Cedar Fair (FUN) Q2 2021 Earnings Call Transcript

Cedar Fair (FUN -1.14%)
Q2 2021 Earnings Call
Aug 04, 2021, 10:00 a.m. ET

Contents:

• Prepared Remarks
• Questions and Answers
• Call Participants

Prepared Remarks:

Operator

Good day. Thank you for standing by and welcome to the Cedar Fair Entertainment Company 2021 second-quarter earnings conference call. [Operator instructions] Please note that today's call is being recorded. [Operator instructions] I would now like to hand the conference over to your speaker today, Mr.

Michael Russell, corporate director of investor relations. Thank you, sir. Please go ahead.

Michael Russell -- Corporate Director of Investor Relations

Thank you, Stacy, and good morning to everyone. Welcome to our 2021 second-quarter earnings conference call. Earlier this morning, we distributed via Wire service our earnings press release, a copy of which is available under the News tab of our investors website at ir.cedarfair.com. On the call with me this morning are Richard Zimmerman, Cedar Fair president and CEO; and Brian Witherow, our executive vice president and CFO.

Before we begin, I need to remind you that comments made during this call will include forward-looking statements within the meaning of the federal securities laws. These statements may involve risks and uncertainties that could cause actual results to differ from those described in such statements. For a more detailed discussion of these risks, you may refer to the company's filings with the SEC. In compliance with the SEC's Regulation FD, this webcast is being made available to the media and the general public as well as analysts and investors.

Because the webcast is open to all constituents and prior notification has been widely and unselectively disseminated, all content on this call will be considered fully disclosed. With that, I would like to introduce our CEO Richard Zimmerman. Richard?

Richard Zimmerman -- President and Chief Executive Officer

Thank you, Michael, and good morning, everyone. We appreciate all of you being with us today. On the call today, we will focus our remarks in three specific areas. As usual, we will review our year-to-date 2021 operating results, including the performance of our parks during the quarter as well as a more recent look at operating trends in this July period.

Second, we will provide an update on our business optimization program, which is well underway. And lastly, I will conclude with some comments on our outlook for the business and why I'm so confident in the future of Cedar Fair and our ability to emerge from such crisis be stronger and better positioned for growth and value creation. Let me begin by saying I'm very pleased to report all our parks are now open, and the 2021 season is off to an excellent start. We came into this season focused on the same strategies that drove our record performance in 2019.

We are delivering a high-quality guest experience while offering more immersive products -- events that complement our world-class attractions. The continued execution of our strategy has produced strong results, highlighted by the following performance trends: first, we are generating strong volume at all our properties, confirming pent-up consumer demand for travel and leisure activities, especially outdoor entertainment; second, we are seeing new highs for in-park per capita spending with our guests showing a strong propensity not only to spend but to spend more across all product categories; third, we are driving sustained sales of advanced purchase products, such as season passes and all-season products with our total number of season passes valid for the 2021 season now exceeding the record number purchased for the 2019 season; and then finally, guest satisfaction scores continue to trend toward historical norms at most of our parks. So, every day, we are reinforcing the long-held perception among our guests that our parks offer highly valued, high-quality entertainment experiences. Achieving and maintaining high guest satisfaction is key to our success in taking pride and driving repeat visitation.

Our excellent performance in -- across these measures was achieved despite disruptions during the second quarter to our park operating calendar, seasonal staffing challenges, and the delayed reopening of Canada's Wonderland, and one of our largest and most profitable parks until early July. Now let me highlight a few of our observations so far this season. Healthy consumer demand has really driven attendance at several parks to near historical highs established in 2019, a record year for us by nearly every measure. Over the past five weeks, attendance has approximated 85% of comparable same-day 2019 levels, a trend that supports our optimistic outlook to the second half of the year when we have historically enjoyed some of our busiest days.

Also underscoring our optimism for the balance of the year was the July 5th reopening of Canada's Wonderland, which represented another step forward for our company. This marks the first time since late in 2019 that all our parks are open simultaneously, and it really positions us well for a strong second half. While city mandated capacity restrictions are still in place at the park, we hope to operate Canada's Wonderland at near full capacity later this season. In addition to strong attendance trends this year, we have also generated record levels of guest spending, including growth across every revenue category.

In the month of July, the in-park per capita spending was $61.93, which represents roughly 120% of 2019 spending levels. The growth of in-park per capita spending has been largely driven by increased spending on extra-charge attractions, including our front-of-line Fast Lane products as well as our guest spending across all other in-park revenue categories. As I previously noted, a strong share of wallet has our guests buying up and spending more with each visit. The trends we have seen since opening our parks in mid-May through this past Sunday are encouraging and suggest consumer confidence is quite strong.

We anticipate that our strong recent momentum will continue as we move into some of our historically busiest days of the year, including the tremendously popular Halloween weekends that usher in an active fourth quarter at most of our parks. Continued strong demand will present opportunities to take price at our gates and within our parks, and allow us to create additional incentives for guests to spend on goods and services during their park visits. Now let me switch gears for a moment to address this issue of labor availability and its impact on staffing levels at our parks. On our last call, we shared our views around our challenges attracting candidates for seasonal labor positions like many other companies in the leisure and the hospitality industries.

