Six Flags Entertainment Corp (FUN) 2009 Q2 法說會逐字稿

Good morning, ladies and gentlemen.

Thank you for standing by.

Welcome to the Cedar Fair first quarter earnings conference call.

During today's presentation all parties will be in a listen only mode.

This conference is being recorded on Tuesday August 4, 2009.

I would like to turn the conference over to our host, Stacy Frole.

Please go ahead, ma'am.

Thank you, brandy.

Good morning and welcome to our second quarter earnings conference call.

I'm Stacy Frole, Cedar Fair's Director of Investor Relations.

Earlier this morning, we issued our second quarter earnings release.

A copy of that release can be obtained on our corporate website at www.cedarfair .com or by contacting our Investor Relations offices at 419-627-2233.

On the call this morning are Richard Kinzel, our Chairman, President, and Chief Executive Officer, and Peter Crage, our Vice President of Finance and Chief Financial Officer.

Before we begin, I need to caution you that comments made during this call will include forward-looking statements within the meaning of the federal securities laws.

These statements may involve risks and uncertainties that could cause results to differ materially from those described in such statements.

You may refer to our 2008 Form 10-K filed with the SEC on March 2nd for a more detailed discussion of these risks.

In addition, in accordance with regulation G, non-GAAP financial measures used on the conference call today are required to be reconciled to the most directly comparable GAAP measures.

During today's call, we will make reference to adjusted EBITDA as defined in our earnings release.

The required reconciliation of adjusted EBITDA is also in the earnings release and available to our investors on the website via the conference call access page.

In compliance with SEC regulation FD, this web cast is being made available to the media and the general public as well as analysts and investors.

Because the web cast is open to all constituents, and prior notification has been widely and unselectively disseminated, all contents of the call will be considered fully disclosed.

Now, let me turn the call over to Dick Kinzel.

Thanks for joining us on the call.

Today we will discuss our second quarter performance, attendance and revenue trends through this past weekend and provide an update on our strategy to reduce debt and strengthen our balance sheet.

First, I would like to provide an update on our sale of assets.

I am pleased to say that we have finalized an agreement with the Vaughn Health Campus of Care to sell 87 acres of surplus land near our Canada's Wonderland amusement park in Toronto.

We expect to close on this transaction in the near future.

The net proceeds of approximately $50 million will be used entirely to reduce our term debt.

We continue to market undeveloped land in Cleveland, as well as Worlds of Fun in Kansas City, Missouri and Valley Fair in Shakopee, Minnesota.

We also continue to discuss the potential sale of California's Great America with the San Francisco 49ers.

I want to stress that these are all profitable parks that produce steady cash flows.

We are being proactive in marketing these assets for sale in order to pay down debt.

That said, we are not in a position where we have to sell these assets, and we will not sell them at artificially low prices.

At this point in time, we are unable to say if and when a sale may occur.

Consistent with our announcement in March, we recently declared our quarterly cash distribution of $0.25 per limited partner unit, payable on August 15.

And have been making prepayments of $13 million on our term debt on a quarterly basis.

We anticipate making this same pre-payment going forward.

Now, on to our operations.

The first half of the 2009 season has been a challenge for the majority of our parks.

The overall weakness in the economy combined with unusually poor weather has continued to negatively impact our operating results.

In addition, on a year-over-year basis, we had 39 fewer operating days in 2009.

Through the first seven months of the year, attendance across our 17 properties was down 10% to 12.6 million visits from 2008.

Average in park guest per spending was down 1% to $39.80 and out of park revenues were $59.6 million, a decrease of $7.7 million from a year ago.

Since the start of July, we with have seen a slight improvement in our attendance and revenue trends.

However, they still remained behind our record breaking results in 2008.

During the month of July, we have made some changes in our advertising strategy to highlight the various promotions, and special events at our parks.

For the most part, the depth of our discounts has not changed significantly.

The variety of ticket options we are promoting has.

We also have concentrated our efforts on more online and social media promotions, which have proven to be successful in both selling additional tickets and controlling costs.

Some of these promotions require guests to buy their tickets online, in advance, for a specific period to receive the discount.

We have found that where will is an economic uncertainty among our consumers, they tend to delay their decisions as to when to bring their families to our parks.

These types of promotions help us to create urgency and gain an earlier commitment from our guests.

