Six Flags Entertainment (SIX) James W. P. Reid-Anderson on Q4 2015 Results - Earnings Call Transcript

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Six Flags Entertainment Corp. (NYSE:SIX)

Q4 2015 Earnings Call

February 18, 2016 9:00 am ET

Executives

Nancy A. Krejsa - Senior Vice President, Investor Relations and Corporate Communications

James W. P. Reid-Anderson - Chairman, President & Chief Executive Officer

John M. Duffey - Chief Financial Officer

Analysts

Joel H. Simkins - Credit Suisse Securities (NYSE:USA) LLC (Broker)

Tim A. Conder - Wells Fargo Securities LLC

Ian A. Zaffino - Oppenheimer & Co., Inc. (Broker)

Barton E. Crockett - FBR Capital Markets & Co.

James Hardiman - Wedbush Securities, Inc.

Afua A. Ahwoi - Goldman Sachs & Co.

Operator

Good morning, ladies and gentlemen. Welcome to the Six Flags Fourth Quarter and Full Year 2015 Earnings Conference Call. My name is Brandy and I will be your operator for today's call. During the presentation, all lines will be in a listen-only mode. After the speakers' remarks, we will conduct a question-and-answer session.

Thank you. I'll now turn the call over to Ms. Nancy Krejsa, Senior Vice President, Investor Relations and Corporate Communications for Six Flags. Please go ahead ma'am.

Nancy A. Krejsa - Senior Vice President, Investor Relations and Corporate Communications

Good morning and welcome to our fourth quarter and full year 2015 earnings call. With me are Jim Reid-Anderson, our Chairman, President and CEO, and John Duffey, our Chief Financial Officer. We will start the call with prepared comments and then open the call to your questions.

Our comments will include forward-looking statements within the meaning of the federal securities laws. These statements are subject to risks and uncertainties that could cause actual results to differ materially from those described in such statements, and the company undertakes no obligation to update or revise these statements.

In addition, on the call, we will discuss non-GAAP financial measures. Investors can find both a detailed discussion of business risks and reconciliations of non-GAAP financial measures to GAAP financial measures in the company's annual reports, quarterly reports, or other forms filed or furnished with the SEC.

At this time, I'll turn the call over to Jim.

James W. P. Reid-Anderson - Chairman, President & Chief Executive Officer

Thank you very much, Nancy, and good morning everyone. I'm really so proud of our phenomenal fourth quarter and full year results. In fact, we achieved our sixth consecutive year of record financial performance in 2015 and we surpassed the $500 million aspirational modified EBITDA target that we set in 2011, all thanks to our innovative and dedicated team members who delivered yet another fantastic season of fun and thrill for our guests.

Our 2015 revenue and EBITDA growth of 7.5% and 10% respectively are the highest in the regional theme park space and I'm very happy that our modified EBITDA margin now at 41.1% is also clearly an industry high. We are highly focused on cash generation so I'm even more pleased that our modified EBITDA less CapEx margin of 32.1% remains by far the highest in the theme park industry, ahead of our regional peers by 900 basis points, and ahead of our destination peers by 1300 basis points. Our increasing profit and efficient capital spending at 9% of revenue allows Six Flags to return a high and increasing percentage of revenue to our shareholders every year in the form of both dividend and share repurchases.

Our cash EPS was over $3 in 2015, an increase of 14%, and our return on invested capital now stands at an attractive 18%, up from 15% in 2014 and believe it or not 2% in 2009. We have consistently delivered about twice the S&P 500 growth rate on cash EPS and on dividend yield. I am extremely proud our team and the fact that we continue to raise the bar on our performance each year through our industry-leading innovation and execution. Our strategy is focused on delighting our guests and ensuring they have a fun, safe and thrilling experience when they visit our parks. And our guest satisfaction scores reinforce that they love our product offering.

Our strong growth continues to come from several areas. First are the innovative, high quality and ever proving experiences we offer our guests. In fact, Magic Mountain just set a Guinness World Record for having more coasters at one park than any other theme park on the planet. That is just one reason why Magic Mountain truly is the Thrill Capital of the World.

Our park product offering in 2015 was clearly the best in our company's history. In last fall, we announced an even better line-up for 2016, including eight new coasters. The Justice League Dark Rides that we introduced in Texas and St. Louis last year received huge recognition in November when the industry named them 2015's Best New Attraction in the World. We are introducing the same ride at both Six Flags Great America and Six Flags Mexico this spring. Our hybrid coasters have set numerous world records and are fan favorites and we will be introducing our seventh one at Six Flags Discovery Kingdom in a few months.

On top of these are number of new additions from our 4-D free-fly coaster at Great Adventure to our new kids area at Six Flags Over Georgia to our numerous new family thrill rides and four looping coaster. And it doesn't stop there. Our Q4 growth trends over the last six years support our belief that our Fright Fest and Holiday in the Park events are unique and have tremendous further opportunities for growth. We have innovated and invested more each year into both of these special brands to make Fright Fest bigger and scarier to make Holiday in the Park more merry and special and to broaden our Holiday in the Park event by introducing it at Six Flags Over Georgia and Six Flags Magic Mountain in 2014 and, of course, Six Flags Great Adventure in 2015. It is crystal clear from guest feedback that Holiday in the Park fills a market void, is a magical time for guests to visit Six Flags and that it will become a growing family tradition during the winter holidays for years to come. We will be adding Holiday in the Park two more parks in 2016.

Our second area of growth comes from the success of our ticket pricing and seasoned pass penetration strategy. Implementing moderate price increases each year and upselling guests to our highest priced tickets have been and will continue to be fundamental to our success. Our data shows that we have been successful in both areas. Seasoned pass holders and members are our most loyal and profitable guests and our active pass base was up an incredible 26% at the end of 2015, which bodes very well for the 2016 season.

The number of members who have stayed with us after their initial 12-month commitment is increasing nicely creating a growing, stable stream of monthly revenue. In addition, the number of unique visitors to our parks continues to grow with an increase both our prior year and over the last six years. Guests continue to view Six Flags as a great value offering even with our year-over-year price increases and our value for the ratings improved once again in 2015 for the sixth year in a row.

