Firefighters Pension and Retirement System and Electrical Workers Pension Fund Local 103 I.B.E.W. were appointed as lead plaintiffs, Bernstein Litowitz Berger & Grossman LLP was appointed as lead counsel, and McKool Smith PC was appointed as liaison counsel. On July 2, 2020, lead plaintiffs filed a consolidated complaint. The consolidated complaint alleges, among other things, that the defendants made materially false or misleading statements or omissions regarding the Company’s business, operations and growth prospects, specifically with respect to the development of its Six Flags branded parks in China and the financial health of its former partner, Riverside Investment Group Co. Ltd., in violation of the federal securities laws. The consolidated complaint seeks an unspecified amount of compensatory damages and other relief on behalf of a putative class of purchasers of Holdings’ publicly traded common stock during the period between April 24, 2018 and February 19, 2020. On August 3, 2020, defendants filed a motion to dismiss the consolidated complaint. On March 3, 2021, the district court granted defendants’ motion, dismissing the complaint in its entirety and with prejudice. On August 25, 2021, plaintiffs filed a notice of appeal to the U.S. Court of Appeals for the Fifth Circuit (“the Fifth Circuit”) from the district court’s decisions granting defendants’ motion to dismiss, denying plaintiffs’ motion to amend or set aside judgment, and denying plaintiffs’ motion for leave to file a supplemental brief. The appeal was fully briefed as of December 15, 2021, and oral argument was held on March 7, 2022. On January 18, 2023, the Fifth Circuit reversed the dismissal and remanded the case to the district court for further proceedings. On February 9, 2023, the Fifth Circuit mandate issued to the district court. On March 7, 2023, the district court entered a scheduling order governing pre-trial proceedings, among other things setting a completion of discovery date for February 16, 2024, and a date for trial beginning February 3, 2025. On April 18, 2023, Co-Lead Plaintiff Oklahoma Firefighters Pension & Retirement System filed a motion for leave to file an amended complaint that would add a new named plaintiff, remove former Co-Lead Plaintiff Electrical Workers Pension Fund Local 103 I.B.E.W., and modify the case caption. On May 2, 2023, defendants filed an opposition to that motion and a motion for judgment on the pleadings. We believe this lawsuit is without merit; however, there can be no assurance regarding the ultimate outcome. Regardless of the merit of plaintiff’s claims, litigation may be expensive, time-consuming, disruptive to the Company’s operations and distracting to management. The outcome of this litigation is inherently uncertain, and we cannot reasonably estimate any loss or range of loss that may arise from this matter. Stockholder Derivative Lawsuits On March 20, 2020, a putative stockholder derivative lawsuit was filed on behalf of nominal defendant Holdings in the U.S. District Court for the Northern District of Texas against certain of its then-current and former executive officers and directors (the “individual defendants”) in an action captioned Schwartz v. Reid-Anderson, et al. , Case No. 4:20-cv-00262-P (N.D. Tex.). In April 2020, two additional stockholder derivative lawsuits, making substantially identical allegations as the Schwartz complaint, were filed by Trustees of the St. Clair County Employees’ Retirement System and Mr. Mehmet Ali Albayrak in the U.S. District Court for the Northern District of Texas in actions captioned Martin, et al. v. Reid-Anderson, et al. , Case No. 4:20-cv-00311-P (N.D. Tex.) and Albayrak v. Reid-Anderson, et al. , Case No. 4:20-cv-00312-P (N.D. Tex.), respectively. On April 8, 2020, plaintiffs in all three of these putative derivative actions moved to consolidate the actions and appoint lead counsel. On May 8, 2020, the district court granted the plaintiffs’ motion to consolidate. The consolidated action is captioned In re Six Flags Entertainment Corp. Derivative Litigation , Case No. 4:20-cv-00262-P (N.D. Tex.). On August 10, 2020, plaintiffs filed a consolidated derivative complaint. The consolidated derivative complaint alleges breach of fiduciary duty, insider selling, waste of corporate assets, unjust enrichment, and contribution for violations of federal securities laws. The consolidated derivative complaint references, and makes many of the same allegations as are set forth in, the Electrical Workers litigation, alleging, among other things, that the individual defendants breached their fiduciary duties, committed waste, are liable for contribution for, or were unjustly enriched by making, failing to correct, or failing to implement adequate internal controls relating to alleged materially false or misleading statements or omissions regarding the Company’s business, operations and growth prospects, specifically with respect to the prospects of the development of Six Flags branded parks in China and the financial health of its former partner, Riverside Investment Group Co. Ltd. The consolidated derivative complaint also alleges that a former officer and director sold shares of the Company while allegedly in possession of material non-public information concerning the same. On September 9, 2020, Holdings and the individual defendants filed a motion to dismiss the consolidated complaint. On April 28, 2021, the district court granted defendants’ motion, dismissing the consolidated complaint in its entirety and with prejudice and denying leave to amend. Plaintiffs’ time to appeal the judgment dismissing this action in its entirety and with prejudice and denying leave to amend lapsed in May 2021. On May 5, 2020, a putative stockholder derivative lawsuit was filed on behalf of nominal defendant Holdings, by Richard Francisco in Texas state court against certain of its then-current and former executive officers and directors (the “individual defendants”) in an action captioned Francisco v. Reid-Anderson, et al. , Case No. DC-20-06425 (160 th Dist. Ct., Dallas Cty., Tex.) (the “Francisco action”). The petition in the Francisco action alleges breach of fiduciary duty, unjust enrichment, abuse of control, gross mismanagement, and waste of corporate assets. The petition in the Francisco action references, and makes many of the same allegations, as are set forth in the Electrical Workers litigation, alleging, among other things, that the individual defendants breached their fiduciary duties, were unjustly enriched by, abused their control, committed gross mismanagement, and committed waste by making, failing to correct, or failing to implement adequate internal controls relating to alleged materially false or misleading statements or omissions regarding the Company’s business, operations and growth prospects, specifically with respect to the prospects