It is important to note that attendance levels have been positive when weather conditions have been favorable.

There just has not been enough good weather in this spring and sumer to compensate for the decline.

As weather typically averages itself out over an operating season, we are hopeful these conditions will continue to improve as we enter the other peak vacation month of August and our important fall season.

It is also important to mention that our $62 million capital expenditures program for the 2009 operating season was lower than normal, partially due to the delayed construction of a rollercoaster at one of our California parks.

King's Island which introduced Diamondback, a world class rollercoaster and the highlight of our 2009 capital expenditures program, has clearly been the standout performer this year among our parks.

The new signature steel coaster has received great reviews from our guests.

We look forward to introducing world class rides and rollercoasters at other other parks in the near future.

Some of which may be announced within the next few weeks.

We've been pleased with the ability of our individual parks to control their operating costs this year.

With our industry continuing to face an uncertain economy, and value-seeking consumers, we made a concentrated effort to control costs, while not sacrificing quality and guest service, and of course, safety, would never be compromised under any circumstances.

The result was a 9%, or $26.1 million reduction in cash operating costs and expenses through the first six months of the year, and continued excellent guest satisfaction ratings.

With approximately 40% of our season still ahead of us, including an additional 70 operating days, and our important Halloween events, which we continue to expand by adding more haunted houses, and attractions this year, we remain focused on adding value to guest visits through special events and promotions, while continuing to control costs.

It has been my experience over the years to be careful not to over react in the short term in ways that could negatively affect the guest experience and perception of value.

While we never like to see a decrease in revenues and cash flow, as long as we remain committed to providing our guests world class thrills, fun, and family entertainment, in a clean and safe environment, we believe Cedar Fair and our amusement parks will be very successful over the long term.

At this point, I will turn the call over to Peter to discuss the second quarter numbers in more detail and provide a more detailed update on the long-term strategy of reducing debt and strengthening our financial position.

Thanks very much, Dick.

Let me begin by emphasizing that virtually all of the revenues from our seasonal amusement parks, water parks, and other resort facilities are realized during a 130 to 140-day operating period, beginning in the second quarter, with the majority of revenues concentrated in the peak vacation months of July and August.

Only Knots Berry Farm and Castaway Bay are open year round with both operating at their highest level of attendance in the third quarter.

Thus I will caution you, that it is always risky to jump to any conclusions on full year results based on second quarter numbers alone.

Before discussing results through the second quarter, I would first like to mention that our 2009 operating calendar has 39 fewer operating days during the first half of the year, when compared with the same period a year ago.

This will reverse itself during the last half of the operating season, as we add 70 additional days in the third quarter, for a total of 31 additional operating days in fiscal 2009 when compared to fiscal 2008.

We define an operating day as each day an individual park is entertaining visitors.

For example, today, would count as 17 operating days as each one of our amusement and water parks are open.

The additional operating days during the second half of the year are primarily due to Labor Day falling later into September, allowing many of our parks to remain open several extra days during the first week of September.

At this point in time, it is difficult to say what impact these additional operating days will have on our full year 2009 results.

As Dick said, our performance through the first half of the year has been a challenge for us.

Net revenues for the six months ended June 28, 2009, decreased 14%, to $290.6 million from $336.6 million in 2008.

Sources of revenues are as follows; $160.9 million admissions revenues, $107.5 million in food, merchandise, and games revenues, and $22.2 million in accommodations and other nonpark revenues.

Through the end of the second quarter, our parks entertained 6.6 million visitors, average in park guest per capita spending was $39.50 and out of park revenues totalled $36.6 million.

This compares with attendance of 7.6 million, average in park guest per capita spending of $40.45 and out of park revenues of $40.5 million, through the second quarter of 2008.

The decrease in attendance in revenues is due to fewer operating day, poor weather conditions at many of our parks, and weakness in the regional economies in which we operate.

During the first half of the year, we have experienced softness in our group sales business, which is driven primarily by the poor economy, the decline in season pass sales and visits, and inclement weather across most of our parks.

Operating costs and expenses, excluding depreciation and amortization, for the fiscal six months decreased 9% to $259 million, from $285 million in 2008.

Due to fewer operating days, our continued focus on controlling cash operating costs across all parks, in the face of decreased revenues.

