Six Flags Entertainment Corporation 2013 Annual Report and Form 10-K CANADA
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Six Flags Entertainment Corporation 2013 Annual Report and Form 10-K Annual Report and Form Six Flags Entertainment Corporation 2013 Six Flags Entertainment Corporation 2013 Annual Report and Form 10-K Memories Made Here! CANADA La Ronde Six Flags Great Escape Lodge & Indoor Waterpark UNITED STATES The Great Escape & Splashwater Kingdom Six Flags Great America Six Flags New England Six Flags Great Adventure & Safari Six Flags Hurricane Harbor Six Flags Discovery Kingdom Six Flags America Six Flags St. Louis Six Flags Magic Mountain Six Flags Hurricane Harbor Six Flags Over Texas Six Flags Over Georgia Six Flags Hurricane Harbor Six Flags White Water Atlanta Six Flags Fiesta Texas MEXICO 2013 Annual Report and Form 10-K Six Flags Mexico Six Flags Entertainment Corporation The global leader in regional theme parks $1.1 billion revenue 18 strategically located parks in North America 39,000 employees/1,900 full time 800 rides/130 coasters 26 million guests annually Six Flags Park California Massachusetts Texas Locations • Six Flags Discovery Kingdom, • Six Flags New England, • Six Flags Fiesta Texas, Vallejo Agawam San Antonio • Six Flags Magic Mountain, • Six Flags Over Texas, Arlington Valencia Missouri • Six Flags Hurricane Harbor, • Six Flags Hurricane Harbor, • Six Flags St. Louis, Eureka Arlington Valencia New Jersey Canada Georgia • Six Flags Great Adventure & • La Ronde, Montreal • Six Flags Over Georgia, Austell Safari, Jackson • Six Flags White Water Atlanta, • Six Flags Hurricane Harbor, Mexico Marietta Jackson • Six Flags Mexico, Mexico City Illinois New York • Six Flags Great America, Gurnee • The Great Escape & Splashwa- ter Kingdom, Queensbury Maryland • Six Flags Great Escape Lodge & • Six Flags America, Largo Indoor Waterpark, Queensbury Financial Highlights Financial and $ in millions except stock price 20131 20121 20111 20101 Operational Highlights Revenue $1,110 $1,070 $1,013 $976 Adjusted EBITDA2 $404 $383 $350 $295 Modified EBITDA2 $444 $416 $379 $323 Net debt3 $1,231 $776 $726 $784 Stock Price at December 31 $36.82 $30.60 $20.62 $13.60 2013 Revenue Contribution Attendance (in millions) n Admissions 2013 26.1 n In-Park Sales 5% n Sponsorship, Licensing, 2012 25.7 & Accommodations 2011 24.3 2010 24.3 54% 41% Modified EBITDA2 Margin 2013 40.0% 2012 38.9% 2011 37.4% 2010 33.1% Quarterly Dividend $0.50 Per Share $0.47 $0.40 $0.45 $0.45 $0.45 $0.45 $0.30 $0.30 $0.30 $0.30 $0.20 $0.10 $0.03 $0.03 $0.015 $0.015 $0.015 $0.00 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2010 2011 2012 2013 Comparison of $600 44-Month Cumulative Total Return* $500 n Six Flags Entertainment Corp. n S&P 500 $400 n S&P MidCap 400 n S&P Movies & Entertainment $300 * $100 invested on May 10, 2010, in stock or index, including $200 reinvestment of dividends. Fiscal year ending December 31. $100 $0 5.10 6.30 9.30 12.31 3.31 6.30 9.30 12.31 3.31 6.30 9.30 12.31 3.31 6.30 9.30 12.31 2010 2011 2012 2013 Five-year historical data is not presented since we emerged from Chapter 11 bankruptcy on April 30, 2010, and the post-emergence stock performance of Six Flags is not comparable to the stock performance prior to our emergence. The stock price on May 10, 2010 reflects the price of $7.36 per share at which our new common stock was issued upon our emergence, after giving effect to both the June 2011 and June 2013 2-for-1 stock splits. The stock began trading on the NYSE on June 21, 2010, and it closed on that date at a price of $9.12, after giving effect to both stock splits. 1 Refer to footnote 1 on the page opposite the inside back cover of this report. 2 The definition of Adjusted EBITDA and600 Modified EBITDA, and a reconciliation of these measures to U.S. GAAP financial measures, can be found opposite the inside back cover of this report and on our website at www.sixflags.com/investors. 3 Net debt equals reported debt less unrestricted cash. 500 1 400 300 200 100 0 “ Every day we are creating unique and thrilling memories for our guests.” It is hard to imagine a better place to invest, work or play than Six Flags. With our growing momentum and fourth consecutive year of record performance now behind us, we are looking forward to delivering new records in the future for our shareholders, guests and employees. Letter to Shareholders Our success starts with our team members, who are our number-one asset. Their innovative ideas keep Six Flags at the forefront of our industry and their contagious enthusiasm brings smiles to the 26 million guests who visit our parks every year. In 2013 they once again helped us achieve record financial results, deliver new marketable capital in every one of our 18 parks—including 3 new world-record rides—and receive the highest guest satisfaction ratings in