These challenges were compounded this year by a shortage in the number of students available through the J-1 Visa program, a program we typically rely upon to help supplement local labor pools in several of our key markets. So to attract the large number of applicants needed to fill thousands of seasonal openings across our parks, we quickly increased hourly rates, offered incentives for candidates to stay on throughout the season and utilize our dormitories to expand our marketing reach beyond our local markets. At each of our parks, we have gone from being market competitive to being the market leader here in terms of pay rate. This change in compensation strategy generated thousands of applicants within a very short period of time, significantly improved staffing levels and allowed most of our parks to return to their original operating schedules.

I mentioned last quarter how we view recent changes in the labor market as structural, fundamental shifts that appear more permanent than transitory. And with that view of the labor market in mind, we are taking a fresh look at our seasonal labor model to determine whether there are incremental benefits to retaining a portion of our associate base on a year-round basis. This coincides with our view of incremental revenue opportunities that would utilize park assets on a year-round basis, much like our resort properties, the Knott's Marketplace, and the Cedar Point Sports Center. Based on what we see at Knott's Berry Farm, a park that already relies more heavily on full-time of -- and year-round part-time associates, we believe that shifting a portion of our seasonal labor force to full-time or year-round part-time positions will improve the training, supervision and retention of our seasonal workforce, meaningfully improve operating efficiencies and guest service levels, lead to higher guest spending levels, and ultimately support our strategy to expanding the operating calendars at our parks and other resort properties.

We will keep you apprised of our progress in this area as we go along. Before I turn the call over to Brian to review the financial results in more detail, I want to update you on the progress we have made on our business optimization program we introduced earlier this year. This program aims to streamline our business processes, realize efficiencies and bring new ways of thinking to how we entertain our guests in order to continue to drive profitable and sustainable growth. First, we remain committed to delivering the previously communicated $50 million in annual run rate benefit over the next two to three years once the program is fully executed and the business has returned to historical attendance levels under normal operating conditions.

Second, because we expect the lion's share of the benefit to be realized beyond the first year, the progress we shared with you in the early stages of the program is more qualitative in nature. The steps we are taking in 2021 are focused on laying the foundation for us to realize the significant benefits of the program beginning in 2022. Finally, while our original cost saving assumptions have been challenged by recent headwinds, including higher labor costs and inflationary pressures on other goods and services, we have remained flexible and continue to adapt our program by identifying new opportunities for cost savings in procurement and other areas of the business. Also, we are successfully achieving the meaningful savings in advertising and marketing we've projected earlier this year.

In addition, our procurement team is already achieving quick wins in areas like office supplies, small parcel, and printers. And although not a particularly large spend category, they will deliver significant run rate savings on a percent of spend basis and are indicative of the order of magnitude we hope to achieve in other areas. In addition, our business intelligence team is now fully integrated into pricing and the workforce management processes and is driving meaningful improvements in areas like advanced sales, ticket yields, and increased revenue per food and beverage labor hour. I believe we will continue to find more cost efficiency and pricing opportunities as we deepen our analysis in other areas, which should help mitigate the effects of anticipated cost pressure and to keep track to realize the program's long-term target benefit of $50 million.

I'll pause here and turn it over to Brian for a review of our financial results. Brian?

Brian Witherow -- Executive Vice President and Chief Financial Officer

Thanks, Richard, and good morning to everyone. I'll begin with a discussion of our results for the second quarter before moving on to an update of our July performance trends. But first, I need to remind you that given the effects of the pandemic in our operating calendars and park operations in both 2021 and 2020, results for the second quarter and six-month periods are not directly comparable. Because we suspended the park operations in mid-March last year and had very limited operations during the second quarter of 2020, I will also provide more relevant comparisons to 2019.

In second quarter this year, we had 393 total operating days, compared with 39 operating days in the second quarter of 2020 and, compared to 726 total operating days in the second-quarter 2019. For the six-month period, our parks had 393 total operating days, compared to 129 operating days in 2020 and 827 operating days in 2019. As reported in our earnings release this morning, net revenues for this second quarter totaled $224 million versus $7 million in the same period a year ago. The increase in net revenues was attributable to an increase of 354 operating days in the period, resulting in a $3.4 million visit increase in attendance and a $35 million increase in out-of-park revenues.

Attendance in the quarter represented approximately 70% of the comparable same-day 2019 levels with much of the shortfall of the direct result of early season capacity limitations as well as the expected slower recovery of the group sales channel. Excluding pre-booked group business, attendance from the general admissions and season pass channels during this quarter an approximated 80% of comparable same-day 2019 attendance levels, indicative of the pent-up demand we anticipated on reopening. Meanwhile, in-park per capita spending in the quarter totaled $55.94, which represented approximately 115% of comparable same-day 2019 of spending levels. As Richard noted, the increase in in-park per capita spending was the result of improved spending across all key revenue categories.

Guest spending on food and beverage, merchandise gains the extra charge attractions was up 30% on a combined basis in the quarter over comparable same-day 2019 levels. The improved spending in these areas resulted from a combination of price increases, more transactions and an increased spending per transactions as our guests have continued to buy up. In addition to taking price on products within the parks, based on the strong consumer demand trends, we continue to dynamically price into demand for single-day tickets and minimize our reliance on promotions to drive volume. Since the reopening, we've increased prices and reduced discounts in tickets at all of our parks.

