10-Q 1 cedarfair-10qx3x2017.htm 10-Q Document

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
x
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 24, 2017
OR
o
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from              to             .
Commission File Number: 1-9444
CEDAR FAIR, L.P.
(Exact name of registrant as specified in its charter)
 
DELAWARE
 
34-1560655
(State or other jurisdiction of
incorporation or organization)
 
(I.R.S. Employer
Identification No.)
One Cedar Point Drive, Sandusky, Ohio 44870-5259
(Address of principal executive offices) (Zip Code)
(419) 626-0830
(Registrant’s telephone number, including area code)
 
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes   x    No  o 
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  x    No  o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.
Large accelerated filer
 
x
  
Accelerated filer
 
o
 
 
 
 
Non-accelerated filer
 
o (Do not check if a smaller reporting company)
  
Smaller reporting company
 
o
 
 
 
 
 
 
 
 
 
 
 
Emerging growth company
 
o
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  o    No  x



 
 
 
Title of Class
 
Units Outstanding as of October 27, 2017
Units Representing
Limited Partner Interests
 
56,237,988

Page 1 of 39 pages





CEDAR FAIR, L.P.
INDEX
FORM 10 - Q
 




PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS


CEDAR FAIR, L.P.
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
 
 
9/24/2017
 
12/31/2016
 
9/25/2016
ASSETS
 
 
 
 
 
 
Current Assets:
 
 
 
 
 
 
Cash and cash equivalents
 
$
249,946

 
$
122,716

 
$
187,302

Receivables
 
52,303

 
35,414

 
51,536

Inventories
 
34,240

 
26,276

 
31,059

Other current assets
 
18,624

 
11,270

 
13,809

 
 
355,113

 
195,676

 
283,706

Property and Equipment:
 
 
 
 
 
 
Land
 
272,213

 
265,961

 
267,175

Land improvements
 
416,629

 
402,013

 
394,141

Buildings
 
707,964

 
663,982

 
675,440

Rides and equipment
 
1,740,826

 
1,643,770

 
1,653,274

Construction in progress
 
57,605

 
58,299

 
34,918

 
 
3,195,237

 
3,034,025

 
3,024,948

Less accumulated depreciation
 
(1,614,727
)
 
(1,494,805
)
 
(1,498,908
)
 
 
1,580,510

 
1,539,220

 
1,526,040

Goodwill
 
185,010

 
179,660

 
215,460

Other Intangibles, net
 
38,532

 
37,837

 
36,430

Other Assets
 
17,407

 
20,788

 
21,473

 
 
$
2,176,572

 
$
1,973,181

 
$
2,083,109

LIABILITIES AND PARTNERS’ EQUITY
 
 
 
 
 
 
Current Liabilities:
 
 
 
 
 
 
Current maturities of long-term debt
 
$

 
$
2,775

 
$
1,200

Accounts payable
 
33,710

 
20,851

 
32,891

Deferred revenue
 
86,732

 
82,765

 
65,748

Accrued interest
 
23,928

 
9,986

 
10,939

Accrued taxes
 
78,657

 
58,958

 
69,916

Accrued salaries, wages and benefits
 
30,666

 
30,358

 
42,744

Self-insurance reserves
 
27,549

 
27,063

 
26,820

Other accrued liabilities
 
20,562

 
9,927

 
12,348

 
 
301,804

 
242,683

 
262,606

Deferred Tax Liability
 
112,671

 
104,885

 
137,712

Derivative Liability
 
14,849

 
17,721

 
30,185

Other Liabilities
 
12,340

 
13,162

 
12,488

Long-Term Debt:
 
 
 
 
 
 
Term debt
 
723,385

 
594,228

 
595,253

Notes
 
936,241

 
939,983

 
939,418

 
 
1,659,626

 
1,534,211

 
1,534,671

Partners’ Equity:
 
 
 
 
 
 
Special L.P. interests
 
5,290

 
5,290

 
5,290

General partner
 

 

 
1

Limited partners, 56,238, 56,201 and 56,091 units outstanding at September 24, 2017, December 31, 2016 and September 25, 2016, respectively
 
74,155

 
52,288

 
100,956

Accumulated other comprehensive income (loss)
 
(4,163
)
 
2,941

 
(800
)
 
 
75,282

 
60,519

 
105,447

 
 
$
2,176,572

 
$
1,973,181

 
$
2,083,109

    
The accompanying Notes to Unaudited Condensed Consolidated Financial Statements are an integral part of these statements.

