2008-04-23 23:44:21 -
- Fitch has published a full report on Six Flags, Inc. (NYSE:SIX)
SIX announced on April 17, 2008 its 2008 1st quarter revenues were up by 35%, driven by the fact that Easter fell in the first quarter of 2008 versus the second quarter of 2007. Attendance was up 19% from the prior first quarter and per capita spending
was up 13%. Fitch recognizes that the first quarter represents a small portion of annual revenue (historically the first quarter made up 5% of the year's attendance).
The company is below breakeven on an interest coverage basis, and leverage is around 13.8 times (x), both of which are very concerning. However, the company's liquidity has been sufficient to cover operating costs in the off-season, invest in its parks and continue to attempt its turnaround in 2008. Limited details were available, but on April 17, management stated that liquidity as of March 31, 2008, consisted of $13 million in cash and $131 million in unused revolver capacity. Fitch notes the $300 million PIERs securities come due in April 2009 and represent material refinancing risk.
Fitch currently rates Six Flags as follows:
Six Flags Theme Parks, Inc.
--Issuer Default Rating (IDR) 'B-';
--Secured Bank credit facility 'BB-/RR1'.
Six Flags, Inc.
--Issuer Default Rating (IDR) 'B-';
--Senior unsecured notes 'CCC/RR6';
--Preferred stock 'CCC-/RR6'
The Rating Outlook is Negative.
For further information, see Fitch's 10 page report dated April 23, 2008 available on the Fitch Ratings web site at www.fitchratings.com.
Fitch's rating definitions and the terms of use of such ratings are available on the agency's public site, www.fitchratings.com. Published ratings, criteria and methodologies are available from this site, at all times. Fitch's code of conduct, confidentiality, conflicts of interest, affiliate firewall, compliance and other relevant policies and procedures are also available from the 'Code of Conduct' section of this site.
Fitch Ratings
Rolando Larrondo, 212-908-9189, New York
Jamie Rizzo, CFA, 212-908-0548, New York
Mike Simonton, CFA, 312-368-3138, Chicago
or
Media Relations:
Brian Bertsch, 212-908-0549, New York
