s i x
f l a g s ,
i n c .
a n n u a l
2 0 0 0
r e p o r t
Enchanted Village
& Wild Waves
Seattle
Six Flags
Darien Lake
The Great Escape
Lake George
Buffalo/Rochester
U n i t e d
S t a t e s
Six Flags
Marine World
Vallejo/San Francisco
Waterworld USA
Sacramento
Denver
Six Flags
St. Louis
Concord
St. Louis
Six Flags
Hurricane
Six Flags
Magic Mountain Harbor
Los Angeles
White Water Bay Frontier City
Los Angeles
Six Flags
Great Adventure &
Wild Safari Animal Park
Cleveland
New York/Philadelphia
Chicago
Six Flags
Elitch Gardens
Waterworld USA
Boston/Hartford/Springfield
Six Flags
Worlds of Adventure
Six Flags
Great America
Oklahoma City
Oklahoma City
Six Flags
Hurricane Harbor
Dallas
Six Flags
Over Texas
Six Flags
New England
Wyandot Lake
Columbus
Six Flags
Hurricane Harbor
Six Flags New York/Philadelphia
America
Washington D.C./Baltimore
Six Flags
Kentucky Kingdom
Louisville
Six Flags
Over Georgia
Atlanta
Six Flags
White Water
Atlanta
Dallas
Six Flags
Fiesta Texas
Six Flags
AstroWorld
San Antonio
Houston
Six Flags
WaterWorld
Houston
Six Flags
SplashTown
Houston
M e x i c o
Six Flags Mexico
Mexico City
M a p
L e g e n d
■ Theme Park
■ Water Park
Six Flags Holland
Amsterdam, Holland
Bellewaerde
Warner Bros.
Movie World
Ieper, Belgium
Düsseldorf, Germany
Six Flags Belgium
Brussels, Belgium
Walibi Schtroumpf
Metz, France
E u r o p e
Walibi Rhône-Alpes
Lyon, France
Warner Bros.
Movie World
Madrid, Spain
(Under Development)
Walibi Aquitaine
Toulouse/Bordeaux,
France
P a r k
L o c a t i o n s
T h e
W o r l d ’ s
T h r i l l
C a p i t a l .
ith 38 theme and water parks in
seven countries, Six Flags owns and
operates more parks than any other
company in the world. Of those
parks, 25 are Six Flags-branded. This number includes Six Flags Belgium,
which is being rebranded in 2001. ■ Six Flags has 30 parks in the U.S. alone
and 16 of the largest theme parks in North America. Approximately
two-thirds of the population of the continental United States lives within
150 miles of one of our parks. ■ Six Flags expects to continue to grow both
domestically and internationally – through the growth of existing parks
and the selective acquisition of new properties. This continued global
growth will cultivate ever-broader
recognition of the Six Flags brand
and industry position.
C o n t e n t s
Shareholders’ Letter
2-9
Nor th American Park Pr ofiles
10-27
Eur opean Park Pr ofiles
28-31
Price Range Of Common Stock
33
Financial Repor ting
34-70
Directors
73
t o
o u r
s h a r e h o l d e r s
ach year when I compose my letter to
shareholders for our annual report, I always
close by thanking our employees for all their
efforts and acknowledging their tireless
contributions to our success. This year
I want to begin by thanking them for their
exceptional performance in 2000, under very trying circumstances. We are clearly
blessed to have the most talented group of theme park professionals in the world working
to build value for our Company. There is simply no question that our employees are our
finest assets. ■ Never has our employees’ operating skill been more tested or more
apparent than during the 2000 season. We began the year with great optimism. Coming
off a terrific operating performance in 1999, highlighted by 40% growth in our adjusted
earnings before interest, taxes, depreciation and amortization (“EBITDA”), and with
strong capital and marketing programs in place for 2000, we felt poised for a very strong
season. Unfortunately, as the year unfolded, we encountered the most difficult operating
conditions in memory – extremely adverse weather that existed for an extended period
during our core summer season in a broad range of U.S. markets. These extremely
difficult operating conditions persisted throughout a substantial part of last season. We
were also hurt by the relative decline in the value of the Euro and the impact that had on
the translation of our European results into our U.S. dollar financial statements.
2000 Performance
Given these issues, we are very pleased with our overall
operating performance in 2000, with 11% growth over 1999 in our full year adjusted EBITDA
(including our Company’s share of the EBITDA from our four partnership parks).
