Struggling Six Flags names new CEO. What does that mean for Knott's and Magic Mountain?

Struggling with a plummeting banal terms and a diminution successful revenues, Six Flags Entertainment Corp. named a caller CEO Monday, weeks aft institution officials suggested they would merchantability much underperforming taxable parks.

Six Flags announced John Reilly, a seasoned taxable parkland operator, arsenic its caller president and CEO. He had served arsenic an interim CEO and main operating serviceman astatine SeaWorld Parks and Entertainment successful the past.

Reilly is taking the reins of the struggling Charlotte, N.C.-based institution that operates Knott’s Berry Farm successful Buena Park and Six Flags Magic Mountain successful Valencia.

“He’s got his enactment chopped retired for him,” said Martin Lewison, subordinate prof of concern absorption for Farmingdale State College successful New York, who is besides a Six Flags shareholder.

Since its merger with Cedar Fair Entertainment Company past year, Six Flags has upset immoderate parkgoers with its cost-cutting efforts, including moving to a determination absorption exemplary wherever parkland presidents astatine Knott’s Berry Farm and Magic Mountain were laid off. At immoderate parks, unrecorded amusement was reduced oregon mostly canceled, and immoderate seasonal events did not instrumentality this year, specified arsenic WinterFest and Tricks and Treats astatine California’s Great America successful Santa Clara.

Lewison said his ain acquisition has been spotty astatine Six Flags parks, and 2 issues the institution volition request to code are however it wants to marque itself, and whether it wants its taxable parks to beryllium family-oriented oregon thrill-oriented.

“The institution is conscionable benignant of a mishmash of a marque close now,” Lewison said.

While the holidays tin beryllium a large operator of postulation to Southern California taxable parks similar Disneyland, Six Flags’ determination parks person experienced immoderate challenges, Lewison said.

At Six Flags, revenues and net were down successful the 3rd 4th compared to the aforesaid play past year, and determination were less visitors successful October compared to the aforesaid period successful 2024. Executives earlier this period suggested they’re taking a stronger look astatine closing and selling disconnected much of its underperforming taxable parks.

In an net telephone earlier this month, Brian Witherow, main fiscal serviceman for Six Flags, said definite parks that correspond 70% of the company’s net are outperforming, portion its different parks are struggling.

Witherow said the institution had invested much wealth successful attraction to amended the impermanent acquisition astatine the underperforming parks, “but did not yet execute the commensurate uplift successful profits we were targeting.”

In a brace of examples, Witherow cited a “historically well-maintained” taxable parkland “with a loyal lawsuit base,” wherever the institution was capable to “minimize costs without impacting user request oregon the impermanent experience,” and net grew 14%. Then, helium cited an underperforming park, where, contempt important spending to code deferred concern needs, net fell significantly.

“Going forward, we mean to beryllium much nimble and strategical successful allocating concern dollars, focusing lone connected our highest imaginable underperforming parks and the strongest opportunities to present near-term returns,” Witherow said. He declined to database which parks were underperforming.

Witherow said it’s a precedence for Six Flags to constrictive its absorption “and shrink our superior needs.”

“We’re going to look astatine the parks wherever our returns are the greatest, wherever the opportunities for maturation are the highest, and we’re going to absorption connected those parks. The different parks we’ll look to monetize and usage those proceeds to trim debt,” Witherow said.

In the 3rd quarter, Six Flags’ underperforming parks saw attendance diminution 5%, Witherow said.

The institution this period permanently shuttered its Six Flags America taxable parkland and Hurricane Harbor h2o parkland successful Bowie, Md., and volition enactment up the onshore for sale. In Northern California, California’s Great America is acceptable to adjacent successful the coming years, with its last play either successful 2027 oregon successful 2032, depending connected whether the institution exercises an enactment to widen its lease by an further 5 years.

Could Six Flags beryllium considering selling either of its parks successful Southern California? Not astatine this time, Witherow suggested.

Some of Six Flags’ parks that person precocious spot values are successful Southern California, arsenic good arsenic Toronto, but those are parks that “are captious to the semipermanent maturation of the business,” Witherow said. A merchantability of those properties, “I deliberation from that perspective, would not beryllium something, astatine slightest wherever we beryllium today, that we would beryllium funny successful pursuing.”

Reilly succeeds Richard A. Zimmerman, who announced his plans successful August to measurement down arsenic Six Flags’ president and CEO and volition permission the committee connected Dec. 8.

Reilly volition articulation the institution astatine a clip erstwhile it is facing unit from activistic investors similar New York-based Jana Partners to amended its operations. Last month, NFL shot subordinate Travis Kelce joined an concern conjugation — which includes Jana Partners — that owns astir 9% of Six Flags.

Jana has said it plans to prosecute with Six Flags’ committee and absorption squad to amended the company’s selling strategy and operations, accelerate exertion modernization, measure its enactment and measure imaginable acquisitions.

Zimmerman, successful the net call, said the institution has an “ongoing constructive engagement” with the concern radical led by Jana Partners, which includes Kelce. He said pursuing the announcement of the group’s involvement successful Six Flags, determination was a surge of user interest, a absorption that “reinforces our assurance that Six Flags is arsenic breathtaking and applicable arsenic ever.”

“Travis Kelce, influencers of that ilk, person tremendous followings,” Zimmerman said. “Travis Kelce is idiosyncratic that’s travel to our parks successful galore of our locations and has an affinity for them. We are going to enactment precise intimately with him and his squad to marque definite that we optimize that opportunity.”

For the 3rd quarter, nett revenues were $1.32 billion, down $31 million, oregon 2% compared with the 3rd 4th of 2024. Adjusted net earlier interest, taxes, depreciation and amortization was $555 million, down by $3 million.

That came contempt attendance totaling 21.1 cardinal guests, up 1%. One informing motion was a diminution successful however overmuch guests were spending wrong the taxable parks, with much play walk holders visiting but less single-day visitors.

There were much informing signs successful October. For the five-week play that ended Nov. 2, determination were 5.8 cardinal guests, down 11% compared to the aforesaid five-week play past year.

Six Flags shares closed Monday astatine $14.44, up 7%. Its 52-week precocious was $49.77.