Six Flags (FUN) Q3 2026 Earnings Call Transcript

DATE

Thursday, Nov. 5, 2026

CALL PARTICIPANTS

• Senior Vice President of Investor Relations - Tim Hennessy
• President and Chief Executive Officer - John T. Reilly
• Chief Financial Officer - Ashok Walia

TAKEAWAYS

• Net Revenues -- $1.17 billion on a same-park basis, representing a 1.4% increase driven by higher per capita spending and out-of-park revenues.
• Same-Park Adjusted EBITDA -- $493.2 million, growing 1.1% year over year despite weather and wildfire smoke disruptions during the peak season.
• Same-Park Per Capita Spending -- $60.51, up 1.3% due to higher merchandise spending and increased sales of premium offerings like Fastlane.
• Total Attendance -- 18.2 million on a same-park basis, down 0.2% as higher season pass visitation was offset by lower single-day attendance and fewer complimentary tickets.
• Active Pass Base -- 7.1 million units, representing 7.1% growth year over year as the company expanded its regional membership and pass offerings.
• Nine-Month Adjusted EBITDA -- $639.5 million on a same-park basis, an 11% increase that reflected improved operational execution and cost management efforts.
• Free Cash Flow -- $257 million for the first nine months, a $300 million improvement from the same period last year.
• Total Liquidity -- $1.06 billion at quarter-end, an increase of $298 million compared to the prior-year period.
• Net Debt -- $4.66 billion, with net leverage improving to 5.8x from 6.1x on a trailing 12-month same-park basis.
• Q4 Adjusted EBITDA Guidance -- $140 million to $150 million, down from $167 million last year due to softer performance in October.
• October Attendance -- Down 9% year over year, with about half the decline attributed to unfavorable weather and the remaining half to a park incident and related ride closures.
• Full-Year Capital Expenditures Guidance -- $350 million to $375 million, lowered from the previous expectation of $400 million to $425 million due to the resequencing of large ride projects.
• Ride Uptime -- 90.3% in the third quarter, up from 89.4% last year, which helped drive a 3% increase in rides per guest.
• Cross-Park Visitation -- Running at approximately fivefold the level of the previous year, driven by the rollout of regional pass networks.
• Quarterly Cost Savings -- $13 million in gross savings during the third quarter, which fully offset $13 million in inflationary pressures from wages and insurance.
• Full-Year Gross Cost Savings Target -- $70 million to $80 million, with $63 million already delivered through the first nine months.
• Operating Days -- 2,122 on a same-park basis, an increase of 54 days primarily reflecting the later timing of Labor Day.
• Georgia Partnership Buyout -- $370 million potential cash requirement in January 2027 if all partners exercise their end-of-term options.
• Noncash Impairment Charges -- $688 million related to goodwill and trade names, resulting in a reported net loss of $366.1 million.
• Asset Sale Proceeds -- $258 million received year-to-date from the sale of seven noncore parks to EPR Properties.

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RISKS

• Walia stated, "October was softer than we planned with attendance down 9% versus last year," noting that weather and the incident at Six Flags Over Georgia impacted early fourth quarter performance.
• Reilly noted that the "tragic incident" in Georgia and the decision to retire the X2 roller coaster have "raised understandable questions" regarding park safety.

SUMMARY

Six Flags Entertainment Corporation (NYSE:FUN) reported results for its largest operating quarter, focusing on portfolio optimization and the expansion of its recurring revenue base. Management reported that the company is executing on five strategic pillars, including local park-level accountability and the deployment of a connected network of parks. The company is currently conducting a portfolio review to identify noncore assets for potential sale while resequencing capital expenditures to prioritize projects with the highest return on invested capital. Despite near-term attendance headwinds in October, leadership stated that the business is demonstrating improved profitability and cash flow conversion through the first nine months of the year.

• Management launched a comprehensive safety review of the entire ride portfolio, verified by independent third-party engineering inspection specialists.
• The company is consolidating corporate offices to reduce administrative layers and increase local ownership at the park level.
• CEO Reilly noted that the later launch of the 2027 pass program was intended to avoid "skip level behavior" where guests use one pass for most of two seasons.
• Walia stated that the company remains focused on reducing net leverage with a long-term goal of approximately 4x.
• The company is exploring further portfolio optimization and asset sales after the peak operating season to unlock value and enhance liquidity.

INDUSTRY GLOSSARY

• Adjusted EBITDA: A non-GAAP measure representing earnings before interest, taxes, depreciation, and amortization, adjusted for non-cash items and non-controlling interests.
• Same-Park Basis: A financial comparison that excludes parks sold or closed to reflect the performance of the current operating portfolio.
• Per Capita Spending: The average amount of revenue generated per park guest, including admissions and in-park purchases.
• Active Pass Base: The total number of season passholders and members eligible to visit the company's parks at a specific time.
• Skip Level Behavior: A consumer trend where guests delay purchases or use multi-season pass validity to avoid buying passes every year.
• Gold Pass: A specific season pass tier that provides access to multiple parks within the company's regional network.
• Fastlane: A premium product offering that allows guests to bypass regular lines for rides and attractions.
• Holiday in the Park: A seasonal winter event featuring themed attractions and holiday-specific entertainment during the fourth quarter.

Full Conference Call Transcript

Operator: Good day, ladies and gentlemen. Thank you for joining us on Sick Flags Entertainment's Third Quarter 26 Earnings Conference Call. At this time, participants are in listen-only mode. A question-and-answer session will follow the formal presentation. Please note that this conference call is being recorded. I will now turn the call over to Tim Hennessy, Senior Vice President of Investor Relations.