For the quarter, we average admissions per cap on paid tickets was up 13% or $4.91 over comparable same-day 2019 levels. On the cost side, operating costs and expenses in the quarter totaled $227 million, compared with $93 million for the second quarter of 2020. The $134 million increase in operating costs and expenses, which was largely due to an increase in operating days in the period, reflected a $21 million increase in cost of goods sold and $89 million increase in operating expenses and a $23 million increase in SG&A expense. The increase in cost of goods sold were the direct result of the May reopening our parks and the related increase in sales volume in the period.

Of the $89 million increase in operating expenses, approximately $49 million was attributable to an increase in seasonal labor wages, with the balance largely attributable to the earlier park openings in 2021. And while the majority of the increase in seasonal labor cost was due to the incremental operating days in the current quarter, there was also a meaningful increase in our seasonal labor rates, which, as Richard mentioned, was required parks, to recruit employees is such a challenging labor market. For the second quarter, our average seasonal labor rate was approximately 40% higher than the seasonal labor rate for the comparable quarter in 2019 and roughly 25% higher than our projected seasonal labor rate coming into 2021. These are additional rate-related labor costs were offset in part by a reduction in hours work, compared to about 2019 actual and 2021 budget due to the tight labor market.

The $23 million increase in SG&A expense was also attributable to increased transaction fees and advertising expense due to the earlier park openings compared to last year, higher full-time wages related to equity compensation and prior period executive salary reductions and incremental fees incurred as a result of our business optimization program. Meanwhile, our adjusted EBITDA, which management believes is a meaningful measure of the company's park-level operating results, improved to $2 million for the second quarter of 2021, compared with an adjusted EBITDA loss of $85 million in the second quarter a year ago. The $87 million increase in adjusted EBITDA reflects severe impact of COVID-19-related park closures in 2020 and the related improvement on 2021 second-quarter attendance and revenues with parks reopening beginning in early May. So turning our attention to recent operating trends, including the results from Canada's Wonderland since its opening on July 5th.

Preliminary net revenues for the seventh-month period ended August 1, 2021, totaled $587 million. Over the same period, combined attendance totaled 8.6 million visits, in-park per capita spending was $59.57 and out-of-park revenues totaled $91 million. As we previously noted, given the effects of the pandemic and suspension of park operations during the summer of 2020, results for the month of July 2021 and 2020 are not really comparable. To provide more relevant information, I'll discuss performance metrics for the 5-week period of June 28 through August 1, 2021, versus July 1st through August 4, 2019.

Since we began reopening parks in May, weekly attendance levels as a percentage of comparable same-day 2019 levels have steadily improved as the mandated capacity of limitations have been lifted and as the parks have expanded their own limitations and removed reservation requirements. Over the past five weeks, total attendance approximated 85% of comparable same-day 2019 attendance levels or approximately 95% of same-day 2019 levels, excluding the group sales channel. Excluding the Canada Wonderland, which remained under capacity limitations in July, total attendance for the five-week period averaged 90% of comparable same-day 2019 attendance levels. For the same period, in-park per capita of spending was at a record $61.93, 22% above comparable in-park per capita spending levels of -- some five-week period in 2019.

Broken down, the guest per capita spending on food and beverage, merchandise gains and extra charge attractions was up approximately 35% for the five-week period, while the admissions per cap on paid tickets was up approximately 15%. Meanwhile, out-of-park revenues during the five-week period totaled approximately $40 million comparable with out-of-park revenues during the same period in 2019. As Richard noted, the continual positive momentum in attendance, combined with the sustained strength we generated in guest spending across all revenue categories, positions us very well for the balance of this year. Shifting our focus for a moment to the balance sheet.

Deferred revenues as of June 27, 2021, totaled $292 million, representing an increase of $86 million or 42%, compared with deferred revenues at the end of the first quarter ending up $65 million or 29% compared to the second quarter of 2019. The increase in deferred revenues in the quarter was driven by the robust sales of season passes and other all-season products, the advanced sale of single-day tickets and other single-day products and improved booking trends at our resort properties. Since the end of the first quarter, we've sold more than 1 million of season passes. And at the end of July, this brought our total number of season passes outstanding and valid for the 2021 season or longer in Knott's Berry Farm and Canada's Wonderland to approximately 2.9 million passes, 8% higher than the number of season passes in our record year of 2019.

The larger season pass base this year has translated into season pass visitation, representing the approximately 55% of total tenants mix through the first seven months of the year, which compares to 65% of the mix in the disruptive 2020 season and 53% of the mix in 2019. Of the $292 million of deferred revenue outstanding at the end of the second quarter, approximately $30 million is projected to be recognized as revenue in 2022 due to used privileges of 2021 season passes at Knott's Berry Farm and Canada's Wonderland of now being extended into next year. Shifting to liquidity and free cash flow. At the end of the second quarter, we had cash on hand of $293 million and $359 million available under our revolver, net of $16 million of letters of credit, for total liquidity of $652 million.