These costs are broken down as follows; $28.8 million, cost of food, merchandise, and games, $179.1 million in operating expenses, and $51.1 million in selling, general, and administrative expense.

After depreciation and amortization, which decreased $3.1 million from last year due to the fewer operating days, and all other noncash costs, operating loss for the six months ended June 28, 2009 was $15.6 million, compared to an operating loss of $1.9 million a year ago.

Those of you who regularly follow our results know we believe adjusted EBITDA, earnings before interest, taxes, depreciation, amortization and other noncash items, provides meaningful insight into our operating results, since we use it for budgeting, cash flow analysis, and measuring park level performance.

Because it is important to us, we make it a point of sharing it with investors.

For the fiscal six month period adjusted EBITDA decreased to $32.1 million from $52 million for the same period a year ago.

Interest expense for the first six months of the year decreased $7.3 million to $59.8 million.

This decrease is attributable to lower interest rates on our variable rate debt along with lower average term debt borrowings during the period.

A credit for taxes of $29.3 million was recorded in 2009 to account for publicly traded partnership taxes, and the tax attributes of our corporate subsidiaries.

This compares with a credit for taxes of $39.5 million for the same fiscal six-month period in 2008.

After interest expense, the credit for taxes and miscellaneous income, our net loss for the fiscal six month period totaled $45.9 million, or $0.83, per diluted limited partner unit, compared to a net loss of $29.1 million or $0.53 per unit a year ago.

Touching on our second quarter results, for the quarter ended June 28, 2009, net revenues decreased 11% to $264.1 million from $296.2 million in 2008.

This decrease reflects a 9% decline in attendance, a 2% decrease in average in-park guest per capital spending, and an 11% or $3.2 million decrease in out of park revenues.

As I mentioned earlier, revenue and attendance declines were primarily due to softness in group sales business, driven by the poor economy, and a decline in season pass sales and visits due to the soft economy and inclement weather across most of our parks.

Cash, operating costs, and expenses, for the quarter decreased 7% or $13.9 million to $180.2 million from $194.1 million in 2008, resulting from the closure of Star Trek, the Experience, as well as a continued focus on controlling cash operating costs across all parks.

After depreciation and amortization, operating income for the quarter totaled $40.7 million compared with $54.5 million in the second quarter of 2008.

Adjusted EBITDA for the second quarter decreased $18.1 million to $84 million, from $102.1 million a year ago.

On a trailing 12-month basis, adjusted EBITDA decreased $17 million to $335.9 million from $352.9 million for the trailing 12 months ended June 29, 2008.

Touching on our results for the month of July.

Over the past five weeks, revenues were down 9% or approximately $25.9 million on a same park basis excluding Star Trek which closed late last year.

This decrease was largely due to an 8% or 495,000 visit decrease in attendance, and a $5 million decrease in out of park revenues.

Over the same five-week period, average in park guest per capital spending was essentially flat.

Although modestly better than the trends through the first six months of the year, the July revenue short fall was primarily due to difficult economic conditions and inconsistent weather patterns, in particular cooler-than-normal temperatures in many of our parks.

With regard to our balance sheet, at the end of the second quarter, our receivables and inventories were at normal seasonal levels, and we have the necessary credit facilities in place to fund current liabilities, capital expenditures, and operating expenses as required.

Partners equity totaled $45.5 million, and our total cash on hand was $32 million.

At the end of the quarter, total debt outstanding was $1.671 billion of variable rate debt, and $17.2 million of which is classified as current, and $135.8 million of which is borrowed under our revolving credit facility.

As of June 28, 2009, $1.56 billion of our outstanding variable rate long-term debt has been converted to fixed rate debt, through the use of several interest rate swap agreements.

As a result, the cost of our debt is approximately 6.4% at the current time.

I'm pleased to report that we finished the quarter in sound condition in terms of both liquidity and cash flow.

Our cash position together with the existing lines of credit, which do not expire until August, 2011, provide sufficient financial flexibility to manage our working capital needs and support growth through our capital expenditures program.

Finally, before we turn the call over for questions, I would like to discuss our strategy for reducing debt, and addressing our capital structure in more detail.

To date, we currently anticipate term debt pay-down of approximately $120 million for the full year 2009.

This includes $52 million from the reduced distribution rate, of which $26 million has already been pre-paid during the first half of the year.