Michael Russell: Thank you, operator, and good morning, everyone. Before we begin, I would like to point everyone to our third quarter 26 earnings release supplemental presentation, which were released this morning. Both can be found in the Investors section of the 6 Flags website www.sixflags.com. Some of our comments will be forward looking statements within the meaning of the federal securities laws. Forward looking statements, which are usually identified by the use of words such as will, expect, should, other similar phrases are subject to numerous risks and uncertainties that could cause actual results to differ materially from what we expect.

Refer you to our SEC filings for a more detailed discussion of the risks that could impact our future operating results and financial condition. During the call, we will discuss our non GAAP measures, which we believe to be useful in evaluating the company's operating performance. These measures should not be considered in isolation or as a substitute for our financial results prepared in accordance with GAAP. Reconciliation of these measures to the most directly comparable GAAP measure is available in our third quarter 26 earnings release and our supplemental information. 1 additional point on the basis of comparisons made in our materials today and on this call. We will refer to our results on a same park basis.

Which excludes the 7 parks sold on April 6, 2026 and the park in Bowie, Maryland that closed after the 2025 season, from all periods presented. Unless we say otherwise, year over year comparisons today are on that same park basis. Joining me today are John T. Reilly, president and chief executive officer and Ashok Walia, chief financial officer, who will take you through our prepared remarks. We will then open the call to questions. With that, I will turn the call over to John.

John T. Reilly: Thank you, Tim. Good morning, everyone. Before we discuss the quarter, let me start by acknowledging recent events. On October 12, Hassan Karim tragically lost his life while visiting 6 Flags Over Georgia. On behalf of everyone at 6 Flags, I extend our deepest condolences to his family, and friends. Our thoughts are also with those who were injured and everyone affected including our team members. This tragic incident together with our decision to retire the X2 roller coaster at 6 Flags Magic Mountain, has raised understandable questions. Those questions deserve clear answers. Nothing is more important to this company or to me than the safety of our guests and of our team members.

Safety is the most fundamental commitment we make. And, to that end, every ride we operate is inspected daily before opening and maintained to comply with our internal and regulatory requirements so that we meet or exceed industry safety guidelines. Here is what we know today and what we are doing. First, local authorities and the ride manufacturer are investigating what happened in Georgia. We are assisting fully in conducting our own internal review. We cannot comment further until that investigation is complete. Second, we have launched a comprehensive safety review of our entire ride portfolio. Led by Mark Pauls, our chief operating officer supported and verified by independent third party engineering inspection specialists.

We will provide further updates as appropriate. Confidence is not restored with a statement. It is earned through action. And our leadership team is committed to earning it. Every guest and team member deserves to feel safe in our parks. And that is the standard we hold ourselves to. At every park, every day. Now let me turn to the business through 3 lenses, our team, our strategy, the results we are delivering.

Having spent most of my career leading and operating many parks, and resorts across many countries, When I got the opportunity to come to 6 Flags late last year, I saw this as the greatest opportunity imaginable in this industry: great brands, and amazing parks with real scale and high barriers to entry. I also knew many of the people who worked in these parks. They are dedicated, results oriented people who know this business. Yes, the company was underperforming but I could also see the potential of what it could be. After 11 months, this company is further along than it was a year ago. And the numbers show it. Through 9 months, adjusted EBITDA is up nearly 11%.

Margin is up about 200 basis points and free cash flow has improved by about $300 million. I am more convinced now than ever of this company's potential. On our last call, we shared our operating priorities with you. With the season now mostly behind us, we have a fuller picture of how our parks are performing and where the opportunities lie. We are executing a strategy that we believe will drive this company to reach its potential. And while it is still early, we are already seeing the results that tell us this strategy is working and this team is headed in the right direction. It all starts with the brand. And our brand research consistently comes back strong.

Awareness of 6 Flags is 96%. And in nearly every market where we operate, we are the No. 1 name in our category. The research also tells us that our stand alone park brands together with some attribution to the 6 Flags name, are stronger together than either 1 alone. Great brands still need great operators. Put experienced park presidents back in charge of our largest parks. With clear ownership of the guest experience. Labor, ride up time, and the park-level P&L. We are bringing back decision making authority in an entrepreneurial spirit to the parks. I am confident from my years in this business that it will pay off.

Centrally, we have the right leaders to scale our resources build centers of excellence, and support the parks as they grow. Mark Pauls, joined as chief operating officer in July, has visited most of our parks and is leading a park-by-park review of uptime maintenance, staffing, operating procedures. Amy Martin-Ziegenfuss, our chief marketing officer, is sharpening how we win and keep guests coming back. Christopher Meyering, our SVP commercial, is leading our pricing and revenue management work to optimize our opportunities. And Dash has brought the investment and cost discipline he will walk you through shortly. Our teams in the parks and at our parks support center know how to lead through good times, and challenging ones.

Progress will not always be a straight line. But we are building this team the right way. Doing right by our guests and team members and delivering value for shareholders are not competing goals. We will do both. Let me turn from who we are to what we are doing. It starts with the 4 priorities we laid out on our last call. Mark level accountability, a better guest experience, stronger commercial capabilities, disciplined capital allocation. We have made steady progress getting the basics right. Building on them is the next phase, and that is where our strategy comes in. Our ambition is to build the premier regional parks entertainment platform.