This strong performance speaks volumes about the skill and experience of our
park operating teams and their ability to improve theme park
performance in even the most challenging operating
environment. It also inspires strong confidence as we head into
our 2001 season. ■ Consolidated revenues in 2000 were a
record $1.01 billion, an 8.6% increase over 1999 revenues of
$927.0 million. This revenue growth was driven primarily by a
systemwide attendance increase of approximately 8.8%. We
continued to do an excellent job in 2000 controlling our
expenses and improving our operating margins. EBITDA margins
grew from 32% in 1999 to 37% in 2000. The revenue growth
and margin improvement combined to produce adjusted EBITDA
for 2000 of $402.5 million as compared to $363.2 million in the
prior year. This represents an increase of $39.3 million, or 11%, over the 1999
results and an increase of $144 million, or 55%, over pro forma 1998 adjusted
EBITDA. ■ Again, those results were achieved in the face of very difficult
operating conditions. Throughout June, July and the
first part of August, we had to contend with
abnormally cool and wet weather in a significant
number of major markets – particularly
Left to right:
Jim Dannhauser, Chief Financial Officer
Kieran Burke, Chairman & Chief Executive Officer
Gary Story, President & Chief Operating Officer
in the Northeast, Midwest and Mid-Atlantic regions. We are
very encouraged that the latter part of the operating season
saw a strong rebound in performance when more normal
weather patterns returned from mid-August forward. For the
period from the end of July to the conclusion of the main operating season in October, attendance at our consolidated parks
grew by 12.5% on a same-park basis, with revenues up by 14.3% over 1999. This powerful recovery demonstrates unequivocally
that our core season difficulties were a direct result of the aberrant weather we experienced. This performance under these
conditions also makes a powerful statement about the strength of our Six Flags brand and the earning power of our business.
Knowing we can perform at this level during difficult times gives us a great sense of confidence and optimism for what we
can achieve in the future. ■ In addition to the solid revenue and cash flow growth we achieved
companywide in 2000, we were especially pleased by the strong market reaction to our
newly branded Six Flags parks. Those four parks, which included our first two international
Six Flags parks in Holland and Mexico, enjoyed spectacular full seasons, with year-over-year
growth of 43% in attendance, 66% in revenues, 16% in per capita spending, and over
100% in park level cash flow. The strong response to the brand internationally is
very exciting, particularly in Europe where we own several parks and have a very
significant opportunity for both internal and external growth using the brand
and our licensed characters. Our European parks performed very well in 2000.
Total European attendance in 2000 was in excess of 6.7 million people,
with year-over-year revenue growth of 9.5% and EBITDA
growth of 79% on a constant currency basis. Establishing
Six Flags as an internationally recognized brand will clearly
accelerate the growth of our European parks and enhance the
overall value of our Company.
Upcoming In 2001 Our capital and marketing
programs for 2001 are now being implemented. We are
rebranding our park in the Brussels market, which will
become Six Flags Belgium. With the successful debut of
our Six Flags Holland park last year, and the strong market reaction to the introduction of the
Six Flags brand in conjunction with the utilization of our Looney Tunes, DC Comics and other
animated characters licensed on an exclusive basis from AOL Time Warner, we are very optimistic
about the upcoming season for our latest extension of the Six Flags brand in Europe. The branding
effort in Belgium is part of a capital program which includes the addition of major rides and
attractions to a large number of other parks. This is a powerful capital program which should
drive strong growth and generate substantial free cash flow after interest expense and capital expenditures. Although
extensive, our 2001 capital program will be significantly less than we invested in each of the past two seasons. This lower
capital investment level reflects the fact that a significant number of our rebranding efforts and the larger levels of capital
expenditures associated therewith have been concluded. In years to come, we should see increasing levels of annual free
cash flow as our EBITDA continues to grow and our annual level of capital expenditures for our existing parks remains at
these lower levels. Our ability to generate free cash flow growth over the next few years will be an important factor in
driving the value of our shares in the public market. ■ As part of this year’s capital program, we are making several
improvements, including a major steel coaster, to our Six Flags Over Texas park as part of its 40th anniversary season and the
40th anniversary of our Six Flags brand. We are
also devoting a portion of our capital
investment program to in-park
spending opportunities at several of
our major market
parks. This trend will
continue in future
seasons as we seek to take advantage of the opportunity to
increase these high margin revenues systemwide.
■ We expect to achieve same-park EBITDA growth in 2001
of approximately 10% over 2000, and approximately
15% growth including the contribution from our three most recent acquisitions described below. ■ In addition to
delivering strong internal growth by driving the core business of our existing portfolio of parks and expanding those parks
into complementary activities, we continue to selectively take advantage of the numerous acquisition opportunities that
exist for us in domestic and international markets. Acquisitions continue to be both strategic and immediately accretive to
our cash flow. We are very pleased to be able to add three interesting parks to our portfolio ahead of the 2001 season.
These three acquisitions demonstrate the numerous opportunities we have domestically and internationally for external
growth through selective park acquisitions.
Recent Transactions In December 2000, we acquired Enchanted Village & Wild Waves, a water park and children’s
ride park located on approximately 65 acres in the Seattle, Washington market. Seattle is the 14th largest city by population
in the country and there is no direct competition in the market. The park has averaged over 500,000 in annual attendance over
the last five years and will be a good cash flow generator for us. There is also room to expand the water park and dry ride
component, the group sales areas, and the quality and number of revenue outlets with controlled expenditures which should
drive good growth. ■ In February 2001, we acquired the former SeaWorld® Ohio park in Aurora,
Ohio from Busch Entertainment Corporation. The 230-acre marine mammal and sealife park is
located immediately adjacent to our Six Flags Ohio theme park and water park. We are combining
all three parks under the name Six Flags Worlds of Adventure. Together with our hotel and
campground properties, this gives us a 690-acre complex, creating one of the largest entertainment
destinations in the Midwest. The entertainment value and power of the combined theme park,
water park and marine wildlife park marketed under
one gate with our Six Flags brand will allow us to drive
attendance and revenue growth at the combined facility.
