WCP: Six Months of Six Flagging

[Horatio]

I searched and didn't see this latest entry posted. Things are not looking good for Snyder's Six Flags. The whole parking mess that we had to deal with years ago was also attempted at Six Flags:

http://www.washingtoncitypaper.com/columns/cheapseats/

Six Months of SIX Flagging

Amused to Death: Are Snyder’s actions putting Six Flags six feet under?

(Charles Steck/File)

Looking back at a half-year of Snyder theme-park disasters

By Dave McKenna

Posted: May 14, 2008

Dan Snyder’s run atop the Six Flags amusement-park chain has been at least as fascinating as his Redskins ownership. Since assuming control of the company in 2005 by leading a hostile takeover, Snyder has used his standard game plan—raising the crap out of concession and parking prices, banning pedestrians to enhance parking revenues, and even hawking cheerleaders—to try and revive its fortunes.

Nothing that’s come out of Redskins Park has yet worked at the theme parks.

The company is now more than $2 billion in debt and has lost money every quarter since Snyder took over; first quarter 2008 figures released last week showed the company lost even more than was predicted by market analysts, some of whom have put Six Flags on a bankruptcy watch list in recent months. Six Flags’ stock (SIX) has tanked.

Here’s a partial look back—through adaptations of posts on City Paper’s City Desk blog—at recent lowlights in Snyder’s Six Flags tenure:

• Nov. 6, 2007: Four-term mayor Richard Cohen gets booted out of office by the voters of Agawam, Mass., who were upset with a parking ordinance straight out of the Snyder playbook that Cohen pushed.

Until last summer, visitors to Six Flags New England had been able to park for $10 or less at private lots owned by small businessmen on Main Street in Agawam. But in June, the town banned parking in those lots and forced parkgoers to use Six Flags lots, where prices had been hiked by Snyder to as much as $30 per car

Cohen, who supported the ban, initially told the city council that the measure was needed for traffic and pedestrian safety, and Six Flags CEO and Snyder partner Mark Shapiro backed up the mayor’s claim at public hearings—despite the fact no injuries or accidents had been reported in the 20 years the private lots had been operating.

The townspeople turned on Cohen and against the parking ordinance, however, when they learned via a story in Washington City Paper that Snyder had used the exact same safety argument in 2000 to get Prince George’s County to ban pedestrians from walking into FedExField on game days. The FedExField prohibition was overturned in 2004 after a lawsuit on behalf of Redskins season-ticket holders; during that litigation, the safety claim was shredded.

Michael Palazzi, owner of a business that was prevented from parking cars by the Six Flags ordinance and campaign manager for the winning mayoral candidate, attributes the election results to the parking ordinance.

“The parking was it,” says Palazzi. “[Cohen] shot himself in both feet with that. He never thought anybody would beat him. He thought all he had to do was make Six Flags happy.”

• Nov. 9, 2007: SIX closes at $1.88, representing a 70-percent drop since Oct. 24, 2005, when Snyder called for the removal of then-Chairman Kieran Burke in a letter to Six Flags shareholders.

At the core of Snyder’s bid to get rid of Burke was this argument: “Stockholders would have been better off hiding their money under a mattress” than investing in the company under Burke, Snyder wrote.

On the day that letter was registered with the SEC, a share of Six Flags stock was trading at $7.35.

I’m no finance guy, but, using the same blunt, simplistic theme Snyder used to depose his predecessor, let me try to add some perspective about his reign: Rather than buying into Snyder’s vision, stockholders would have been better off hiding half of their money under the mattress, then using the other half to build an effigy of the Redskins owner and burning it.

• Jan. 9: During the day’s trading, SIX stock falls to $1.75 a share, setting still another record low.

The apparent sell-off comes amid a company push to get liquor licenses for Six Flags Over Texas and the water park Hurricane Harbor—spots it owns in Arlington, Texas.

Some locals try to kill the licensing gambit: “I don’t want them [drunks] messing with my kids and grandkids,” one Arlingtonian railed at a meeting of the Texas Alcoholic Beverage Commission.

