The coronavirus has shut down what was shaping up to be a spectacular year at Cedar Fair, according to the company's first quarter financial report.
With only one theme park open during the first three months of the year — Knott's Berry Farm — Cedar Fair typically operates at a loss during the quarter, the company noted. As expected, that continued with Cedar Fair reporting a net loss of $216 million, compared to a net loss of $84 million compared with the same period last year. Revenue was down $13 million for the quarter from 2019 as a result of Knott's closing two weeks before the end of the reporting period.
Knott's closed on March 14 as part of the effort to slow the spread of the virus, which has closed theme parks around the world. Prior to that, though, Knott's was enjoying a 19 percent increase in visits, representing 149,000 additional visitors and an increase in $8 million in revenue for the quarter over the same period in 2019.
"Although the COVID-19 pandemic created conditions which led to the closure of our operations in mid-March, we are nevertheless pleased that the record pace we established in 2019 carried well into the first quarter of 2020," Cedar Fair CEO and President Richard Zimmerman said. "Strong season passes sales, coupled with Knott’s Berry Farm’s very strong start this year and an anticipated pent-up demand for outdoor entertainment, give us confidence our parks are well positioned to provide our guests with an outstanding choice for family outdoor entertainment."
Cedar Fair estimates that the closure cost the company 388,000 visits and more than $20 million in revenue when compared with the same two-week period at the end of the first quarter in 2019. On the bright side, season pass sales company-wide were up more than 30 percent in the quarter over the prior year. The company has announced that it will extend its 2020 passes through the 2021 season.
While the parks are closed, Cedar Fair also has delayed hiring or furloughed in-park employees, suspended quarterly cash distribution payments, and arranged credit to help the company through an extended period without incoming revenue. Management is moving forward with reopening plans, though it warned in its quarterly filing with the SEC that it has had to prepare for some parks potentially not opening in 2020, which is it lined up all that borrowing last month.
"Concurrent with the proactive steps we’ve taken to date, our park GMs and their teams have been actively addressing and planning for new measures and guidelines to ensure our properties can reopen as soon as possible once state and local restrictions have been lifted," Zimmerman said. "As we contemplate what new measures could be necessary, our overarching goal is to ensure the safety and well-being of everyone inside our properties, while still providing our guests a best-day experience."
All Cedar Fair parks remain closed indefinitely, however, with no reopening dates scheduled.
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It is going to be interesting seeing scores of financial reports on 2020 with the massive notes of "now, if not for..you know...it would have been a great year."