3


CEDAR FAIR, L.P.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(In thousands, except per unit amounts)
 
Three months ended
 
Nine months ended
 
9/24/2017
 
9/25/2016
 
9/24/2017
 
9/25/2016
Net revenues:
 
 
 
 
 
 
 
Admissions
$
361,279

 
$
361,949

 
$
598,723

 
$
604,947

Food, merchandise and games
205,137

 
202,341

 
356,512

 
354,032

Accommodations, extra-charge products and other
86,273

 
85,993

 
138,570

 
137,776


652,689

 
650,283

 
1,093,805

 
1,096,755

Costs and expenses:

 
 
 
 
 
 
Cost of food, merchandise, and games revenues
52,647

 
52,057

 
92,376

 
92,860

Operating expenses
202,710

 
199,292

 
447,379

 
441,421

Selling, general and administrative
71,663

 
65,099

 
151,142

 
142,082

Depreciation and amortization
70,060

 
64,685

 
126,237

 
118,175

Loss on impairment / retirement of fixed assets, net
1,347

 
1,355

 
3,057

 
5,382

Gain on sale of investment
(1,877
)
 

 
(1,877
)
 


396,550

 
382,488

 
818,314

 
799,920

Operating income
256,139

 
267,795

 
275,491

 
296,835

Interest expense
21,638

 
20,957

 
62,472

 
61,869

Net effect of swaps
(952
)
 
1,650

 
3,717

 
8,902

Loss on early debt extinguishment

 

 
23,115

 

(Gain) loss on foreign currency
(29,193
)
 
7,341

 
(35,047
)
 
(23,675
)
Other income
(416
)
 
(58
)
 
(464
)
 
(84
)
Income before taxes
265,062

 
237,905

 
221,698

 
249,823

Provision for taxes
73,747

 
62,918

 
63,769

 
65,339

Net income
191,315

 
174,987

 
157,929

 
184,484

Net income allocated to general partner
1

 
2

 
1

 
2

Net income allocated to limited partners
$
191,314

 
$
174,985

 
$
157,928

 
$
184,482

 
 
 
 
 
 
 
 
Net income
$
191,315

 
$
174,987

 
$
157,929

 
$
184,484

Other comprehensive income (loss), (net of tax):
 
 
 
 
 
 
 
Foreign currency translation adjustment
(11,143
)
 
1,397

 
(13,085
)
 
(5,447
)
Unrealized gain on cash flow hedging derivatives
1,994

 
1,994

 
5,981

 
1,356

Other comprehensive income (loss), (net of tax)
(9,149
)
 
3,391

 
(7,104
)
 
(4,091
)
Total comprehensive income
$
182,166

 
$
178,378

 
$
150,825

 
$
180,393

Basic income per limited partner unit:
 
 
 
 
 
 
 
Weighted average limited partner units outstanding
56,078

 
55,948

 
56,062

 
55,922

Net income per limited partner unit
$
3.41

 
$
3.13

 
$
2.82

 
$
3.30

Diluted income per limited partner unit:
 
 
 
 
 
 
 
Weighted average limited partner units outstanding
56,591

 
56,365

 
56,631

 
56,392

Net income per limited partner unit
$
3.38

 
$
3.10

 
$
2.79

 
$
3.27

The accompanying Notes to Unaudited Condensed Consolidated Financial Statements are an integral part of these statements.