The third area of growth is in-park revenue, especially culinary, which grew double-digit in 2015 primarily due to our All-Season Dining Pass. We introduced this Dining Pass in all of our parks in 2014 and it has been a huge success. Amazingly, though, sales penetration of the Dining Pass still remains relatively low; however, our revenue in this area grew quite nicely in 2015. With the investments we are making to diversify and improve the quality of our culinary offerings, our All-Season Dining Pass provides us significant opportunity to grow revenue and gain incremental share of wallet from our most loyal guests.

Fourth is international. It is clear that the Six Flags brand is very popular and resonates with people around the world. Many markets outside the United States are ripe for developing theme parks as a growing middle class craves access to more unique forms of entertainment. We have the perfect brand to roll out globally, and we already have a nice steady stream of revenue from our Dubai and China partnership, and that revenue stream will continue to grow.

Finally, we have by far the best team in the industry, and that team continues to deliver big time. I have never worked with a more dedicated group of people nor a more fun group, and our bench strength of leaders is strong and growing.

All of these areas contributed to our success in 2015 and will also be the foundation for our growth strategy going forward, enhancing guest service, innovating unique and thrilling ride, improving value for the money perception even as we increase ticket prices, growing in-park revenue and building our international licensing business.

In summary, 2015 was another phenomenal year and we are extremely well positioned for the 2016 season and beyond.

John is now going to share a few more details on our financial results. John?

John M. Duffey - Chief Financial Officer

Well, thank you, Jim, and good morning to everyone on the call. We are very pleased with how we finished the year with very strong attendance gains, revenue growth, and record profitability in the fourth quarter.

I will start with a discussion of our fourth quarter performance and then provide details for the full year 2015. Attendance in the quarter grew 22% due to both an increase in season pass visitation as well as one day admissions. The strong attendance growth was a result of the following.

First, as we have mentioned before, we continued to invest in our Fright Fest and Holiday in the Park events. These offerings expand the operating calendar, which not only drives incremental attendance but also are a key component to our success in retaining and growing our season pass and membership programs.

In addition, as Jim mentioned, we added Holiday in the Park at Six Flags Great Adventure in New Jersey. The solid attendance growth in the quarter is a clear indication that our strategy is working well, and we will continue to invest to make these events even bigger and better for our guests in 2016 and beyond.

Second, we experienced strong sales of our 2016 season passes and memberships, which we began marketing in September. Similar to prior years, guests who purchased a 2016 season pass or membership could utilize it to attend both Fright Fest and Holiday in the Park during the 2015 season.

Revenue for the quarter was a record $217 million, an increase of $34 million or 18.4%. This increase was driven by the strong growth in attendance and a 19% increase in sponsorship and international licensing revenue, partially offset by a 3% or $1.08 decrease in guest spending per capita. The guest spending per capita was negatively impacted by foreign exchange associated with the weaker Mexican peso and Canadian dollar as well as the strong season pass mix. If you adjust for foreign exchange, guest spending per capita increased $0.07.

The revenue growth in the quarter was well balanced with admissions revenue up $19 million or 20% and in-park revenues up $12 million or 17%. Adjusting for foreign exchange, admission revenues were up $21 million or 23%,2 and in-park revenues were up $15 million or 22%. The strong in-park revenue growth was a direct result of the higher attendance, but also is a result of the investments we made on incremental premium Fright Fest attraction such as our haunted houses and mazes, new guest offerings for Holiday in the Park, and our successful All-Season Dining program.

Cash operating and SG&A expenses increased $15 million or 12% in the quarter primarily as a result of the increased investments in Fright Fest and Holiday in the Park, including the incremental cost of Six Flags Great Adventure. The strong revenue growth resulted in adjusted EBITDA of $62 million versus $46 million in the fourth quarter of 2014, a $16 million or 34.5% increase. Adjusting for foreign exchange, adjusted EBITDA was up $18 million, an incredible 42%.

To put into perspective where we are today as it relates to both our Fright Fest and Holiday in the Park franchises, over the last five years, we have taken what was generally an EBITDA loss quarter to the $62 million we delivered in the fourth quarter of 2015. And we can clearly now offer our guests nearly year-round entertainment in the majority of our theme parks.

Moving to the full year 2015 performance, total revenue for the year increased $88 million or 7.5% over 2014, as the result of a 7% increase in admission revenue, a 9% increase in in-park revenue, and a 15% increase in international licensing revenue. The admissions and in-park revenue were adversely impacted by foreign exchange. Adjusting for foreign exchange, total revenues were up $107 million or 9% with admissions revenue up 9% and in-park revenues up 11%. Attendance in 2015 grew to 28.6 million guests, an increase of 2.9 million or 11.4%.

Our strong offerings and innovations provided us with the opportunity to increase pricing across all our ticket types in 2015. Despite price increases, guest spending per capita decreased $1.37 or 3.2%. Both admissions per cap and in-park per caps were dampened by the higher season pass and membership mix, which increased to 56% of total attendance in 2015 versus 50% in 2014, as well as adverse foreign exchange. Adjusting for foreign exchange, guest spending per capita decreased $0.67 or 1.6%.

Cash operating and SG&A expenses increased 6% in 2015 and represented 50.9% of revenue versus 51.7% in 2014, an 80 basis point improvement. We were extremely pleased to achieve adjusted EBITDA of $481 million in 2015, representing an increase to $42 million or 9.6% over 2014. Adjusting for foreign exchange, adjusted EBITDA grew $50 million or 11.5%.

As many of you know, in 2011, we set an aspirational goal of achieving $500 million of modified EBITDA in 2015. We not only achieved this target, but surpassed it with $520 million of modified EBITDA. Since we achieved our target, the remaining Project 500 shares or approximately 1.5 million shares will be granted in the first quarter of 2016. Our 2015 modified EBITDA margin of 41.1% is a company and industry high and compares to a margin of 40.6% in 2014, a 50 basis point improvement. The increase is a direct result of the strategy to drive revenue through pricing, season pass penetration, enhanced product offerings, and international licensing initiatives while leveraging across infrastructure.