Connected networks of parks that deliver experiences guests love to share. And a loyal, recurring member and pass holder base creates sustainable value for our shareholders. We are focused on 5 key elements that drive it and I will give you a proof point for each. First, build fun experiences that guests love, talk about, and share. It starts with rides that are safe and run when guests expect them. Ride availability is the biggest driver of how guests feel about their day, and it is improving. In the third quarter, ride uptime was 90.3%, up from 89.4% last year. Guests are also riding more. With rides per guest up nearly 3%.

Around the rides, we are improving attractions, events, comfort, and service. Because happy guests return and bring new ones. More of our growth spending is going exactly there. 2, expand the passholder network and base. The base is growing. At the end of September, our active pace was up about 7% versus the same date last year. And pass holders and members made up about 61% of our attendance in the quarter. Our regional passes and memberships are doing what we built them to do. Guests are traveling further and expanding our catchment areas visiting more than 1 park. Cross park visits are running about 5x last year's level. That is the network working. And we are just getting started.

Brands that have never been available together on 1 pass, like the incomparable combination of Knott's Berry Farm and 6 Flags Magic Mountain in Greater Los Angeles. Are now available together in the same regional markets. We see an opportunity to lean in based on our success this year including with paid marketing support. 3, optimize the portfolio through a disciplined investment strategy. Our parks did not all play the same role or contribute to growth at the same level. We do not invest in them in the same way. Every park has a plan built around its own market and its own growth opportunity. Where a park is strong, we build on it.

Where there is more room to grow, we start by getting the fundamentals right. We put our capital to its best and highest use. And safety and maintenance comes first. We carry more debt than we want, and bringing it down is a priority. Optimizing the portfolio is how we will get there. We are actively reviewing our parks and real estate including potential sales of noncore assets, to unlock value, reduce debt, and enhance liquidity. That also keeps us investing in the parts that drive our business. The 7 noncore parks we sold this year show how we think about it. We act when the value is right.

Every dollar has to help us get there, as we build for our future. 4, execute with excellence. That means marketing defines the right guest at the right time, pricing that reflects the value we provide, and operations that run with consistency from park to park. We are adding new capabilities behind strengthening our marketing and pricing and that work is well underway. Over time, our guests will see more personal, better-targeted messaging, and a stronger connection with us. It also opens up new ways to sell. 5, build a performance culture. Our park leaders own their results. They make decisions closest to the guests and they carry the accountability that comes with it.

We are also making this company faster and simpler. Centrally, some decisions took longer than they should have, with too many layers between the people closest to the guest and the people making the call. Consolidating our corporate offices is 1 example. Fewer layers means faster decisions, more accountability, and more local ownership. Shared services give the parks the strength of scale they could never build alone. We are seeing early results. Taken altogether, these 5 strategic pillars are intended to drive the outcomes that matter. Recurring revenue, a growing and more loyal pass holder base, higher guest lifetime value, margin expansion, stronger free cash flow, and lower leverage.

Our long term goals are adjusted EBITDA margins in the mid-30s, and net leverage of about 4x. So how are we doing? The evidence is early, but it is moving in the right direction. Start with a quarter. Third quarter is our biggest of the year, but it was not the easiest. The later Labor Day, gave us more operating days, but a less favorable July 4 calendar and wildfire smoke at a handful of parks took much of that back. Even so, on a same park basis, net revenues grew 1.4% to $1.17 billion adjusted EBITDA grew 1.1% to $493 million and we held our margin at 42%.

Per capita spending rose and paid attendance grew as we issued fewer complimentary tickets. Progress rarely shows up in a straight line. And the start of the fourth quarter tested us. October is the most important month of the quarter and it was softer than we planned. Weather hit several of our biggest early October weekends and events, and the ride closures that followed the incident in Georgia landed in the same weeks. Through 9 months, we have seen real proof points that our strategy is taking hold. Including an increased pass base, materially higher cross park visitation fueled by our Gold Pass, and the new brand combinations available in each region, an increase in adjusted EBITDA, and margin expansion.

That is momentum that reinforces confidence we are on the right track and we intend to build on it. That is our strategy and where we are headed, and we are energized by what is ahead. Ashok will take you through the financial details including our outlook for the fourth quarter. I will be back at the end with some closing comments. With that, I will hand the call over to Ashok.

Ashok Walia: Thank you, John, and good morning, everyone. Before I walk through the numbers, I want to give you 3 takeaways upfront. Because they frame everything else I will say this morning. First, we delivered a solid third quarter In our largest and most important quarter of the year, on a same park basis, we grew both revenue and adjusted EBITDA and held our margin at 42% even with a less favorable July 4 calendar and with weather and wildfire smoke weighing on several of our parks during peak season. Second, our year to date results show improving profitability and cash flow versus prior year.

Through the first 9 months on a same-park basis, adjusted EBITDA is up about 11% and our margin has expanded by about 200 basis points. As a result, for the 9 months, our cash flow from operations less CapEx is $257 million, a $300 million improvement from the same period last year. Third, we have the balance sheet flexibility to meet our commitments and continue investing in the business. That takes into account our fourth quarter outlook and the seasonality of our business through the winter and early spring when liquidity is at its lowest.

We ended the quarter with more than $1 billion of liquidity, an improvement of $298 million versus this time last year, with nothing drawn on our revolver. We believe that gives us ample capacity to meet our obligations including to fund the full 6 Flags Over Georgia purchase if needed in January. Now let me walk through the details starting with our reported results. Third quarter net revenues were $1.17 billion Net loss was $366 million or $3.59 per diluted share which includes a noncash impairment charge of $688 million related to goodwill, trade names, and long lived assets. The details will be included in our quarterly 10-Q filing.

