United Parks & Resorts Inc.

Previous wording

While conditions have improved in some markets and for various positions, the current condition of the overall labor market and the challenging current operating environment have led to turnover and hiring challenges for some positions and/or markets which could impact operations and the guest experience.

Current wording

While conditions have improved in some markets and for various positions, the current condition of the overall labor market and the challenging current operating environment have led to turnover and hiring challenges for some positions and/or markets which could impact operations and the guest experience. Additionally, we have experienced increased union organizing activities in certain units of the Company.

Previous wording

The theme park industry is seasonal in nature. Historically, we generate the highest revenues in the second and third quarters of each year, in part because four of our theme parks were historically only open for a portion of the year. As a result, approximately two-thirds of our attendance and revenues were historically generated in the second and third quarters of the year and we generally incurred a net loss in the first quarter. The percent mix of revenues by quarter is relatively constant each year, but revenues can shift between the first and second quarters due to the timing of Easter and spring break holidays and between the first and fourth quarters due to the timing of holiday breaks around Christmas and New Year. Even for our eight theme parks which have historically been open year-round, attendance patterns have significant seasonality, driven by holidays, school vacations and weather conditions. Changes in school calendars that impact traditional school vacation breaks and/or start dates could also impact attendance patterns. Any changes to the operating schedule of a park such as increasing operating days for our historically seasonal parks, could change the impact of seasonality in the future.

Current wording

The theme park industry is seasonal in nature. Historically, we generate the highest revenues in the second and third quarters of each year, in part because three of our theme parks are only open for a portion of the year. As a result, approximately two-thirds of our attendance and revenues were historically generated in the second and third quarters of the year and we generally incurred a net loss in the first quarter. The percent mix of revenues by quarter is relatively constant each year, but revenues can shift between the first and second quarters due to the timing of Easter and spring break holidays and between the first and fourth quarters due to the timing of holiday breaks around Christmas and New Year. Even for our nine theme parks which are open year-round, attendance patterns have significant seasonality, driven by holidays, school vacations and weather conditions. Changes in school calendars that impact traditional school vacation breaks and/or start dates could also impact attendance patterns. Any changes to the operating schedule of a park such as increasing operating days for our historically seasonal parks, could change the impact of seasonality in the future.

Previous wording

Admissions revenue. Admissions revenue for the three months ended September 30, 2024 decreased $2.8 million, or 0.9%, to $297.0 million as compared to $299.8 million for the three months ended September 30, 2023. The decline was a result of a decrease in attendance, partially offset by an increase in admission per capita. Total attendance for the third quarter of 2024 decreased by approximately 100 thousand guests, or 1.4%, compared to the prior year quarter. The decrease in attendance was primarily due to a negative calendar shift and meaningfully worse weather, including related to Hurricanes Debby and Helene, during peak visitation periods, compared to the prior year quarter. Admission per capita increased by $0.19 to $42.24 for the third quarter of 2024 compared to $42.05 in the prior year quarter, primarily due to the net impact of the park mix, partially offset by lower pricing on certain promotional admission products compared to the prior year quarter.

Current wording

Admissions revenue. Admissions revenue for the three months ended March 31, 2025 decreased $9.7 million, or 5.8%, to $156.1 million as compared to $165.8 million for the three months ended March 31, 2024. The decline was primarily a result of decreases in admissions per capita and attendance. Total attendance for the first quarter of 2025 decreased by approximately fifty-nine thousand guests, or 1.7%, when compared to the prior year quarter. Attendance was negatively impacted by an unfavorable calendar shift including the shift of Easter and Spring Break holidays from the first quarter to the second quarter when compared to the prior year. Admission per capita decreased by 4.2% to $46.04 for the first quarter of 2025 compared to $48.06 in the prior year quarter, primarily due to the net impact of the admissions product mix and lower realized pricing on certain admission products, due in part to the shift of peak visitation days from the first quarter to the second quarter, when compared to the prior year quarter.

Previous wording

Food, merchandise and other revenue. Food, merchandise and other revenue for the three months ended September 30, 2024 increased $0.5 million, or 0.2%, to $248.9 million as compared to $248.5 million for the three months ended September 30, 2023, as a result of an increase in in-park per capita spending, partially offset by a decrease in attendance, as discussed above. In-park per capita spending increased by 1.6% to $35.42 in the third quarter of 2024 compared to $34.85 in the third quarter of 2023. In park per capita spending improved primarily due to pricing initiatives compared to the third quarter of 2023.