Full year diluted GAAP earnings per share was $1.58 versus $0.77 in 2014, an increase of 105%. Full year cash earnings per share, which we believe is a better reflection of our earnings versus reported GAAP EPS due to our tax loss carry forwards, was $3.01 versus $2.63 in 2014, an increase of 14%.

As of December 31, 2015, we had $400 million of net operating loss carry forwards remaining. Based on our current projections, we anticipate paying minimal cash taxes through at least 2018.

Total capital spending in 2015 was $114 million, right on our targeted rate of 9% of revenue. Reported net debt as of December 31 was $1.4 billion. The company is in a very good position with significant cash on hand at year-end, no outstanding borrowings on its revolver, and a net leverage ratio at December 31, 2015 of 2.9 times.

We repurchased $122 million or 2.4 million shares in the fourth quarter and this took our full year purchases to $245 million or 5.2 million shares. We have $54 million remaining on our board authorized share repurchase program.

We are very pleased with the great start to the 2016 season pass and annual membership sales. As a result of our strong early momentum, our Active Pass Base at December 31, 2015 is the highest it has ever been and it grew by 26% versus the record levels we saw at the same time last year. Deferred revenue grew to $97 million as of December 31, 2015, a $26 million or 36% increase over prior year.

In summary, we are extremely pleased with the fourth quarter and full year performance. For the year, we were able to increase attendance with strong marketable capital, excellent marketing, and a successful season pass and membership strategy. We were able to accomplish this with price increases across all of our ticket types, which speaks to the value and the strength of our product offerings. And we effectively leveraged our cost infrastructure, resulting in record EBITDA and excellent cash flow generation.

We are well positioned as we head into 2016 and beyond. As we look to the 2016 calendar, I would like to remind you that Easter falls in the first quarter versus the second quarter in 2015. Many school districts schedule their spring breaks around this holiday and we operate many of our parts during the spring break weeks. Therefore, we anticipate that approximately 150,000 to 200,000 of attendance will shift from Q2 into Q1 when you compare 2016 with 2015.

And now, I'd like to turn the call back over to Jim.

James W. P. Reid-Anderson - Chairman, President & Chief Executive Officer

Thank you very much, John. It was another fantastic year, our best ever, and our team is ready to deliver another record breaking year in 2016. Construction is well underway on our new rides and attractions, and our marketing and operational plans are ready to go. Between new coasters and family rides, this is our biggest new product launch year in a decade and I can assure you our park line up in 2016 will be our best ever. We never stop innovating and I can promise you there is much more product news to come in 2016 and beyond.

Our planning and execution to 2016 remains aligned with our target of delivering $600 million of modified EBITDA by 2017. The key areas that have driven our growth and success over the last six years will also be the keys to our success in the future, including; the strategic approach to ticket pricing, further penetrating sales of season passes and memberships, in-park revenue driven by our All-Season Dining Pass, international expansion and, of course, expansion of our special events, Fright Fest and Holiday in the Park. There is no doubt the investments we are making in the business and especially in Fright Fest and Holiday in the Park are paying off.

The momentum we have built over the last several years across all facets of our business along with the investments we have planned in the future will continue to generate attractive returns for our shareholders for many-many years to come. We are investing more each year in Holiday in the Park by adding new attractions, decorations and activities for guests to enjoy.

You will recall that we introduced Holiday in the Park at Great Adventure in New Jersey in 2015 and we have had rave reviews from our guests. They were loud and clear in their feedback, but they love the event and want Holiday in the Park to become an annual tradition. It is clear there is huge opportunity to continue growing this brand.

As such, we will be introducing Holiday in the Park at two additional parks in 2016, Six Flags America near Washington DC and at Six Flags St. Louis. This will bring our total park count to nine for the holiday season and provide our company four clear seasons to market the guests and partners.

Our international strategy also continues to progress forward with both our existing and potential partners. To provide some perspective, in addition to our Dubai and Chinese deals, over the past few months, we have executed non-binding letters of intent to explore development of theme parks in two additional countries. While these letters of intent are subject to conditions and further negotiations and may never lead to definitive agreements, we believe they are indicative of the substantial international interest in regional theme park development and the progress we are making on that front.

You may also have recently read that our public bid was accepted to operate a 67 acre water park in beautiful Oaxtepec, Mexico, an existing park that has not been opened for several years. It is located approximately 50 miles south of our theme park in Mexico City in a warm tropical area, but is conducive to year-round operation.

Our Mexico City theme park is truly one of our top performing and fastest growing parks and we can leverage the highly talented local management team who are more than capable of making this Hurricane Harbor water park a huge success. Before the park opens in the spring of 2017, we intend to make a one-time upfront capital investment of approximately $15 million to $18 million, which will be incremental to our base CapEx spend of 9% of revenue. We are very excited about this opportunity and anticipate a very quick payback on the capital investment.

We have now posted 22 record quarters since emerging from bankruptcy and we are working towards setting many more records. We also are the ultimate growth and yield stock, consistently delivering about twice the S&P 500 yield and growth rate.

Our future is very bright, momentum is strong and we remain on track to achieve our 2017 aspirational target of $600 million of modified EBITDA. I have never been more confident in our future than I am today. It is exciting to realize that our consistent execution and success over the last six years has built a broader and more stable foundation for the company and the Six Flags brand than ever before. And that stronger foundation opens up new opportunities for further growth.

You all have seen the press release we issued this morning regarding organizational changes at the company. Effective tomorrow, I will be stepping in to the role of Executive Chairman of Six Flags. And concurrently, John Duffey will become President and CEO, while Marshall Barber will become CFO. I think all of you know John, but you may never have interacted with Marshall. Marshall has worked at Six Flags for 20 years and is an outstanding financial executive.

In fact, we are fortunate to have multiple highly talented senior level financial executives on our team along with superb bench strength in operations. This is a well deserved opportunity for both John and Marshall to step up into new operational roles for which they have been actively groomed. I know that they are very excited by the opportunity.

