Six Flags at half mast
Filed under: Company News, Economy
Six Flags Inc. (SIX) announced yesterday that , barring a significant restructuring, it is likely to go bankrupt this summer. Although this news came out after the close of the market, shares dropped 10 percent to 18 cents in electronic trading. This follows a 32 percent drop this year. In mid-day trading on Friday, SIX is a smidge over 14 cents.Unfortunately, this isn't really all that surprising. The economic meltdown of 2008 brought a massive drop in disposable income, which has led to falling amusement park revenues. While Disney, the undisputed king of the hill, has been cutting employees and imposing other austerity measures, lesser lights have been going out of business.
As the Theme Park Insider noted almost two years ago, Six Flags' downfall has been a long time coming. Initially beset by the fact that their properties were overvalued in the real estate bubble, the company has subsequently been undermined by the dwindling finances of its customers and its own stock problems.
The company's biggest worry is its looming debt. It has until August 15 to pay $287.5 million to holders of its "preferred income equity redeemable shares." With additional costs added in, Six Flags' liability may be as much as $315 million. With credit frozen and its own prospects bleak, it seems unlikely that the company will be able to make that deadline.
According to many analysts, Six Flags' is facing a choice between filing Chapter 11 now or getting forced into bankruptcy in the middle of August. An advance filing would allow it to continue operating, at least for the time being.
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Reader Comments (Page 1 of 21)
3-13-2009 @ 4:50PM
Greg said...
Gee it's so hard to wonder why attendance is down, how's about raising prices just a little bit more? How much is a single day ticket now days? $50-60-70-80? I haven't attended the park in Gurnee Il in about 5-6 years due to the skyrocketing ticket costs. Pay a fortune for the priviledge of waiting in lines sometimes for 2+ hrs for a single ride.
Drop the ticket prices along with food & beverage costs to a more reasonable level & you will see attendance increase, as will the profits.
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3-14-2009 @ 6:55PM
BJ Bruce said...
I agree with Greg 100%. The ticket prices are way too high,the food and drinks are as well.You will spend at least $350.00 for a family of 4 to go to most theme parks to ride maybe 6 rides, if you are lucky. Since when did a 10 year old become an adult??? Kids' tickets are 9 and under!!Thats a load of CRAP!!
3-13-2009 @ 3:09PM
laura said...
the prices are definately the issue. six flags has become more and more greedy over the years with the yearly increases in ticket prices. they have only thereselves to blame. it use to be a budget family vacation. now its just over priced and over rated. exspecially with additional costs for special events. they could easily pack the place with an actual 50%cost decrease in ticket price. give people a reason to come.
3-13-2009 @ 3:15PM
Sblme19 said...
I agree. They make it impossible for the typical family of four to afford a day at the park.
3-13-2009 @ 2:15PM
b said...
It honestly doesn't surprise me. I have worked for Six Flags in the past and there are only a couple parks in the system that turn a profit and those parks recieve very little money for the next season, for things like repairs and basic upkeep of the park. They drasticaly overspend and when they come up with new ideas they only let them stay around for a season and don't wait to see if the idea will actually work.
Six Flags you want to save money. Stop the shuttles for employees. The majority of employees don't take them. Stop paying for the employee exchange program. There are plenty of people in the US looking for jobs. Clean up the park, stop spending money on new attractions that you can't take care of, and make a day in the park more affordable for the average family. More people will come when they aren't worried about their children getting hurt on the rides, or finding a clean bathroom.
BTW the yellow uniforms are annoying to guests.
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3-13-2009 @ 6:25PM
rw said...
I've been reading the comments here and I hate to admitt it, but I AGREE with everyone on here. However, unless you have been to the Six Flags in Largo Maryland, then, you havent seen a more dirty, and DANGEROUS theme park. Each year, we expect at least 5 murders in the park, without question. The local police (PG County) has decided to open up a police substation in the park, due to the violence.
It's just not worth going anymore. Ohh, and the rides SUCK!
3-13-2009 @ 8:10PM
Mel said...
Way to go. WE have one here in Vallejo Ca. One person has been decapitated and many have had broken bones. The park is filthy and their bathrooms are nasty.... I don't go anymore. I don't let my kids go either.... The food is disgusting and the place smells...
3-14-2009 @ 5:00PM
Master Shake said...
Six Flags is in trouble because they don't know how to make a park truly fun. They put a bunch of rides together and think their job is done. Get a clue, dumb asses.