4


CEDAR FAIR, L.P.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF PARTNERS’ EQUITY
(In thousands)
 
Nine months ended
 
9/24/2017
 
9/25/2016
Limited Partnership Units Outstanding
 
 
 
Beginning balance
56,201

 
56,018

Limited partnership unit options exercised
9

 
29

Limited partnership unit forfeitures
(3
)
 

Issuance of limited partnership units as compensation
31

 
44

 
56,238

 
56,091

Limited Partners’ Equity
 
 
 
Beginning balance
$
52,288

 
$
48,428

Net income
157,928

 
184,482

Partnership distribution declared ($2.565 and $2.475 per limited partnership unit)
(144,516
)
 
(139,041
)
Expense recognized for limited partnership unit options

 
5

Tax effect of units involved in treasury unit transactions
(2,560
)
 
(1,903
)
Issuance of limited partnership units as compensation
11,015

 
8,985

 
74,155

 
100,956

General Partner’s Equity
 
 
 
Beginning balance

 

Net income
1

 
2

Partnership distribution declared
(1
)
 
(1
)
 

 
1

Special L.P. Interests
5,290

 
5,290

 
 
 
 
Accumulated Other Comprehensive Income
 
 
 
Foreign currency translation adjustment:
 
 
 
Beginning balance
18,891

 
22,591

Period activity, net of tax $0 and $3,131
(13,085
)
 
(5,447
)
 
5,806

 
17,144

Unrealized loss on cash flow hedging derivatives:
 
 
 
Beginning balance
(15,950
)
 
(19,300
)
Period activity, net of tax ($1,113) and ($279)
5,981

 
1,356

 
(9,969
)
 
(17,944
)
 
(4,163
)
 
(800
)
Total Partners’ Equity
$
75,282

 
$
105,447

The accompanying Notes to Unaudited Condensed Consolidated Financial Statements are an integral part of this statement.


5


CEDAR FAIR, L.P.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
 
Nine months ended
 
9/24/2017
 
9/25/2016
CASH FLOWS FROM OPERATING ACTIVITIES
 
 
 
Net income
$
157,929

 
$
184,484

Adjustments to reconcile net income to net cash from operating activities:
 
 
 
Depreciation and amortization
126,237

 
118,175

Loss on early debt extinguishment
23,115

 

Non-cash foreign currency gain on debt
(39,296
)
 
(23,891
)
Other non-cash expenses
26,942

 
36,004

Net change in working capital
27,625

 
31,267

Net change in other assets/liabilities
66

 
(5,337
)
Net cash from operating activities
322,618

 
340,702

CASH FLOWS FOR INVESTING ACTIVITIES
 
 
 
Capital expenditures
(152,373
)
 
(126,864
)
Proceeds from sale of investment
3,281

 

Purchase of identifiable intangible assets
(66
)
 

Net cash for investing activities
(149,158
)
 
(126,864
)
CASH FLOWS FOR FINANCING ACTIVITIES
 
 
 
Term debt borrowings
750,000

 

Note borrowings
500,000

 

Term debt payments
(617,850
)
 
(6,000
)
Note payments, including amounts paid for early termination
(515,458
)
 

Distributions paid to partners
(144,517
)
 
(139,042
)
Payment of debt issuance costs
(19,684
)
 

Tax effect of units involved in treasury unit transactions
(2,560
)
 
(1,903
)
Payments related to tax withholding for equity compensation
(2,053
)
 
(920
)
Net cash for financing activities
(52,122
)
 
(147,865
)
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS
5,892

 
1,772

CASH AND CASH EQUIVALENTS
 
 
 
Net increase for the period
127,230

 
67,745

Balance, beginning of period
122,716

 
119,557

Balance, end of period
$
249,946

 
$
187,302

SUPPLEMENTAL INFORMATION
 
 
 
Net cash payments for interest expense
$
48,729

 
$
61,558

Interest capitalized
1,770

 
1,699

Cash payments for income taxes, net of refunds
44,090

 
33,141

Capital expenditures in accounts payable
5,582

 
3,179

The accompanying Notes to Unaudited Condensed Consolidated Financial Statements are an integral part of these statements.

