Regional amusement park operator Six Flags (NYSE: SIX ) is starting to win the battle of the turnstiles. Recent exit surveys taken during the month of June show the park scoring its highest marks in five years in categories like safety, cleanliness, and employee service.
Yes, those results are only for June. The real challenge is to keep the smiles coming later in the summer, when employees are wearing down, repeat visitors are harder to overwhelm, and park managers are tempted to cut corners to come in under budget.
Cynics can argue that it was those factors that tripped up Six Flags last year, yet numbers speak louder than both glowing exit surveys or bashing bears. Attendance may have dipped last year by 13.4%, but per-capita spending shot through the roof with a 14.2% increase year over year. Early season-ticket sales for this year were running ahead of last year, indicating that guests were looking forward to giving the chain a shot in its second season under CEO Mark Shapiro.
During its initial business update last month, Six Flags was reporting further increases in guest spending early in the 2007 season. Attendance was flat, but that's a positive, since the company had six fewer operating days at that point over 2006.
Six Flags will post its second-quarter results later this month. No one is expecting any fireworks. Seasonal parks make most of their money during the summer-heavy third quarter. However, recent rumblings of rival Cedar Fair (NYSE: FUN ) privately shopping itself and a mean streak of ride-related accidents throughout the country this year are drawing media attention to an industry that's typically ignored until the last of its park guests head off into the parking lot come October.
Six Flags is still a couple of years away from profitability. Its burdensome debt has weighed down its EBITDA-positive results. Making a bullish case for improvement is easy at this point. If the company's family-friendly initiatives pan out -- and they've slowly been inching that way -- attracting families with wider smiles and fatter wallets will improve margins over its fixed overhead costs.
Six Flags is no Disney (NYSE: DIS ) . Eyeing margins, it's no Cedar Fair, either. But the company has been taking baby steps in the right direction since Shapiro came aboard 19 months ago.
If those baby steps happen to be accompanied by a pair of camera-snapping, snack-chomping, giddy-riding parents, it's really just a matter of time before Six Flags becomes the marquee brand it could have been all along.
There's no line for more Foolish content:
Cedar Fair and its chunky 6.6% yield have made the units attractive to readers of the Income Investor newsletter service. Disney is a Stock Advisor recommendation. Take a free 30-day trial of either newsletter for an investing ride.Longtime Fool contributor Rick Munarriz enjoys taking his family on coaster treks over the summer. Yes, he's been on all of the Cedar Point coasters, except for Maverick. He owns units in Cedar Fair and shares in Disney. He is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early. The Fool has a disclosure policy, and you're tall enough to ride it.