Texas-based amusement park company Six Flags Entertainment (NYSE:SIX) said today that their entire lineup of waterparks and theme parks will remain closed at least through the middle of May, complying with government efforts to stem the tide of the COVID-19 pandemic. Six Flags indicated the parks could remain closed even longer, with reopening occurring "as soon as possible" after mid-May.
The entertainment company said it will keep up to date with the latest state and federal guidelines regarding the coronavirus response and related matters such as social distancing. It will also closely watch news developments about the virus.
Starting April 6, Six Flags will reduce pay and hours for its employees as a cost-saving measure during the shutdown. Full-time hourly employees will see their hours cut by 25% to 30 hours per week. Full-time salaried employees will take a temporary 25% pay cut, within the boundaries set by minimum wage laws, and all executive pay will be reduced by a quarter during the period.
Employee health insurance plans will remain unchanged. President and CEO Mike Spanos remarked, "We decided to decrease salaries rather than implement a workforce reduction to ensure ... that Six Flags has an experienced workforce in place when we are in a position to reopen our parks."
Meanwhile, analysts at Wedbush noted that dividends could be reduced by the park closure, and that Six Flags might breach its debt covenants if it stays closed into June or even longer into the critical summer season.