This compares to $631 million of total liquidity at the end of the first quarter. $21 million of positive cash flow we generated in the second quarter was meaningfully better than our prior guidance of a net cash burn of approximately $60 million per month and benefited from the very strong 2021 season pass sales, the earlier reopening of parks and higher-than-expected attendance and our guest spending levels during this period. So based on recent trends and our current outlook for the business, we now expect that we will be cash flow positive for the balance of 2021. However, this will depend on all our parks remaining open as planned, attendance levels continuing to normalize and no resurgence of this pandemic and related disruptions to our operations.

Before I turn the call back over to Richard, I'd like to review how our debt covenants impact our ability to make the -- and reinstate distribution payments. In September of 2020, we amended our credit facilities to, among other benefits, to suspend the testing of our senior secured leverage ratio covenant through calendar year 2021. Our lenders also approved modifying the testing of the senior secured leverage ratio through calendar year 2022 and into the first half of 2023. We've also agreed to suspend paying distributions or making other restricted payments, while the senior secured leverage test remains suspended or modified and to maintain a minimum liquidity position of $125 million through calendar year 2022.

While we remain committed to reinstating distribution when it is permitted and most appropriate, a move toward a meaningful and sustainable distribution hinges on our ability to reestablish momentum in the core business and reduce our net leverage ratio to more historical levels over time. This is our top near-term priority. Finally, we will continue to withhold current year and long-term financial guidance until we have a more informed outlook into the second half 2021 and a higher degree of confidence for the overall market environment prospectively. With that, I'd like to turn the call back over to Richard.

Richard Zimmerman -- President and Chief Executive Officer

Thanks, Brian. Looking forward, let me echo the confidence and optimism Brian just expressed about our business over the remainder of the 2021 season as well as long term. We are confident that our team is up to the task of continuing to successfully then execute our initiatives and build upon our momentum, ensuring we are delivering the high-quality guest experience our parks are known for and offsetting the effects of current macro factors that really outweigh on the performance of our business, such as inflationary pressures and labor constraints. Next, let me address our outlook around capital allocation.

I want to reemphasize that our near-term capital allocation strategy remains unchanged. We are focused on responsibly investing in our parks, reestablishing growth in the core business and paying down debt to return net leverage ratio back inside five times the adjusted EBITDA as quickly and responsibly as possible. Longer term, we are committed to getting net leverage back down within our historical range of three to four times adjusted EBITDA. As Brian mentioned, although our distribution currently remains suspended due to covenant-related restrictions, our Board is committed to reinstating a growing sustainable distribution.

With the effects of the worldwide pandemic aside, our company has shown over the decades that competent execution of our flexible and resilient business model can generate the excess levels of free cash flow that's needed to consistently invest in our business, while at the same time returning capital to unitholders. Underlying the sustainability of that success is our commitment to investing in and continually enhancing the overall guest experience, which has become the hallmark of Cedar Fair's regional parks. It is the primary driver behind our continued growth in season pass sales and overall attendance and the reason why our guests visit our parks multiple times throughout the season. With this in mind, we remain focused on investing in each of our parks and the underlying strategic initiatives that will drive our success going forward.

Through the first 6 months of the year, we have invested $25 million in our parks, primarily on essential compliance and infrastructure requirements as well as the restarts of select unfinished 2020 projects, including ongoing renovations of our Castaway Bay and Sawmill Creek Resort properties at Cedar Point, both of which are year-round properties that fit nicely within our strategy in expanding the operating calendar. For the remainder of this year, we plan to invest another $50 million to $75 million to finish our resort renovations as well as to kick off projects planned for the 2022 season, bringing our projected total capital spend for calendar year 2021 to what's approximately $75 million and $100 million. Based on the positive trend established through the first seven months of the year as well as our renewed confidence in the recovery of the business over the remainder of 2021, we now plan to invest between $175 million to $200 million in calendar year 2022 to achieve our overarching goal of consistently providing immersive and unforgettable guest experiences. While we continue to invest in our legendary portfolio rise in attractions, our consumer research continues to reinforce this significance of food and beverage and the high-quality menu options we offer as essential components of delivering a memorable park experience.

As we learned during the pandemic, there is a clear and strong desire among our guests to attend festivals and other limited duration events at the parks. We have also witnessed this firsthand at Knott's Berry Farm where we achieved some of our highest customer satisfaction scores by hosting creative culinary events, such as the Taste of Boysenberry Festival. Because we believe food and the beverage pays such a significant role in our organic growth, we will be investing aggressively for the 2022 season to upgrade and expand our facilities across the portfolio, while at the same time, improving the capabilities, technologies and our efficiencies of our food preparation on delivery systems. Finally, I can't underscore enough how excited our park teams are to once again be entertaining guests.

We hope you'll have a chance this season join thousands of our loyal guests to gather along our midway to watch Grand Carnivale or attend the celebrations of our 150th anniversary at the Cedar Point or the 100th anniversary at Knott's Berry Farm. High-caliber special events like these are being offered across our entire portfolio of properties. It is also what we do best. It creates memories for a lifetime, and most of all, it makes people happy.

Stacy, at this point, could you open up the call for questions?

Questions & Answers:

Operator

[Operator instructions] Your first question comes from James Hardiman from Wedbush Securities.

James Hardiman -- Wedbush Securities -- Analyst

Hi. Good morning. Thanks for taking my call. So hopefully, this won't go off the rails.