The charges do not affect our cash position and are excluded from our same park adjusted EBITDA. Unless otherwise noted, the majority of my comments from here on will be on a same park basis, which excludes the parks we sold during the second quarter. And our buoy park that closed after the 2025 season. Please keep that in mind as you reference year-over-year changes throughout my remarks. Further, I would point out that our earnings release also has the reported results and a reconciliation to the same park results. As well as well as a detail of quarterly historical same park results and drivers to assist you in your modeling.

Third quarter adjusted EBITDA was $493.2 million, up $5.4 million or 1.1% as we held our margin at 42% down 13 basis points versus last year. The quality of our attendance improved as we issued fewer complimentary tickets. Total attendance was 18.2 million essentially flat with last year. The later Labor Day, helped the quarter while weather in the Northeast and Midwest plus wildfire smoke. At several parks weighed on peak weeks during the quarter. Our guests also spent more per visit. Per capita spending rose about 1.3% to $60.51 with increases in both admissions and in park spending. Key drivers included higher merchandise spending, and spending on premium offerings, such as Fastlane.

On the cost side, our savings kept pace with inflation. Which is what protected our margin. In the third quarter, we delivered about $13 million of savings mainly from full time seasonal labor park operating costs, and procurement. That fully offset about $13 million of cost pressures from wages, insurance, and other inflation. We did this while operating 54 more days than last year mainly from the shift in Labor Day. Zooming out to the first 9 months, the improvement in our profitability and margin is clear. Revenue grew about $62 million Adjusted EBITDA also grew about $62 million or 11% $639.5 million. Essentially every dollar of our revenue growth reached the bottom line.

And our margin expanded about 200 basis points from 26.3% to 28.3%. On a trailing 12 month basis, adjusted EBITDA rose to $806 million Cost savings have been a major driver. Year-to-date, we have delivered about $63 million of gross savings or about $36 million net of cost pressures. And we are on track for $70 million to $80 million of gross savings for the full year or $36 million to $46 million net. These savings are not a 1-time benefit. They are a part of how we run the business every day, and we are building a pipeline of savings for the years ahead. So that more of the revenue growth reaches the bottom line.

That keeps us on path to achieve adjusted EBITDA margins in the mid-30s over time. Just as important, our earnings are converting into cash flow. On a reported basis, through the first 9 months, operating cash flow was $498 million, up $133 million from last year reflecting stronger business performance at the remaining parks and favorable working capital. Capital spending was $241 million compared to $408 million last year. And free cash flow was $257 million. This marks an improvement in free cash flow of about $300 million through the first 9 months compared to last year. These figures are as reported so last year and the first months of this year, include the parks we no longer operate.

The reduction in CapEx reflects a more rigorous approach to capital allocation. Not a change in our growth strategy. After funding infrastructure, including maintenance, every project now competes for funding on its expected return on invested capital, and we have resequenced our pipeline so that the highest return investments come first. The projects we have moved have not been abandoned. They remain in our long range plan and will be reevaluated against the same return thresholds in future years. As you will observe, when you visit our parks, a growing share of our growth capital is going towards guest experience investments. Which we believe offer attractive returns and support our strategy to rebuild attendance.

We do not expect this resequencing to change our path to adjusted EBITDA margins in the mid-30s over time. On the contrary, our sharpened focus around capital allocation strengthens free cash flow and liquidity. The cash generation has strengthened our balance sheet. We ended the quarter with $1.06 billion of liquidity, up $223 million from $837 million at the end of the second quarter. That is comprised of $268 million of cash and revolver available. This represents an improvement of $298 million in our liquidity compared to the same time last year. We are also delevering. We have reduced debt by $175 million this year.

Net debt fell by about $200 million in the quarter, to approximately $4.7 billion and the net leverage improved to 5.8x from 6.1x based on a trailing 12 month same-park adjusted EBITDA. About 70% of our debt is fixed rate, and we have no immediate maturities. We remain focused on reducing net leverage targeting a goal of about 4x. We expect any proceeds from asset sales will go to paying down debt. On insurance. The higher cost to the third quarter reflects the structure of our insurance programs our claims experience, and our actuarial estimate of claims that occurred but not yet been reported. All related to the period before the incident in October.

We self insure claims up to a certain retention level, Beyond that, we have $100 million of comprehensive general liability coverage that applies above that. Based on that coverage and what we know today, we do not expect any claim payments to have a material impact on our liquidity. That brings me to 6 Flags Over Georgia. We own about a third of the partnership units. And in January, we may buy the remaining units under the end of term option we exercised in December 2024. The amount payable should every partner choose to be paid out would be approximately $370 million. Set by a formula in the partnership agreement.

However, we are in active dialogue with the unitholders and some partners may elect to roll over their units and defer the payment. Which would reduce our cash requirements. We will update you when we have more information on any such rollover. Today, we pay about $26 million a year in distributions to the Georgia partners. Once we own their units, those distributions end. At the current rate, interest on the revolver borrowing would be about $21 million a year, while giving us full ownership of the park. Our priority is to reduce leverage. As we optimize the portfolio, proceeds from the asset sales that do not fit our strategy will be directed primarily to paying down debt.