3-17-2009 @ 5:33PM
LIZ said...
SIX FLAGS GREAT ADVENTURES IN NEW JERSEY IS THE BEST! IT'S CLEAN, SAFE, MANY POLICE OFFICER'S PRESENT. (THEY NEED IT WITH ALL THE NUCKLEHEADS STARTING TROUBLE). COMPARE TO THE ONE IN MARYLAND. MARYLAND SIX FLAGS IS A DUMP, SUPER GHETTO. COME AND VISIT GREAT ADVENTURE'S YOU WILL GET YOUR MONIES WORTH! I AGREE WITH YOUR COMMENT ABOUT MAKING CUTS LIKE THE EMPLOYEE SHUTTLE. IT WILL BE SAD IF IT'S CLOSED. WE HAVE A FAMILY TRADITION WHERE OUR ENTIRE FAMILY GOES TO GREAT ADVENTURES FOR EASTER EVERY YEAR. FOR OVER 25 YEARS WE HAVE GONE TO SIX FLAGS GREAT ADVENTURE'S. I HOPE ATLEAST THEY KEEP THIS ONE OPEN.
3-14-2009 @ 11:59PM
Jodi Tauber said...
as a six flags great america season pass holder for 7 years, i've grown quite dissipointed with the park. Prices are soaring, the waterpark was a total waste of money with chicagos weather probability. one of the 2 coasters built in 1 year that they were so pleased at with was not built for cooler weather. It is constantly breaking down both during the operating day or is not open at all. After several seasons of this they finally took down the coaster but what took them so long to figure it out. I'm a coaster fan this is why i go to six flags, but i'm seriously re-considering my season passes for next year, and taking off to to ohio to go to either kings island or cedar point which both better coasters and the parks are better maintained. maybe six flags should get some tips from cedar fair entertainment.
3-15-2009 @ 3:24AM
jb said...
You are one smart guy... they should listen to you. I agree on all points. One addition... the park in our area (southern cal) attracts the lowest class of people. You wouldn't want to bring your family there. Many times, people were smoking pot while in line. One visitor standing in line next to us, put it into disgusting but true words on hot summer day, he said, "This is like being in a babies diaper". It used to be a great place for families. Maybe in the future.
3-15-2009 @ 3:58AM
Larissa said...
These ideas should be looked upon by the Six Flags CEO and the shareholders . It is obvious all of these ridiculous high wages paid to the big wigs have been a waste as the companies are going belly up.
3-16-2009 @ 5:19PM
Dena said...
I totally agree. I live in Louisville, KY and I can count on ONE HAND how many times I've been to KY Kingdom- and with the advent of the Hellavator aka the Superman ride that caused the tragedy it caused 2 years ago I haven't gone since it opened the ride as Hellavator. I went maybe once or twice and I'm not shocked by this at all.
3-16-2009 @ 6:07AM
Larry said...
Never worked there but as a customer I would have the same observations.
3-13-2009 @ 2:19PM
jay said...
I will be sad to see Six Flags go under, if it happens.
I worked there when there was only one Six Flags ( i.e. Six Flags over Texas)
But their downfall was going too much Disney/Warner Brothers and getting away from the regional appeal.
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3-13-2009 @ 5:45PM
Keith said...
Dude, you must be old as dirt, our six flags in St.louis is as old as i am, been around since 1967
3-13-2009 @ 6:29PM
Paula said...
I agree with the previous poster, you must be real old. Because, I used to go to Six Flags in Georgia when I was young and I'm 52 now.
3-14-2009 @ 7:04PM
ronevsorg said...
from wikipedia:The Six Flags chain began in 1961 with the creation of Six Flags Over Texas by Angus G. Wynne of Kaufman County, Texas
3-14-2009 @ 9:17PM
Paula said...
Yeah, I guess I'm as 'old as dirt',too, because I remember when Six Flags Over Texas was opened! I was a little girl and from where we lived in Texas it took us seven hours in an unairconditioned car to get there--- and it was the high light of the year! Many fond memories of Six Flags. My husband and I took our two children there years later and all of us had a blast. I will miss Six Flags.
3-13-2009 @ 2:21PM
KillerK said...
Isn't this company owned by Daniel Snyder, the guy who owns the Redskins? If so I'm not surprised, nor concerned. I only have compassion for the number of employees that willnow have to look for jobs.
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