of the development of Six Flags branded parks in China and the financial health of its former partner, Riverside Investment Group Co. Ltd. The petition also alleges that a former officer and director engaged in insider trading. On May 28, 2020, the parties in the Francisco action filed a joint motion to stay proceedings through the resolution of the forthcoming motion to dismiss the Electrical Workers litigation. On June 3, 2020, the district court granted the joint motion to stay proceedings. On June 12, 2020, an additional stockholder derivative lawsuit, making substantially identical allegations as the Francisco petition, was filed on behalf of nominal defendant Holdings in Texas state court by putative stockholder Cliff Bragdon in an action captioned Bragdon v. Reid-Anderson, et al. , Case No. DC-20-08180 (298 th Dist. Ct., Dallas Cty., Tex.) (the “Bragdon action”). On July 10, 2020, the district court granted an agreed motion filed by the parties in the Francisco and Bragdon actions to consolidate cases, to accept service and an unopposed motion to appoint co-lead and liaison counsel, and to stay both the Francisco and Bragdon actions through final resolution of the motion to dismiss the Electrical Workers litigation. The consolidated state derivative action was captioned In re Six Flags Entertainment Corp. Derivative Litigation , Case No. DC-20-06425 (160th Dist. Ct., Dallas Cty., Tex.). On September 8, 2020, the parties to the consolidated state derivative action filed an agreed motion to transfer the case from Dallas County to Tarrant County, which motion was so ordered on September 27, 2020. The consolidated action is now captioned In re Six Flags Ent. Corp. Derivative Litigation, No. 096-320958-20 (96 th Dist. Ct., Tarrant Cty., Tex.). On February 9, 2023, the stay was lifted in the consolidated action when the Fifth Circuit issued the mandate in the Electrical Workers litigation. In an April 27, 2023 joint report to the court, the parties informed the court that they were conferring, that they would provide a further update within 30 days, and that, in the meantime, the defendants had no obligation to respond to the Francisco or Bragdon complaints or the consolidated action. On February 16, 2023, a putative stockholder derivative lawsuit was filed on behalf of nominal defendant Holdings by John Hancock in Texas state court against certain of its former executive officers and directors (the “individual defendants”) in an action captioned Hancock v. Roedel, et al. , Case No. 348-340304-23 (348 th Dist. Ct., Tarrant Cty., Tex.). Plaintiff refers to and makes many of the same allegations as are set forth in the Electrical Workers litigation, claiming that, among other things, the individual defendants caused Six Flags to make false and misleading statements and omissions about the status of construction of Six Flags branded parks in China and the financial health of its former partner, Riverside Investment Group Co. Ltd. Plaintiff asserts breach of fiduciary duty and unjust enrichment claims. Plaintiff seeks an unspecified amount of monetary damages and equitable relief including, but not limited to, disgorgement. On February 22, 2023, a putative stockholder derivative lawsuit was filed on behalf of nominal defendant Holdings by Antonio Dela Cruz in in the U.S. District Court for the Northern District of Texas against certain of its current and former executive officers and directors (the “individual defendants”) in an action captioned Cruz v. Reid-Anderson, et al. , Case No. 3:23-CV-0396-D (N.D. Tex.). Plaintiff refers to and makes many of the same allegations as are set forth in the Electrical Workers litigation, claiming that, among other things, the individual defendants caused Six Flags to make false and misleading statements and omissions about the status of construction of Six Flags branded parks in China and the financial health of its former partner, Riverside Investment Group Co. Ltd. Plaintiff asserts contribution, breach of fiduciary duty, and unjust enrichment claims. Plaintiff seeks an unspecified amount of monetary damages and equitable relief including, but not limited to, disgorgement. Wage and Hour Class Action Lawsuits Holdings and/or certain of its consolidated subsidiaries are named defendants in various lawsuits generally alleging violations of federal and/or state laws regulating wage and hour pay. Plaintiffs in these lawsuits seek monetary damages, including unpaid wages, statutory penalties, and/or attorneys’ fees and costs. Regardless of the merits of particular suits, litigation may be expensive, time-consuming, disruptive to the Company’s operations and distract management from the operation of our business. In recognition of these impacts on the business, the Company may enter into settlement agreements or other arrangements to settle litigation and resolve such disputes. No assurance can be given that such agreements can be obtained on acceptable terms or at all, or that litigation will not occur. These agreements may also significantly increase the Company’s operating expenses. The outcomes of these lawsuits are inherently uncertain, and we cannot reasonably estimate any loss or range of loss that may arise from these matters in excess of the amounts that we have recognized for these lawsuits, which amounts are not material to our consolidated financial statements. Personal Injury Lawsuit On November 18, 2021, the Texas Judicial Panel on Multidistrict Litigation consolidated numerous lawsuits filed against Six Flags Splashtown, LLC d/b/a Six Flags Hurricane Harbor Splashtown asserting claims arising from an alleged chemical vapor release on July 17, 2021 at Six Flags Splashtown. Certain plaintiffs have also named unaffiliated third parties as additional defendants. The consolidated multidistrict litigation is captioned In re Six Flags Splashtown Litigation (Master File No. 2021-77214), and is pending in the 295th Judicial District Court in Harris County, Texas. Plaintiffs are seeking compensatory and punitive damages. On April 14, 2023, Six Flags Splashtown settled with 421 plaintiffs, including all bellwether plaintiffs set for trial on April 17, 2023, for an immaterial amount. This settlement resolved all claims brought by these plaintiffs only. The parties are working to document this settlement and will seek to have the Court appoint a special master to determine the amounts each settling plaintiff will receive. This settlement does not resolve all claims arising from the alleged chemical vapor release. There are 113 remaining plaintiffs -- 61 plaintiffs represented by two different firms ( 6 of whom are subject to a motion to reinstate that is currently pending before the Court) and 52 pro se plaintiffs. The Court set a status conference for June 13, 2023, and ordered all remaining plaintiffs to appear. Any who fail to appear at the status conference