Our future planning shows adequate liquidity through next year's seasonal low point without any incremental debt except for revolver borrowings under our credit facility. Turning to the fourth quarter. As John mentioned, October was softer than we planned with attendance down 9% versus last year. About half of that came from unfavorable weather, on several of our most important weekends earlier in the month, including from hurricane Isasis. And the other half from the impact of the incident at 6 Flags Over Georgia and the related ride closures. Encouragingly, in the last week of October, we saw year over year growth excluding directly impacted parks.

Last year's fourth quarter same park adjusted EBITDA was $166.9 million and we now expect to generate approximately $140 million to $150 million in the fourth quarter this year. The vast majority of the difference compared to the year ago period reflects the month of October. While we are working hard to limit this impact, I think it is important to put into perspective as the difference only represents about 3% of our trailing 12 month adjusted EBITDA. And even with the fourth quarter headwinds, we are expecting the same park adjusted EBITDA to grow for the full year compared with last year. October typically brings in 60% to 65% of our fourth quarter revenue.

Leaving the remainder to be earned in November and December. We expect about 60 more operating days in the quarter compared to last year, mainly from the holiday in park events. For modeling purposes, those holiday operating days draw lower attendance than operating days in October. However, they are very accretive days from a cash flow perspective. Our parks remain open throughout October and for the full year, we expect approximately 4.87 thousand operating days, 46 more than 2025. To be clear, we see this shortfall as temporary in nature. It reflects events specific to this October, not a change in the underlying demand for our parks or in the long term earning power of the business.

We are already responding through marketing, pricing, and product offers and nothing we saw in October changed our operating plan for 2027 or our long term emissions to drive an expansion in margins. To sum up, I want to reiterate the 3 messages I started with. First, the third quarter was a good quarter. We grew revenue and adjusted EBITDA held our margin at 42%, grew paid attendance, and increased per capita spending despite challenging weather in several of our key markets. Second, our year to date results show a stronger business compared to last year.

Adjusted EBITDA is up by 11% our margin is up by about 200 basis points, we have generated $257 million of free cash flow and we are on track for $70 million to $80 million of gross cost savings this year and we expect to grow the same park adjusted EBITDA for the full year. Third, we have ample liquidity to buy the remaining units of Georgia partnership. We ended the quarter with $1.06 billion of liquidity, We expect to end the year with sufficient liquidity to fund the payment in full if needed. With that, I will turn it back to John for closing comments.

John T. Reilly: Thanks, Ashok. What gives me confidence is what I see across our parks. Roughly 95 thousand full-time and seasonal team members who show up every day with passion, to create fun, thrills, and lifetime memories for our guests. We know confidence is earned and we intend to keep earning it quarter by quarter. Thank you to our teams, and thank you for your support. With that, operator, please open the lines for questions.

Operator: We will now begin the question-and-answer session. Please limit yourself to 1 question and 1 follow-up. If you would like to ask a question, please press *1 to raise your hand. To withdraw your question, press *1 again. We ask that you pick up your handset when asking a question to allow for optimum sound quality. If you are muted locally, please remember to unmute your device. Please stand by while we compile the Q&A roster. The first question comes from the line of Steven Wieczynski with Stifel. Steven? Your line is open.

Steven Wieczynski: Yeah. Hey, guys. Good morning. So, John or Ashok, maybe I am reading too much into this, but to me, it sounds like you are more open to potentially selling or shutting down additional parks versus, where your commentary was let's call it 3 months ago. Am I thinking about that the right way? And if I am, wondering what maybe what made you change your mind or your thought process versus just a couple months ago. And if, yeah, we think about lowering your park based, I mean, do you guys. You know, you guys actually have a number in mind that you wanna get to?

Meaning, 34 parks goes down to x or y or what that number could look like. Thanks.

John T. Reilly: Hey, Steven. it is John. I will take that. So we commented on this the last. At the last call, The response was that we did not have anything underway for the operating season. And that really was a question of the timing and where we were in the season and a real focus on execution. And on delivering for our expanded pass base and continuing to push the expansion of our pass and membership base. We are happy with that result. That said, we do believe there is opportunity for further portfolio optimization And now that the bulk of the season has passed, those discussions are underway.

And, you know, we are not going to quantify that in terms of a number of parks. What I can tell you is we have done a lot of work to strategize, categorize our parks in terms of values to our strategies going forward, things like expanding the pass base, and regional membership. Which parks are in the most critical networks, We are also looking at accretion or improvement to our leverage ratio where would that where would that have the biggest impact? So you know, it is 1 of many measures we are taking to strengthen the company. We will give you more specifics as we go forward. Okay. Gotcha. Thanks, John.

Steven Wieczynski: And then you know, if we think about the long-term, the long-term goal of getting margins into the mid-30s, wondering what long-term maybe means to you. just trying to understand how long that might take, and then maybe also help us think about some of the, the drivers of what is gonna improve that margin improvement going forward.

John T. Reilly: Yeah. Steven, thanks. So we are pleased with our progress thus far. This year. We have some green shoots, and we have about 200 basis points in improvement. The way we think about that, we are not going to guide today. In terms of a year target. And you know, as we go forward, we will try to provide more color on these. But what I would say is we expect we can get about halfway there on cost work. I mean, Ashok mentioned in his earlier comments that we had, you know, around $70 million in cost savings offset by some inflation and other factors.

We are pleased with our early progress, and we are building an organization that can more reliably deliver that every year, I think, as he alluded. But the way we see it is we can get about halfway there on cost base and then the improvement in the revenue, this business scales up very well. The improvement in the revenue should get us the rest of the way there. Okay. Thanks, John. Appreciate it.

