SeaWorld(SEAS) - 2021 Q4 - Annual Report

Revenue Generation - The company generates revenue primarily from theme park admissions and sales of food and merchandise within the parks[22]. - The company generated most of its revenue from admission ticket sales, utilizing demand-based pricing strategies to maximize revenue[73]. Impact of COVID-19 - The COVID-19 pandemic significantly impacted financial results, with temporary park closures and reduced attendance affecting operations[26]. - The COVID-19 pandemic significantly impacted group events in 2020 and 2021, affecting overall attendance and financial performance[81]. - The adverse impacts of the COVID-19 pandemic on business and financial performance are discussed in the risk factors section[327]. Theme Park Operations - In 2021, all 12 parks were operational without COVID-19 related capacity limitations by the end of Q2[25]. - Year-round operations began at SeaWorld San Antonio and select days at Busch Gardens Williamsburg and Sesame Place in 2021[30]. - The company operates 12 theme parks with over 650 attractions, including 79 animal habitats and 190 rides, appealing to a broad demographic[32]. - The theme park portfolio includes 79 animal habitats, 190 rides, and 121 shows, with a total of 274 offerings available in 2021[40]. Animal Welfare and Conservation - The company is committed to animal rescue and conservation, having helped nearly 39,900 wild animals over its history[34]. - The company has a comprehensive approach to animal welfare, focusing on physical, behavioral, and population health, and participating in Species Survival Plans[55]. - The company has invested significantly in animal care, with onsite animal hospitals at each park and a focus on behavioral health advancements[54]. - The company is committed to conservation efforts, partnering with organizations to protect endangered species and their habitats[61]. New Attractions and Investments - Significant capital investments are made annually to support existing facilities and develop new attractions, crucial for revenue growth and guest retention[41]. - In 2021, the company opened Riptide Race at Aquatica Orlando and plans to launch four of the nine most anticipated roller coasters in 2022[42]. - New attractions scheduled for 2022 include Ice Breaker, Iron Gwazi, Emperor, Tidal Surge, Pantheon, Reef Plunge, and Riptide Race, enhancing the guest experience[44]. - Partnerships with conservation organizations have been established for new rides, focusing on animal rescue and climate change awareness[45]. Guest Experience and Services - The company offers a variety of in-park services, including merchandise, quick queue passes, and cabana rentals, aimed at enhancing guest convenience and experience[77]. - The company introduced new rides including Rapids Racer and Wahoo Remix, enhancing guest experiences with features like synchronized light and sound elements[51]. Staffing and Labor Market - The company has increased turnover and staffing challenges due to the current labor market, leading to wage pressures in 2021[28]. - As of December 31, 2021, the company employed approximately 2,800 full-time and 11,400 part-time and seasonal employees, with a diverse workforce composition[67]. Sustainability Efforts - The company has made significant investments in sustainable operations, including a solar panel project that generated nearly 100% of Aquatica San Diego's annual energy use in 2019[63]. - The company has removed all single-use plastic straws and shopping bags, and has been recognized for its recycling efforts, including being named "Recycler of the Year" 20 times by the City of San Diego[65]. - The company has implemented a Responsible Food Sourcing Policy, achieving 100% cage-free eggs and expanding plant-based food offerings[66]. Regulatory Environment - The company is compliant with various federal, state, and local regulations, including those related to animal care and environmental protection, although future changes may require significant expenditures[99][100]. - The company faces a rapidly changing regulatory environment, including impacts from COVID-19 and potential changes in labor costs and tax laws, which could adversely affect financial conditions[104]. Financial Risks - The company is exposed to interest rate risks, with approximately $1.2 billion of outstanding long-term debt being variable-rate[326]. - Inflation has significantly impacted operations, affecting costs of food, merchandise, and construction[324]. - A hypothetical 100 bps increase in LIBOR could increase annual interest expense by approximately $11 million if revolving credit borrowings average $385 million[326]. Corporate Sponsorship and Partnerships - The company seeks long-term corporate sponsorships that align with its values, contributing to marketing, media exposure, and conservation efforts[82]. - Licensed consumer products are being developed to drive sales beyond theme parks, with strategic alliances established with brands like Sesame Street and Build-A-Bear to enhance brand visibility and consumer loyalty[78]. International Expansion - The company is progressing on the SeaWorld Abu Dhabi project, with construction on track for completion by the end of 2022, indicating potential international market expansion[94]. Competition - The company competes with major theme parks like Disney and Universal, leveraging its unique offerings and strong brand recognition to attract visitors[96][98].