SeaWorld has an exceptional business model and an irreplaceable set of assets
– Sergio D. Rivera
Unfavourable weather conditions, shifts in the calendar and an overspend on certain marketing activities, have all contributed to "disappointing" Q3 financial results for SeaWorld.
However, year-to-date figures were more encouraging, with increased revenue, net income and adjusted EBITDA, and SeaWorld said it was pleased with progress towards "optimising our business and operations".
Hurricane Dorian alone caused a loss of around 90,000 visits to its Florida park, the company said, with a total aggregate of approximately 330,000 guest visits lost due to this, increased numbers of rainy days in Q3 2019 (50 per cent more than the same quarter in 2018), and a calendar shift that saw a peak weekend summer day in July moved to a weekday in September.
"Despite the weather and calendar headwinds that negatively impacted attendance this quarter, we continued to grow our total revenue per capita and we continued to make good progress on our cost efficiency initiatives," said interim CEO Marc Swanson.
"Our progress on cost reductions was masked in the quarter by a significant overspend in marketing expense of approximately US$9.5m (€8.6m, £7.4m) related to less disciplined management of certain marketing-related costs. We have since made adjustments to our process to better manage these costs and do not expect this type of overspend to repeat."
Q3 2019 saw SeaWorld receive around 8.1 million guests (down by 200,000 on Q3 2018). It generated total revenues of US$473.7m (€429.7m, £369.2m), net income of US$98m (€88.9m, £76.4m), and Adjusted EBITDA of US$206.9m (€187.7m, £161.2m). Of these only the net income was an increase on the same quarter last year, by 2.1 per cent. Other measures fell by around the same rate.
For the first nine months of the year, there were increases across revenue, net income and Adjusted EBITDA, with net income more than doubling to US$113.7m (€103.1m, £88.6m). In the first nine months of 2018, net income was affected by approximately US$34m (€30.8m, £26.5m) of pre-tax expenses associated with separation-related costs and legal settlement accruals.
Looking ahead, SeaWorld has a line-up of new rides and attractions launching next year, which Swanson said the company considers to be the strongest in its history.
He added: "We are committed to continue to refine our marketing, communications and pricing strategies to drive increased attendance and revenue and to remain focused on reducing costs and expanding our margins. As such, we have confidence in our ability to achieve the higher end of our 2020 goal of US$475m to US$500m (€430.8m to €453.6m; £370m to £390m) in Adjusted EBITDA."
SeaWorld has also announced that Sergio D. Rivera, formerly of ILG, Inc. and Starwood Hotels & Resorts Worldwide, has taken over as CEO, following the sudden departure in September this year of Gus Antorcha. The appointment sees interim CEO Marc Swanson return to his previous role as chief financial officer, and Elizabeth Castro Gulacsy step back down from CFO to her former role of chief accounting officer.
Rivera was responsible for development, sales, marketing and resort operations at ILG's Vacation Ownership Segment. Before that he was president of the Americas for Starwood. Scott Ross, chairman of SeaWorld's Board of Directors, said Rivera would bring "exceptional leadership and management skills across sales, marketing, operations, development, finance and commercial management".
Joining him on the Board is Neha Jogani Narang, who was previously director of consumer and developer marketing for Facebook. She brings a background in consumer marketing, brand, product, digital media, ecommerce and technology to the role.