News Quarterly Financial Results
- Thread starter David
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Looks like I need to go dig up my debt to income ratio spreadsheet I made a year ago and update it. WIthout looking at it I hesitate to make an analysis but the trend was not good before, disastrous as I recall. However they did have a couple of corrective quarters. I am not sure I like where this is going.
Provisionally I continue to be bearish.
Provisionally I continue to be bearish.
Zimmy, The quarterly report actually has their ratio in it. Here's the text: "As of March 31, 2019, the Company’s total leverage ratio as calculated under the Senior Secured Credit Facilities was 3.51 to 1.00."
thanks. did they say what it was quarter by quarter? As you may recall I have been tracking it that way.
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It's good to put into perspective the fact that SeaWorld is still, at this point, losing money. But they are taking steps in the right direction. With a return to profitability, they will quickly turn attention to knocking the debt down..
But as they say, you have to spend money to make money. And that's why we see this $150m a year capex on new attractions across the portfolio.
But as they say, you have to spend money to make money. And that's why we see this $150m a year capex on new attractions across the portfolio.
Not that I saw in the full SEC report text. Now I went back to the last one (4th qtr/full year) and found this text. "As of December 31, 2018, the Company’s total leverage ratio2 as calculated under the Senior Secured Credit Facilities was 3.58 to 1.00" Then for the 3rd quarter of last year it was this: "As of September 30, 2018, the Company’s total net leverage ratio[2] as calculated under the Senior Secured Credit Facilities was 3.40 to 1.00. " That's all I looked up but here (Link) is all of their SEC listings if you want to peruse them.
This is true. But ever since Blackstone saddled them with all of the debt from the IPO their long term debt hasn't come down much. It was up over $1.6B at first but for the last couple of years at least it's been in the $1.53B to $1.58B range. So the company isn't worrying too much about getting it down at this point. It's profitability that they are trying to achieve, ,which they did last year for the first time since the IPO as they ended with a $44.8m profit. So let's hope it continues this year!
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These quarterly results are setting up for one heck of an expectation for Q2. If they were able to survive this quarter with a gain, considering the onslaught of weather in San Diego plus the loss of practically ALL of their spring break/Easter crowds in Orlando, Q2 should show some serious positive results. I am quite shocked at the gain since in February, San Diego's rent payments were down 20%, and the rent payments (at least based on last year) tracked very closely with the companies gains in revenue.
One thing I would factor in, with regards to profit, is SEAs has a pretty big depreciation number year to year. This is a non-cash adjustment so, I believe you could fact that into the true profit. Just last year, their depreciation was almost $161 million. Correct me if I am wrong, because Id prefer to know the correct view of this. However, I've always added bottom line profit with depreciation. With that in mind, they profited just over $200 million last year.
My final point (and opportunity to be corrected if I am wrong) is last year alone, SEA's Net Cash Generated by Operating Activity was over $290 million. I've always viewed this is the businesses actually ability to operate. The other numbers matter, but I have always viewed this number as the true measurement of profitability. Afterall, some of the operating expenses are non-cash adjustments.
Again, I could be totally wrong, but this is how I've always viewed the numbers.
One thing I would factor in, with regards to profit, is SEAs has a pretty big depreciation number year to year. This is a non-cash adjustment so, I believe you could fact that into the true profit. Just last year, their depreciation was almost $161 million. Correct me if I am wrong, because Id prefer to know the correct view of this. However, I've always added bottom line profit with depreciation. With that in mind, they profited just over $200 million last year.
My final point (and opportunity to be corrected if I am wrong) is last year alone, SEA's Net Cash Generated by Operating Activity was over $290 million. I've always viewed this is the businesses actually ability to operate. The other numbers matter, but I have always viewed this number as the true measurement of profitability. Afterall, some of the operating expenses are non-cash adjustments.
Again, I could be totally wrong, but this is how I've always viewed the numbers.
If we want to get technical EBITDA which is Earnings Before Interest, Taxes, Depreciation and Amortization is typically considered the best indicator of a company's financial performance. Basically to calculate EBITDA you take your earnings and add taxes, interest payments, deprecation and Amortization. You ignore the tax environment where the company is located and you aren't factoring in financing and accounting decisions. The idea is that by looking at earnings without those being factored in you are seeing a truer picture of the company's ability to make money.
In that light EBITDA for SEAS in Q1 was 16.4 million. Which was up from 2.3 million the previous year. That is an increase of 14.1 million or 614.4%.
I just want to point at that considering that with the entirety of big spring break weeks shifting from Q1 to Q2 this year these are incredible earnings that blow expectations out of the water. I was of the opinion that given they lost a significant period of attendance with the spring break shift that it would be a great accomplishment if they just broke even from Q1 2018
For those who want to learn more about EBITDA and why it's such a good indicator of a companies performance, you can find more information by reading this article.
Edit: fixing some mistypes
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Thanks @BGWnut! This is incredibly helpful, and to an extent, I have looked over EBITDA, so I'll take your recommendations into account. With regards to Spring Break, I completely agree with you. I was shocked they were up. I was expecting them to be at best flat, and at worst, down may 200,000 guests. Considering the weather in San Diego and Texas, I was quite worried.
