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“We have been calling for the government to regulate the sector for a
long time since a level playing field must be established for the
operators....” Charles Mangion Shadow Finance Minister | Malta
Theme Parks | US
hope for
EUROPE Lesley Morisetti,
Economics Research Associates
Six Flags
director has revealed that Euro-
pean theme parks that relied on
people taking a longer holiday
were hit hardest over the last 12
months. She stated: “Historically,
in a recession the urban parks do
much better than the resorts and
lthough theme tourist area parks, because
park operator Six
Six Flags, the bankrupt theme park owner, would be taken over by its lenders under a
people are more likely to take less
Flags filed for
recently-filed reorganisation proposal.
costly day trips. They must con-
Chapter 11 bank- tinue to provide what the cus-
ruptcy earlier this tomer perceives as good value for
year, it seems there is fresh ture,” Six Flags said in its dis- would get 7 per cent of the 11 bankruptcy protection tions are on solid ground,” the money.”
hope for the organisation. A closure statement. new stock and collect earlier this year. Its petition stated president and CEO
new reorganisation proposal Six Flags owned 20 theme between 8-12 per cent of listed assets of $3bn and debt Mark Shapiro. “This process is ASIA China, and to a lesser
would see lenders given 92 parks and hadn’t posted an what they are owed. of $2.4bn as of December 31, strictly a financial restructur- extent the whole of Asia, have
per cent of the new stock to annual profit since 1998. It Other unsecured creditors 2008. Thirty-six affiliates also ing of our debt,” which he been hailed as “bright spots” with
be issued and a $600m new filed for court protection in owed $1.35bn would get 1 sought protection. described as “an unsustain- growing economies and an
term loan in exchange for can- June along with 36 affiliates. per cent of the stock, which Six Flags’ shares fell by able $2.4bn debt load from expanding middle class in the
celling about $1.13bn in debt, Should the plan be would be worth between 0.4 more than four-fifths in the the previous management medium to long-term. The region
according to court papers approved by US Bankruptcy per cent and 0.6 per cent of past year, closing at 26 cents team.” is very far from saturated in terms
filed by Six Flags in a US Bank- Judge Christopher Sontchi, what they are owed. The plan June 12, giving the company a The company said in a of entertainment venues and its
ruptcy Court in Wilmington, who will take the vote of still must be approved by the market value of $26m, while statement that it is seeking performance is different from
Delaware. creditors into consideration, court, however. in August $287.5m in pre- court approval of a pre- more mature markets. “There is
Cutting debt through the the lenders would recover 92 The inability to refinance ferred stock matured and arranged reorganisation plan lots of activity in theme parks,
reorganisation plan will per cent of what they are $400m of debt falling due $131m of 8.875 per cent that will cut its debt by about resorts, cultural facilities and
leave the company with owed, according to court forced the theme park opera- senior notes become due $1.8bn and eliminate more other entertainment in Greater
“appropriate liquidity and a records. tor to seek protection from next year. than $300m worth of pre- China, and the country’s
sustainable capital struc- Noteholders owed $400m creditors by filing for Chapter “Our brand and our opera- ferred stock obligations. economy, which has been
growing by double digits since
the early 1990s, is still projected
Theme Parks | World
to grow 6-8 per cent this year,”
revealed Christian Aaen, manag-
ing director of ERA’s new office in
Hong Kong.
Reinvestment and
It seems that India, which has
historically kept out foreign
investment but is now letting it in,
research still rule the roost
holds promise for the future of
themed destinations. “We
believe a lot of growth in the
industry going forward will be in
Asia,” said Ray Braun, senior vice
Because of the role they play as an interlude from the pressures of
president, ERA.
daily life, theme parks and attractions tend to fare relatively well NORTH AMERICA While
during a recession, according to a report compiled by the
faring well the first part of the year,
Economics Research Associates.
many of the major US theme
parks saw a poor fourth quarter
due to the recession. “Destina-
tion parks, of which there are
hile theme parks ued: “When parks rein- tions,” observed Christian Reinvestment: required to rate. Smart money comes many in our Top 20, were hit
and attractions vest in a major new ride or Aaen. “TDL’s performance safeguard future of in at the bottom of a harder than regional parks. This is
have seen more show or zone, the increase was counter-cyclical and attractions industry cycle.” typical in a downturn when con-
ups and downs than the in attendance tends to be impressive.” At the same time, the sumers choose the lower cost,
average rollercoaster of in the high single digits, Based on ERA's obser- need to constantly check closer-to-home attractions.
late, tEconomics whereas a recession vation of past recessions, pricing structure. Most in with the customer was Many of the regional parks were
Research Associates impacts in the low single recovery is the reward of importantly, it can also important as David closed for the fall and dodged the
(ERA) believes that an digits.” reinvestment: "Parks prepare for the future. Camp, director, ERA recession bullet, while the year-
intimate understanding of In Japan, attendance tend to bounce back “The down times are a Europe/Middle round destination parks suf-
both the changing eco- numbers for parks were rather quickly from a perfect time to start plan- East/Africa, emphasised: fered,” noted John Robinett,
nomic environment and mostly flat or down, with recession,” said Robinett. ning and implementing “The industry in Europe senior vice president, ERA
the evolving customer the notable exception of “You don’t see three-year reinvestment, and to look experienced a fairly stable
viewpoint are the neces- Tokyo Disneyland (TDL) drops - you see one or at ways of improving your year, but with only a
sary pre-requisites for and Tokyo Disney Sea two-year drops and then product and the customer modest increase and a lot
survival. “Our models (TDS). "These two parks they bounce back.” experience,” explained of concern for the future.
suggest that reinvestment combined had another If it is not the time to Robinett. “You have staff Parks should monitor
probably has a stronger record year, sparked develop or open a new that may be underutilised, customers' perception of
correlation with atten- mainly by the 25th ride, attraction or area, a you have all the vendors value for money by con-
dance than does the anniversary of Tokyo Dis- park can still reinvest in and planning consultants ducting research, includ-
economy,” remarked neyland but also helped by training, customer who need work and have ing regular customer
John Robinett, senior vice investment in strong mar- service, maintenance and lower prices, you can buy surveys, and being reac-
president, ERA. He contin- keting and new attrac- marketing - and revisit its materials at a cheaper tive to them.”
GamesWorld | 17 | October 2009
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