will immediately be dismissed. We have defended this litigation vigorously and will continue to do so. Regardless of the merit of particular claims, litigation may be expensive, time-consuming, disruptive to the Company’s operations and distracting to management. In recognition of these considerations, the Company may enter into further settlement agreements or other arrangements to settle litigation and resolve such disputes. No assurance can be given that such agreements can be obtained on acceptable terms or that litigation will not occur. These agreements may also significantly increase the Company’s operating expenses. The outcome of this litigation is inherently uncertain, and we cannot reasonably estimate any loss or range of loss that may arise from the remaining matters in excess of the amount that we have recorded for this litigation, which amount is not material to our consolidated financial statements. Litigation Relating to Routine Proceedings We are also engaged from time to time in other routine legal and tax proceedings incidental to our business. We do not believe that any of these routine proceedings will have a material impact on the business or our financial condition. Securities and Exchange Commission Investigation The Securities and Exchange Commission is conducting an investigation into the Company’s disclosures and reporting made in 2018 through February 2020 related to its business, operations and growth prospects of its Six Flags branded parks in China and the financial health of its former business partner, Riverside Investment Group Co. Ltd. The Company received a document subpoena in February 2020 and subsequently certain current and former executives received subpoenas in connection with this matter and they continue to provide responsive information. The Company is fully cooperating and is committed to continuing to cooperate fully with the SEC in this matter. We cannot predict the length, scope or results of the investigation, or the impact, of the investigation on our results of operations, business or financial condition. |
Business Segments
Business Segments | 3 Months Ended |
Apr. 02, 2023 | |
Business Segments | |
Business Segments | 7. Business Segments Our chief operating decision maker “CODM” regularly receives consolidated information which is used to make strategy decisions. Each individual park location, has a Park President or General Manager responsible for the operational results and executing the strategy set forth by the CODM. Substantially all of our parks provide similar products and services through a similar process to the same class of customer through a consistent method. We also believe that the parks share common economic characteristics. Based on these factors, we have only one reportable segment - parks. The following information reflects our goodwill and long-lived assets (which consists of property and equipment, right-of-use operating leases and intangible assets) as of April 2, 2023, January 1, 2023 and April 3, 2022: As of (Amounts in thousands) April 2, 2023 January 1, 2023 April 3, 2022 Domestic $ 2,283,902 $ 2,290,318 $ 2,321,053 Foreign 116,922 114,048 114,556 Total $ 2,400,824 $ 2,404,366 $ 2,435,609 Revenues and (loss) income before income taxes by domestic and foreign jurisdictions for the three months ended April 2, 2023 and April 3, 2022: Domestic Foreign Total 2023 (Amounts in thousands) Revenues $ 120,482 $ 21,708 $ 142,190 (Loss) income before income taxes (95,356) 7,645 (87,711) 2022 Revenues $ 125,903 $ 12,204 $ 138,107 Loss before income taxes (83,048) (1,727) (84,775) |
Pension Benefits
Pension Benefits | 3 Months Ended |
Apr. 02, 2023 | |
Pension Benefits | |
Pension Benefits | 8. Pension Benefits We froze our pension plan effective March 31, 2006 and effective February 16, 2009, the remaining participants in the pension plan no longer earned future benefits. The following summarizes our pension costs during the three months ended April 2, 2023 and April 3, 2022, respectively: Three Months Ended (Amounts in thousands) April 2, 2023 April 3, 2022 Service cost $ — $ — Interest cost 1,954 1,384 Expected return on plan assets (2,402) (3,059) Amortization of net actuarial loss 234 229 Administrative fees 650 300 Total net periodic expense (benefit) $ 436 $ (1,146) The components of net periodic pension benefit other than the service cost component were included in "Other income" in the condensed consolidated statements of operations. Weighted-Average Assumptions Used To Determine Net Cost Three Months Ended April 2, 2023 April 3, 2022 Discount rate 4.95 % 2.60 Rate of compensation increase N/A N/A Expected return on plan assets 5.75 % 5.75 Employer Contributions We did no t make any pension contributions during the three month periods ended April 2, 2023 or April 3, 2022. |
Stock Repurchase Plans
Stock Repurchase Plans | 3 Months Ended |
Apr. 02, 2023 | |
Stock Repurchase Plans | |
Stock Repurchase Plans | 9. Stock Repurchase Plans On March 30, 2017, Holdings announced that its Board of Directors approved a stock repurchase plan that permits Holdings to repurchase an incremental $500.0 million in shares of Holdings’ common stock (the "March 2017 Stock Repurchase Plan"). As of April 2, 2023, Holdings had repurchased 8,071,000 shares at a cumulative cost of approximately $365.1 million and an average price per share of $45.24 under the March 2017 Stock Repurchase Plan, leaving approximately $134.9 million available for permitted repurchases . |
General - Basis of Presentati_2
General - Basis of Presentation (Policies) | 3 Months Ended |
Apr. 02, 2023 | |
General - Basis of Presentation | |
Consolidated U.S. GAAP Presentation | a. Consolidated U.S. GAAP Presentation Our accounting policies reflect industry practices and conform to U.S. GAAP. The unaudited condensed consolidated financial statements include our accounts and the accounts of our wholly owned subsidiaries. We also consolidate the partnerships that own Six Flags Over Texas ("SFOT") and Six Flags Over Georgia (including Six Flags White Water Atlanta) ("SFOG," and together with SFOT, the "Partnership Parks") as subsidiaries in our unaudited condensed consolidated financial statements, as we have determined that we have the power to direct the activities of the Partnership Parks that most significantly impact their economic performance and we have the obligation to absorb losses and receive benefits from the Partnership Parks that can be potentially significant to these entities. The equity interests owned by non-affiliated parties in the Partnership Parks are reflected in the accompanying unaudited condensed consolidated balance sheets as redeemable noncontrolling interests . |