I know it's always a little bit dicey when we try to do math in real time here, but I wanted to run through a couple of the numbers. Obviously, significant that July was, I think, 85% on a same-park basis. You gave us that number excluding group sales, which was 95%, I believe, both of those numbers included Canada's Wonderland, and I think you know where I'm going with this. So Canada's Wonderland, excluding that, it was 90%.

And I'm assuming that still includes a group sales number. So I guess what I'm getting at is if we wanted to adjust for group sales piece is that same 10% and we're basically comparable to 2019, excluding both Canada's Wonderland and the group sales piece.

Brian Witherow -- Executive Vice President and Chief Financial Officer

James, it's Brian. Yes, I would say your math is directionally correct. The group business that we said early on is just like in prior macro events, the most disruptive is the slowest to recover. And as we evaluate how we're trending this year, we know it's hard to make up for lost business in group in the spring in earlier season.

A lot of those outings are just that time of the year and that while we can shift some of it, we -- and we have seen some positive momentum in that channel. We're looking at the business as we said this sort of group that evaluate how we're doing within season pass and general admission. And that's about right, it's about a 10% gap from that group business.

James Hardiman -- Wedbush Securities -- Analyst

OK. Perfect. And then the other big topic is obviously what's going on with respect to labor. And I thought the number you gave us is really helpful that the seasonal labor rate is 40% higher versus 2019.

I guess a couple of questions on that. As we think about -- obviously, that's a sort of a gross number before we factor in, offset in terms of labor hours. I guess is there any way to think about total labor inflation and whether on a percentage basis or even better on a dollar basis versus 2019, given those two offsetting factors and whether you want to do it? I guess it would be helpful if we could think about both this year, the remainder of this year, but then also 2022, where I think, correct me if I'm wrong, the way you set up some of these bonuses, maybe the gross number is a little bit less than that 40% as we look to next year.

Richard Zimmerman -- President and Chief Executive Officer

Yes, James. Good morning. It's Richard. Let me first start, and then Brian can weigh in on the specifics of your question around the numbers.

On the labor front, listen, we're very pleased with this -- and as I said in my remarks, with the reaction in our -- each of our regional markets of being the market leader, we generated the kind of staffing levels that we needed to be able to return to a more normalized operating schedule. So we're really pleased with the quick response. So I'd also -- to start there, second, again, I'll reiterate part of the reason we created the business intelligence function was really focus on workforce management. I'm really excited by the tools that we're putting in place and the way the teams -- the park operating teams are using them.

It's good to see that we can provide more tools when you see an element of our cost structure that seems to be escalating. And lastly, I'll -- on the staffing front, I'll just reiterate how proud I am of our team and all the good work they're doing the -- and providing a high-quality guest experience with increasing NPS scores week over week in one of the toughest challenging -- most challenging environments I've seen in the over just this 30 years I've been doing this. So my hat's off to Tim Fisher, our chief operating officer and the teams in the field who are, I think, are really doing tremendous work. Brian, on the specifics of the numbers?

Brian Witherow -- Executive Vice President and Chief Financial Officer

Yes, James, just to provide a little bit more color around those numbers. That 40% is reflective of the rate adjustments we've taken as well as the anticipated impact of those incentives that are associates to stay on. There are definitely, as you alluded to, some offsets that aren't reflected in that, whether that be subsidies we're receiving in a market like Toronto or the labor hour reductions, right? So that overall rate impact is not flowing all the way to what's bottom line. In terms of hours, as you would imagine, part of the reason why we're paying the rates we're paying is because it's been challenging, as Richard said in the call to get the numbers of associates and fill all the seasonal positions.

And so we're really down in hours in part because of that. We're also down in hours because of efficiencies. The operators are mining and identifying throughout the season and as well as changes that we're making to operating calendars. As you may recall, we have five parks that are within our system right now that aren't operating five days a week as we try and maximize attendance up against those staffing challenges.

And so parks like Valley Fair, Worlds of Fun, Park to name just a few, are operating four of -- or five days a week versus just seven. So all of those things net down to a much less of an impact percentage-wise at least our outlook for the balance of the year. However, at the end of the day, it's very dynamic and then where this balance for the year goes, rate-wise, staffing availability-wise, we still have to continue to manage.

James Hardiman -- Wedbush Securities -- Analyst

Let me ask it this way, if I may. In the context of the $50 million of EBITDA enhancement, I think the last time we spoke, you thought about $15 million of upside to revenue and, call it, 300 basis points of margin expansion. Has that algorithm changed? Should we think about -- and obviously, sticking to the $50 million, should we think about maybe more on the top line and less margin expansion to still get us to that same $50 million number?

Brian Witherow -- Executive Vice President and Chief Financial Officer

Yes. As Richard said, James, in his comments, we continue to adjust our program and look deeper as we've gotten further into areas like procurement. We're identifying and some more cost savings, which has been very encouraging. And I think the team there that we're building out feels very optimistic.

That by itself would be very hard to offset kind of the pressures that we're seeing in terms of labor headwinds, rate headwinds, and so that's a piece of it. But I think you hit on it, right. Another big part is the advancements we're making around business intelligence. While that team will benefit us on both the cost and on the revenue side, I would say we are seeing some very quick wins out of them on the revenue side that may change the math behind this regional $50 million slightly, but we remain confident in our ability to deliver on that in the end.