In 2005, while launching his successful coup to take over the board of directors, Snyder pledged to stockholders that if they put him in charge, he would “focus on mothers (with young children) as well as youth.”

The stock has lost three-fourths of its value since he wrote that. So, pledge shmedge. Give booze a shot.

• Also on Jan. 9: Six Flags Discovery Kingdom, the company’s Vallejo, Calif., outpost, is named the worst park for elephants in the entire country.

That is, stockholders aren’t the only ones taking a beating from Six Flags.

The honor is bestowed by In Defense of Animals, a San Rafael, Calif.-based animal rights group. An IDA spokesperson says Six Flags elephants are routinely “hit, hurt, prodded, poked and beaten” with a device called a bull hook, which is a metal hook on the end of a long pole.

The group has asked the federal government to investigate the same Six Flags park because one of the giraffes there died in a fire last fall.

• Jan. 31: Accounts from Kaitlyn Lasitter, the 14-year-old whose feet were chopped off at Kentucky Kingdom last year—an incident that the company blamed (along with the weather in Texas) for its overall horrible performance in the summer of 2007—appear in the media.

From the Indianapolis Star:

Kaitlyn Lasitter said the Superman Tower of Power ride had climbed only 20 feet last summer when it jolted and cables fell on her and two of her friends, wrapping around their necks, according to court documents.

Kaitlyn said she and her friends, as well as other people on the ride, were screaming for someone to stop the ride, but it kept going up as the girls frantically pulled the cables away from their necks.

“We were all screaming, and then it kept going up, and we just continually screamed and were yelling at people,” Kaitlyn said in her deposition. “I remember smoke and the smell of burning. I felt like I was going to die.”

• March 18: Six Flags announces the formation of the Thrilleaders, billed as “the first-ever professional, theme park cheerleading team.”

From the press release: “The Thrilleaders will captivate Six Flags guests with their explosive, high-energy routines and act as Ambassadors of Thrill throughout the Six Flags family of parks.”

Snyder loves cheerleaders. He’s reworked the Redskins cheerleaders into perhaps the most marketed, least-clothed crew in the league. But amusement parks are a whole other ballgame; the Thrilleaders could be Snyder’s dumbest idea since signing Brandon Lloyd.

Wasn’t Lloyd supposed to act as an Ambassador of Thrill, also?

• March 25: Six Flags Great Escape Lodge, a hotel owned by Snyder’s theme park chain, goes viral.

Not Soulja Boy viral. Legionnaires’-disease viral.

New York health authorities would eventually estimate that at least 496 visitors came down with cases of something called norovirus. By April, three class-action lawsuits are filed against Six Flags.

From Newsday: “Norovirus is characterized by acute gastrointestinal pain, vomiting and diarrhea lasting one or two days.”

In other words, norovirus is not to be confused with Norvovirus, an ailment that crippled Snyder’s team during the Norv Turner era and was characterized by malaise and an inability to win close games.

May. 16 - 22, 2008 (Vol. 28, #20)

[Thoth]

Well, he'll never go broke owning the Redskins.

They'll sell out no matter how horrendous the onfield product, or how high the parking, ticket, and concession prices.

[chow184]

norovirus is not to be confused with Norvovirus, an ailment that crippled Snyder’s team during the Norv Turner era and was characterized by malaise and an inability to win close games.

I wonder if the Norvovirus and Gibbsitis are similar... :doh:

[Califan007 The Constipated]

Snyder loves cheerleaders. He’s reworked the Redskins cheerleaders into perhaps the most marketed, least-clothed crew in the league.

"Least-clothed crew"??...He acts like they're wearing g-strings out there now due to Snyder (not that it would be a bad thing lol). I don't think the Skins cheerleaders are any "less-clothed" than any other cheerleading squad.

[Walking Deadman]

It's a city paper article what do you expect?

[TheLongshot]

Like Six Flags was a great company before Snyder got involved.

From my theme park going friends, Six Flags has had a horrible reputation for a long time.

Jason

[chipwhich]

Like Six Flags was a great company before Snyder got involved.