I am sure, however, that you will ask why we would make these changes now when things are going so well. There are a few main reasons. First, I believe providing opportunities to advance people within an organization is critical to retain and motivate talented people and to ensure the company's continued success. Many CEOs stay in their roles too long, becoming overly confident and rigid in thinking. I don't ever want to become that person taking things for granted and potentially blocking the opportunity for great leaders with innovative ideas from progressing within the organization.

Second, our succession plan is excellent. Our bench strength is immense and given that we are in a period of strong growth, our board members are confident these changes will be seamless and help us go from strength-to-strength, while also fostering professional development for many team members. In addition, investors are looking more and more for companies to split the role of Chairman and CEO since that is considered to enhance corporate governance.

And then finally, on a personal level, two of my kids have already left home to attend university and to work. I have a 17-year-old going to university in six months and a 16-year-old who will be off in two years. I want a bit more time at home with my boys before they are off. That is very difficult to do while traveling and being a hands-on CEO.

I truly believe our business momentum is stronger than it has been at any point in the nearly six years I've been with Six Flags and I feel extremely confident about our long-term future, and especially our ability to deliver our seventh straight record year in 2016.

Our ongoing success comes primarily, because we have the best people in the industry working at Six Flags and it has been an honor to be the CEO of the company over the last few years. I will continue to be active at the company from a strategic perspective as Executive Chairman and I will maintain an office in our Gurnee theme park, right at the center of where our happy guests mingle. I am really looking forward to working closely with John as we move forward to another great phase in our company's incredible story.

Brandy, at this point, could you please open the call up for any questions?

Question-and-Answer Session

Operator

Certainly. Your first question comes from Joel Simkins with Credit Suisse.

Joel H. Simkins - Credit Suisse Securities (USA) LLC (Broker)

Hey, good morning, everyone. And Jim and John and Marshall, congratulations on all the transition opportunities, I think it's a great step for the company.

More importantly, Jim, I just – I want to know who is going to handle the new capital introductions going (31:43). But – and that was a bit of a joke. But in all seriousness, I just wanted to talk perhaps and we will start with the Mexico deal. Obviously, it's a great announcement for you guys. As we think about some other international opportunities, are there perhaps more of these deals out there where there's an existing asset that you could comment and operate? And then perhaps further on that international question, you mentioned the LOIs. What kind of milestones could we expect to see over the next kind of 12 months plus to convert these sort of fully signed deals that would move ahead?

James W. P. Reid-Anderson - Chairman, President & Chief Executive Officer

Well, Joel, thanks for the questions. They're all good ones. I think first and foremost in terms of the new capital video, I think we're looking for a new star to showcase their talent on this and I'm looking at him right now. John Duffey will be the best possible new star of those new capital videos.

With regard to international, I do want to let you know that my comments earlier about the potential here -- I feel so strongly about the future internationally that I think it's going to drive massive increases long-term in our revenue and our EBITDA. It takes a while to get these businesses up and running, but we mentioned the fact that we have two LOIs out there and we're also negotiating multiple other potential deals. I can't say to you that there are going to be milestones so that you know what's next. We don't publicize until we actually have deals signed. But I think on every quarterly call, we will obviously give an update, Joel, as to where we are. John will do that along with Marshall. And, of course, if we do sign any major deals, we would put out a press release to announce that.

John, do you want to add to that?

John M. Duffey - Chief Financial Officer

And I think as you think about those LOIs, we're obviously very pleased that we are able to sign two additional deals, and honestly, Joel, we think that there is a lot more opportunities out there for us.

As it relates to your question on Mexico, we are extremely excited about this opportunity. It's a great property located near our park in Mexico City, so not only do we think that it's a great park that will drive a lot of attendance, but it really is an opportunity to cross-sell the two and potentially get more season passes. So we're very excited about that and we will continue to look at opportunities as they come along, but they really would have to make sense. We'd have to get a very good return on that. This property, in particular, is an existing park that does need some additional capital, but has a fairly high return.

Joel H. Simkins - Credit Suisse Securities (USA) LLC (Broker)

Sure. And two quick follow-ups if I may. Obviously, we're getting lots of questions these days from investors on the NOL and perhaps maybe a longer term value enhancement opportunity around a REIT. So, could you just update us on that?

Then secondly, and I'm not sure if I'll get an answer, but you did recently extend your accesso deal through 2025. What can we expect from a hardware perspective at the parks going forward? And given that you've cut this deal in much better footing, are there slightly better economics to you going forward? Thank you.

John M. Duffey - Chief Financial Officer

Yeah. Joel, as it relates to the net operating losses, we've talked about the – we do have some losses that will take us through 2018 and we are always looking at ways that we can develop further tax opportunities to minimize the amount of tax that we would pay going forward. I think that we've talked recently about opportunities around REIT and we continue to evaluate that.

As it relates to the accesso contract, we are very, very excited about the long-term contract that we signed with accesso. I think it is a contract that is good for both parties and it provides us with the ability to continue to look at various things, particularly in-park, that we will be able to utilize more efficiently. So, we're very excited about that.

Joel H. Simkins - Credit Suisse Securities (USA) LLC (Broker)

Thank you.

James W. P. Reid-Anderson - Chairman, President & Chief Executive Officer

Thanks, Joel.

Operator

Your next question comes from Tim Conder of Wells Fargo Securities.

Tim A. Conder - Wells Fargo Securities LLC

Thank you. And let me offer my congratulations, Jim, to you, John, and then also Michael on all the changes and transition there to each of you gentlemen. I'll stay on the NOL part. It seems like you filed something with the IRS prior to the December 7 cutoff ahead of the new legislation. Can you give us any more detail, what specifically is requested? And then, any potential timeline -- I know it's the government, so that's maybe a very difficult question -- but any potential timeline where you're expecting the decision from them?

And then as it relates to the memberships and season passes, can you talk about – did the absolute units in the traditional season pass product -- did that also grow or were you continuing to see a conversion over to the membership side?