James Hardiman -- Wedbush Securities -- Analyst

Great. Thanks, Brian. Thanks, Richard.

Brian Witherow -- Executive Vice President and Chief Financial Officer

Thanks, James.

Richard Zimmerman -- President and Chief Executive Officer

Thanks, James.

Operator

Your next question is from Stephen Grambling from Goldman Sachs.

Stephen Grambling -- Goldman Sachs -- Analyst

Thanks. I may have missed this in the opening remarks, so apologies, but is there any sense as you think about the strength in per caps? How much of that do you feel like is underlying kind of consumer demand versus any kind of shifts you're seeing in the season passes? And how do you generally try to assess kind of the sustainability of that trend? Thanks.

Richard Zimmerman -- President and Chief Executive Officer

Stephen, good morning. It's Richard. Great question. When we think about what we're seeing and trying to evaluate the strength of the consumer, we start going back to 2019, which is a record year for us and a record level of per cap at that time.

We saw that increasing in over a really strong 2019 in 2020, even though our operations were disrupted. And we're really pleased to get open at 10 of our properties. We saw strength in consumer spending last year in the midst of the disruption. So I think what we're seeing is what's really -- the back to fundamentally what we believe about the business model, there's a lot of appeal to our product.

We're an outdoor experience that can be sampled by and enjoyed by thousands of people on a day. So we see a lot of demand for our product. And I do think what we're seeing this validates the pent-up demand, but we are seeing a continued strength in spending that relates to some of the things that we put in place, be it the business intelligence function, revenue management that function -- and has really ramped up this year improving. But we're also seeing the payoff, if it will, the benefit of some of the investments we made in 2017, 2018, 2019, particularly around food and beverage, which I hit on in my prepared remarks.

We -- this is the continuation of several years of a lot of impact in the food and beverage area, increasing per caps because of quite the high-quality menu items we're providing, the culinary talent we put into each of the respective parks, the facilities that we've built out over the last few years. So I really think what we're seeing now is a continuation of strength that we saw before. And so clearly, the pent-up demand, and we've heard the term spending, there is some of that embedded in what we and others in the industry are seeing but we're also seeing the continuation of trends that existed prior to the pandemic.

Stephen Grambling -- Goldman Sachs -- Analyst

And maybe as a quick follow-up on that, are you seeing any differences across the parks or geographies? It sounds like it's broad-based but then are you also seeing any change in the type of consumer, who's showing up in your park? Is it -- I realize that attendance is quickly recovering, but are you finding that it's a different type of customer who is arriving?

Richard Zimmerman -- President and Chief Executive Officer

We've not seen that it as a different customer. All of our consumer research shows we're getting -- absent the disruption of the group business, which Brian commented on, which we expected, and typically in the spring, there'd be a lot of use groups coming. But put that to the side, we -- what we're seeing this summer is guests that look exactly like the guests who were coming in 2019 when we were ramped up at full speed. As I've been walking the midways, been up at the Cedar Point, also seeing their 150th anniversary celebration parade, the guests that I'm seeing are having a great time and, from a profile perspective, look a lot at who you would expect.

And our target audience is mom with kids and families and where they're coming out in droves right now, so we've now seen some sustained strength. We've seen increasing not just spending, but we've seen strong and increasing tenants levels during the month of July. This is typically -- July and August are two of the biggest months of the year. And so we really -- and right in the middle of it, but we feel really, really good about the results that we put on the board and the performance in July.

Stephen Grambling -- Goldman Sachs -- Analyst

Got it. Money is flashing within spending. Thanks so much. I'll jump in the queue.

Operator

Your next question is from Eric Wold.

Eric Wold -- B. Riley Securities -- Analyst

Thank you. Good morning, guys. A couple of questions. I guess, one, just kind of going back to the last question a bit diving in there.

And you also noted that the season pass visitation mix is comparable to '19 at 55% versus 53%, but you got 8% more season pass holders this year versus '19. So I guess this implies that fewer average visits per pass over. I guess, can you confirm that? I guess, what would be the apples-to-apples increase in the single-day visitation to be able to drive versus '19?

Brian Witherow -- Executive Vice President and Chief Financial Officer

Yes, Eric, it's Brian. So as you can imagine, this year, and much like last year, the disruption still on the operating calendar is probably playing with some of these metrics. That's why as we compare metrics like season pass mix in '21, we go back to '20, we go back to '19. There's really no doubt that we have slightly more passes outstanding right now, as I mentioned, about 8% higher than where we were at the same time in '19.

Season pass visitation is trending roughly in line with where we would have expected. It is also slightly below the '19 and some of that's related to the fact that we have less operating days in the current year. As we get into more apples-to-apples, I guess, I'll say on operations, although, as I mentioned before, not all of our parks are open up seven days a week as they normally then would be in months like July and August, we'll see how that trend line goes. What I can say is we're really encouraged in spite of the disruption in the group channel, which we're confident we can recover the shift in growth in general admission has been significant, and so that's really important to us.

As you've heard us talk about in the past, things like unique visitor being an important metric for us, continuing to identify more guests that can ultimately get plugged into this season pass pipeline for ultimately conversion up to that higher, better product. We're very encouraged by what we've seen in demand in those other channels. So there's no doubt that some of the use the numbers that are down a bit, but not too -- to the point that has us concerned. And we'll reevaluate as we get through the year, right? We're still leading -- just heading into August and fall is such a huge demand time for our season pass also to come out and enjoy things like the Haunt events.