Another $50 million from the anticipated net proceeds from the sale of surplus land in Canada, which Dick mentioned earlier, and our regular amortization payment of approximately $17 million.

In addition, to the steps we have already taken, we will continue to monitor and explore other opportunities.

Given the continued challenging debt and equity capital market environment, we are taking proactive but thoughtful steps to address our capital structure for the long term.

Not only do we want to continue to reduce our debt and strengthen our balance sheet, we also want to ensure we have appropriately staggered our debt maturities and blended interest rates to better position the Company for the future.

As part of this strategy, we launched an amend and extend offer to our term debt holders last week.

We're hopeful that this process will allow us to extend the maturity of a portion of our long term debt and provide added flexibility to delever the Company over the long term.

As this process is still ongoing, we are unable to provide additional details at this time, however, we do hope to complete this process within the very near future at which time we will provide additional information.

At this point, I'll conclude our prepared remarks and allow for any questions you might have.

Thank you, sir.

We will now begin the question-and-answer session.

(Operator Instructions).

Our first question comes from the line of Scott Hamann with Keybanc Capital Markets.

Please go ahead.

Yes, good morning.

I'm just trying to kind of peel back the onion here a little bit on some of these drivers for the first half the year, and I was hoping you might be able to kind of give me an order of magnitude on some of these issues that have impacted results, weather, corporate season pass, sales, operating day, just the general economy.

I mean which of those are the big drivers, and kind of as you look at weather in particular, in past seasons, has that -- have people delayed visits earlier in the year kind of come back and you recoup those later in the year?

Scott, I think as we said in our prepared remarks, it really is a combination of all of the above that you have mentioned about, for example, our eastern parks, Dorney park for example, it was the third wettest summer that they've had sore far, and that is a very important park to us.

And Cedar Point, we've only had one 90-degree day here in Sandusky all season.

The economy certainly has played a big part in it.

For example, Detroit has 17% unemployment rate.

And they're the highest in the country.

Charlotte which is another big market for us, happened to be third in the latest surveys that we saw.

And that of course as a result of seasons past sales, with confidence in the economy.

So I wish I could narrow it down to one thing.

But I honestly believe it is a combination.

As Pete said in his remarks, that it basically the economy, it is the weather and consumer confidence, and hopefully within the remaining 40% of the season that we have, why the people will come out and the weather will turn around and people will get some confidence in the economy and still want a day or two to come out with their family and visit one of our parks.

Is there anything Pete you want to add to that?

No, Dick, I think you covered it.

We tried to zero in on the exact drivers, but these are fairly ominous -- the weather, the cold temperatures, fairly ominous situations, to carve out and attribute a particular decline to a particular event or series of events is extremely difficult if not impossible.

Okay.

And just kind of looking at the cost side, going forward, I mean obviously, you have been planning for a lower revenue environment, and I realize you have a high fixed cost structure there, and sounds like you will ramp up some marketing spend here, so how do we think about what kinds of flexibility you had to take costs out if trends kind of continue at this rate for the rest of the operating season?

Scott, we have really been reducing our costs, probably to the last eight or 10 months.

Last year, when we closed the parks in November, of course when the economy turned on us, we had a feeling then that it was going to be a very rough 2009 season.

We delayed one of our capital programs that was supposed to go into one of our parks until 2010.

We started cutting back on -- unfortunately, we had to cut back on some of our full-time staffing.

We went into reducing combining our seasonal staffing, eliminating some of the supervisory positions in our seasonal staffing going forward.

And again, in anticipation that it was going to be a soft year.

So we have been actually cost-cutting probably since last November and I think we're pretty well there.

I think we've done all of the layoffs we can do on the permanent staff level and on a day to day level, we monitor our seasonal staffing as well as we can.

Okay.

And then finally, just Peter, on the Canadian land sale, what was the gross price that you paid, and do you expect there to be a gain or loss recorded in the third quarter?

We expect a gain in the third quarter.

We haven't finalized those calculations for a couple of reasons.

Number one, when we close on the sale, we will have an exchange with the which could change now and then and we will be receiving the funds in Canadian dollars but we will be calculating that as soon as we close but there will be a gain in the third quarter.

Okay.

And I guess I have one quick follow-up on the Canadian currency.