Operator: Thank you. Your next question comes from the line of David Katz with Jefferies. David, your line is open.

David Katz: Hi, good morning. Thank you for taking my question. I wanted to just get your latest thoughts on the you know, increasing pass base right, presumably, with, you know, single day visitation you know, moving down. How do you look at the balance of the equilibrium between those and the dynamics that it implies you know, for per caps, for visibility, obviously, all of the different parts to it. Obviously, we have seen that dynamic elsewhere in our coverage and, you know, what it implies for the long term. So I would love some little more depth of thought on that. Thanks.

John T. Reilly: Yeah. Thanks, David. This is John. I will take that. So in terms of in terms of the sort of increase in pass and membership base, and potential impact on share of total tickets is the way we look at it. First, we are here to maximize total revenue. And so we may, as we trade some people up, lower the per visit per cap but we are happy to take the extra visits and the higher total revenue increasing the total value per guest. This. We are working on this in 2 different ways, and we have strengthened our marketing and our commercial engines within the company.

The structure of the products that trade up, which we are seeing tremendous results, the regional visitation, is something that our commercial team is driving deliberately along with the marketing team we are seeing results. But what I will say is our marketing team is also made a lot of progress in the last month. On our marketing technology infrastructure. that is gonna allow us to market in a more targeted way, a more personal way, with personas and different guests that we have not messaged to before. So we think we can do both. Over time, we think we can grow single day And over time, we can grow past through the capabilities that we are building in marketing.

But what I. And we have traded a few points from single day tickets, about 3 points. To pass in membership. But we feel good we feel good about the trade off overall because it is growing total revenue. And we feel good that our marketing commercial engines are gonna be able to manage this as we go forward.

David Katz: Right. And as my follow-up, you know, this may be for Ashok. Right? You know, there is been such a dynamic debate over CapEx levels across the company. Obviously, that predates you all. How do you feel about the sustainability of your maintenance CapEx levels so far? And, how do we think about a total CapEx budget from a long term perspective? I can recall us modeling a 9% to 10% level. Is that what you think is required in this business on an ongoing basis? Thanks.

Ashok Walia: Yeah, thank you. The. 1 of the things that I shared in my prepared remarks was our very rigorous approach to capital allocation. So we have multiple projects that we look and evaluate and we try to prioritize them based on the return that they are going to deliver to us. What I said is that all the projects that are not passing that hurdle are put back into the pipeline to compete in the next year. When I look at CapEx, you know, the CapEx is in 2 components. 1 is our growth CapEx. And the other 1 is our infrastructure CapEx. The infrastructure CapEx includes things like maintenance, safety, security, that is part of the infrastructure piece.

That usually ranges between 20% to 30% of our total CapEx. It depends on timing. It also depends on the mix of the growth CapEx. And, you know, we continue to look at it. We will continue to refine on it. But right now, where we are and how we see the levels that we have, we are pleased with the levels of capital that we are able to invest in the business. Between growth and between infrastructure.

Operator: Thank you. Your next question comes from the line of Arpine Kocharyan with UBS. Your line is open.

Arpine Kocharyan: Hi. Thank you so much for taking my question. And I apologize if I am hopping between calls today, so it is very likely you have already addressed this. But I was hoping you could dissect the past program trends a little bit more. It seems like there are some there were some definitional changes in the press release. You are now citing past member sales plus past sales plus member sales, specifically that 2.5% increase you are seeing right now in past program plus members, how has that paced through October? I guess what I am really trying to get to is how much the Georgia incident might have impacted your past sales.

In October, and kind of trying to get to read-throughs for 2027. Impact. For 2027 impact from this sort of foregone past sales, if you wanna call it that way.

John T. Reilly: Hi, Arpine. This is John. I will take that. So, in our pass program is-- In our past base, it is a past and membership base. And it is an active base at any moment in time during the year. And it fluctuates based on people moving in and out of membership or potentially certain passes expiring. So we added membership to about 8 parks that had never had membership at the beginning of the summer. And now we have a higher membership base. So that is that is 1 impact. The second thing that we did is we intentionally launched the 2027 pass program later. Than we did in last year.

And that was to avoid what we call skip level behavior where people are getting a year and a half of a pass on a 1 season purchase. So the combination of membership and an intentional delay in the launch in the summer by a couple of weeks has lowered the base of 2027 sales as we go in. We expect that to be even, maybe slightly up as we get to the New Year in of the pass in membership base. So that is the dynamic there. And there is an intentional skip level delay so that we can yield more out of those passes going forward.

As far as Georgia, and trying to model any impacts from there, well, first, you know, our main focus here is on the investigation. And on and on safety, of course. And but what I would say if you want to talk about the business performance, with Georgia is that if you go back to what we commented on in the script, these are resilient brands, strong brands, and all of our research says both the 6 Flags brands and the Mark brands are strong. We have gone back and studied incidents in the industry and, you know, it is very difficult to make a prediction.

As far as the performance in Georgia, these things are typically not a matter of years and more a matter of months. if we do all the right things. So, you know, I do not have anything to quantify that for you. What I can say is the result any impact from that seems to be limited to Georgia and potentially Magic Mountain because we have the x 2 matter as well. And then some isolated impacts on the parks that have temporary closures due to their rise out of commission for a period of time right now.

But we do not see anything beyond that And as we move forward, we will you know, we will share with you. that is very, very helpful. Thank you for that.