And so then for those parks that have the WinterFest events in November, December, those are high-demand season pass times as well.

Eric Wold -- B. Riley Securities -- Analyst

Perfect. I know that the push toward season pass -- or toward the single day has been a big focus. So good to see that. And second question, obviously, with the goal of moving more parks toward year-round or at least increase the number of operating days at the parks, take advantage of demand, any initial thoughts when you think about across the entire portfolio, what the total increase in operating days could be versus kind of the pre-pandemic baseline?

Richard Zimmerman -- President and Chief Executive Officer

Eric, it's Richard. Good morning. Thanks for the question. We're evaluating that right now.

You saw us start to dip our toe into that last year when we opened up some of our parks in November and December. Looking at the Charlotte Park down here, we did a few extra days. We're really evaluating that -- and what makes sense. I will tell you, go back to 2019, we're very encouraged by the strong first year performance of WinterFest at Canada's Wonderland.

So it really said to us, there's a lot more opportunity than we think if we reconfigure how we deliver our product and what the guest experience is. That's what -- the kind of learning that I take away from last year's disrupted operation in 2020. We're able to put on limited duration festivals and events that really kept us to be connected and then engaged with our customer, but also had great appeal. So as we think about expanding the number of calendar days, what we're thinking about is what that product looks like on those days that were open, how we can configure it and use events to make it special and continue to stay engaged through all the four seasons of the year that's under our Seasons of FUN banner and give people more reason to use their season pass, but also more reason to buy the season pass.

Eric Wold -- B. Riley Securities -- Analyst

Got it. Thank you, guys. Appreciate it.

Richard Zimmerman -- President and Chief Executive Officer

Thanks, Eric.

Operator

[Operator instructions] Your next question comes from Michael Swartz of Truist.

Michael Swartz -- Truist Securities -- Analyst

Hey, guys. Good morning. Just wanted to touch on capex and some of your comments on your prepared remarks. I think you laid out about $175 million to $200 million in capital expenditures that you're planning for '22.

So I'm guessing is that -- or trying to understand, so is that a new baseline or does that have some of the catch-up spending embedded that's in it? And then with the whole year-round opportunity, would that necessitate a greater level of ongoing capital investment?

Brian Witherow -- Executive Vice President and Chief Financial Officer

Yes, Mike, it's Brian. As it relates to capex, I think we're still committed to our long-term goals, as we previously noted, getting that investment in the core business back into the 9% to 10% range. It's just a little difficult right now, right, with the disruption to the business to look at some of those metrics in the same traditional sense as we had. The planned spend for the calendar year 2022 and it's still somewhat ahead of that base.

So as we -- and as Richard has done, we're reactivating several key projects that will pause back in 2020, most notably the renovation of the two-year round resorts, Cedar Point, Castaway Bay and Sawmill Creek, both of which we believe are going to play key roles in our strategy of expanding the operating calendar at that park and in that ball -- market. So I would say, yes, there is definitely some of the escalated spend for calendar year 2022 because of some deferred projects or paused projects.

Michael Swartz -- Truist Securities -- Analyst

And then just with the thought or maybe plan to go year-round operations, would that necessitate structurally higher spending or anything incremental above the 9% to 10%?

Richard Zimmerman -- President and Chief Executive Officer

No, you're -- Mike, it's Richard. No, we think that 9% to 10% is a comfortable range for what we need to do as we look forward. So no, I don't think that -- when you think about the extra days, it's certainly higher capex, but it's our capital that -- it's the capex-light, if I could use that term. Obviously, we'll still monitor and make sure that we keep the facilities up to their high-quality conditions, but no.

We think that the opportunity to expand our operating calendar is one that is both -- that we'll see great demand for and have a lot of appeal to our guests, but also something that really is capital efficiency.

Michael Swartz -- Truist Securities -- Analyst

OK. Great. Thank you. And then maybe a follow-up, if I may, on -- can you just provide us some color or granularity on what you're seeing with some of your forward-looking metrics, whether that's Sports Center bookings or we're talking about hotels or some of your resort properties? Anything you can give us a little more color on maybe for the back half of the year?

Richard Zimmerman -- President and Chief Executive Officer

No. What we've always said, there's two leading indicators, Mike, first season passes. We talked about the strength now. And in mid-August, we'll go on sale shortly with our 2022 sales.

So we'll be able to give you some color on that as we get deeper into the fall. Resort performance has been really outstanding and we like what we see in terms of -- and encouraged by the bookings, but also the asset performance. That's not just the hotels we have in Sandusky, that's in Southern California, Knott's Berry Farm, and even down here, down at Caroline. We're performing well as we get deeper into the season.

So as the group is -- it's something that, I think, will take some time to rebuild. We talked about that, although I will tell you we've gotten call from some clients that traditionally come see us in the fall, and they're coming back. So we're starting to see a little bit of momentum in the group channel as our phone rings and people think that it's about what they're doing in the fall. Some of our traditional groups are coming back to us.

So nothing significant enough yet I would establish a trend, but I like the optics of what I'm seeing.

Michael Swartz -- Truist Securities -- Analyst

OK. Thank you.