6


CEDAR FAIR, L.P.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIODS ENDED SEPTEMBER 24, 2017 AND SEPTEMBER 25, 2016

The accompanying unaudited condensed consolidated financial statements have been prepared from the financial records of Cedar Fair, L.P. (the Partnership) without audit and reflect all adjustments (consisting of normal recurring adjustments) which are, in the opinion of management, necessary to fairly present the results of the interim periods covered in this report. Due to the seasonal nature of the Partnership's amusement and water park operations, the results for any interim period may not be indicative of the results expected for the full fiscal year.

(1) Significant Accounting and Reporting Policies:
The Partnership’s unaudited condensed consolidated financial statements for the periods ended September 24, 2017 and September 25, 2016 included in this Form 10-Q report have been prepared in accordance with the accounting policies described in the Notes to Consolidated Financial Statements for the year ended December 31, 2016, which were included in the Form 10-K filed on February 24, 2017. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission (the Commission). These financial statements should be read in conjunction with the financial statements and the notes thereto included in the Form 10-K referred to above.
Adopted Accounting Pronouncements
In March 2016, the FASB issued Accounting Standards Update No. 2016-09, Improvements to Employee Share-Based Payment Accounting ("ASU 2016-09"). The amendments in ASU 2016-09 are meant to simplify the current accounting for share-based payment transactions, specifically the accounting for income taxes, award classification, cash flow presentation, and accounting for forfeitures. ASU 2016-09 is effective for annual and interim periods beginning after December 15, 2016. The Partnership adopted this guidance in the first quarter of 2017. The impact of the guidance included: (1) prospective recognition of excess tax benefits and tax deficiencies as income tax expense (as opposed to the previous recognition in additional paid-in-capital), approximately $0.7 million of excess tax benefits were recognized in provision for taxes for the nine months ended September 24, 2017; (2) prospective exclusion of future excess tax benefits and deficiencies in the calculation of diluted shares, which had an immaterial impact on net income per limited partner unit for the nine months ending September 24, 2017; (3) prospective classification of excess tax benefits as an operating activity within the statement of cash flows (as opposed to the previous classification as a financing activity), approximately $0.7 million of excess tax benefits were classified as an operating activity for the nine months ended September 24, 2017; (4) the formal accounting policy election to recognize forfeitures as they occur (as opposed to estimating a forfeiture accrual), which did not have a material impact on the Partnership's financial statements; (5) retrospective classification of employee taxes paid when an employer withholds shares for tax withholding purposes as a financing activity within the statement of cash flows (as opposed to the previous classification as an operating activity), approximately $0.9 million was reclassified for the nine months ended September 25, 2016.
New Accounting Pronouncements
In May 2014, the FASB issued Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers ("ASU 2014-09"). The ASU provides for a single, principles-based model for revenue recognition that replaces the existing revenue recognition guidance. ASU 2014-09 is effective for annual and interim periods beginning after December 15, 2017 and will replace most existing revenue recognition guidance under U.S. GAAP when it becomes effective. It permits the use of either a retrospective or modified retrospective transition method, and early adoption is permitted only as of an annual reporting period beginning after December 15, 2016, including interim reporting periods within that reporting period. The Partnership expects to adopt this standard in the first quarter of 2018 using the modified retrospective method. The Partnership anticipates the primary impact of the adoption on the consolidated financial statements will be the additional required disclosures around revenue recognition in the notes to the consolidated financial statements. The Partnership does not anticipate adoption of the standard to have a material effect on the consolidated financial statements.

In February 2016, the FASB issued Accounting Standards Update No. 2016-02, Leases ("ASU 2016-02"). The ASU requires the recognition of lease assets and lease liabilities within the balance sheet by lessees for operating leases, as well as requires additional disclosures in the consolidated financial statements regarding the amount, timing, and uncertainty of cash flows arising from leases. The ASU does not significantly change the recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee, nor does the ASU change the accounting applied by a lessor. ASU 2016-02 is effective for annual and interim periods beginning after December 15, 2018. This ASU requires a modified retrospective method and applies to the earliest period presented in the financial statements. The Partnership expects to adopt this standard in the first quarter of 2019. While the Partnership is still in the process of evaluating the effect this standard will have on the consolidated financial statements and related

7


disclosures, the Partnership anticipates recognizing a right-of-use asset and corresponding lease liability on the consolidated balance sheet for the Santa Clara land lease, as well as other operating leases, upon adoption.

