United Parks & Resorts Inc.

Previous wording

Admissions revenue. Admissions revenue for the three months ended March 31, 2024 increased $1.9 million, or 1.2%, to $165.8 million as compared to $163.9 million for the three months ended March 31, 2023. The improvement was primarily a result of an increase in attendance, partially offset by a decrease in admissions per capita. Total attendance for the first quarter of 2024 increased by approximately seventy-two thousand guests, or 2.1%, when compared to the prior year quarter. Attendance was positively impacted by a favorable calendar shift including the earlier timing of Easter and certain school spring breaks and was negatively impacted by adverse weather across most of our markets, particularly at our Florida parks, including during peak visitation periods. Admission per capita decreased by 0.9% to $48.06 for the first quarter of 2024 compared to $48.51 in the prior year quarter, primarily due to the net impact of the admissions product mix when compared to the prior year quarter.

Current wording

Admissions revenue. Admissions revenue for the three months ended June 30, 2024 decreased $5.9 million, or 2.2%, to $264.0 million as compared to $269.9 million for the three months ended June 30, 2023. The decline was a result of a decrease in admission per capita, partially offset by an increase in attendance. Total attendance for the second quarter of 2024 increased by approximately 47 thousand guests, or 0.8%, when compared to the prior year quarter. The increase in attendance was primarily due to increased demand. Admission per capita decreased by $1.28 to $42.68 for the second quarter of 2024 compared to $43.96 in the prior year quarter, primarily due to lower pricing on certain promotional admission products and the net impact of the admissions product and park mix when compared to the prior year quarter.

Previous wording

Costs of food, merchandise and other revenues. Costs of food, merchandise and other revenues for the three months ended March 31, 2024 decreased $0.2 million, or 0.7%, to $23.0 million as compared to $23.2 million for the three months ended March 31, 2023.

Current wording

Costs of food, merchandise and other revenues. Costs of food, merchandise and other revenues for the three months ended June 30, 2024 increased $0.4 million, or 1.1%, to $38.6 million as compared to $38.2 million for the three months ended June 30, 2023.

Previous wording

Selling, general and administrative expenses. Selling, general and administrative expenses for the three months ended March 31, 2024 decreased $0.4 million, or 0.8%, to $47.9 million as compared to $48.3 million for the three months ended March 31, 2023. The decrease in selling, general and administrative expenses is primarily due to a decrease in labor-related costs and third-party consulting costs, partially offset by increased marketing-related costs.

Current wording

Selling, general and administrative expenses. Selling, general and administrative expenses for the three months ended June 30, 2024 decreased $4.4 million, or 6.4%, to $63.8 million as compared to $68.2 million for the three months ended June 30, 2023. The decrease in selling, general and administrative expenses is primarily due to a $8.6 million decrease in third-party consulting costs, including approximately $8.3 million of nonrecurring costs for strategic initiatives when compared to the second quarter of 2023.

Previous wording

Depreciation and amortization. Depreciation and amortization expense for the three months ended March 31, 2024 increased $1.8 million, or 4.8%, to $39.2 million as compared to $37.4 million for the three months ended March 31, 2023. The increase primarily relates to the impact of new asset additions, partially offset by asset retirements and fully depreciated assets.

Current wording

Depreciation and amortization. Depreciation and amortization expense for the three months ended June 30, 2024 increased $2.5 million, or 6.5%, to $40.3 million as compared to $37.8 million for the three months ended June 30, 2023. The increase primarily relates to new asset additions, partially offset by the impact of asset retirements and fully depreciated assets.

Previous wording

Interest expense. Interest expense for the three months ended March 31, 2024 increased $2.4 million, or 6.5%, to $38.8 million as compared to $36.4 million for the three months ended March 31, 2023. The increase primarily relates to a write-off of discounts and debt issuance costs resulting from the Refinancing Transactions during the three months ended March 31, 2024. See Note 6–Long-Term Debt to our unaudited condensed consolidated financial statements included elsewhere in this Form 10-Q for further details.