Operator

Your next question is from Brett Andress from KeyBanc.

Brett Andress -- KeyBanc Capital Markets -- Analyst

Hey. Good morning. First, just a housekeeping. What capacity restrictions are currently in place at Canada's Wonderland? And then when do you think that could go full capacity?

Richard Zimmerman -- President and Chief Executive Officer

So, Brad, it's Richard. Good morning. They're in Tier 3, I think it is right now. And that's going to -- they -- the government just extended that to August 26th.

There's another tier that sits above that. Right now, they're doing numbers that I think you kind of work out the math that would say, they're not yet back to, I think, 75% or 80% of 2019's level. But as I think we -- as we look forward, the trends there on the pandemic side, the vaccination, Canada has made great progress on the vaccination front. So we think the health trends are working well as we look at the fall toward us being able to really open up the -- and further degree.

Obviously, we're staying close to the provincial government up there, and we got a really strong relationship with the health and safety administration up there and are in constant contact in terms of what we're doing and how we can also keep this in lockstep with what they're seeing as well. So we get the latest information on the health side.

Brett Andress -- KeyBanc Capital Markets -- Analyst

Got it. OK. And then it seems like the guest experience is getting better and better each week. But just to put a little more color on that, are you back to 2019 levels at this point? I guess, what kind of gap do you see that you still have to fill? And then my last question, if you take a snapshot in the most recent week or the last few days, have you seen any noticeable impacts from delta? It doesn't sound like it, but I just wanted to check the box.

Richard Zimmerman -- President and Chief Executive Officer

Let me take the first question on what we're seeing in terms of NPS. I will tell you that we've seen some really that aspects of what I would expect to see. The parks where we've had Grand Carnivale, Kings Island in Cincinnati, here at Carowinds, saw a nice pickup in NPS, not just the guests really responded to in the -- and what makes us feel really good about our longer-term strategy is that the events are driving both our performance but also higher NPS scores as people come out and experience the event. So we're not yet back to 2019, but we're closing the gap.

And then we think that as we get into the fall with our traditional the Halloween event, I think that's also another way that we can close the gap. Brian, do you want to take the second one?

Brian Witherow -- Executive Vice President and Chief Financial Officer

Yes, Brett, in terms of the most recent performance, I can't say that we've seen anything demonstrative. I will tell you just last week, in terms of when we look at like volume and demand, one of our probably top 3 or so in terms of the comparatives against those same-day 2019 attendance levels. So highly dynamic situation. A lot of the news that we're all seeing out there is maybe coming out of markets that we don't have parks in.

And we're just going to -- as Richard said, we're going to have to wait and see how our markets in the -- the state and local authorities in those markets react, and we'll have to adjust accordingly. But so far, there's just been nothing demonstrative in terms of any impact to the business and the demand that we're seeing.

Brett Andress -- KeyBanc Capital Markets -- Analyst

Got it. Thanks, guys.

Operator

Your next question comes from Paul Golding from Macquarie Capital.

Paul Golding -- Macquarie Bank -- Analyst

Thank you very much for taking the question. First, a housekeeping question. Are any of your parks currently on a reservation system still or have they all come off, I guess, except for Canada maybe?

Richard Zimmerman -- President and Chief Executive Officer

Canada is on our reservation system. The rest, for the most part, are not on. We're going to continue to monitor the demand but for the most part, Canada is the place where we've got the tightest restriction.

Paul Golding -- Macquarie Bank -- Analyst

Got it. And then with respect to the 2022 capex plan and sort of guided expectation there, I guess, I'm trying to think about how much of that is locked in versus -- susceptible to fluctuations based on whether the supply of materials is available or the supply chain for some of this, the new attractions or maintenance capex -- just out there. Just trying to get a sense of how locked in that is versus maybe still early in the process, maybe gets pushed into '23 or could see some price inflation even from there? Any color on that would be great. Thanks.

Richard Zimmerman -- President and Chief Executive Officer

Yes, I would say that we're seeing like every other business, Paul, supply chain challenges. But as we think through our cycle and getting parks ready for opening next year, again, we will come out with our announcements around all of our new opening product. I won't steal the marketing team's thunder in a couple of weeks here, but when we look at the product lineup, when we look at our commitment to food and beverage, I think you'll see the spend start to concentrate in the spring and summer as we get into the 2022 capital. And then like we see every year, we'll start spending, and we'll start constructing things for the '23 season in the second half of the year.

So once we get down to weekend operations this year, we'll keep working on '22 product. But then as you get into the middle of '22, and we've opened up all that product, yes, then we'll start working on '23 product.

Paul Golding -- Macquarie Bank -- Analyst

Thanks so much, Richard.

Duration: 56 minutes

Call participants:

Michael Russell -- Corporate Director of Investor Relations

Richard Zimmerman -- President and Chief Executive Officer

Brian Witherow -- Executive Vice President and Chief Financial Officer

James Hardiman -- Wedbush Securities -- Analyst

Stephen Grambling -- Goldman Sachs -- Analyst

Eric Wold -- B. Riley Securities -- Analyst

Michael Swartz -- Truist Securities -- Analyst

Brett Andress -- KeyBanc Capital Markets -- Analyst

Paul Golding -- Macquarie Bank -- Analyst

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