From my theme park going friends, Six Flags has had a horrible reputation for a long time.

Jason

Don't confuse Six Flags Landover with Six Flags amusement parks nationwide.

[zoony]

You gotta love McKenna. Brilliant. Biased, agenda-driven, and tabloidesque for sure... but brilliant.

He's carved out a niche in reporting on the team that nobody is even close to treading on. His editor should give him a raise. I bet he's done more to sell papers there than anyone on staff.

[TheLongshot]

Don't confuse Six Flags Landover with Six Flags amusement parks nationwide.

I'm not. That is the general impression of the chain.

Jason

[xX2PORTIS6Xx]

Is it September 4th yet?

[rhyno]

I'm pretty sure there was an article a few weeks ago talking about how snyder is either a silent artner or doesn't have controlling interest in six flags. This article is making the assumption that he's runnning it into the ground. Not sure about this one.

[elkabong82]

I wonder how the other amusement parks are doing right now?

[tenken627]

Whether or not Six Flags was horrible before Snyder took over, a drop from $7.35 to $1.75 a share within just about 2 years is pretty damning...

Ouchhhh. That hurts a lot.

[s0crates]

I wonder if the Norvovirus and Gibbsitis are similar...

I remember the Turner years well. Gibbs' teams had much more discipline and drive than Turner's teams.

[SonnyandSam]

Of course, the City Paper ignores that some guy named Bill Gates who at the time owned about the same number of shares as Danny, also demanded major changes and worked with Danny to essentially take over the company. Much easier target to pick on Danny than Bill Gates.

The company was heavily in debt and on the verge of bankruptcy when Snyder and Gates took control of the Board. Since then, they have been selling off underperforming properties and announced a new Six Flags over Dubai in the Middle East. Moody's lowered its default rating on Six Flags recently. And the loss per share was lower this year than last because of higher attendance, increased spending by guests and a reduction in costs this past year. (Isn't that what a good business is supposed to do???)

So it has not all been bad news for Snyder as the City Paper loves to project. The Six Flags fundamentals are looking better than they did when Snyder took over.

Needless to say, Six Flags remains heavily leveraged and is likely moving into a tough summer with the weak economy and high gas prices....not a good sign for any amusement park.

I just hate when any media, including the Post, refuse to tell both sides of a story. It's easier to be a high school journalist with an agenda, then a real journalist that presents an even and fair accounting of the news....without the opinion....that should be left for the reader or a columnist. :2cents:

P.S. all of this financial info is readily available on the internet and any real journalist could have found it on their own, let alone make a few phone calls....but trashing someone you have a vendetta against is far easier for birdcage papers like the City Paper.

[33]

P.S. all of this financial info is readily available on the internet and any real journalist could have found it on their own, let alone make a few phone calls....but trashing someone you have a vendetta against is far easier for birdcage papers like the City Paper.

Not to mention that real estate has taken a massive drop since Snyder/Gates took over and the majority of Six Flags worth is in their land.

[McD5]

I wonder how the other amusement parks are doing right now?

Some are doing incredibly well.....like Disney.

That is one of the biggest problems he faces--competition from heavyweights.

Name brands, franchises, companies with several sources of revenue, like lodging, and merchandise sales in addition to the theme parks.

You honestly can't expect him to be very successful in a business in which he has no experience in.

Neither you nor I would have quick success opening an opera school.

Nor should anyone have ever expected him to know how to operate a nfl team without a lengthy learning curve.

Make no mistake--SIX is a disaster currently, the bonds are deep junk, and he is now moving pieces around to avoid bankruptcy.

The effort is there....and he has bought himself a little time, but the fundamentals aren't sound, and the margins are awful.

In their latest earnings release, once again they disappointed--worse than analysts were expecting.

[McD5]

Of course, the City Paper ignores that some guy named Bill Gates who at the time owned about the same number of shares as Danny, also demanded major changes and worked with Danny to essentially take over the company. Much easier target to pick on Danny than Bill Gates.