Current wording

Food, merchandise and other revenue. Food, merchandise and other revenue for the three months ended March 31, 2025 decreased $0.8 million, or 0.6%, to $130.8 million as compared to $131.6 million for the three months ended March 31, 2024, as a result of a decrease in attendance, as discussed above, partially offset by increased in park per capita spending. In-park per capita spending increased by 1.1% to $38.58 in the first quarter of 2025 compared to $38.15 in the first quarter of 2024. In park per capita spending increased primarily due to the impact of increased volume for certain in-park offerings when compared to the first quarter of 2024.

Previous wording

Costs of food, merchandise and other revenues. Costs of food, merchandise and other revenues for the three months ended September 30, 2024 increased $0.2 million, or 0.5%, to $40.6 million as compared to $40.4 million for the three months ended September 30, 2023.

Current wording

Costs of food, merchandise and other revenues. Costs of food, merchandise and other revenues for the three months ended March 31, 2025 decreased $0.1 million, or 0.4%, as compared to the three months ended March 31, 2024.

Previous wording

Operating expenses. Operating expenses for the three months ended September 30, 2024 increased $1.5 million, or 0.7%, to $207.3 million as compared to $205.8 million for the three months ended September 30, 2023. The increase in operating expenses is primarily due to an increase in labor-related costs and a $2.6 million increase in third-party consulting costs associated with nonrecurring strategic initiatives, partially offset by a decrease in non-cash fixed asset write-offs compared to the third quarter of 2023.

Current wording

Operating expenses. Operating expenses for the three months ended March 31, 2025 decreased $3.6 million, or 2.2%, to $161.3 million as compared to $164.9 million for the three months ended March 31, 2024. The decrease in operating expenses is primarily due to a $4.6 million decrease in non-cash self-insurance adjustments when compared to the first quarter of 2024.

Previous wording

Selling, general and administrative expenses. Selling, general and administrative expenses for the three months ended September 30, 2024 decreased $4.3 million, or 7.3%, to $55.4 million as compared to $59.7 million for the three months ended September 30, 2023. The decrease in selling, general and administrative expenses is primarily due to a $6.6 million decrease in third-party consulting costs, including approximately $4.2 million of nonrecurring costs for strategic initiatives, partially offset by an increase in marketing related costs compared to the third quarter of 2023.

Current wording

Selling, general and administrative expenses. Selling, general and administrative expenses for the three months ended March 31, 2025 decreased $3.7 million, or 7.8%, to $44.1 million as compared to $47.9 million for the three months ended March 31, 2024. The decrease in selling, general and administrative expenses is primarily due to a $3.0 million decrease in third-party consulting costs, including approximately $2.1 million of nonrecurring costs for strategic initiatives when compared to the first quarter of 2024.

Previous wording

Depreciation and amortization. Depreciation and amortization expense for the three months ended September 30, 2024 increased $2.4 million, or 6.1%, to $41.6 million as compared to $39.2 million for the three months ended September 30, 2023. The increase primarily relates to new asset additions, partially offset by the impact of asset retirements and fully depreciated assets.

Current wording

Depreciation and amortization. Depreciation and amortization expense for the three months ended March 31, 2025 increased $2.5 million, or 6.4%, to $41.7 million as compared to $39.2 million for the three months ended March 31, 2024. The increase primarily relates to the impact of new asset additions, partially offset by asset retirements and fully depreciated assets.

Previous wording

Interest expense. Interest expense for the three months ended September 30, 2024 increased $2.6 million, or 7.1%, to $39.7 million as compared to $37.1 million for the three months ended September 30, 2023. The increase primarily relates to the net impact of the Refinancing Transactions which included a higher average outstanding balance on our variable debt, partially offset by a lower average outstanding balance on our fixed debt. 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 March 31, 2025 decreased $4.7 million, or 12.0%, to $34.1 million as compared to $38.8 million for the three months ended March 31, 2024. The decrease primarily relates to the net impact of the Refinancing Transactions completed in 2024, which includes a lower average interest rate on our variable debt, partially offset by a higher average outstanding balance on our total debt. 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

Provision for income taxes. Provision for income taxes in the three months ended September 30, 2024 was $41.6 million compared to $42.7 million for the three months ended September 30, 2023. Our consolidated effective tax rate was 25.8% for the three months ended September 30, 2024 compared to 25.7% for the three months ended September 30, 2023. The effective tax rate for the three months ended September 30, 2024 and 2023 was primarily impacted due to state income taxes and limits on certain compensation deductibility.