Income Taxes | b. Income Taxes We recorded a valuation allowance of $97.6 million, $96.0 million and $107.8 million as of April 2, 2023, January 1, 2023 and April 3, 2022, respectively, due to uncertainties related to our ability to use some of our deferred tax assets, primarily consisting of certain state net operating loss and other tax carryforwards, before they expire. The valuation allowance was based on our estimates of taxable income by jurisdiction in which we operate and the period over which our deferred tax assets were recoverable. Our projected taxable income over the foreseeable future indicates we will be able to use all of our federal net operating loss carryforwards before they expire. We classify interest and penalties attributable to income taxes as part of income tax expense. As of April 2, 2023, January 1, 2023 and April 3, 2022, we had no recorded amounts for accrued interest or penalties. |
Goodwill and Intangibles | c. Goodwill and Intangibles As of April 2, 2023, the fair value of our single reporting unit exceeded its carrying amount. We have one reporting unit at the same level for which Holdings common stock is traded and we believe our market capitalization is the best indicator of our reporting unit’s fair value. At April 2, 2023, we did not identify any triggering events that would require a full quantitative analysis to be performed. |
Long-Lived Assets | d. Long-Lived Assets We review long-lived assets, including finite-lived intangible assets subject to amortization, for impairment upon the occurrence of events or changes in circumstances that would indicate that the carrying value of the asset or group of assets may not be recoverable, “triggering event(s)”. Recoverability of assets to be held and used is measured by comparing the carrying amount of the asset or group of assets to the future net cash flows expected to be generated by the asset or group of assets. If such assets are not considered to be fully recoverable, any impairment to be recognized is measured by the amount by which the carrying amount of the asset or group of assets exceeds its respective fair value. Assets to be disposed of are reported at the lower of the carrying amount or fair value less costs to sell. As of April 2, 2023, we did not identify any triggering events that would require a quantitative analysis. |
Earnings Per Common Share | e. Earnings Per Common Share We incurred a net loss for the three months ended April 2, 2023, and April 3, 2022. Therefore, diluted shares outstanding equaled basic shares outstanding for the purposes of determining loss per common share because their inclusion would be antidilutive. The computation of diluted earnings per share excluded the effect of 1,607,000 and 2,744,000 antidilutive stock options, restricted stock units and performance stock units for the three months ended April 2, 2023, and April 3, 2022, respectively. |
Stock Benefit Plans | f. Stock Benefit Plans Pursuant to the Six Flags Entertainment Corporation Long-Term Incentive Plan (the "Long-Term Incentive Plan"), Holdings may grant stock options, stock appreciation rights, restricted stock, restricted stock units, unrestricted stock, deferred stock units, performance stock units, performance and cash-settled awards and dividend equivalent rights ("DERs") to select employees, officers, directors and consultants of Holdings and its affiliates. Periodically, we will grant performance stock units to key employees. These awards vest on attainment of specific objectives most often related to Adjusted EBITDA or recognized revenue over a defined period. As of April 2, 2023, we have not determined that it is probable that we achieve any of the specific objectives, and thus, we have not recognized any expense associated with any outstanding performance stock units. During the three months ended April 2, 2023, and April 3, 2022, stock-based compensation expense consisted of the following: Three Months Ended (Amounts in thousands) April 2, 2023 April 3, 2022 Long-Term Incentive Plan $ 3,284 $ 4,150 Employee Stock Purchase Plan 30 75 Total Stock-Based Compensation $ 3,314 $ 4,225 During the three months ended April 2, 2023, and April 3, 2022, we paid a nominal amount to employees with dividend equivalent rights for previously declared dividends due upon the vesting of the related shares of Holdings’ common stock. These dividends were declared prior to the suspension of dividend payments . |
Accounts Receivable, Net | g. Accounts Receivable, Net Accounts receivable are reported at net realizable value and consist primarily of amounts due from guests for the sale of group outings and multi-use admission products that allow for payment plans, such as season passes and memberships. We are not exposed to a significant concentration of credit risk; however, based on the age of the receivables, our historical experience and other factors and assumptions we believe to be customary and reasonable, we record an allowance for doubtful accounts. As of April 2, 2023, January 1, 2023 and April 3, 2022, we have recorded an allowance for doubtful accounts of $2.7 million, $4.1 million and $5.7 million, respectively, which is primarily comprised of estimated payment defaults under our membership program and multi-use admission products that allow for payment plans. To the extent that payments under our membership program and multi-use admission products have not been recognized in revenue, the allowance for doubtful accounts recorded is offset with a corresponding reduction in deferred revenue. |
Recently Adopted Accounting Pronouncements | h. Recently Adopted Accounting Pronouncements In March 2020, FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting (“Update 2020-04”), which provides optional expedients and exceptions for applying U.S. GAAP principles to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. The amendments in Update 2020-04 apply only to contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform. The expedients and exceptions provided by the amendments do not apply to contract modifications made and hedging relationships entered into or evaluated after December 31, 2022, except for hedging relationships existing as of December 31, 2022, that an entity has elected optional expedients for and that are retained through the end of the hedging relationship. The provisions in Update 2020-04 are effective upon issuance and can be applied prospectively through December 31, 2022. Interest on the Second Amended and Restated Credit Facility accrues at an annual rate based on LIBOR. |
General - Basis of Presentati_3
General - Basis of Presentation (Tables) | 3 Months Ended |
Apr. 02, 2023 | |
General - Basis of Presentation | |
Schedule of stock-based compensation expense | Three Months Ended (Amounts in thousands) April 2, 2023 April 3, 2022 Long-Term Incentive Plan $ 3,284 $ 4,150 Employee Stock Purchase Plan 30 75 Total Stock-Based Compensation $ 3,314 $ 4,225 |
Revenue (Tables)
Revenue (Tables) | 3 Months Ended |
Apr. 02, 2023 | |
Revenue | |