The company was heavily in debt and on the verge of bankruptcy when Snyder and Gates took control of the Board. Since then, they have been selling off underperforming properties and announced a new Six Flags over Dubai in the Middle East. Moody's lowered its default rating on Six Flags recently. And the loss per share was lower this year than last because of higher attendance, increased spending by guests and a reduction in costs this past year. (Isn't that what a good business is supposed to do???)

So it has not all been bad news for Snyder as the City Paper loves to project. The Six Flags fundamentals are looking better than they did when Snyder took over.

Needless to say, Six Flags remains heavily leveraged and is likely moving into a tough summer with the weak economy and high gas prices....not a good sign for any amusement park.

I just hate when any media, including the Post, refuse to tell both sides of a story. It's easier to be a high school journalist with an agenda, then a real journalist that presents an even and fair accounting of the news....without the opinion....that should be left for the reader or a columnist. :2cents:

P.S. all of this financial info is readily available on the internet and any real journalist could have found it on their own, let alone make a few phone calls....but trashing someone you have a vendetta against is far easier for birdcage papers like the City Paper.

You make a few good points--the author definitely seems to have an agenda.

Having said that, it is hard to put lipstick on this pig currently.

Revenues increased, partially artificially, because the big Easter park weekend happened to fall into an earlier financial quarter this year than last year.

Next qtrs earnings comps won't have that luxury, and will likely look even worse.

Gates isn't criticized because Gates doesn't run the company. Nor does anyone know how hedged on the position Gates is, or if he is even taking any risk. His entire position may be offest with put options. Or, guaranteed in some other manner.

Even if he is taking some risk, it is nominal, and he likely bought shares as a favor to a friend. It isn't going to help or hurt him financially.

Even with this apparent increase in revenues, they still lose money hand over fist.

[Califan007 The Constipated]

Some are doing incredibly well.....like Disney.

Except for Disney California Adventure, that place is a ghost town...and it's only about 50 feet from Disneyland lol...what a huge mistake that was.

[Xameil]

Like Six Flags was a great company before Snyder got involved.

From my theme park going friends, Six Flags has had a horrible reputation for a long time.

Jason

Don't confuse Six Flags Landover with Six Flags amusement parks nationwide.

Actually the one in NY was called The Great Mistake before he took it over. So I think this has more to do with other factors and they are just trying to pin the blame on him.

[Redskins:Victory_or_Death]

Not to hijack the thread or bash Danny (because I doubt he has much to do with this particular ad)...

The wife and I were talking and we wondered if some Asian Americans mght find the new "Six Flags! More Fun!" TV ad to be vaguely racist... The seeming use of "engrish" in the motto seems to us to be in pretty poor taste.

Being WASPs, I don't think it's up to us to comment on how Asian Americans might feel about it. :whoknows:

Anyone care to comment?

[RFKFedEx]

I went to Magic Mountain in LA back in 2004 (b/f Danny took over). Six Flags Magic Mt. has the worlds best collection of roller coasters on any one lot. However, it was a Saturday in April and litterly half of the rides were closed. At first I figured it was b/c of malfunction. However, throughout the day, certain rides would open and close for no apparent reason. The lines for the roller coasters were an average of one hour. No exageration! Granted, it was a Saturday, but if everyhting had been open the lines would have been reasonable.

The only thing I could conclude at the end of the day was that the rides were closed purely to save $ on labor and opperational costs. Six Flags is not worth the $40 of addmission nor the $20 or so we paid to park.

King's Dominion was run much better than that place the last time I attended about ten years ago.

[tr1]

All this proves is that NFL allegiance is akin to religion...allegiance to Six Flags is nothing.

[laxpck]

Lets not forget this was Wild World people. WILD WORLD.

It was horrible then. The only way to make it good now is to make it into a Kings Dominion or a Busch Gardens.

IT WAS WILD WORLD.

[RFKFedEx]

IT WAS WILD WORLD.

Don't forget that it was Adventure World in between being Wild World and Six Flags America.

Does anybody remember those tv ads w/ Big John Stud riding the Wild One roller coaster the year it debuted in like '87? That was pretty funny, I can still remember the theme song.