Was there an impact that was meaningful on the spending per capita numbers coming out of Canada's Wonderland?

Nothing that jumps out, no.

Okay.

Thanks.

Thank you.

And our next question comes from the line of Tim Conder with Wells Fargo.

Please go ahead.

Thank you, gentlemen.

Following on the previous question, could you quantify for us, the impact year to date, of what season and group sales are?

Again I know weather is obviously, I mean the data support staff, observation support staff, that is obviously a factor, but kind of pull out the economy impact, is there a way just to say our group sales are down X million dollars year-over-year, or our season pass sales are down this amount, and sort of attribute that portion at least to the economy, and then there is obviously weather and the fewer operating days, if you could give us a little more color on that, it would be greatly appreciated.

Tim, we've identified that season pass and group sales were down.

We don't necessarily attribute those specifically to the economy.

I hear what you're saying, that people would have made those decisions some time ago and the economy may have impacted it.

We're finding though that a lot of the companies a lot of the individuals are making their decision closer to the date that they come to the park.

So it to specifically identify those as economic driven versus the walk-up business, weather driven, we haven't done that and we don't necessarily think that is a good comparison.

One of the things that we're finding this year that has never happened before, is a lot of the companies that it was a benefit to take their employees to an outing, and this year, what we find is a lot of the companies now are subsidizing that, as opposed to making it a benefit.

Basically, they are charging their employees a certain percentage of the admission to come to the park, as opposed to in the past, they gave them perhaps a barbecue dinner, along with the tickets to the park and this year, the employees have to subsidize some of that.

Okay.

And then year to date, Peter, what was the impact on EBITDA of the closure of the Star Trek, the Experience?

Was that a positive impact?

Negative impact?

Do you have the specific amount, that would be great?

Positive impact for -- we did have EBITDA in 2008, so it would have been a -- the differential.

Do we have that number, Stacy, in front of us or no?

We will have to get to you on that, Tim.

The revenues for the first six months were about $6 million so on a pro forma basis the $336million that we had mentioned last year would have been about $331 million.

EBITDA for Star Trek last year was, for the first half of the year, was about a million dollars.

So it was relatively negligible.

And then I apologize if I missed this portion, but did you give an update on where things stand with the Minneapolis and the Kansas city parks?

What we basically said on that, Tim, was that we are marking those parks, however we're not in a position that we feel that we have to sell them, and we're certainly not going to let them go for a fire sale, and really, there is nothing really new to report at this time.

I think you mentioned there that you were surprised at the level of interest that you had in those parks.

I mean is that still continuing?

And I mean how do you feel in general about the direction of maybe indications of interest?

Right now, the level has really slowed down a lot.

The first level that we got certainly was below the expectation that -- the multiples we were expecting to get, and I would say the level of interest now has slowed down considerably.

Okay.

We certainly are continuing to market them.

But it has slowed down considerably, Tim.

Okay.

And last question, gentlemen, can you comment, year to date, on your net promotional activities, it has been in the press pretty substantially, about some of your competitors, and you can give us a directional level of how your net promotional activity has been year to date and what you expect it for the full year?

When you say net promotional activity, Tim, could you define that?

I mean again, I know promotions at some parks vary year over year, depending on if there is a new ride there, and then the types of promotions that you run in each park, each year, vary also.

So again, if you look at that, all together, on a net basis, how are your promotions on a year-over-year basis running?

Well, especially at the Legacy parks, we didn't do a lot of promotions in the past.

We relied mainly on new capital that was going in and promoted it that way and the Paramount parks there is an awful lot of promoting with special events.

This year though we've adopted some of the TPI strategy, for example, at things we've never done at Cedar Point, for example, we have one of the Cleveland Cavaliers coming in this Wednesday, to sign autographs, and on Thursday, at Cedar Point, we have the Air Force band that is going to give a performance.

And we have a stay vacation weekend that we're marketing here at Cedar Point.

Next Thursday we have Jeff Gordon, the NASCAR driver coming in.

And basically, we have an awful lot of promotions that we've never really done before.

But basically what it is doing is we're trying to get some interest in the marketplace and trying to stir interest to get people up to try to come out to the parks and to enjoy themselves.

But that type of promotion is not only going on at Cedar Point but it is also going on at all of the other parks within the system, also.

Okay.