Schedule of revenues disaggregated by contract duration | The following tables present our revenues disaggregated by contract duration for the three months ended April 2, 2023, and April 3, 2022, respectively. Long-term and short-term contracts consist of our contracts with customers with terms greater than one year and less than or equal to one year, respectively. Sales and usage-based taxes are excluded from revenues. Three Months Ended April 2, 2023 Sponsorship, Park Food, International Merchandise Agreements and (Amounts in thousands) Park Admissions and Other Accommodations Total Long-term contracts $ 4,861 $ 540 $ 6,763 $ 12,164 Short-term contracts and other (a) 71,442 52,246 6,338 130,026 Total revenues $ 76,303 $ 52,786 $ 13,101 $ 142,190 Three Months Ended April 3, 2022 Sponsorship, Park Food, International Merchandise Agreements and (Amounts in thousands) Park Admissions and Other Accommodations Total Long-term contracts $ 3,951 $ 782 $ 6,528 $ 11,261 Short-term contracts and other (a) 69,036 53,487 4,323 126,846 Total revenues $ 72,987 $ 54,269 $ 10,851 $ 138,107 (a) Other revenues primarily include sales of single-use tickets and short-term transactional sales for which we have the right to invoice. |
Long-Term Indebtedness (Tables)
Long-Term Indebtedness (Tables) | 3 Months Ended |
Apr. 02, 2023 | |
Long-Term Indebtedness | |
Schedule of long-term debt | As of April 2, 2023, January 1, 2023 and April 3, 2022, the principal balance of our long-term debt consisted of the following: As of (Amounts in thousands) April 2, 2023 January 1, 2023 April 3, 2022 Second Amended and Restated Term Loan B $ 479,000 $ 479,000 $ 479,000 Second Amended and Restated Revolving Loan 170,000 100,000 — 2024 Notes 949,490 949,490 949,490 2025 Notes 365,000 365,000 725,000 2027 Notes 500,000 500,000 500,000 Net discount (1,859) (2,138) (2,972) Deferred financing costs (9,790) (10,821) (19,272) Total debt $ 2,451,841 $ 2,380,531 $ 2,631,246 Less short-term borrowings (170,000) (100,000) — Total long-term debt $ 2,281,841 $ 2,280,531 $ 2,631,246 |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Loss (Tables) | 3 Months Ended |
Apr. 02, 2023 | |
Accumulated Other Comprehensive Loss. | |
Schedule of components of AOCI | Changes in the composition of Accumulated Other Comprehensive Loss ("AOCL") during the three months ended April 2, 2023, were as follows: Accumulated Cumulative Other Translation Cash Flow Defined Benefit Income Comprehensive (Amounts in thousands) Adjustment Hedges Plans Taxes Loss Balances at January 1, 2023 $ (33,145) $ 5,337 $ (39,385) $ (4,002) $ (71,195) Net current period change 772 — — 144 916 Amounts reclassified from AOCI — (787) 234 138 (415) Balances at April 2, 2023 $ (32,373) $ 4,550 $ (39,151) $ (3,720) $ (70,694) |
Schedule of reclassifications out of accumulated other comprehensive income (loss) | Reclassifications out of AOCI during the three months ended April 2, 2023 and April 3, 2022: Amount of Reclassification from AOCI Three Months Ended Component of AOCI Location of Reclassification into Income (Loss) April 2, 2023 April 3, 2022 Amortization of (gain) loss on interest rate hedge Interest (benefit) expense $ (787) $ 1,117 Income tax expense (benefit) 196 (281) Net of tax $ (591) $ 836 Amortization of deferred actuarial loss and prior service cost Operating expenses $ 234 $ 229 Income tax benefit (58) (57) Net of tax $ 176 $ 172 Total reclassifications $ (415) $ 1,008 |
Derivative Financial Instrume_2
Derivative Financial Instruments (Tables) | 3 Months Ended |
Apr. 02, 2023 | |
Derivative Financial Instruments | |
Schedule of derivative assets at fair value | Derivative Assets (Amounts in thousands) April 2, 2023 January 1, 2023 April 3, 2022 Derivatives Not Designated as Hedging Instruments Interest rate swap agreements — other current assets $ 4,610 $ 6,135 $ — Interest rate swap agreements — other non-current assets 3,225 4,446 3,996 $ 7,835 $ 10,581 $ 3,996 |
Schedule of derivative liabilities at fair value | Derivative Liabilities (Amounts in thousands) April 2, 2023 January 1, 2023 April 3, 2022 Derivatives Not Designated as Hedging Instruments Interest rate swap agreements — other accrued liabilities $ 6,253 $ 8,476 $ 4,250 Interest rate swap agreements — other long-term liabilities 4,859 6,224 7,512 $ 11,112 $ 14,700 $ 11,762 |
Schedule of gains and losses before taxes on derivatives designated as hedging instruments | Gain (Loss) Gain (Loss) Reclassified from Recognized in AOCL AOCL into Interest Expense, Net (Amounts in thousands) 2023 2022 2023 2022 Interest rate swap agreements $ — $ 11,540 $ 787 $ (1,117) Total $ — $ 11,540 $ 787 $ (1,117) |
Business Segments (Tables)
Business Segments (Tables) | 3 Months Ended |
Apr. 02, 2023 | |
Business Segments | |
Schedule of segment financial information and a reconciliation of net income to Park EBITDA | The following information reflects our goodwill and long-lived assets (which consists of property and equipment, right-of-use operating leases and intangible assets) as of April 2, 2023, January 1, 2023 and April 3, 2022: As of (Amounts in thousands) April 2, 2023 January 1, 2023 April 3, 2022 Domestic $ 2,283,902 $ 2,290,318 $ 2,321,053 Foreign 116,922 114,048 114,556 Total $ 2,400,824 $ 2,404,366 $ 2,435,609 Revenues and (loss) income before income taxes by domestic and foreign jurisdictions for the three months ended April 2, 2023 and April 3, 2022: Domestic Foreign Total 2023 (Amounts in thousands) Revenues $ 120,482 $ 21,708 $ 142,190 (Loss) income before income taxes (95,356) 7,645 (87,711) 2022 Revenues $ 125,903 $ 12,204 $ 138,107 Loss before income taxes (83,048) (1,727) (84,775) |
Pension Benefits (Tables)
Pension Benefits (Tables) | 3 Months Ended |
Apr. 02, 2023 | |
Pension Benefits | |
Summary of pension costs | Three Months Ended (Amounts in thousands) April 2, 2023 April 3, 2022 Service cost $ — $ — Interest cost 1,954 1,384 Expected return on plan assets (2,402) (3,059) Amortization of net actuarial loss 234 229 Administrative fees 650 300 Total net periodic expense (benefit) $ 436 $ (1,146) |
Schedule of weighted average assumptions used to determine benefit obligations and net cost | Three Months Ended April 2, 2023 April 3, 2022 Discount rate 4.95 % 2.60 Rate of compensation increase N/A N/A Expected return on plan assets 5.75 % 5.75 |
General - Basis of Presentati_4
General - Basis of Presentation (Details) $ in Millions | 3 Months Ended | ||
Apr. 02, 2023 USD ($) item | Jan. 01, 2023 USD ($) | Apr. 03, 2022 USD ($) | |
Summary of Significant Accounting Policies | |||
Number of parks owned or operated | 27 | ||
Number of reporting units | 1 | ||
Valuation allowance | $ | $ 97.6 | $ 96 | $ 107.8 |
Accrued interest and penalties, income taxes | $ | 0 | 0 | 0 |
Allowance for doubtful accounts | $ | $ 2.7 | $ 4.1 | $ 5.7 |
Minimum | |||
Summary of Significant Accounting Policies | |||
Percentage of park attendance and revenues typically occurring in second and third calendar quarters | 70% | ||