Arpine Kocharyan: And then just a quick follow-up, you know, and thank you for clarifying, Billy. Liquidity situation in your release. I think that is very helpful. But I was wondering if you could talk or maybe walk us through a bit more on both Georgia payment, as well as. And this is gonna be a lot more forward looking than you are probably ready to look right now, but sort of your 2028,, 2020 maturities, sort of higher cost of capital today. But mostly, I am interested in how you are thinking about the balance sheet more medium term beyond just the next quarter.

But, of course, we think about next quarter and the Georgia payment, that is probably the more relevant question near term.

Ashok Walia: Yeah. So thank you. This is Ashok, and I will take that question. So we have internally modeled our liquidity scenario knowing the variables that we know today and assuming that we will have to fund Georgia fully. Based on that analysis and based on knowing what the Q1 26 burn was, we believe we have sufficient liquidity available to us to continue to invest in the business and operate the business. That analysis that I talked about, scenario analysis that we prepared, does not include any benefits from what John talked about on portfolio optimization, so that will be incremental.

We also have if needed, we also have the lever of looking at a growth CapEx and you know, making a refinement on the timing. So we have some flexibility there. If needed again. And then, obviously, the fact is that we are in active discussion with the partners, and we will share in terms of what the outcome is and how many partners might want to stay and roll over because that will help reducing our cash flow. That is not included in the analysis. The analysis includes that everything is fully funded and we are. We have sufficient liquidity to run the business both from investment perspective and operations. That is very, very helpful.

Operator: Thank you very much. Your next question comes from the line of James Hardiman with Citi. James, your line is open.

James Hardiman: Hey. Good morning. Thanks for taking my question. So obviously, way too early to have guidance with respect to 2027. I do not I do not know if you are you will ever give guidance on 2027, but I am I am sort of going fishing here a little bit. But maybe anything that you feel like you have visibility on as we look to 2027, whether it is attendance or admissions pricing, in park pricing, labor cost, You know, weather is always gonna be a big swing factor. I do not know if you feel like on balance 2026 was a bad weather year that creates an easier comparison. Obviously, you have had some success cutting costs.

Sort of how we should think about sort of incremental run rate savings into 2027 Again, I am sort of fishing here, but anything you can give us to help us think through 2027 would be great.

Ashok Walia: So this is Ashok, and I can start off with the with the cost piece first and you know, in terms of the business principle, that we have been using from a cost perspective is that cost savings should be such that they offset inflationary pressures and then deliver some to the bottom line. You know, lot of work has gone within the organization. To be able to trace, track, and report cost savings and also trace track, and report on the inflationary pressures and the investments we want to make into the business such that the cost savings deliver and slow down after offsetting inflation to the bottom line. And that will be the going in approach.

While we do this, it is not a 1 time effort. it is ongoing. Every cost that comes on the table, we turn it and we try to look for opportunities in terms of how we can improve those costs. Have a view in terms of what the future pipeline would look like, and we are working on that pipeline for 2027 and beyond.

John T. Reilly: I will just maybe add, James, in terms of the weather. Mean, we. We do not view the. You know, it is a positive weather here. We mentioned the wildfire impacts, other things we had during the summer. But we also do not wanna dwell on that because we believe we have enough opportunities with the strategies and priorities we have laid out to move the needle significantly on our own. And so the 1 thing I might add to Ashok and to add a little bit to our first discussion around the shift in pass and membership and per caps. We do have we do.

We have identified some great opportunities for next year too in terms of Fastlane. it is a big business for us. And we have some pricing opportunities there. We have taken pricing opportunities and reconstituted our dining plans, which are a significant business for us. Going into next year. So I will not go into all the details. But, you know, we are working on opportunities to grow the business. And, you know, weather for us is an uncontrollable, so we will we will control the controllables. Got it.

James Hardiman: that is helpful. And then maybe as a follow-up to Steven's question top about portfolio optimization. I guess if we if we go back to the to the last year's sale or, I guess, this year's sale. Sorry. The EPR sale, You know, obviously, you were able to generate cash, but you lost a certain amount of EBITDA generation. And so the net impact on leverage was pretty minimal. But I think if I am hearing what you are saying correctly, maybe you think that deleverage can be meaningful as a result of continued portfolio optimization from here. You know, again, similar to how, you know, how Steven laid it out.

I do not know if I am reading too much into sort of what you have said so far. Or is there an opportunity to sort of assist the balance sheet and the leverage as a result of continued optimization? Thanks.

John T. Reilly: So we look at this 2 ways, James. And you look at the silver parks that we sold earlier this year. Yes. They did help us with the cash. And the leverage ratio, although it did not necessarily lower our leverage ratio, We sold some smaller parks that were not a major focus for us. At a multiple that was similar to where the portfolio was trading. So that gives us strategic focus from the management team, resources, capital allocation, to redirect to the bigger parks. that is an important step for us and we are we are open to similar sales like that going forward.

But secondly, because in some smaller parks, the portfolio, we were able to get approximately a similar multiple If you look at all the parks in our portfolio, they are not all. They would not all sell at the same multiple. there is an opportunity to do more potentially on the leverage ratio. But, again, this is something we are exploring. We do not have anything to announce today.

Ashok Walia: And if I may, I would just add to what John just said. You know, portfolio optimization is 1 lever. The other thing we have to also keep in mind that we are going to focus on continuing to grow our attendance in the business. And hold the middle of the p and l between cost savings and inflationary pressures that we see. So that the EBITDA also improves, and that will also help drive an improvement in leverage. So it is multiple levers that we have that we will have to deploy.

Analyst: Got it.