On a -- if you look at all of that together, though, Dick, I guess on a dollar basis, are your promotions flat year-over-year, in percentage of revenue terms, or are they up 5%, 3%, I mean I guess that's kind of the direction, if you have any color on that.

I guess the best number I can give you, I guess, Tim, would be our admissions per capita.

And our admissions per capita is doing very well.

In fact that is one of the bright spots that we have this year is admissions per capita.

Again, as I said, for the most part, the depth of our discounts has not changed significantly, but basically, the variety of tickets we're offering is all together different than we've done in the past.

Tim, are you asking whether or not -- is your question whether or not we're directing more marketing dollars to promotions and less to other areas?

Is that your question?

Well, again, as you boil it all down, if you look at marketing promotions, however you want to classify it, maybe between the two, is that number as a percent of revenues, up or down, on a year to date basis, and what do you expect I guess for the full year from that perspective.

I don't have that number in froth of me Tim.

We -- front of me, Tim.

We would have to get back to you on that one.

Our marketing spend is similar to last year.

But obviously on a week over week basis as we see how the business is operating, marketing is directing it in different directions but to give you a specific number, we would have to get back to you.

We have not allocated any additional funds toward these promotions.

They were already in the budget.

Okay.

Thank you, gentlemen.

Thank you.

(Operator Instructions).

And our next question comes from the line of James Hardiman with FTN Capital Markets.

Please go ahead.

Good morning, guys.

A couple of quick questions, and I apologize on the first one if you already answered this, I don't think that you have, the update on your financial covenants, I believe that the leverage ratio, the distribution suspension leverage ratio is the easiest one to trip.

Obviously, the Canada's Wonderland deal really helps you from that perspective, but it seems like the EBITDA numbers are probably off a little bit more than you would initially expected, and how bad would the second half have to be for that to be a concern?

Going into I think it is the end of '09 that that becomes an issue?

James, the -- I'll run through the calculation really quickly you with.

We expect to be after the $120 million debt repayment at about $1,580 million on the term debt at the end of this year.

The fourth quarter 2009 maximum consolidated revenue leverage ratio covenant that you referred to steps down to 475.

So that would calculate to an EBITDA level of $332 million on a fiscal year basis.

Right now, our trailing 12 month is $335 million .

So if we can achieve with the additional 70 operating days in the last half of the year, if we can achieve a level of EBITDA similar to last year, we should be in good shape.

But no

And is it -- have you talked to your lenders, is there any chance that that covenant can be renegotiated?

Or is that sort of out of the question at this point?

We're talking to them about a number of issues on the amendment, and again, since that process is still ongoing, I don't want to comment on it.

Okay.

And then just on the capital expenditures side, is it still safe to say, you talked about the reasons why this year was lower than last year, still safe to say that we will probably see $80 million to $90 million for next year?

Yes.

And --

We will go back to normal spending next year.

And can you comment a little bit on what the strategy -- obviously, you don't want to unveil anything today but it seems like you're uniquely positioned to comment on some of the strengths and weaknesses of some different regions across the United States.

Is the strategy going to be more towards giving new rides and attractions to parks that just haven't seen them in the longest, or are you going to activity seek out maybe some of the markets that would be best positioned to maybe take advantage of a new attraction?

James, I think both.

We felt with the acquisition in 2006, that there were some real opportunities in those southern parks, mainly Charlotte, and in Richmond.

And our capital will be directed pretty much, as you can see, our big capital the last two years, has been in Canada's Wonderland and in Cincinnati in King's Island and I can tell you we're pleased with both of those markets, the capital programs both of those parks have given us.

Even in the soft conditions we've had this I don't remember, one of the bright spots in the Company is King's Island in Cincinnati.

And certainly I think that you see when we make our announcement in the next 14 to 30 days, why you will see that we are going to continue to put emphasis on trying to bring people to the parks through a combination of attractions and thrill rides.

Great and then just finally, in terms of the upcoming Halloween season, we've seen over the last few years that you've been able to maybe expand some Halloween events, obviously Cedar Point has been doing stuff forever and some of your other parks have been doing stuff forever, but are there any additional levers to pull this Halloween season that will help that comp positively versus last year, or is there anything special going on this Halloween season for some of the parks?