James W. P. Reid-Anderson - Chairman, President & Chief Executive Officer

So, Tim, thanks very much for your comments. You know that we don't break down detail on the season pass membership side, but what I can tell you at a very, very high level, we sold both absolute -- we sold growth in both categories. And given that active base increase of 26%, it's really encouraging to see that. I think we also described -- John talked to it, I did too -- once members get to the 12-month period, then they keep rolling forward and we're now generating that revenue on a monthly basis from the 13th month on and that is really helping to enhance our traditionally low fourth and first quarters, where the regional business historically has lost a lot of money. You can see we've gone to the point where now we're generating over $60 million of EBITDA, and that membership piece is certainly a piece of that.

Tim A. Conder - Wells Fargo Securities LLC

Okay.

John M. Duffey - Chief Financial Officer

And then, Tim, on the REIT questions in particular, as you know, there was a legislation that came up that you had referenced where basically it will prohibit REITs going forward. There was a rule that allowed for any ruling requests that were in place and have submitted prior to December 7 that they would be grandfather. We did in fact violate ruling prior to that date, so we are grandfathered from the change in the legislation, but I will tell you that I'm not going to speculate as to what the IRS would rule on that or the timing on it.

Tim A. Conder - Wells Fargo Securities LLC

Okay. And then a couple of follow-ups. Then, Jim, you went into one of my follow-ups there a little bit. Any color that you, Jim or John can give on the benefit Q4 saw from that smoothing of the memberships? And then, I guess, also as it relates to revenue, John, just some quantification, the international revenue that occurred during Q4 and then just a total for the year?

James W. P. Reid-Anderson - Chairman, President & Chief Executive Officer

John, why don't you start with international, then I'll talk benefits.

John M. Duffey - Chief Financial Officer

Yeah. So, on international, the full year revenue, Tim, was $16 million and from that we generated about $13 million of EBITDA. So we talked before about that this international revenue is a very high margin revenue for us and I think we saw that in the 2015 year. As it relates to the fourth quarter, it was about $6 million of revenue, about $4.5 million of EBITDA.

Tim A. Conder - Wells Fargo Securities LLC

Okay, great. Thank you.

James W. P. Reid-Anderson - Chairman, President & Chief Executive Officer

But, Tim, coming back on your first question, we had talked about early on, you'll remember even in conversation that we had privately and then on call, one of the biggest concerns in this industry has been the inability to retain season pass holders year-to-year. It's been a very difficult thing for the regional players. And so our goal in bringing the membership in was to have one more tool for retaining people. We've obviously got other tools that we use, and our connection with season pass holders is through the ability to email them or get to them directly in other forms has really improved, but the membership has been a huge plus. Not only did it smooth out the revenue in the way that you mentioned, but now we're at the point where we've got these members who are staying on. Not only have we got all the communications with them, but they are staying on well past the 12 months. And remember that the price point on a membership is around 18% to 20% higher than a traditional season pass. So it is very good all round for the company.

John M. Duffey - Chief Financial Officer

And, Tim, we saw good growth on both season pass and memberships. So if you think of the whole strategy on memberships is to be able to attract those people that may have a difficult time spending their upfront money to buy a season pass. So we look at it as it's a lot of incremental pass holders that we otherwise may not have been able to get, but we saw both in-- good growth in both segments.

Tim A. Conder - Wells Fargo Securities LLC

Okay. And lastly, gentlemen, the international front – you've talked previously about a goal of four to 10 parks over a five-year period or so or an eight-year period. It would appear you're well on your way to four now. Just any kind of update on your goals and time period there?

James W. P. Reid-Anderson - Chairman, President & Chief Executive Officer

Tim, we've never actually given a goal, believe it or not. I think in various conversations, I think people have assumed there are certain numbers. We've obviously now said that we have two that we're very active with, two that are in LOI stage and I've made the comment that there are multiple others that we're negotiating as we speak. So I am not going to give you a number and say this is the number that we're anticipating. I do think that it will be growing nicely every single year. And I think what you may be referring to is – I think we made a reference to the fact that our partner in China would like to have multiple parks, up to potentially 10. But I think that's going to be over a period of many years and will not happen overnight. So, I guess, what I am saying is, I can't answer your question directly and give you a number, but we feel very confident about our ability every year to be increasing these numbers nicely.

Tim A. Conder - Wells Fargo Securities LLC

Okay. Thank you.

Operator

Your next question comes from Ian Zaffino of Oppenheimer.

Ian A. Zaffino - Oppenheimer & Co., Inc. (Broker)

Hi. Thank you very much. I just wanted to drill a little bit deeper into the in-park spend. I know you attributed some of the benefit there to All-Season Dining, and then also you mentioned the mazes and other types of activities inside the park. But is there like an element where – you introduced this New Jersey Park and you are seeing maybe just higher spend out of that park and that maybe helped the mix? And then also, does Holiday in the Park have, let's just say, a higher in-park spend per diem versus an average day? Maybe if you could help us understand how the different pieces move? Thanks.

James W. P. Reid-Anderson - Chairman, President & Chief Executive Officer

So it's a really good question, Ian. And we'll never get into specifics about exactly what's going where, but I'll make several high level comments that I think will help you. First, overall, we grew revenue very nicely at every single park across the system last year. It was an amazing year. Meaning, that's something that you just don't see regularly and we're very proud of that. And I think that Holiday in the Park and IPS were a core part of that. One piece of that is the All-Season Dining Pass and I made the comment in my prepared comments earlier that we have relatively low penetration there.

So I feel very confident about our ability to continue to drive revenue by penetrating further with the existing active pass base, which is also at an all time high at this time of the year, and that gives us tremendous opportunity to be able to just grow revenue from culinary sales. We are also working on multiple other initiatives in every category to drive revenue, but I would say to you that our biggest opportunity in-park is the culinary and the All-Season Dining Pass.

Now, John, would you like to take the Holiday in the Park question?

John M. Duffey - Chief Financial Officer

Yeah. As it relates to the Holiday in the Park, absolutely, Ian, we were very pleased with what we saw on the in-park spending for those parks that were open. And it's all about creating the special atmosphere for our guests. So we bring in a lot of new merchandise, new food offerings that are really tailored around that special event. And so there is a lot of things that we up-charge for. So, for example, pictures with Santa, et cetera. And so we were very pleased with what we saw in the fourth quarter associated with that. But I think as we continue to grow that business, we continue to add it to additional parks, we have even more opportunities to continue to take the in-park spends.