Current wording

Interest expense. Interest expense for the three months ended June 30, 2024 increased $2.4 million, or 6.6%, to $39.4 million as compared to $37.0 million for the three months ended June 30, 2023. The increase primarily relates to the net impact of a higher average outstanding balance on our variable debt, partially offset by a lower average outstanding balance on our fixed debt, as a result of the Refinancing Transactions. See Note 6–Long-Term Debt to our unaudited condensed consolidated financial statements included elsewhere in this Form 10-Q for further details.

Previous wording

Benefit from income taxes. Benefit from income taxes in the three months ended March 31, 2024 was $5.6 million compared to $8.2 million for the three months ended March 31, 2023. Our consolidated effective tax rate was 33.4% for the three months ended March 31, 2024 compared to 33.3% for the three months ended March 31, 2023. The effective tax rate in the three months ended March 31, 2024 and 2023 was primarily impacted by state income taxes and other compensation related items, partially offset by a tax benefit related to equity-based compensation which vested during the period.

Current wording

Provision for income taxes. Provision for income taxes in the three months ended June 30, 2024 was $31.6 million compared to $31.4 million for the three months ended June 30, 2023. Our consolidated effective tax rate was 25.7% for the three months ended June 30, 2024 compared to 26.5% for the three months ended June 30, 2023. The effective tax rate for the three months ended June 30, 2024 and 2023 was primarily impacted due to state income taxes and limits on certain compensation deductibility.

Previous wording

Food, merchandise and other revenue. Food, merchandise and other revenue for the three months ended March 31, 2024 increased $2.1 million, or 1.6%, to $131.6 million as compared to $129.5 million for the three months ended March 31, 2023, as a result of an increase in attendance, as discussed above, partially offset by decreased in park per capita spending. In-park per capita spending decreased by 0.5% to $38.15 in the first quarter of 2024 compared to $38.33 in the first quarter of 2023. In park per capita spending decreased primarily due to a decrease in one-time revenue related to our international services agreements, partially offset by the impact of pricing initiatives when compared to the first quarter of 2023. Excluding one-time revenue related to our international services agreements, in-park per capita spending increased by 4.0%. See Note 1–Description of the Business and Basis of Presentation in our notes to the unaudited condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for further information on our international services agreements.

Current wording

Food, merchandise and other revenue. Food, merchandise and other revenue for the six months ended June 30, 2024 increased $9.6 million, or 2.7%, to $365.2 million as compared to $355.6 million for the six months ended June 30, 2023 as a result of an increase in in-park per capita spending and an increase in attendance, as discussed above. In-park per capita spending increased by 1.4% to $37.90 for the six months ended June 30, 2024 compared to $37.37 for the six months ended June 30, 2023. In park per capita spending improved primarily due to pricing initiatives, partially offset by a decrease in revenue related to our international services agreements when compared to the first six months of 2023. See Note 1–Description of the Business and Basis of Presentation in our notes to the unaudited condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for further information on our international agreements.

Previous wording

Operating expenses. Operating expenses for the three months ended March 31, 2024 decreased $7.8 million, or 4.5%, to $164.9 million as compared to $172.7 million for the three months ended March 31, 2023. The decrease in operating expenses is primarily due to a decrease in costs associated with our international services agreements and a decrease in legal costs, including approximately $3.1 million related to the previously disclosed temporary COVID-19 park closures when compared to the first quarter of 2023. See Note 1–Description of the Business and Basis of Presentation in our notes to the unaudited condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for further information on our international services agreements.

Current wording

Operating expenses. Operating expenses for the six months ended June 30, 2024 decreased by $13.3 million, or 3.6%, to $355.1 million as compared to $368.4 million for the six months ended June 30, 2023. The decrease in operating expenses is primarily due to a decrease in nonrecurring legal costs and contractual liabilities resulting from the previously disclosed temporary COVID-19 park closures and a decrease in costs associated with our international services agreements when compared to the first six months of 2023. See Note 1–Description of the Business and Basis of Presentation in our notes to the unaudited condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for further information on our international agreements.