Just James, just a little bit of history, that started out, when we took that program from Knots Berry Farm and we put it at Cedar Point, it started out very slow and it took a few years to build and this will be the third year that we've had that at the Paramount park, and we've added -- we added more attractions and more haunted houses and things like that, so we think it is going to grow.

We put a few more marketing dollars into it, but that really is a word of mouth type of attraction, that sort of spreads through the schools and that, because school is in session at that time, and it is strictly a weekend venue, so it takes time to build, but we're continuing to put money into it and we're very optimistic that this being the third year, that it will get deeper roots each year and hopefully it will be much, much better this year.

Even with the dollars we're putting in, and also with the word of mouth, and it is a great date night, and then during the day, it is a great family attraction.

Excellent.

Great.

Thanks guys.

Thanks, James.

Thank you.

And our next question comes from the line of Ross Haberman with Habberman Funds.

Please go ahead.

Mr.

Ross Haberman, please go ahead.

Okay.

Your next question comes from the line of Jeffery Thomison with Hilliard Lyons.

Please go ahead.

Good morning.

You just answered most of my questions, so thanks for that.

But I will just make sure I have a handle on the $120 million term debt reduction if I may.

Is it accurate to say that year to date, you have gone through $34 million, $35 million of that 120, and then the second half of the year should bring roughly 85 million to go?

I believe so.

And it is about $34 million, $35 million through the first half and the remainder in the third and fourth quarter.

That's correct, Jeffery.

And secondly, did you say you expect to end the year at about $1.58 billion in term debt?

Term debt alone.

Right.

Excluding revolver.

Okay.

And then finally, I would just pass along that I spent the entire day Sunday at King's Island, and was very impressed, and very pleased.

That's always good to hear, Jeff.

I will pass that along to the team there.

Great.

Thank you.

Thank you.

Ladies and gentlemen, if you do have any additional questions, at this time, please press the star followed by the one on your touch-tone telephone.

And our next question comes from the line of Ross Haberman with Habberman Funds.

Please go ahead.

Good morning, gentlemen.

How are you?

Good morning.

Quick question.

Could you at least touch upon the prospects of perhaps selling?

You ran through a couple, two or three great American, valley fair and some of the other one, some of the other parks.

Any likelihood over this calendar year, or is it too early to say?

Ross, it really is too early to say.

We are marketing them.

But as I indicated earlier, the interest has really lightened Atmos on those parks around I'm really not too optimistic that a sale on either one of those properties will take place within the next four or five months.

Do you have any individual parks which are at a break-even on a park level and/or losing money today?

No, all of our parks are operating profitably.

Okay.

And I guess after the Canada real estate sale, are there any other excess, superfluous assets which you have up for sale?

Yes, we're actively trying to sell about 700 acres in -- right outside of Cleveland, the site of the old Geauga Lake amusement park.

We had some offers on that and they were way low and we feel it is more valuable than the offers we've had on it.

It is on a lake.

We had a small water park on one side of the lake that is doing very well for us.

Again, I think it is economic conditions and the state of the economy in northeastern Ohio that prohibits us at this time from getting too much interest on that property.

But again, when the economy turns around, hopefully we can divest of that excess land as well.

Okay, guys, thank you very much.

Thank you, Ross.

Thank you.

And our next question is a follow-up question from the line of Scott Hamann with KeyBanc Capital Markets.

Please go ahead.

Thank you.

There was recently an environmental impact statement that was released in conjunction with the Great American stadium project.

Do you have any thoughts on -- I don't know if you have gone through that or not but just any general thoughts on what that might mean or how that changes the position of the situation?

Yes, Scott and that just came out and we have 45 days to respond to and our attorneys, and Jeff Millkey, our corporate attorney are going through that page by page and we will have definitely have our responses to that study in plenty of time to make our concerns known.

But it is really too early.

I have not got a report as to what the report say, just a very brief summary, but we will certainly have it broken down in detail within the next 30 to 45 days.

Okay.

Thanks.

Thank you.

And at this time, management, there are no further questions in the queue.

Thank you.

At this point, if there are no further questions, I would like to thank everyone for joining us on the call today.

Should you have any follow-up questions, please feel free to contact me at 419-627-2227.

We look forward to speaking with you again in early November to discuss our third quarter results.

Thank you.

Ladies and gentlemen, this concludes the Cedar Fair second quarter earnings conference call.

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