Current wording

Benefit from income taxes. Benefit from income taxes in the three months ended March 31, 2025 was $1.1 million compared to $5.6 million for the three months ended March 31, 2024. Our consolidated effective tax rate was 6.2% for the three months ended March 31, 2025 compared to 33.4% for the three months ended March 31, 2024. The effective tax rate in the three months ended March 31, 2025 was primarily impacted by state income taxes and deferred revaluation due to state filing changes as of January 1, 2025. The effective tax rate in the three months ended March 31, 2024 was primarily impacted by state income taxes and limits on certain compensation deductibility, partially offset by a tax benefit related to equity-based compensation which vested during the period.

Previous wording

Generally, our principal sources of liquidity are cash generated from operations, funds from borrowings under our revolving credit facility and existing cash on hand. Our principal uses of cash typically include the funding of working capital obligations, debt service, investments in theme parks (including capital projects), share repurchases and/or other return of capital to stockholders, when permitted. As of September 30, 2024, we had a working capital ratio (defined as current assets divided by current liabilities) of 0.6. We typically have operated with a working capital ratio of near 1.0 due to a significant deferred revenue balance from revenues paid in advance for our theme park admissions products and high turnover of in-park products that result in limited inventory balances. We believe our cash flow from operations, along with our revolving credit facility, will allow us to meet our liquidity needs.

Current wording

Generally, our principal sources of liquidity are cash generated from operations, funds from borrowings and existing cash on hand. Our principal uses of cash typically include the funding of working capital obligations, debt service, investments in theme parks (including capital projects), share repurchases and/or other return of capital to stockholders, when permitted. As of March 31, 2025, we had a working capital ratio (defined as current assets divided by current liabilities) of 0.6. We typically have operated with a working capital ratio of near 1.0 due to a significant deferred revenue balance from revenues paid in advance for our theme park admissions products and high turnover of in-park products that result in limited inventory balances. We believe our cash flow from operations, along with our revolving credit facility, will allow us to meet our liquidity needs.

Previous wording

The following table presents a summary of our cash flows (used in) provided by operating, investing, and financing activities for the periods indicated:

Current wording

The following table presents a summary of our cash flows provided by (used in) operating, investing, and financing activities for the periods indicated:

Previous wording

Net cash provided by operating activities was $367.7 million during the nine months ended September 30, 2024 as compared to $398.5 million during the nine months ended September 30, 2023. The change in net cash provided by operating activities was primarily impacted by an increase in cash paid for interest and income taxes.

Current wording

Net cash provided by operating activities was $25.7 million during the three months ended March 31, 2025 as compared to $71.4 million during the three months ended March 31, 2024. The change in net cash provided by operating activities was primarily impacted by changes in working capital.

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 nine months ended September 30, 2024 consisted primarily of capital expenditures of $222.2 million largely related to future attractions. Net cash used in investing activities during the nine months ended September 30, 2023 consisted of $234.2 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 three months ended March 31, 2025 consisted of capital expenditures of $56.9 million largely related to future attractions. Net cash used in investing activities during the three months ended March 31, 2024 consisted primarily of $87.3 million of capital expenditures.

Previous wording

Net cash used in financing activities during the nine months ended September 30, 2024 primarily results from $445.3 million used to repurchase shares, repayments of $238.2 million on long-term debt and $8.6 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 nine months ended September 30, 2023 results primarily from share repurchases of $17.9 million, repayments of $9.0 million on our long-term debt, and payment of tax withholdings on equity-based compensation through shares withheld of $6.6 million

Current wording

Net cash used in financing activities during the three months ended March 31, 2025 results primarily from $4.6 million used to repurchase shares and repayments of $3.9 million on our long-term debt. 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. See Note 10–Stockholders’ Deficit in our notes to the unaudited condensed consolidated financial statements for further details.

Previous wording

As of September 30, 2024, our Senior Secured Credit Facilities consisted of $1.542 billion in Term B-2 Loans which will mature in August 2028, along with a $700.0 million Revolving Credit Facility, which had no amounts outstanding as of September 30, 2024 and will mature on the earlier of (x) August 23, 2029 and (y) May 26, 2028, if at least $225,000,000 of Term B-2 Loans (or any debt refinancing, refunding or replacing any Term B-2 Loans that mature on or prior to November 22, 2029) are outstanding on the date that is 91 days prior to the Term B-2 Loans maturity date of August 25, 2028. As of September 30, 2024, SEA had approximately $17.5 million of outstanding letters of credit, leaving approximately $682.5 million available for borrowing under the Revolving Credit Facility.

