Six Flags doing FABULOUS under new management

[SoonerDave]

The number of cars in the parking doesn't say anything about making a profit, or even generating revenue, for that matter. Beyond that, making a profit isn't the problem; making enough profit is the key.

Enough articles out there about Six Flags make it pretty plain that amusement park revenue is a function of capital expenditure, and Premier Parks nee Six Flags had already cut back on that very item virtually across the board a couple of years ago in order to start paying down its acquisition debt. In other words, they had indebted themselves to the point where they couldn't "prime the pump" with the capital expenditure necessary to sustain or increase revenue growth. If neither WW or FC has seen new captial infusion recently, it means they're already behind the eight ball just to sustain revenue levels from previous years.

Shapiro has done *precisely* this (increased per-visitor expenditure) with the parks the new ownership has chosen to retain. My thought is that they assessed the OKC parks as either a) having gone too long without capital infusion, or b) requiring too much expenditure based on potential revenue growth. Either way, that implied a big yellow light on the parks' viability.

That's why I believe the new owners may need to infuse both parks with *significant* amounts of capital to compensate for recent financial neglect if they have any hope of making the parks profitable enough for them to remain open. Maybe they'll get that job done, and get the parks financially rehabilitated. We just don't know at this point, except that one set of owners already has deemed it not worth the effort. We'll just have to see what happens. I don't mean to be a wet blanket on the local parks' futures, but I do believe they face an uphill battle for long-term viability.

-SoonerDave

[jbrown84]

You definitely have strong points, however I'm not convinced that Shapiro's selling off of these parks is because they're not salvagable. He is doing the same with all the smaller parks that were added by Premier when they acquired Six Flags. They don't want to be as "regional" as they were under the previous management. And if they really do have a goal of selling many of them to land developers, then they probably want to get these two out of the way because of their lack of value in that area. Neither park could ever have the kind of revenue that the major city parks have, but as a stand alone investment, they could certainly be profitable. They just weren't big enough for Shapiro's ta$te.

If these local investors can afford to buy the parks, then they can surely afford to make some significant improvements and "catch up" with what decline had occurred.

[SoonerDave]

Very good point - it could simply be that those parks weren't going to make the kind of money that the new owners wanted no matter how much money they threw at them.

From what I've read about the other parks they're closing or trying to sell, many of them are in areas that are deteriorating. They're trying to escape a money-loser in New Orleans that was made even worse when it was basically destroyed by Katrina (The old ownership bought themselves a pig in a poke on that one. It was a money-losing park built with some federal "rehab"/special project money, and it was manifestly unsuccessful. Six Flags bought it thinking they could turn it around, and it was still failing, and Katrina was the kiss of death for it. They're trying to escape some sort of 75-year agreement to run the place.)

I was surprised to scan a few boards about Magic Mountain and to find out that there is quite a bit less surprise at that park's pending sale than I would have predicted. There was observation that it has increasingly become a gang-banger hideout, had deteriorated considerably, and was losing attendance despite almost desperate efforts to promote it.

Compared to those situations, WW and FC are relative gold mines. I just wish they'd announce the new ownership and get on with whatever they're planning to do to them....I think so long as the perception that the parks are still "for sale" (or a sale is up in the air), I think it creates a perception that they are "damaged goods." Someone else suggested that FC has quite a bit of undeveloped land to the west, and a combination of WW and FC into that land might be a real neat marketing idea and efficiency concept - great way to reinvent them.

-SoonerDave

[jbrown84]

I think that's actually a good idea. Frontier City is in a good location and has a nice grounds with hills and mature trees, whereas the White Water location is nothing special and is landlocked so to say. With the success of water park/theme park combos like KC's Worlds of Fun and Oceans of Fun and San Antonio's Fiesta Texas, I think it would be a great way to maximize the appeal and profitability of the parks. Plus, I would imagine water slides are much easier/cheaper to relocate than roller coasters and thrill rides.

[ETL]

Hi, I am new to all this, but I have a question. What are large theme parks attracted to? I mean we are in a great location (near the center of the US) and there are so many areas around here that don’t have an even amusing area. I, too, think it would be great to see a theme park and water park combined. Maybe they should start anew with a new park. Make the rides a little more exciting and original. Just about everyone I know has been to Six Flags (Dallas). Imagine around 1.2-1.4 million people around OKC going to the park and more from Tulsa and Kansas and from other states. If people are willing to drive 2-3 hours to Dallas then why wouldn’t people from the North do the same to visit us? Also, somewhere I read that OKC gets 12 million visitors a year, without a much of a theme park I my opinion. Personally, I would rather drive 2-3 hours to go to Six Flags than Frontier City. I admit Frontier City IS NOT A DUMP but it isn’t the best ether. And not only that, but Six Flags doesn’t want to give up Frontier City and White Water Bay, they want to gouge whoever is willing to buy them. OH, has anyone other than Toby Keith thought of bringing a little Branson to OKC or the area around it (i.e. live shows, tours, and places to just spend money, you know, Branson). Am I crazy? Please help me!