James W. P. Reid-Anderson - Chairman, President & Chief Executive Officer

I would say there is one thing we can say, though, John, because I think what Ian was getting at there, one of the parts of his question was: did New Jersey drive the success. And I think that New Jersey was only a piece of it. And what was really interesting, Ian, was that we saw growth everywhere. And, as an example, if you take our Georgia Park through word of mouth and just people being excited by what they experienced prior year, they brought friends and family and that park saw a huge boost in Holiday in the Park attendance and that was true across our whole system. So it wasn't that one park mix affected it overly dramatically. Great Adventure had a very nice effect, but every park had a really good growth.

Ian A. Zaffino - Oppenheimer & Co., Inc. (Broker)

Okay. And then the good old question about gas prices here. I know we always say that doesn't really affect attendance. Are you seeing maybe the consumer having a little bit more money in their pocket and that's also helping the in-park spend? And then a second question would be maybe if you could touch upon memberships and kind of the boost there. Was that also driven by the increase in Holiday in the Park? Is that really giving you another opportunity to upsell on the memberships, and maybe you can kind of touch on the attribution of that? Thanks.

John M. Duffey - Chief Financial Officer

Yeah. Ian, as it relates to gas pricing, we talked before about the fact that we've gone back and looked at a lot of historical data and the correlation between gas prices and attendance, whether gas pricing are going up or down. And, honestly, we have not seen any correlation between those two. So we don't believe that that's a big driver of our attendance gains. We obviously think that our attendance gains are more from a lot of the things that we've already highlighted. But it does put, we believe, more money in people's pocket. So I think there was probably some benefit associated with additional spending when these people were in the park.

As it relates to membership, as we talked about whether it would be really memberships or season pass, we think that adding events like expansion of Fright Fest but also adding Holiday in the Park to additional parks gives people reason to come to the park multiple times. As you think about it, we've got this great capital that we announced in the spring, so it gives people a reason to come to the park. Everyone loves to come to the park during the summer period and now they want to come to enjoy this fantastic Fright Fest and Holiday in the Park. That gives them multiple reasons to come. And when they do that, they see the tremendous value associated with season pass and membership. So I think that's been one of the key drivers of growth in both of those areas.

James W. P. Reid-Anderson - Chairman, President & Chief Executive Officer

And we have been driving that, Ian. So one of the things that I think has come up before us is are members different in any way. And what's really, really beautiful about the members is not only do you retain beyond that 12-month period, you got all their credit information, so that you're able to continue to generate that revenue going forward, but they look very similar in demographics to the traditional season pass holder and are higher than the average U.S. demographic in terms of income. So it's really a very positive overall situation that we have and I think that's part of why we have seen the best overall growth in revenue, best growth in profitability not just last year, but for the last few years compared to any of the regional park company.

Ian A. Zaffino - Oppenheimer & Co., Inc. (Broker)

Okay, great. Thank you very much. That's very helpful.

Operator

Your next question comes from the line of Barton Crockett of FBR Capital Markets.

Barton E. Crockett - FBR Capital Markets & Co.

Okay, great. Thanks for taking the question. And I was curious about one of the nuances here in the numbers you guys put up, the description that some of the attendance lift was from the presales of the 2016 season pass people being able to get in the fourth quarter of 2015 for some of the holiday events. Can you give us a little bit more quantification around that? Was this a material driver of that 20% plus growth in attendance or not, and how does the revenue accounting work there? I mean, if you are letting people come in, in the fourth quarter, do you now essentially allocate revenues for that season pass over five quarters versus four quarters, and was this a noticeable revenue impact or not really?

John M. Duffey - Chief Financial Officer

Well, Barton, let me start by saying that we have done this for a number of years. So we will always start to begin to market the next year's season pass and memberships in the fall and we did that in 2015 as well. And we've seen – historically, we've seen very good sales of the season pass in the fall. And one of the drivers is that people see that clearly as a benefit if they can buy that pass and utilize it for the remainder of 2015 and then the following year. But I just want to emphasize that we've been doing this for a number of years. So I would tell you that that was not a big driver of our attendance for the fourth quarter as you compare year-over-year. And we will continue to do that going forward because it really locks people in early and to get them to buy that pass early, lock those people in is a great opportunity.

James W. P. Reid-Anderson - Chairman, President & Chief Executive Officer

So, Barton, no change in approach. It's the same approach we've used and, by the way, others have used, going back forever. And secondly, there's no change in the accounting at all, it's exactly the same.

John M. Duffey - Chief Financial Officer

And no change in the accounting. So basically the way the accounting works is that you recognize. You have a historical data in terms of the estimate of how many visits those people make to the park and you recognize that revenue as they visit. But again, as Jim said, really no change whatsoever in how we've accounted for that.

Barton E. Crockett - FBR Capital Markets & Co.

Okay. All right. And then in terms of the success with the Holiday in the Park, I mean, clearly – I know you don't like to talk about weather, but when you are talking about winter, it's important. And this was a very warm winter, at least going through December. You are expanding this into more parks. What's your view of the ability for the weather normalized to support the type of performance that we saw this quarter going forward? Because normally I would think you'd assume it would be colder. And I'm just wondering what your feeling is about the ability of people to really want to go and the weather to support that in future years.

James W. P. Reid-Anderson - Chairman, President & Chief Executive Officer

Well, Barton, we have always said that unless there's some major hurricane or something coming through, we will not use weather either as a positive or a negative. We focus on the operational performance. And I would say that people are focused, let's say, on what is perceived to be better weather on the East Coast here or the West Coast there. But remember that last year, especially in Texas, early on in the year and later on in the year, it was horrendous weather, really bad weather that impacted not only our parks, but many businesses. And so our view is pretty simple. Weather tends to even out over an entire year. And whilst there were these up and downs here and there, it really was very similar to prior years overall.