Previous wording

Net cash provided by operating activities was $71.4 million during the three months ended March 31, 2024 as compared to $50.3 million during the three months ended March 31, 2023. The change in net cash provided by operating activities was primarily impacted by improved operating performance and changes in working capital.

Current wording

Net cash provided by operating activities was $244.7 million during the six months ended June 30, 2024 as compared to $234.9 million during the six months ended June 30, 2023. The change in net cash provided by operating activities was primarily impacted by improved operating performance.

Previous wording

Investing activities consist principally of capital investments we make in our theme parks for future attractions and infrastructure. Net cash used in investing activities during the three months ended March 31, 2024 consisted primarily of capital expenditures of $87.3 million largely related to future attractions. Net cash used in investing activities during the three months ended March 31, 2023 consisted of $69.8 million of capital expenditures.

Current wording

Investing activities consist principally of capital investments we make in our theme parks for future attractions and infrastructure. Net cash used in investing activities during the six months ended June 30, 2024 consisted of capital expenditures of $166.8 million largely related to future attractions. Net cash used in investing activities during the six months ended June 30, 2023 consisted of $145.6 million of capital expenditures.

Previous wording

Net cash used in financing activities during the three months ended March 31, 2024 results primarily from $16.9 million used to repurchase shares and from payment of tax withholdings on equity-based compensation through shares withheld of $7.5 million. Net cash used in financing activities during the three months ended March 31, 2023 results primarily from payment of tax withholdings on equity-based compensation through shares withheld of $5.6 million. See Note 10–Stockholders’ Deficit in our notes to the unaudited condensed consolidated financial statements for further details.

Current wording

Net cash used in financing activities during the six months ended June 30, 2024 primarily results from repayments of $234.3 million on long-term debt, $228.9 million used to repurchase shares and $8.4 million for payments of tax withholdings on equity-based compensation through shares withheld, partially offset by $379.3 million of net proceeds from the issuance of debt . Net cash used in financing activities during the six months ended June 30, 2023 results primarily from share repurchases of $13.9 million and payment of tax withholdings on equity-based compensation through shares withheld of $6.3 million. See Note 10–Stockholders’ Deficit in our notes to the unaudited condensed consolidated financial statements for further details.

Previous wording

We are a holding company and conduct our operations through our subsidiaries, which have incurred or guaranteed indebtedness as described below. As of March 31, 2024, our indebtedness consisted of senior secured credit facilities, 8.75% first-priority senior secured notes (the “First-Priority Senior Secured Notes”) and 5.25% senior notes (the “Senior Notes”).

Current wording

We are a holding company and conduct our operations through our subsidiaries, which have incurred or guaranteed indebtedness as described below. As of June 30, 2024, our indebtedness consisted of senior secured credit facilities and 5.25% senior notes (the “Senior Notes”).

Previous wording

As of March 31, 2024, our Senior Secured Credit Facilities consisted of $1.170 billion in Term B-2 Loans which will mature in August 2028, along with a $390.0 million Revolving Credit Facility, which had no amounts outstanding as of March 31, 2024 and will mature in August 2026. As of March 31, 2024, SEA had approximately $17.5 million of outstanding letters of credit, leaving approximately $372.5 million available for borrowing under the Revolving Credit Facility.

Current wording

As of June 30, 2024, our Senior Secured Credit Facilities consisted of $1.546 billion in Term B-2 Loans which will mature in August 2028, along with a $390.0 million Revolving Credit Facility, which had no amounts outstanding as of June 30, 2024 and will mature in August 2026. As of June 30, 2024, SEA had approximately $17.5 million of outstanding letters of credit, leaving approximately $372.5 million available for borrowing under the Revolving Credit Facility.

Previous wording

As of March 31, 2024, SEA had outstanding $725.0 million in aggregate principal amount of Senior Notes due on August 15, 2029 and $227.5 million in aggregate principal amount of First-Priority Senior Secured Notes, due on May 1, 2025.

Current wording

As of June 30, 2024, SEA had outstanding $725.0 million in aggregate principal amount of Senior Notes due on August 15, 2029.