Current wording

As of March 31, 2025, our Senior Secured Credit Facilities consisted of $1.535 billion in Term B-3 Loans which will mature on December 4, 2031, along with a $700.0 million Revolving Credit Facility, which had no amounts outstanding as of March 31, 2025 and will mature on August 23, 2029. As of March 31, 2025, SEA had approximately $11.4 million of outstanding letters of credit, leaving approximately $688.6 million available for borrowing under the Revolving Credit Facility.

Previous wording

As of September 30, 2024, we were in compliance with all covenants in our credit agreement governing the Senior Secured Credit Facilities and the indentures governing our Senior Notes.

Current wording

As of March 31, 2025, 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 related to our long-term debt and restrictive covenants.

Previous 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.

Current 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.

Previous wording

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

Current wording

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

Previous wording

(a) Reflects a loss on early extinguishment of debt and write-off of debt issuance costs and discounts associated with 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.

Current wording

(a) Reflects a loss on early extinguishment of debt and write-off of discounts and debt issuance costs associated with the Refinancing Transactions in 2024. 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

(c) Reflects primarily non-cash self-insurance reserve adjustments of: (i) approximately $4.1 million for the three months ended September 30, 2024; (ii) approximately $8.7 million for the nine and twelve months ended September 30, 2024; and (iii) approximately $4.8 million and $11.8 million for the three and nine months ended September 30, 2023, respectively. Also includes 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.

Current wording

(c) For the three months ended March 31, 2025 and 2024 and for the twelve months ended March 31, 2025, includes non-cash expenses related to asset write-offs and costs related to certain rides and equipment which were removed from service. Also includes approximately $4.6 million and $16.6 million related to non-cash self-insurance reserve adjustments for the three months ended March 31, 2024 and twelve months ended March 31, 2025, respectively.

Previous wording

(d) For the three, nine, and twelve months ended September 30, 2024, reflects business optimization, development and other strategic initiative costs primarily related to: (i) $4.4 million, $7.4 million, and $7.2 million, respectively, of third-party consulting costs and (ii) $1.3 million, $5.3 million, and $10.8 million, respectively, of other business optimization costs and strategic initiative costs. Reflects business optimization, development and other strategic initiative costs primarily related to: (i) $3.1 million and $17.1 million of third-party consulting costs for the three and nine months ended September 30, 2023, respectively, and (ii) $3.6 million and $9.7 million of other business optimization costs and strategic initiative costs for the three and nine months ended September 30, 2023, respectively.

Current wording

(d) For the three months ended March 31, 2025, reflects business optimization, development and other strategic initiative costs primarily related to $1.2 million of other business optimization costs and strategic initiative costs. For the three months ended March 31, 2024, reflects business optimization, development and other strategic initiative costs primarily related to: (i) $1.8 million of other business optimization costs and strategic initiative costs; and (ii) $1.5 million of third-party consulting costs. For the twelve months ended March 31, 2025, reflects business optimization, development and other strategic initiative costs primarily related to: (i) $9.3 million of third-party consulting costs; and (ii) $6.5 million of other business optimization costs and strategic initiative costs.

Previous wording

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

Current wording

(e) For the three months ended March 31, 2025, primarily reflects costs associated with certain legal matters and nonrecurring contractual liabilities related to the previously disclosed temporary COVID-19 park closures. For the three 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 twelve months ended March 31, 2025, primarily reflects a reversal of costs, which had previously been accrued, associated with nonrecurring contractual liabilities and respective assessments related to the previously disclosed temporary COVID-19 park closures.

Previous 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.

Current wording

(f) 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.

Previous 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.

Current wording

(g) 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.

Previous 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.

Current wording

(i) 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 (g) and (h) above.

Previous wording

There have been no material changes to our contractual obligations as of September 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 September 30, 2024, not including any possible prepayments, are as follows for the remainder of 2024, 2025-2026, 2027-2028, and thereafter, respectively (in thousands): $3,885; $31,080; $1,507,333; and $725,000. Our estimated future interest payments based on interest rates in effect at September 30, 2024 are as follows for the remainder of 2024, 2025-2026, 2027-2028, and thereafter, respectively (in thousands): $38,975; $308,027; $266,657; and $26,894. Includes amounts attributable to the Senior Secured Credit Facilities and Senior Notes calculated as of September 30, 2024 using certain assumptions and excluding any possible principal prepayments.

Current wording

There have been no material changes to our contractual obligations as March 31, 2025 from those previously disclosed in our Annual Report on Form 10-K.