Cedar Fair feeling the recession's pinch
7/24/2009SANDUSKY - When Ben Balazs made his annual pilgrimage to Cedar Point this month with six friends and family members, he did something different to save money: He packed his lunch.
"We went outside and ate outside, and did a sit-down meal for dinner so we weren't spending a lot of money on food," the 17-year-old Bedford Township resident said.
Unfortunately for Cedar Point's parent company, he wasn't alone.
Yesterday, Cedar Fair LP said attendance at its amusement parks this summer has dropped 11 percent and revenues 12 percent from the same period a year ago. It blamed the drops on cool weather and a turgid economy.
The company, based in Sandusky, owns Cedar Point and 10 other amusement parks, six outdoor water parks, an indoor water park, and five hotels.
Cedar Fair said that through Sunday, its revenues were $452.6 million, down $62.3 million compared to last year. Attendance was 10.2 million visits, a decrease of 1.2 million visits.
Meanwhile, average in-park spending fell 2 percent to $39.52 per visitor. Nonpark revenues, including resort hotels, fell 12.4 percent to $50 million from $56.2 million a year ago.
"We anticipated this would be a challenging year for our operations when compared with our record-breaking results in 2008," Dick Kinzel, Cedar Fair's chairman, president, and chief executive officer, said in a written statement. "Since the July 4 weekend, attendance and revenue trends have improved somewhat across the regions in which we operate, although overall results since then still remain slightly behind last year."
The amusement park industry
- which use to tout itself as largely recession-resistant - can't beat back assaults this summer from both a faltering economy and bad weather, industry watchers said.
"No question that the economy is affecting our industry this year, and the weather has been a major problem in the northern states and especially in the East Coast states," said Gary Slade, publisher of Amusement Today, a 3,000-circulation magazine that caters to amusement industry executives.
"The parks that I've spoken to are all off on their gate count because of the economy, and off on their [per-guest] spending," Mr. Slade said. "Most are telling me that, where the guests in the past may have come to the park for the whole day and purchased two meals in the park, they're buying one meal and then either packing a lunch or eating off the grounds to save money."
Cedar Fair said its performance in the first half of the 2009 season included 39 fewer operating days than a year ago.
The second half of the season will have an additional 70 operating days at its parks compared to a year ago.
The company has been aggressively discounting admission prices to lure customers in the midst of the recession. Mr. Kinzel indicated the practice would continue as the summer wears on.
Also yesterday, Cedar Fair said it has finalized the sale of 87 acres near Toronto. Vaughan Health Campus of Care will pay $50 million for the land, which is adjacent to Canada's Wonderland amusement park and Cedar Fair will use the money to pay down its debt.
Contact Larry P. Vellequette
at: lvellequette@theblade.com
or 419-724-6091.