Success in the rollercoaster business is generally measured by the turnstile count.
In the case of financially troubled Six Flags — parent company of Six Flags New England in Agawam, Mass., one of the region’s biggest tourist attractions — attendance declined from 27.9 million in 2002 to 24.9 million in 2007.
The amusement park giant has been plotting a turnaround in recent years, but continues to be strapped for cash.
Despite Six Flag’s 35 percent increase in revenues over last year and its efforts to boost attendance and reduce operating costs, Standard & Poor’s Ratings Services recently placed the company on credit watch with negative implications because it missed a May 15 dividend payment.
The company reported “a stockholders’ deficit of $252.6 million” and a total indebtedness of approximately $2.26 billion as of Dec. 31, according to its annual report.
Six Flags’ woes are reflected in its stock’s two-year slide, from a high of $11.80 in early 2006 to $2 as of press time.
According to the company’s annual report, it has implemented a number of strategies to improve the company’s bottom line. It sold seven parks in April 2007 for $312 million, eased its near-term refinancing pressures by selling senior notes at a discount, increased revenue opportunities and reduced operating expenses.
On the cost-cutting efforts, management reduced its marketing budget by $25 million and cut staff through an early retirement program. On the revenue side, the company grew its sponsorship and guest revenue to $38 million.
Notably, management continues to move forward with international expansion plans in Dubai and possibly China, according to information released to investors in April.
Business As Usual
It’s business as usual at Six Flags New England as the staff prepares for the upcoming summer season. Among efforts to boost attendance at the park 27 miles north of Hartford, Six Flags New England will be slashing its gate ticket prices by $10 on May 27, instituting an “Everyone Pays Kids Price” promotion.
Six Flags New England also strengthened its family offerings last year, with the addition of Wiggles Worlds and Thomas Towns aimed at the younger children. In that vein, it will host a Wiggles concert on June 14.
“These sections designed specifically for children are so popular that we had to add a stroller parking area,” said Sandra Daniels, spokeswoman for Six Flags.
Plans for the older crowd, construction delays and local regulatory issues caused the park to cancel construction of a $7.5 million indoor rollercoaster.
But the company did move forward as planned with the construction of seven other coasters in other locations, Daniels added.
Sarah Gmyr, spokesperson for the Virginia-based International Association of Amusement Parks, , said that the industry is healthy and experiencing some some growth this year. In 2007, about 330 million people visited an amusement park, bringing in revenues in excess of $11.5 billion, she said.