Maximum | |||
Summary of Significant Accounting Policies | |||
Percentage of park attendance and revenues typically occurring in second and third calendar quarters | 75% | ||
United States | |||
Summary of Significant Accounting Policies | |||
Number of parks owned or operated | 24 | ||
Mexico | |||
Summary of Significant Accounting Policies | |||
Number of parks owned or operated | 2 | ||
Canada | |||
Summary of Significant Accounting Policies | |||
Number of parks owned or operated | 1 |
General - Basis of Presentati_5
General - Basis of Presentation - Earnings Per Common Share (Details) - shares | 3 Months Ended | |
Apr. 02, 2023 | Apr. 03, 2022 | |
Antidilutive options | ||
Antidilutive stock options excluded from computation of diluted shares outstanding (in shares) | 1,607,000 | 2,744,000 |
General - Basis of Presentati_6
General - Basis of Presentation - Stock Benefit Plans (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 02, 2023 | Apr. 03, 2022 | |
Stock Benefit Plans | ||
Stock-based compensation | $ 3,314 | $ 4,225 |
Long Term Incentive Plan | ||
Stock Benefit Plans | ||
Stock-based compensation | 3,284 | 4,150 |
Employee Stock Purchase Plan | ||
Stock Benefit Plans | ||
Stock-based compensation | $ 30 | $ 75 |
Revenue - Disaggregation of Rev
Revenue - Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 02, 2023 | Apr. 03, 2022 | |
Revenue | ||
Revenues | $ 142,190 | $ 138,107 |
Long-term contracts | ||
Revenue | ||
Revenues | 12,164 | 11,261 |
Short-term contracts and other | ||
Revenue | ||
Revenues | 130,026 | 126,846 |
Park Admissions | ||
Revenue | ||
Revenues | 76,303 | 72,987 |
Park Admissions | Long-term contracts | ||
Revenue | ||
Revenues | 4,861 | 3,951 |
Park Admissions | Short-term contracts and other | ||
Revenue | ||
Revenues | 71,442 | 69,036 |
Park Food, Merchandise and Other | ||
Revenue | ||
Revenues | 52,786 | 54,269 |
Park Food, Merchandise and Other | Long-term contracts | ||
Revenue | ||
Revenues | 540 | 782 |
Park Food, Merchandise and Other | Short-term contracts and other | ||
Revenue | ||
Revenues | 52,246 | 53,487 |
Sponsorship, International Agreements, and Accommodations | ||
Revenue | ||
Revenues | 13,101 | 10,851 |
Sponsorship, International Agreements, and Accommodations | Long-term contracts | ||
Revenue | ||
Revenues | 6,763 | 6,528 |
Sponsorship, International Agreements, and Accommodations | Short-term contracts and other | ||
Revenue | ||
Revenues | $ 6,338 | $ 4,323 |
Revenue - Performance Obligatio
Revenue - Performance Obligations (Details) - Long-term contracts - USD ($) $ in Millions | 3 Months Ended | |||
Apr. 02, 2023 | Apr. 03, 2022 | Jan. 01, 2023 | Jan. 01, 2021 | |
Revenue | ||||
Performance obligation | $ 42.8 | $ 59 | ||
Contract with Customer, Liability | 152.1 | 185.1 | $ 33.5 | $ 58.7 |
Unearned contract with customer revenue recognized | 12.2 | $ 12.2 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-04-04 | ||||
Revenue | ||||
Performance obligation | $ 54.6 | |||
Expected timing of satisfaction, period | 9 months | |||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-02 | ||||
Revenue | ||||
Performance obligation | $ 17.7 | |||
Expected timing of satisfaction, period | 1 year | |||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-01-01 | ||||
Revenue | ||||
Performance obligation | $ 9.3 | |||
Expected timing of satisfaction, period | 1 year | |||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-01-01 | ||||
Revenue | ||||
Performance obligation | $ 7.1 | |||
Expected timing of satisfaction, period | 1 year | |||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2026-01-01 | ||||
Revenue | ||||
Performance obligation | $ 12.8 | |||
Expected timing of satisfaction, period | 1 year |
Long-Term Indebtedness - Additi
Long-Term Indebtedness - Additional Information (Details) | 3 Months Ended | |||||||||||
May 03, 2023 USD ($) | Oct. 03, 2021 USD ($) | Apr. 02, 2023 USD ($) | Apr. 03, 2022 USD ($) | May 02, 2023 USD ($) | Apr. 26, 2023 USD ($) | Jan. 01, 2023 USD ($) | Apr. 30, 2020 USD ($) | Aug. 31, 2019 USD ($) agreement | Jun. 30, 2019 USD ($) agreement | Apr. 30, 2017 USD ($) | Jun. 30, 2016 USD ($) | |
Summary of Long-term debt | ||||||||||||
Outstanding amount | $ 2,451,841,000 | $ 2,631,246,000 | $ 2,380,531,000 | |||||||||
Commitment fee percentage | 0.50% | |||||||||||
Payments of debt issuance costs | 970,000 | |||||||||||
Achievement of leverage ratio of less than 1.25 | ||||||||||||
Summary of Long-term debt | ||||||||||||
Commitment fee percentage | 0.375% | |||||||||||
Estimate of Fair Value Measurement | ||||||||||||
Summary of Long-term debt | ||||||||||||
Long-term debt, fair value | 2,423,800,000 | 2,660,500,000 | 2,284,300,000 | |||||||||
June 2019 Swap Agreements | ||||||||||||
Summary of Long-term debt | ||||||||||||
Notional amount | $ 300,000,000 | |||||||||||
Number of agreements | agreement | 3 | |||||||||||
August 2019 Swap Agreements | ||||||||||||
Summary of Long-term debt | ||||||||||||
Notional amount | $ 400,000,000 | |||||||||||
Number of agreements | agreement | 2 | |||||||||||
Revolving Credit Facility | ||||||||||||
Summary of Long-term debt | ||||||||||||
Debt instrument face amount | $ 500,000,000 | |||||||||||
Second Amended and Restated Revolving Loan | ||||||||||||
Summary of Long-term debt | ||||||||||||
Maximum borrowing capacity | 350,000,000 | |||||||||||
Outstanding amount | 100,000,000 | |||||||||||
Letters of credit outstanding amount | 21,000,000 | 21,000,000 | ||||||||||
Long-term line of credit | $ 0 | |||||||||||
Commitment fee percentage | 0.625% | |||||||||||
Long-term debt, gross | 170,000,000 | 100,000,000 | ||||||||||
Second Amended and Restated Term Loan B | ||||||||||||
Summary of Long-term debt | ||||||||||||
Maximum borrowing capacity | $ 479,000,000 | |||||||||||
Interest rate, stated percentage | 6.60% | |||||||||||
Long-term debt, gross | $ 479,000,000 | $ 479,000,000 | 479,000,000 | |||||||||
Second Amended and Restated Term Loan B | LIBOR | ||||||||||||
Summary of Long-term debt | ||||||||||||
Basis spread on variable rate | 1.75% | |||||||||||
2025 Notes | ||||||||||||
Summary of Long-term debt | ||||||||||||
Long-term debt, gross | $ 365,000,000 | $ 365,000,000 | 725,000,000 | 365,000,000 | ||||||||
Periodic payment of interest | 12,800,000 | |||||||||||
2025 Notes | Six Flags Theme Parks Inc. | ||||||||||||
Summary of Long-term debt | ||||||||||||
Debt instrument face amount | $ 725,000,000 | |||||||||||
Interest rate, stated percentage | 7% | |||||||||||
2024 Notes | ||||||||||||
Summary of Long-term debt | ||||||||||||
Debt instrument face amount | $ 700,000,000 | $ 300,000,000 | ||||||||||
Interest rate, stated percentage | 4.875% | |||||||||||
Principal amount of debt used in conversion | $ 1,000 | |||||||||||
Purchase price | $ 892,600,000 | $ 1,000,500 | ||||||||||