Also, appreciate that article. I'm going to digest that this evening!
Also, appreciate that article. I'm going to digest that this evening!
BGWnut makes a good point. Some time last year or the year before we talked extensively about EBITDA and that was the time I built the metrics and posted them. As I recall the forecasting was was ugly and the hard intel, particularity about the Chinese investors was, (correctly, we now know) concerning.
I really want to take a better look at their numbers over the past 5 years. A one year turn around as they have can not typically be explained by, "they got better." Particularly since in hindsight we know the ops didn't. I do not know what kind of tourism numbers there were in FL the last couple of years, but it would be interesting to see if Uni and the mouse had similar improvements. That might give us an indication if this were a general industry improvement due to a perceived economic view or might this be something else. I tend to think the latter as the hard numbers on the economy, despite the rhetoric are not good. (general employment is up but so is, and to a much higher extent under-employment. most of the new jobs are part time and/ or low paying. Further expendable income in the middle class is way down due to costs of goods going up. (tariffs get pushed down to the consumer)
Now I will admit, my MBA focused more on ops, law, macro, and long term strategy and less on accounting (cause that shit is voodoo), micro (cause that shit is sominex), and finance (cause that is just accounting voodoo on steroids). So if anyone who does like those horrible forms of witchcraft wants to help me with this insanity drop me a line.
I really want to take a better look at their numbers over the past 5 years. A one year turn around as they have can not typically be explained by, "they got better." Particularly since in hindsight we know the ops didn't. I do not know what kind of tourism numbers there were in FL the last couple of years, but it would be interesting to see if Uni and the mouse had similar improvements. That might give us an indication if this were a general industry improvement due to a perceived economic view or might this be something else. I tend to think the latter as the hard numbers on the economy, despite the rhetoric are not good. (general employment is up but so is, and to a much higher extent under-employment. most of the new jobs are part time and/ or low paying. Further expendable income in the middle class is way down due to costs of goods going up. (tariffs get pushed down to the consumer)
Now I will admit, my MBA focused more on ops, law, macro, and long term strategy and less on accounting (cause that shit is voodoo), micro (cause that shit is sominex), and finance (cause that is just accounting voodoo on steroids). So if anyone who does like those horrible forms of witchcraft wants to help me with this insanity drop me a line.
We basically focused on completely different areas. My focus was on accounting and general finance. I do agree that micro is just insanity. I was never really into business law or econ in general. Granted I don't have an MBA. Just a bachelor's in finance.
I am inclined to line up with you. I am super happy with the performance of the last year, but I am hard pressed to believe things just got better. In May of 2017, Manby made a point that they were reducing marketing spend and spending less on acquiring the customer. Then, second quarter hit and the year was curtains from there. I believe that 2018 was just a return to the advertising/marketing norms and this year may be a more reliable indicator of performance improvements.
Also, when you reference ops, do you mean in park ops or, corporate ops?
One of my closest friends who I met in grad school was a finance major at UVA's McIntire School of Commerce. He is the ONLY reason I got through accounting and finance. You have to understand, I was a light and scenic theater design major in college and my entire profession carrer had been in IT. Until grad school the closest I came to econ or any of the other dreary sciences were my taxes. Imagine being dropped into graduate level accounting (at W&M no less) 15 years after college with 0 prior knowledge in a cohort half full of college B majors? I was like the proverbial fish out of water!
When we talk about ops we are talking more about project management, delivery chain, things like Lean and Six Sigma or even PMBOK. So operating contracts and buissnes not so much rides and shows. (however you could argue that in the case of a park that kind of stuff would fall under the same category)
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Earnings report date announced today. It'll be Tuesday 6- August.
www.seaworldinvestors.com
SeaWorld Entertainment, Inc. Announces Second Quarter Earnings Release Date And Conference Call Information
SeaWorld Entertainment, Inc. (NYSE: SEAS) announced today that it will release its second quarter financial results before the market opens on Tuesday, August 6, 2019. In conjunction with the release, the Company has scheduled a conference call, which will be broadcast live over the internet on...
Just a reminder that tomorrow morning they are announcing the Q2 earnings. Will be interesting to see if the trend is still good. I'm interested to see what attendance is currently like before they get into the coaster building frenzy of next year.
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Also worth noting that the actual results will be released tomorrow morning some hours ahead of the call. The call itself is worth listening to as we occasionally get some insights as to high level how things are moving.
I want to see:
Positive financials: some speculation out there is that this has been a bad quarter for theme parks in general. I've read a few articles suggesting that the unusual number of discounts being offered might be indicative of low attendance. I'm not completely convinced of that as fact.
News about sesame place
High level future planning (maybe an update of their capital expenditure plans beyond 2021).
Any mention of how the board feel bgw food and wine 2019 went.
I want to see:
Positive financials: some speculation out there is that this has been a bad quarter for theme parks in general. I've read a few articles suggesting that the unusual number of discounts being offered might be indicative of low attendance. I'm not completely convinced of that as fact.
News about sesame place
High level future planning (maybe an update of their capital expenditure plans beyond 2021).
Any mention of how the board feel bgw food and wine 2019 went.