In addition, we will achieve significant expense savings operating the parks as one. Taken together,
this should enable us to drive significant EBITDA growth for controlled investment levels.
Moreover, the combined facility significantly enhances our competitive position in the Cleveland
core market, as well as our ability to draw visitation from numerous outer markets. ■ We are
also pleased to have been selected by the City of Montreal to acquire La Ronde, a 146-acre theme
park located near downtown Montreal on the former site of the 1967 Montreal World’s Fair. This is
a terrific opportunity for us. Montreal and the province of Quebec provide a large residential
population and significant numbers of tourists from which to attract park patrons. The park enjoys
a superb location and already generates attendance in excess of one million visitors on an annual
basis. With appropriate marketing and investment and the introduction of our Six Flags brand and
Warner Bros. characters, we can transform La Ronde into a world-class theme park over the next several years. ■ To provide
additional capital to fund these three acquisitions and to enable us to take advantage of the numerous opportunities we have
for internal and external growth by investing in our business, we concluded a convertible preferred stock offering in midJanuary 2001, raising gross proceeds of $287.5 million. The preferred stock has an 8.5-year term, a 7.25% dividend and a 20%
conversion premium when issued, making the conversion price $20.85 per share. ■ We also recently concluded a refinancing
of certain of our public debt in order to continue to simplify and increase the flexibility of our capital structure. With
these financings in place, we have ample liquidity and committed financings to pursue our business
plan, no maturities in our debt structure until 2006 and no meaningful amortization in our
bank facilities before December 2004. Given the uncertain state of the capital markets at the
present time, we are very fortunate to be in such
a strong financial position with significant
levels of liquidity available to pursue
growth. ■ In addition to
uncer tainty in capital
markets, there is
general concern about the depth and duration of the current
slowdown in the United States economy and the impact
this may have on many businesses. Historically,
the regional theme park industry has proven to
be largely recession resistant. At Six Flags, 90%
of our customers come from within 150 miles of each
park, over 55% of our business comes on a group, season
pass or other presold ticket, our customers spend an average of
8-10 hours in our parks, and we deliver a substantial entertainment value for an
affordable price. Given the proximity of our patrons and this strong price-value relationship,
we believe that we will hit our performance target of 15% EBITDA growth in 2001, even in the face of a weakening economy.
Global Growth And Rebranding Our confidence in the future is based on the many strengths and assets we
have built in our Company over time. We are today the world’s largest regional theme park operator with thirty-nine parks,
including La Ronde, (quadruple the number of our nearest competitor) in seven countries serving nearly 50 million guests
annually and generating over $1 billion in consolidated revenues systemwide. ■ Our parks include a broad spectrum of
entertainment venues including theme parks, water parks, animal parks, marine mammal parks, amphitheaters and ancillary
hotels and campgrounds. With thirty domestic parks, Six Flags
has achieved an unparalleled national footprint – one which
provides incredible geographic diversity and which simply
cannot be duplicated. Our reach is extensive. Approximately
two-thirds of the population of the continental United States
(175 million people) live within a 150-mile radius of our parks.
Our parks serve each of the ten largest metropolitan areas of the country and eighteen of the top
twenty-five. We own sixteen of the largest theme parks in North America, and for the 2001 season,
twenty-five of our parks will be branded Six Flags facilities. ■ Internationally, we currently own
seven parks in five European countries, including a major Warner Bros. Movie World park in Germany,
with a second one under construction in Madrid. This strong foothold in Europe gives us the
opportunity to duplicate the dominant market share we have achieved in the United States. We
also own the largest park in Mexico City, with over 20 million residents living within 50 miles of
the park. This park gives us a
gateway into the Latin and South
American markets, and our
pending acquisition of La Ronde
will give us our first park in Canada.
■ Enhancing our unique
network of parks are our priceless brands and character licenses which enable us to accelerate the
growth of the parks we own today and those we acquire in the future. We have worldwide
ownership of the Six Flags name, the preeminent brand name in the regional theme park industry.
Our exclusive long term licenses from Warner Bros. and DC Comics give us access to a stunning array
of characters and intellectual property whose breadth and scope appeal to our entire family
audience. The impact of branding on our business has been tremendous. We will continue to add
our Six Flags brand name and our licensed characters to the parks we
own or acquire to accelerate their growth and to enhance the family
entertainment experience of our guests. ■ I look forward to reporting to
you on our progress in 2001 and what we hope will be an outstanding year.
Sincerely,
Kieran E. Burke
Chairman and Chief Executive Officer