Previous wording

As of March 31, 2024, we were in compliance with all covenants in the credit agreement governing the Senior Secured Credit Facilities and the indentures governing our Senior Notes and First-Priority Senior Secured Notes. See Note 6–Long-Term Debt to our unaudited condensed consolidated financial statements for further details relating to our restrictive covenants.

Current wording

As of June 30, 2024, we were in compliance with all covenants in the credit agreement governing the Senior Secured Credit Facilities and the indentures governing our Senior Notes. See Note 6–Long-Term Debt to our unaudited condensed consolidated financial statements for further details relating to our restrictive covenants.

Previous wording

We define Adjusted EBITDA as net (loss) income plus (i) income tax (benefit) provision, (ii) loss on extinguishment of debt, (iii) interest expense, consent fees and similar financing costs, (iv) depreciation and amortization, (v) equity-based compensation expense, (vi) certain non-cash charges/credits including those related to asset disposals and self-insurance reserve adjustments, (vii) certain business optimization, development and strategic initiative costs, (viii) merger, acquisition, integration and certain investment costs, and (ix) other nonrecurring costs including incremental costs associated with the COVID-19 pandemic or similar unusual events.

Current wording

We define Adjusted EBITDA as net income plus (i) income tax provision, (ii) loss on extinguishment of debt, (iii) interest expense, consent fees and similar financing costs, (iv) depreciation and amortization, (v) equity-based compensation expense, (vi) certain non-cash charges/credits including those related to asset disposals and self-insurance reserve adjustments, (vii) certain business optimization, development and strategic initiative costs, (viii) merger, acquisition, integration and certain investment costs, and (ix) other nonrecurring costs including incremental costs associated with the COVID-19 pandemic or similar unusual events.

Previous wording

The following table reconciles Adjusted EBITDA and Covenant Adjusted EBITDA to net (loss) income for the periods indicated:

Current wording

The following table reconciles Adjusted EBITDA and Covenant Adjusted EBITDA to net income for the periods indicated:

Previous wording

(b) Includes approximately $4.6 million, $2.3 million and $14.0 million related to non-cash self-insurance reserve adjustments for the three months ended March 31, 2024 and 2023 and twelve months ended March 31, 2024, respectively. For the three months ended March 31, 2024 and 2023 and for the twelve months ended March 31, 2024, also includes non-cash expenses related to asset write-offs and costs related to certain rides and equipment which were removed from service.

Current wording

(c) Reflects primarily non-cash expenses related to miscellaneous fixed asset disposals including asset write-offs and costs related to certain rides and equipment which were removed from service. Includes non-cash self-insurance reserve adjustments of: (i) approximately $4.6 million for the six months ended June 30, 2024; (ii) approximately $9.4 million for the twelve months ended June 30, 2024; and (iii) approximately $4.7 million and $7.0 million for the three and six months ended June 30, 2023, respectively.

Previous wording

(c) For the three and twelve months ended March 31, 2024, reflects business optimization, development and other strategic initiative costs primarily related to: (i) $1.8 million and $10.4 million, respectively of other business optimization costs and strategic initiative costs; and (ii) $1.5 million and $15.5 million, respectively of third-party consulting costs. For the three months ended March 31, 2023, reflects business optimization, development and other strategic initiative costs primarily related to: (i) $6.6 million of other business optimization costs and strategic initiative costs; and (ii) $2.8 million of third-party consulting costs.

Current wording

(d) For the three, six, and twelve months ended June 30, 2024, reflects business optimization, development and other strategic initiative costs primarily related to: (i) $2.2 million, $4.0 million, and $13.0 million, respectively, of other business optimization costs and strategic initiative costs and (ii) $1.5 million, $3.0 million, and $5.9 million, respectively, of third-party consulting costs. Reflects business optimization, development and other strategic initiative costs primarily related to: (i) $11.2 million and $14.0 million of third-party consulting costs for the three and six months ended June 30, 2023, respectively, and (ii) $6.2 million of other business optimization costs and strategic initiative costs for the six months ended June 30, 2023.