Now, were we grateful that we didn't have any major storms hitting our parks right at the end of the year? Of course. And could that affect future years? Yes, it could. But we have a very diversified portfolio of parks, and as we add more parks, that really helps to further diversify and minimize the effect of weather. So it's one of those things where we've consistently said the same thing, as do our other competitors in the industry, and I truly believe that to be a case.

John, would you disagree?

John M. Duffey - Chief Financial Officer

No, I wouldn't disagree at all. And as a matter fact, Barton, I actually happened to visit Great Adventure during Holiday in the Park when it was 30 degrees, and the park was packed. People were excited. I had people coming up to me, thanking me for adding that. And so I think as you think about particularly Holiday in the Park with that atmosphere, I don't believe that cold weather dampens attendance at all.

Barton E. Crockett - FBR Capital Markets & Co.

Okay. That's very helpful. And then one final thing. Turning to the international, you aren't going to tell us -- I understand why -- what the countries are where you have the letters of intent. But can you give us a sense of the magnitude of the opportunities where you have these letters of intent? Are these comparable to what you have in China and Dubai or somewhat smaller? Any kind of broad strokes you can provide around that?

John M. Duffey - Chief Financial Officer

Yeah, Barton, unfortunately, at this point in time, since they are just LOIs, we can't really provide any detail. But as we obviously get further along in the process, we will be able to provide a little bit more color.

Barton E. Crockett - FBR Capital Markets & Co.

Okay. That's great. Thanks for the time, guys.

Operator

Your next question comes from James Hardiman of Wedbush Securities.

James Hardiman - Wedbush Securities, Inc.

Hi. Good morning. Thanks for taking my call. Maybe talk a little bit about the consumer trends you are seeing there. Obviously, the fourth quarter really couldn't have been much better, but I think a lot of investors are concerned that some of the global issues are weighing down on the consumer thus far in 2016. Obviously, you're not going to give us an update on business in 2016. But is there anything that you are seeing in the data that tells you that your consumer is at all being affected by some of the global economic malaise? And, I guess, specifically, talk a little bit about trends you are seeing in Texas. Obviously, there are fears around sort of the energy economy there and what type of an impact that's having on Texas. Obviously, you said that your parks there were rough this year, so maybe talk a little bit about that.

James W. P. Reid-Anderson - Chairman, President & Chief Executive Officer

James, as good business executives, we always try to approach the economy by assuming that things aren't always great, because we're trying to build the business ourselves and make sure that we have core growth in our own operating performance and not rely on the economy itself to do anything for us. I would say that right now, we are seeing no signs that would suggest that the economy is in bad shape. Is it in great shape? I wouldn't say that it's in great shape, but I don't look at it and say, it's bad.

I think what we're seeing specifically is that consumers are looking for great values and there really isn't a much better entertainment value than what we provide. It's sort of very unique thrills that you really can't get anywhere else, and the opportunity to spend a day with family and friends. And the fact that we've taken on this news in every park approach, we have something new in every park this year as we did last year, in fact more this year, from a ride and coaster perspective than we had last year or in any of the last 10 years. That just means people are excited about coming to the parks and if they have more money because gas prices are down, that's even better that they come and spend it with us. So we're very, very happy and I would tell you there is no sign of any negatives in Texas that we can see. Obviously, the season isn't up fully and running yet. We're gearing up for that, but the evidence that we saw would suggest that we're in good shape.

John?

John M. Duffey - Chief Financial Officer

I'd just want to echo what Jim said, which is, in challenging times, people look for great values. And I think they see our offering, particularly with the season pass and the membership, is a great, great value. And I think that having the membership in place gives people the opportunity, if it's challenging to have that upfront outlay, the ability to pay over time, and I think that has helped as well. But I can tell you that we have continued to see our guests spending more and more money in the parks than they ever have before. And I think that has to do a lot with the expansion of the offerings that we have.

James W. P. Reid-Anderson - Chairman, President & Chief Executive Officer

And, John, I think the other thing, though, right, is the whole Dallas-Fort Worth and San Antonio markets have just done an amazing job of diversifying. Haven't they? I think population growth is very, very strong. The diversification in the market there is that there are other business and not just reliant on oil and gas has been very positive and genuinely we feel less exposed in those markets than we have historically been because of those changes. Is it possible that we might lose some folks in the outer market? It's possible. But certainly, through the holidays, we saw nothing like that. In fact, we're very strong.

James Hardiman - Wedbush Securities, Inc.

Very helpful. And then maybe just talk a little bit about the balance between attendance and per caps. Obviously, there's a lot of moving parts here and you've got some accounting impacts of the membership passes having some downward pressure on the per caps. But it seems like even if you cut through all of that, strategically you guys saw something in 2015 that made you say we could probably really flex our muscles in terms of attendance and maybe not take quite as much price as we have in the past. How did you come to that strategic decision? What did you see there? And as we think about 2016, how should we think about that balance? Should we see a more even mix of per caps versus attendance? How should we think about that?

James W. P. Reid-Anderson - Chairman, President & Chief Executive Officer

That's a really good question, James. And you may remember, as we closed out last year with a great year and then opened the year, people – certain people were very concerned about the approach that we were taking and were per caps collapsing. And, in fact, we've articulated all along that our approach is a very smart approach that targets very modest increases in pricing so that our guests don't feel like they are being gouged along with penetration of season passes and membership. I know that's very high level, but that approach we have used successfully over the last few years and it has worked wonders and I feel like momentum is accelerating because of that. And that's why I mention that I have never felt more confident about where we are than where we are today. And when we look forward, we're going to approach it exactly the same way. And maybe, John, you're going into this world as CEO, do you want to describe how we're going to approach this strategy? Is there any change coming?

John M. Duffey - Chief Financial Officer

Really there is no change to this strategy. It's really taking a balanced approach, as Jim indicated, making sure that as we push price up and we will continue to do that, because we believe that – really that is probably our number one opportunity as it relates to revenue growth. So as we continue to take those prices up, we'll just make sure that we do it in a very smart way. And I think the best evidence of the fact that we continued to have pricing power is the fact that we took prices up in 2015 and increased our attendance significantly. In addition, we took our pricing up on our 2016 passes and our asset base is up 26% year-over-year. So I think that is the best evidence that we continue to have pricing power and I think we'll continue to have that power for several more years to come.