the company’s 53-year history. Every day we are creating unique and thrilling memories for our guests—after all, people never tire of having fun. Perhaps it is conquering a fear of heights with your best friend, the exhilaration of flying at top speeds with your child, a heart-warming Broadway-style show with your grandmother or the aroma of a funnel cake that creates that lasting memory. There is no doubt that each and every visit to Six Flags is special and unique. As we head into 2014, our business strategy remains stable and focused. New world-record-breaking rides will rise and forever change the skylines of four of our parks, and we will also roll out new attractions in all the others. Our innovation will also include ongoing growth in several highly successful programs such as our Six Flags Membership Program, All Season Dining Pass, and biometrics park-entry system. In addition, we will make further investments in our culinary program and special events such as Fright Fest®, when our parks are turned into Halloween scare zones, and Holiday in the Park®, when we celebrate the winter holidays with millions of sparkling lights. Innovations such as these attract new guests, enrich their in-park experiences, and keep them returning to Six Flags time and time again. For our shareholders, we take pride in the fact that our efforts over the last four years have delivered above-market returns including a 27 percent return on investment in 2013, a 56 percent return in 2012, and a 52 percent return in 2011. Our dividend yield, at close to 5 percent, remains among the highest in the U.S. market, and in 2013 we repurchased 14 percent of our outstanding shares—all while maintaining the lowest leverage ratio in the industry. We remain optimistic about the future of Six Flags and look forward to many more years of generating attractive returns for our shareholders. Thank you for your ongoing support of me, my colleagues and our company. Jim Reid-Anderson Chairman, President and Chief Executive Officer Six Flags Entertainment Corporation 2 600 500 500 444 416 Jim Reid-Anderson 379 400 404 Chairman, President and CEO 383 323 Six Flags Entertainment Corporation350 Photo300 location: Overlook at 295 Six Flags220 Magic Mountain, California Adjusted EBITDA Actual 200 197 Modified EBITDA Actual Modified EBITDA Aspirational Target 2009 2010 2011 2012 2013 2014 2015 Adjusted and Modified EBITDA1 ($ in millions) 600 The company has successfully grown profits through focused 500 execution of its strategy and has 500 444 a goal to generate $500 million of 416 Modified EBITDA1 by 2015. 379 400 404 383 323 350 Adjusted EBITDA Actual 300 295 Modified EBITDA Actual 220 Modified EBITDA Target for 2015 Adjusted EBITDA Actual 200 197 Modified EBITDA Actual Modified EBITDA Aspirational Target 2009 2010 2011 2012 2013 2014 2015 1 The definition of Adjusted EBITDA and Modified EBITDA and a reconciliation of these two measures to U.S. GAAP financial measures can be found opposite the inside back cover of this report and on our website at www.sixflags.com/investors. 3 Our guests “ Six Flags is the “ What I like best “ Fiesta Texas has say it best most amazing is CRAZY FUN. the greatest rides when it comes place on earth!” There is always and is the best to making Alyssa Shaw something new season pass memories going on—great investment ever.” rides, great food.” Erminia Minnie Irlas Uviedo Hope Pierce Green Thrill Rides: Thrill and Family Rides Thrill and Family Rides Laugh and scream as you experience the G-force of our exhilarating coasters. Drop Rides: Family Rides: Dare to tackle our Build family bonds stunning views while sharing a and breathtaking new experience drops. together. 4 Kids’ Rides and Water Parks Kids’ Rides and Water “ Loved X Flight, it “ What I love about “ Had a phenomenal “ Batman: was wonderful.” Six Flags is the 2013 season! See MY FAVORITE Mitzi Germinaro Doolen friendly staff.” you next year Six RIDE EVER.” Tiffany Jean Mower Flags!” Taiya Patnode “ The slides are Ross Ratliff AWESOME!!!” David Calvillo Children’s Rides: Smile along with your children as they enjoy their own pint-sized thrills. Steel Coasters: Feel the rush of adrenaline as you drop and roll on our record-breaking coasters. Water Parks: Cool down in our wave pools and exciting water slides. 5 Our guests “ I love Fright Fest “ I like the Christmas “ Love Holiday in the say it best and go every year. activities in the park Park!!” when it comes It is spooktacular.” because they are so Diamantina Sanchez to making Morgan Thompson family friendly.” memories Mandy Shuler Chaney “ Loved seeing more lights this year!” Tish Caligiuri Animals, Shows and Holiday Events Fright Fest®: Holiday in the Park®: Add chills to your thrills Warm up your holidays when when our parks are filled our parks are sparkling with with ghouls, haunted millions of lights.