Previous wording

(d) For the three and twelve months ended March 31, 2024, primarily reflects costs associated with nonrecurring contractual liabilities and respective assessments related to the previously disclosed temporary COVID-19 park closures. For the three months ended March 31, 2023, primarily relates to costs associated with certain legal matters related to the previously disclosed temporary COVID-19 park closures.

Current wording

(f) Primarily reflects costs associated with certain legal matters and nonrecurring contractual liabilities related to the previously disclosed temporary COVID-19 park closures.

Previous wording

(e) Adjusted EBITDA is defined as net (loss) income before income tax expense, interest expense, depreciation and amortization, as further adjusted to exclude certain non-cash, and other items as described above.

Current wording

(h) Adjusted EBITDA is defined as net income (loss) before income tax expense, interest expense, depreciation and amortization, as further adjusted to exclude certain non-cash, and other items as described above.

Previous wording

(f) Our Debt Agreements permit the calculation of certain covenants to be based on Covenant Adjusted EBITDA, as defined above, for the last twelve-month period further adjusted for net annualized estimated savings we expect to realize over the following 24-month period related to certain specified actions, including restructurings and cost savings initiatives. These estimated savings are calculated net of the amount of actual benefits realized during such period. These estimated savings are a non-GAAP Adjusted EBITDA add-back item only as defined in the Debt Agreements and does not impact our reported GAAP net (loss) income.

Current wording

(i) Our Debt Agreements permit the calculation of certain covenants to be based on Covenant Adjusted EBITDA, as defined above, for the last twelve-month period further adjusted for net annualized estimated savings we expect to realize over the following 24-month period related to certain specified actions, including restructurings and cost savings initiatives. These estimated savings are calculated net of the amount of actual benefits realized during such period. These estimated savings are a non-GAAP Adjusted EBITDA add-back item only as defined in the Debt Agreements and does not impact our reported GAAP net income.

Previous wording

(h) Covenant Adjusted EBITDA is defined in the Debt Agreements as Adjusted EBITDA for the last twelve-month period further adjusted for net annualized estimated savings among other adjustments as described in footnotes (f) and (g) above.

Current wording

(k) Covenant Adjusted EBITDA is defined in the Debt Agreements as Adjusted EBITDA for the last twelve-month period further adjusted for net annualized estimated savings among other adjustments as described in footnotes (i) and (j) above.

Previous wording

There have been no material changes to our contractual obligations as of March 31, 2024 from those previously disclosed in our Annual Report on Form 10-K other than the debt and interest obligations pursuant to the Refinancing Transactions (see Note 6–Long-Term Debt to our unaudited condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for further details). As a result, our total long-term debt obligations as of March 31, 2024, not including any possible prepayments, are as follows for the remainder of 2024, 2025-2026, 2027-2028, and thereafter, respectively (in thousands): $8,798; $250,960; $1,137,810; and $725,000. Our estimated future interest payments based on interest rates in effect at March 31, 2024 are as follows for the remainder of 2024, 2025-2026, 2027-2028, and thereafter, respectively (in thousands): $115,184; $271,627; $225,976; and $25,375. Includes amounts attributable to the Senior Secured Credit Facilities, Senior Notes and First-Priority Senior Notes calculated as of March 31, 2024 using certain assumptions and excluding any possible principal prepayments.

Current wording

There have been no material changes to our contractual obligations as of June 30, 2024 from those previously disclosed in our Annual Report on Form 10-K other than the debt and interest obligations pursuant to the Refinancing Transactions (see Note 6–Long-Term Debt to our unaudited condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for further details). As a result, our total long-term debt obligations as of June 30, 2024, not including any possible prepayments, are as follows for the remainder of 2024, 2025-2026, 2027-2028, and thereafter, respectively (in thousands): $7,770; $31,079; $1,507,334; and $725,000. Our estimated future interest payments based on interest rates in effect at June 30, 2024 are as follows for the remainder of 2024, 2025-2026, 2027-2028, and thereafter, respectively (in thousands): $135,506; $323,282; $274,992; and $25,375. Includes amounts attributable to the Senior Secured Credit Facilities and Senior Notes calculated as of June 30, 2024 using certain assumptions and excluding any possible principal prepayments.