SeaWorld(SEAS) - 2022 Q1 - Quarterly Report

Financial Performance - Total revenues for the three months ended March 31, 2022, were $270.7 million, a 57.5% increase from $171.9 million in the same period of 2021[121] - Operating income improved to $10.0 million, compared to an operating loss of $18.9 million in the same period last year[121] - Net loss decreased to $9.0 million, an 80.0% improvement from a net loss of $44.9 million in the prior year[121] - Adjusted EBITDA for the three months ended March 31, 2022, was $65.9 million, up from $25.2 million in the same period of 2021, reflecting improved operational performance[158] - Covenant Adjusted EBITDA for the last twelve months ended March 31, 2022, was $729.8 million, indicating strong compliance with financial covenants[158] Attendance and Revenue Breakdown - Attendance increased to 3.4 million guests, representing a 53.7% rise compared to 2.2 million guests in the prior year[121] - Admissions revenue reached $150.9 million, up 57.5% from $95.8 million in the previous year[121] - Food, merchandise, and other revenue for Q1 2022 rose by $43.7 million, or 57.4%, to $119.8 million compared to $76.1 million in Q1 2021, attributed to increased attendance and in-park per capita spending[123] - Total revenue per capita increased by 2.5% to $79.54 from $77.63 in the previous year[121] Operational Efficiency and Challenges - The company continues to face staffing challenges and inflationary pressures impacting operational efficiency[107] - The operating environment has improved as COVID-19 related capacity limitations have been eliminated, although uncertainties remain regarding future impacts[105] - Operating expenses for Q1 2022 increased by $45.2 million, or 41.9%, to $152.9 million compared to $107.8 million in Q1 2021, primarily due to increased labor-related costs[125] - Selling, general, and administrative expenses for Q1 2022 rose by $14.6 million, or 46.4%, to $46.1 million compared to $31.5 million in Q1 2021, mainly due to increased marketing-related costs[126] Cash Flow and Capital Expenditures - Net cash provided by operating activities in Q1 2022 was $70.8 million, significantly higher than $18.4 million in Q1 2021[141] - Capital expenditures for the three months ended March 31, 2022, totaled $35.1 million, significantly higher than $15.3 million in the same period of 2021, with core expenditures at $23.0 million and expansion/ROI projects at $12.1 million[144][145] Debt and Interest Expense - As of March 31, 2022, total indebtedness included $1.194 billion in Term B Loans and $725.0 million in Senior Notes due August 15, 2029, along with $227.5 million in First-Priority Senior Secured Notes due May 1, 2025[150][151] - Interest expense decreased by 18.0% to $25.4 million from $31.0 million in the same quarter of 2021[121] - A hypothetical 100 bps increase in LIBOR would increase the company's annual interest expense by approximately $15.2 million, assuming an average balance on revolving credit borrowings of approximately $385.0 million[171] Market Risks - The company is exposed to market risks from fluctuations in interest rates and, to a lesser extent, currency exchange rates[170] - The company manages interest rate risk primarily by managing the amount, sources, and duration of its debt funding[171] - The adverse impacts of the COVID-19 pandemic on the company's business and financial performance are discussed in the "Risk Factors" section of its Annual Report[172]