United Parks & Resorts(US:PRKS)2025-11-07 12:17Revenue Performance - Total revenues for the three months ended September 30, 2025, decreased by $34.1 million, or 6.2%, to $511.9 million compared to $545.9 million in the same period of 2024[126]. - Total revenues for the nine months ended September 30, 2025 decreased by $51.9 million, or 3.9%, to $1,289.0 million compared to $1,340.9 million for the same period in 2024[135]. - Admissions revenue for the nine months ended September 30, 2025 decreased by $46.3 million, or 6.4%, to $680.5 million compared to $726.8 million for the same period in 2024[136]. Attendance and Admissions - Admissions revenue decreased by $28.3 million, or 9.5%, to $268.7 million, primarily due to a decrease in admission per capita and attendance, which fell by approximately 240,000 guests, or 3.4%[127]. - Attendance levels are influenced by factors such as affordability, new attractions, competitive offerings, and global economic conditions[118]. - Total attendance for the first nine months of 2025 decreased by approximately 252 thousand guests, or 1.5%, compared to the first nine months of 2024[136]. Operating Expenses - Operating expenses increased by $7.1 million, or 3.4%, to $214.4 million, primarily due to higher labor-related costs and increased non-cash self-insurance adjustments[130]. - Selling, general and administrative expenses rose by $5.3 million, or 9.6%, to $60.7 million, driven by increased third-party consulting costs and legal fees[131]. - Inflation has significantly impacted the company's operations, affecting costs related to food, merchandise, labor, and utilities[171]. Net Income and Profitability - Net income for the three months ended September 30, 2025, was $89.3 million, a decrease of $30.4 million, or 25.4%, compared to $119.7 million in the prior year[126]. - Net income for the nine months ended September 30, 2025 decreased by $46.3 million, or 23.2%, to $153.3 million compared to $199.6 million for the same period in 2024[135]. - Operating income for the nine months ended September 30, 2025 decreased by $78.5 million, or 20.3%, to $309.0 million compared to $387.5 million for the same period in 2024[135]. Cash Flow and Financing - Net cash provided by operating activities was $301.7 million during the nine months ended September 30, 2025, down from $367.7 million during the same period in 2024[150]. - Net cash used in financing activities for the nine months ended September 30, 2025, was $16.3 million for share repurchases and $11.6 million for long-term debt repayments, compared to $445.3 million and $238.2 million respectively in 2024[155][158]. - As of September 30, 2025, the company had $1.527 billion in Term B-3 Loans maturing on December 4, 2031, and a $700 million Revolving Credit Facility with approximately $689.1 million available for borrowing[158]. Cost Management and Strategic Initiatives - The company has identified meaningful cost savings opportunities, including technology initiatives, to improve operating margins[120]. - The company incurred $4.4 million in business optimization costs for the three months ended September 30, 2025, reflecting ongoing strategic initiatives[166]. Debt and Compliance - Approximately $1.5 billion of the company's long-term debt is variable-rate debt, with a hypothetical 100 bps increase in Term SOFR potentially increasing annual interest expense by approximately $22.3 million[173][174]. - The company was in compliance with all covenants in the credit agreement governing the Senior Secured Credit Facilities and the indentures governing its Senior Notes as of September 30, 2025[160]. Depreciation and Amortization - Depreciation and amortization expense for the nine months ended September 30, 2025 increased by $8.3 million, or 6.9%, to $129.4 million compared to $121.0 million for the same period in 2024[141]. In-Park Spending - Food, merchandise, and other revenue decreased by $5.7 million, or 2.3%, to $243.2 million, despite a 1.1% increase in in-park per capita spending, which rose to $35.82[128]. - In-park per capita spending increased by 0.6% to $37.07 for the nine months ended September 30, 2025 compared to $36.85 for the same period in 2024[137]. EBITDA Metrics - Adjusted EBITDA for the nine months ended September 30, 2025, was $489.98 million, compared to $555.72 million in 2024, reflecting a decrease of approximately 11.7%[166]. - Covenant Adjusted EBITDA for the last twelve months ended September 30, 2025, was $654.73 million, which includes estimated cost savings adjustments[166]. Seasonal Trends - The theme park industry is seasonal, with approximately two-thirds of attendance and revenues generated in the second and third quarters[123]. Contractual Obligations - There were no material changes to the company's contractual obligations as of September 30, 2025, compared to previous disclosures[167].