Operator: Thank you both. Your next question comes from the line of Brandt Montour with Barclays. Grant, your line is open.

Grant: Can you hear me? Yes. Okay. Great. So the first question is, circling back on the commentary on October, I was hoping you could be a little bit more specific when you said that you saw visitation growth in the last week of October. X directly impacted parks. When you say directly impacted parks, are those Georgia and Magic Mountain? Are those all parks with rides that were practically shut down? Are those sort of all 6 Flags branded Just sort of give us a sense of what proportion of the portfolio was able to grow toward the end of October?

John T. Reilly: Yeah. I think without going into all the individual parks, you know, we saw some softness in Georgia. And if you look at the incident and the ride related closures, that was about half of it. And as I mentioned, that is that is primarily Georgia and Magic Mountain. And then there are some parks that because of the incident, they had 1 or 2 very signature rides. Closed, and that had some impact. Some temporary impact. That was not all the parks with ride closure. So if you look at that, that is around half then we have the name storm that we mentioned and the other factors there. So the.

Towards the end of the month, we did see improvement. We saw improvement in different regions. there is not a pattern to the improvement that we saw in terms of performance, whether a park is are branded 6 Flags or not. So beyond what we have already discussed, we do not see an impact on the other 6 Flags branded parks. Okay.

Grant: that is helpful. And then just circling back in the last discussion, could you guys just give us an update on the Maryland and Richmond asset sales specifically?

John T. Reilly: Yes. The Maryland asset sale is still targeted for late 2027. The buyer is going through a. An entitlement process to move toward finalization of the sale. That has not changed. And then in terms of Richmond, we have moved forward in a process to. And are in a process to evaluate bids. We do not have anything more to say. Beyond that.

Analyst: Great.

Operator: Thanks all. Your next question comes from the line of Patrick Scholes with Truist Securities. Patrick, your line is open.

Charles Scholes: Hi. Good morning, everyone. When I look at the slide on passes and memberships with the active PACE active pass base up 7.1% as of September 27, but then expected to be flat to slightly up. That would imply, obviously, sizable deceleration happened in the probably for obvious reasons in October. What was your season pass sales pace in October? That would lead to that lower expectation? Thank you.

John T. Reilly: Yeah. I would go back to some of the decisions we made in terms of skip level behavior. And a later launch that is a big that is a big impact in July. Terms of the number sold because for 2 weeks, we were not selling the next year's pass. The other impact is that we have more people in membership and those are those are rolling over the calendar period. We are not gonna comment on October would. What I what I would say for October is mentioned the month was softer. The past base was. The. In terms of the past sales pace, it was slower as well.

And we do have a number of measures quarter to go that we believe are going to give us an opportunity for improvement there. Okay.

Analyst: We will leave it at that.

Operator: Thank you. Your next question comes from the line of Chris Woronka with Deutsche Bank. Christopher, your line is open.

Chris Woronka: Hey, good morning, guys. Thanks for taking the John, I think the reduction in CapEx is, you know, certainly in discretionary is certainly a positive. But the question on that is, do the parks look different next year in terms of is some of that kind of hard dollar CapEx maybe going over to OpEx in terms of your you referenced experiences? Is that gonna potentially include things like with live entertainment and other things that maybe make the parks look different each week?

John T. Reilly: We are looking at expanded events entertainment, and that will be part of the slate going forward. We have a number of focus parks as part of how we optimize the portfolio and how we optimize the capital allocation and the expense allocation. Magic Mountain, for example, is going to be undergoing a major refurbishment that is all contemplated in the numbers that Ashok shared with you. And that is contemplated within our savings plan. Additionally, in New Jersey, 6 Flags Great Adventure and 6 Flags Great America in Chicago, We have similar programs underway making the parks more family-friendly, providing more comfort, shade, amenities, but that is all contemplated within the plan.

There may be some expansion in entertainment operating expenses. We did that this year, and we will do it as it makes sense. Okay. Thanks.

Analyst: Thanks, John.

Chris Woronka: Very, very helpful. And then I guess just as a follow-up, I do not know if you guys gave out any data points on this or how you look at it. But you think you still have room on peak attendance days or weekends? You know, I think as you see the opportunity going forward when you talk about rebuilding attendance. Do you think that comes more in kind of the you know, some of the shoulder days, I guess, you might call them? Or do you think that there is still a lot of room on some of these peak weekends and holidays.

And I guess I would, you know, kind of strip out weather and just kind of look at it on a clean weather basis if that is possible.

John T. Reilly: Yeah. What I would say is there is a lot of excess capacity in these parks, and we are not bumping up on closures or anything like that. As we operate. Certainly Halloween is busier. Terms of when during the year do we have opportunities, we will use our event strategy going forward to help build upon building parts of the year when we have opportunities. If you look at Boysenberry, the food and beverage event in Knott's Berry Farm, it is hugely successful. We do not have similar events in the other parks. We can deploy those at times of year.

When we have a lot of excess capacity or an opportunity But that said, we have got opportunity throughout the calendar year, even in Halloween, we can open earlier. We can stay open later. We can move into September So there is opportunity throughout the calendar. Okay.

Analyst: Thanks.

Operator: We have reached the end of our Q&A session. I will now turn the call back to John for closing remarks.

John T. Reilly: Thank you. We appreciate you joining us this morning We are energized by the opportunity ahead and grateful to our team members across all of the parks. We look forward to speaking with you again next quarter. Thank you.

Operator: This concludes today's call. Thank you for attending. You may now disconnect.

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