James W. P. Reid-Anderson - Chairman, President & Chief Executive Officer

And the strategic approach that we're using across multiple fronts, including our marketing and other initiatives, will not change. They work. We've been successful with them and we've seen not only the destination players, but also the regional players, talk about taking pricing going forward. So I think we have this incredible umbrella under which we operate and we still got tremendous room to grow.

James Hardiman - Wedbush Securities, Inc.

That's very helpful. And then just maybe one last clarification. I think you talked about the membership passes and the accounting benefiting – I'm sorry, being a detriment to per caps in 2Q and 3Q and benefiting per caps in 4Q and 1Q. Was that actually the case in 4Q? I would've expected to maybe see a little bit more of a lift. But was it just overcome by some of these other issues that you've touched on? And will that continue to be a detriment, I guess, as we think about 2016 overall from a per cap perspective, the impact of the membership accounting?

John M. Duffey - Chief Financial Officer

Well, let me start by saying that the memberships actually have a favorable impact on per caps over the year because we do charge a premium for memberships versus the season pass. So over the year, it is a higher per cap than what you would see on season pass. There are some nuances as you think from quarter-to-quarter because, as people roll off that initial year, we're recognizing that revenue monthly, not when they actually visit. So it tends to have a little bit more downward pressure on per caps in the second and the third quarter where we'll see a little bit more attendance versus the other two quarters. But, again, I want to make sure that it's clear that overall in the year it actually provides an uplift versus a season pass purchase.

James W. P. Reid-Anderson - Chairman, President & Chief Executive Officer

But there is no doubt, John, right, that the very high attendance that we saw in Q4 did dampen the overall effect of memberships. It's just one of those things. The higher the attendance you get, the higher the season pass and membership effect is to reduce that per cap a little bit.

John M. Duffey - Chief Financial Officer

That's right.

James W. P. Reid-Anderson - Chairman, President & Chief Executive Officer

But it did happen.

James Hardiman - Wedbush Securities, Inc.

Got it. Thanks, guys.

Operator

Your next question comes from Afua Ahwoi of Goldman Sachs.

Afua A. Ahwoi - Goldman Sachs & Co.

Hello. Thank you for taking my question. Just two from me, and maybe following up a little bit on the earlier question. As we think about our models for 2016, given the strong growth in attendance we saw in 2015, how should we think about comparisons? Is it fair to think that the two-year stack can accelerate, so we should continue to expect growth? Or is there any – or do we have to think about how we model that maybe to keep a two-year stack at a certain level? And then just for my clarification, the two additional parks that will have Holiday in the Park in 2016, which ones are they? And can you remind me what that will bring the total count to of the number of parks you have under the Holiday in the Park? Thank you.

James W. P. Reid-Anderson - Chairman, President & Chief Executive Officer

Okay. Afua, question number two, which is which parks will have Holiday in the Park, at St. Louis and in Washington at our America Park. And the number of parks total will be...

John M. Duffey - Chief Financial Officer

It will be nine parks.

James W. P. Reid-Anderson - Chairman, President & Chief Executive Officer

So that's that. And then the first question that you asked about growth, I think you know we don't give guidance on the growth number, but you've heard what I said earlier. I feel like our performance or the momentum is so strong, we feel very good with the 26% increase in the active base. If you go back to last year, we talked about the growth in the active base and we felt very confident and obviously it came true. So we're seeing that active base, but we can't and won't predict the future. We're just feeling pretty good at this time.

John M. Duffey - Chief Financial Officer

I think if you combine the active base growth up 26% going into the year along with the best capital lineup that we've had in a decade, I feel very confident that we'll be able to continue to grow our attendance.

Afua A. Ahwoi - Goldman Sachs & Co.

Got it. And actually one follow-up for me. Given the Holiday in the Park and sort of the extension of the season that you've been doing over the last few years, are you seeing a change in the frequency of those active pass members? Are they coming more often, or is that unchanged from what you've spoken to in the past, which I think has been three to four is what you said in the past?

James W. P. Reid-Anderson - Chairman, President & Chief Executive Officer

Yeah. We talked before about in the three to four range and I'll tell you, Afua, we really have not seen any change in that.

Afua A. Ahwoi - Goldman Sachs & Co.

Got it. Thank you.

Operator

Your next question is a follow-up from the line of Barton Crockett with FBR Capital Markets.

Barton E. Crockett - FBR Capital Markets & Co.

Great. I just wanted to just double check one number. Did you tell us what the percentage of your attendance was this year from the active pass? It was 50% last year. What did it grow to this year?

James W. P. Reid-Anderson - Chairman, President & Chief Executive Officer

It grew to 56% in 2015, Barton.

Barton E. Crockett - FBR Capital Markets & Co.

Okay, great. Thank you.

Operator

And there are no further questions at this time, I'll now turn the floor back over for any closing or additional comments.

James W. P. Reid-Anderson - Chairman, President & Chief Executive Officer

Thank you very much, Brandy. I want to thank you all for joining today's call. As this is my last earnings call as CEO, I do want to express my personal thanks for all of the support that you have given me as our investors. The stock is up nearly eight-fold since the day I joined the company and yet I feel very confident that the best is still to come. Remember, I remain one of the top investors in the company and I am confident that our highly talented team will continue to deliver tremendous results for our shareholders. It seems most appropriate, John, for me to hand over to you to close out this call.

John M. Duffey - Chief Financial Officer

Well, thanks, Jim. I am really looking forward to my new role in the next chapter of our success. This is a great industry and there is no better brand than Six Flags in the global regional theme park space. We are providing affordable family entertainment. And quarter-by-quarter, year-by-year, we consistently deliver guest excellence, innovative products and attractions and remarkable financial results. As always, we appreciate your continued support as we strive to create thrills for all ages and build Six Flags into the world's premier regional theme park operator. Our primary focus is to delight our guests, invest in our employees, and in doing so create tremendous value for our shareholders. Please do come out and visit one of our amazing parks in 2016. Take care.

Operator

Thank you. That does conclude today's conference call. You may now disconnect.

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