Long-term debt, gross | 949,500,000 | 949,490,000 | 949,490,000 | 949,490,000 | ||||||||
Periodic payment of interest | 23,100,000 | |||||||||||
Percentage of aggregate principal amount of notes tendered | 94% | |||||||||||
2027 Notes | ||||||||||||
Summary of Long-term debt | ||||||||||||
Debt instrument face amount | $ 500,000,000 | |||||||||||
Interest rate, stated percentage | 5.50% | |||||||||||
Long-term debt, gross | 500,000,000 | $ 500,000,000 | $ 500,000,000 | $ 500,000,000 | ||||||||
Periodic payment of interest | $ 13,800,000 | |||||||||||
2031 Notes | ||||||||||||
Summary of Long-term debt | ||||||||||||
Debt instrument face amount | $ 800,000,000 | $ 800,000,000 | ||||||||||
Net proceeds | $ 784,000,000 | |||||||||||
Interest rate, stated percentage | 7.25% | |||||||||||
Percentage of offering price | 99.248% | |||||||||||
Senior secured debt | Achievement of leverage ratio of less than 1.25 | Minimum | ||||||||||||
Summary of Long-term debt | ||||||||||||
Leverage ratio | 1.25% | |||||||||||
Senior secured debt | Quarter ending June 30, 2023 | Maximum | ||||||||||||
Summary of Long-term debt | ||||||||||||
Leverage ratio | 4.50% | |||||||||||
Senior secured debt | Four fiscal quarter ending September 30, 2023 | Maximum | ||||||||||||
Summary of Long-term debt | ||||||||||||
Leverage ratio | 4.25% | |||||||||||
Senior secured debt | Four fiscal quarter ending June 30, 2024 | Maximum | ||||||||||||
Summary of Long-term debt | ||||||||||||
Leverage ratio | 4.25% | |||||||||||
Senior secured debt | Four fiscal quarter ending September 30, 2024 | Maximum | ||||||||||||
Summary of Long-term debt | ||||||||||||
Leverage ratio | 3.75% | |||||||||||
Senior secured debt | Each four fiscal quarter after September 30, 2024 | Maximum | ||||||||||||
Summary of Long-term debt | ||||||||||||
Leverage ratio | 3.75% |
Long-Term Indebtedness - Schedu
Long-Term Indebtedness - Schedule of Long-term Debt (Details) - USD ($) $ in Thousands | Apr. 02, 2023 | Jan. 01, 2023 | Apr. 03, 2022 | Oct. 03, 2021 |
Summary of Long-term debt | ||||
Net discount | $ (1,859) | $ (2,138) | $ (2,972) | |
Deferred financing costs | (9,790) | (10,821) | (19,272) | |
Total debt | 2,451,841 | 2,380,531 | 2,631,246 | |
Less short-term borrowings | (170,000) | (100,000) | ||
Total long-term debt | 2,281,841 | 2,280,531 | 2,631,246 | |
Second Amended and Restated Term Loan B | ||||
Summary of Long-term debt | ||||
Long-term debt, gross | 479,000 | 479,000 | 479,000 | |
Second Amended and Restated Revolving Loan | ||||
Summary of Long-term debt | ||||
Long-term debt, gross | 170,000 | 100,000 | ||
Total debt | 100,000 | |||
2024 Notes | ||||
Summary of Long-term debt | ||||
Long-term debt, gross | 949,490 | 949,490 | 949,490 | $ 949,500 |
2025 Notes | ||||
Summary of Long-term debt | ||||
Long-term debt, gross | 365,000 | 365,000 | 725,000 | 365,000 |
2027 Notes | ||||
Summary of Long-term debt | ||||
Long-term debt, gross | $ 500,000 | $ 500,000 | $ 500,000 | $ 500,000 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Loss - Changes in AOCL (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 02, 2023 | Apr. 03, 2022 | |
Accumulated other comprehensive loss, net of tax | ||
Beginning balance | $ (950,565) | $ (982,200) |
Ending balance | (1,016,713) | (1,037,776) |
Cumulative Translation Adjustment | ||
Accumulated other comprehensive loss, net of tax | ||
Beginning balance | (33,145) | |
Net current period change | 772 | |
Ending balance | (32,373) | |
Cash Flow Hedges | ||
Accumulated other comprehensive loss, net of tax | ||
Beginning balance | 5,337 | |
Amounts reclassified from AOCI | (787) | |
Ending balance | 4,550 | |
Defined Benefit Plans | ||
Accumulated other comprehensive loss, net of tax | ||
Beginning balance | (39,385) | |
Amounts reclassified from AOCI | 234 | |
Ending balance | (39,151) | |
Accumulated Income Taxes Adjustment [Member] | ||
Accumulated other comprehensive loss, net of tax | ||
Beginning balance | (4,002) | |
Net current period change | 144 | |
Amounts reclassified from AOCI | 138 | |
Ending balance | (3,720) | |
Accumulated other comprehensive loss | ||
Accumulated other comprehensive loss, net of tax | ||
Beginning balance | (71,195) | (81,187) |
Net current period change | 916 | |
Amounts reclassified from AOCI | (415) | |
Ending balance | $ (70,694) | $ (75,622) |
Accumulated Other Comprehensi_4
Accumulated Other Comprehensive Loss - Reclassification out of AOCI (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 02, 2023 | Apr. 03, 2022 | |
Reclassifications out of accumulated other comprehensive income (loss): | ||
Interest expense, net | $ 36,302 | $ 37,530 |
Income tax benefit | (17,852) | (19,113) |
Net of tax | (69,859) | (65,662) |
Reclassification out of Accumulated Other Comprehensive Income. | ||
Reclassifications out of accumulated other comprehensive income (loss): | ||
Total reclassifications | (415) | 1,008 |
Reclassification out of Accumulated Other Comprehensive Income. | Amortization of (gain) loss on interest rate hedge | ||
Reclassifications out of accumulated other comprehensive income (loss): | ||
Interest expense, net | (787) | 1,117 |
Income tax benefit | 196 | (281) |
Net of tax | (591) | 836 |
Reclassification out of Accumulated Other Comprehensive Income. | Amortization of deferred actuarial loss and prior service cost | ||
Reclassifications out of accumulated other comprehensive income (loss): | ||
Operating expenses | 234 | 229 |
Income tax benefit | (58) | (57) |
Net of tax | $ 176 | $ 172 |
Derivative Financial Instrume_3
Derivative Financial Instruments - Derivative Instruments Recorded at Fair Values (Details) - USD ($) $ in Thousands | 3 Months Ended | ||||
Mar. 24, 2022 | Apr. 02, 2023 | Apr. 03, 2022 | Jan. 01, 2023 | ||
Derivative Financial Instruments | |||||
Settlement amount included in accumulated other comprehensive income | [1] | $ (591) | $ 9,479 | ||
Interest rate swap agreements | |||||
Derivative Financial Instruments | |||||
Derivative assets | 7,835 | 3,996 | $ 10,581 | ||
Derivative liability, total | 11,112 | 11,762 | 14,700 | ||
Derivatives Designated as Cash Flow Hedges | Interest rate swap agreements | |||||
Derivative Financial Instruments | |||||
Net cash proceeds | $ 7,400 | ||||
Derivatives Designated as Cash Flow Hedges | Interest rate swap agreements | Amended And Restated Term Loan B | |||||
Derivative Financial Instruments | |||||
Settlement amount included in accumulated other comprehensive income | $ 7,700 | ||||
Derivatives Not Designated as Hedging Instruments | Interest rate swap agreements | |||||
Derivative Financial Instruments | |||||
Derivative assets - Current | 4,610 | 6,135 | |||
Derivative assets - Non-current | 3,225 | 3,996 | 4,446 | ||
Derivative liabilities - current | 6,253 | 4,250 | 8,476 | ||
Derivative liabilities - noncurrent | $ 4,859 | $ 7,512 | $ 6,224 | ||
[1] Change in cash flow hedging is presented net of tax benefit of $0.2 million for the three months ended April 2, 2023 and net of tax expense of $3.1 million for the three months ended April 3, 2022. |
Derivative Financial Instrume_4
Derivative Financial Instruments - Gains and Losses before Taxes on Derivatives (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 02, 2023 | Apr. 03, 2022 | |
Derivative Financial Instruments | ||
Loss to be reclassified from AOCI to operations during the next twelve months | $ 3,200 | |
Derivatives Designated as Cash Flow Hedges | ||
Derivative Financial Instruments | ||
Gain (Loss) Recognized in AOCL | $ 11,540 | |
Loss (Gain) Reclassified from AOCL into Operations | 787 | (1,117) |
Derivatives Designated as Cash Flow Hedges | Interest Rate Swap Agreements | ||
Derivative Financial Instruments | ||
Gain (Loss) Recognized in AOCL | 11,540 | |
Loss (Gain) Reclassified from AOCL into Operations | 787 | $ (1,117) |
Derivatives Not Designated as Hedging Instruments | ||
Derivative Financial Instruments | ||
Loss recognized in interest expense | $ 100 |
Commitments and Contingencies (
Commitments and Contingencies (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||||||
Apr. 17, 2023 plaintiff | Apr. 08, 2020 claim | Mar. 02, 2020 claim | May 31, 2023 USD ($) shares | Apr. 30, 2020 claim | Feb. 29, 2020 claim | Apr. 02, 2023 USD ($) multiple | Apr. 03, 2022 USD ($) | Jan. 01, 2023 USD ($) | |
Details of commitments and contingencies | |||||||||
Redemption value of noncontrolling interests | $ 521,400 | ||||||||
Redeemable noncontrolling interests, ending balance | 521,395 | $ 522,067 | $ 521,395 | ||||||
Additions to property and equipment | 25,488 | 32,071 | |||||||
Securities Class Action Lawsuits | Pending Litigation | |||||||||
Details of commitments and contingencies | |||||||||
Number of claims filed | claim | 2 | 2 | |||||||
Stockholder Derivative Lawsuits | Pending Litigation | |||||||||
Details of commitments and contingencies | |||||||||
Number of claims filed | claim | 2 | ||||||||
Number of claims consolidated | claim | 3 | ||||||||
Personal injury lawsuit | |||||||||
Details of commitments and contingencies | |||||||||
Number of plaintiffs | plaintiff | 421 | ||||||||
Number of plaintiffs remaining to be settled | plaintiff | 113 | ||||||||
Number of plaintiffs remaining to be settled represented by different firms | plaintiff | 61 | ||||||||
Number of plaintiffs subject to motion to reinstate | plaintiff | 6 | ||||||||
Number of pro se plaintiffs | plaintiff | 52 | ||||||||
Partnerships That Own Partnership Parks | |||||||||
Details of commitments and contingencies | |||||||||
Total loans receivable | 288,300 | $ 288,300 | 288,300 | ||||||
Six Flags over Georgia | |||||||||
Details of commitments and contingencies | |||||||||
Redeemable noncontrolling interests, ending balance | $ 280,200 | ||||||||
Remaining redeemable units (as a percent) | 68.50% | ||||||||
Limited partner interests owned (as a percent) | 31.50% | ||||||||
Six Flags over Texas | |||||||||
Details of commitments and contingencies | |||||||||
Redeemable noncontrolling interests, ending balance | $ 241,200 | ||||||||
Remaining redeemable units (as a percent) | 45.90% | ||||||||
Limited partner interests owned (as a percent) | 54.10% | ||||||||
Six Flags over Texas | Subsequent Event | |||||||||
Details of commitments and contingencies | |||||||||
Units purchased in partnership parks (in units) | shares | 0.149 | ||||||||
Purchase price of partnership units | $ 300 | ||||||||
Six Flags over Texas and Georgia | |||||||||
Details of commitments and contingencies | |||||||||
Annual distributions by general partners to limited partners in partnership parks | $ 85,600 | ||||||||
Share of partnership parks' annual distributions paid to six flags entertainment corporation | $ 38,100 | ||||||||
Rolling period for making minimum capital expenditure at each of the Partnership Parks | 5 years | ||||||||
Percentage of capital expenditures to Partnership Parks' revenues | 6% | ||||||||
Weighted average period of the park's EBITDA for calculation of value of purchase price | 4 years | ||||||||
Additions to property and equipment | $ 18,300 | 20,600 | |||||||
Cash generated from operating activities by partnerships, after deduction of capital expenditures and excluding the impact of short-term intercompany advances | $ 73,000 | ||||||||
Six Flags over Georgia | |||||||||
Details of commitments and contingencies | |||||||||
Specified multiple for purchase price valuation (in multipliers) | multiple | 8 | ||||||||
Specified price for purchase of partnership parks | $ 409,700 | ||||||||
Six Flags over Texas | |||||||||
Details of commitments and contingencies | |||||||||
Specified multiple for purchase price valuation (in multipliers) | multiple | 8.5 | ||||||||
Specified price for purchase of partnership parks | $ 527,400 |
Business Segments - Information
Business Segments - Information by Geographic Region (Details) $ in Thousands | 3 Months Ended | ||
Apr. 02, 2023 USD ($) segment | Apr. 03, 2022 USD ($) | Jan. 01, 2023 USD ($) | |
Business segment information by geographical areas | |||
Number of reportable segments | segment | 1 | ||
Long-lived assets | $ 2,400,824 | $ 2,435,609 | $ 2,404,366 |
Revenues | 142,190 | 138,107 | |
(Loss) income before income taxes | (87,711) | (84,775) | |
Domestic | |||
Business segment information by geographical areas | |||
Long-lived assets | 2,283,902 | 2,321,053 | 2,290,318 |
Revenues | 120,482 | 125,903 | |
(Loss) income before income taxes | (95,356) | (83,048) | |
Foreign | |||
Business segment information by geographical areas | |||
Long-lived assets | 116,922 | 114,556 | $ 114,048 |
Revenues | 21,708 | 12,204 | |
(Loss) income before income taxes | $ 7,645 | $ (1,727) |
Pension Benefits (Details)
Pension Benefits (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 02, 2023 | Apr. 03, 2022 | |
Net periodic benefit cost: | ||
Interest cost | $ 1,954 | $ 1,384 |
Expected return on plan assets | (2,402) | (3,059) |
Amortization of net actuarial loss | 234 | 229 |
Administrative fees | 650 | 300 |
Total net periodic expense (benefit) | $ 436 | $ (1,146) |
Weighted-Average Assumptions Used To Determine Net Cost | ||
Discount rate | 4.95% | 2.60% |
Expected return on plan assets | 5.75% | 5.75% |
Employer contributions | $ 0 | $ 0 |
Stock Repurchase Plans (Details
Stock Repurchase Plans (Details) - March 2017 Stock Repurchase Plan - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | ||
Apr. 02, 2023 | Apr. 03, 2022 | Mar. 30, 2017 | |
Stock Repurchase Plans and Shareholder Rights Plan | |||
Amount authorized of shares to be repurchased under Stock Repurchase Program | $ 500 | ||
Total number of shares purchased (in shares) | 8,071,000 | ||
Value of shares repurchased | $ 365.1 | ||
Shares acquired, average cost (in dollars per share) | $ 45.24 | $ 45.24 | |
Permitted dollar value of repurchases remaining | $ 134.9 |