In January 2017, the FASB issued Accounting Standards Update No. 2017-04, Simplifying the Test for Goodwill Impairment ("ASU 2017-04"). ASU 2017-04 eliminates step two from the goodwill impairment test. Instead, an entity should recognize an impairment charge for the amount by which a reporting unit's carrying amount exceeds its fair value, not to exceed the carrying amount of goodwill. ASU 2017-04 is effective for annual and any interim impairment tests for periods beginning after December 15, 2019 on a prospective basis. Early adoption is permitted for annual and any interim impairment tests occurring after January 1, 2017. The Partnership has adopted the standard for its 2017 annual impairment test which is currently in process. The Partnership does not anticipate the adoption of the standard to have a material effect on the consolidated financial statements.

(2) Interim Reporting:
The Partnership owns and operates eleven amusement parks, two separately gated outdoor water parks, one indoor water park and five hotels. The Partnership's seasonal amusement parks are generally open during weekends beginning in April or May, and then daily from Memorial Day until Labor Day, after which they are open during weekends in September and, in most cases, October. The two separately gated outdoor water parks also operate seasonally, generally from Memorial Day to Labor Day, plus some additional weekends before and after this period. As a result, a substantial portion of the Partnership’s revenues from these parks are generated during an approximate 130- to 140-day operating season with the major portion concentrated in the third quarter during the peak vacation months of July and August. In 2017, four of the seasonal properties will extend their operating seasons approximately 20 to 25 days to include WinterFest, a holiday event operating during November and December. Knott's Berry Farm continues to be open daily on a year-round basis. Castaway Bay is generally open daily from Memorial Day to Labor Day with an additional limited daily schedule for the balance of the year.

To assure that these highly seasonal operations will not result in misleading comparisons of current and subsequent interim periods, the Partnership has adopted the following accounting and reporting procedures for its seasonal parks: (a) revenues on multi-use products are recognized over the estimated number of uses expected for each type of product and are adjusted periodically during the operating season prior to the ticket or product expiration, which occurs no later than the close of the operating season, (b) depreciation, certain advertising and certain seasonal operating costs are expensed over each park’s operating season, including some costs incurred prior to the season, which are deferred and amortized over the season, and (c) all other costs are expensed as incurred or ratably over the entire year.


8


(3) Long-Lived Assets:
Long-lived assets are reviewed for impairment upon the occurrence of events or changes in circumstances that would indicate that the carrying value of the assets may not be recoverable. In order to determine if an asset has been impaired, assets are grouped and tested at the lowest level for which identifiable, independent cash flows are available. A significant amount of judgment is involved in determining if an indicator of impairment has occurred. Such indicators may include, among others: a significant decline in expected future cash flows; a sustained, significant decline in equity price and market capitalization; a significant adverse change in legal factors or in the business climate; unanticipated competition; and slower growth rates. Any adverse change in these factors could have a significant impact on the recoverability of these assets and could have a material impact on the Partnership's consolidated financial statements.

The long-lived operating asset impairment test involves a two-step process. The first step is a comparison of each asset group's carrying value to its estimated undiscounted future cash flows expected to result from the use of the assets, including disposition. Projected future cash flows reflect management's best estimates of economic and market conditions over the projected period, including growth rates in revenues and costs, estimates of future expected changes in operating margins and cash expenditures. Other significant estimates and assumptions include terminal value growth rates. If the carrying value of the asset group is higher than its undiscounted future cash flows, there is an indication that impairment exists and the second step must be performed to measure the amount of impairment loss. The amount of impairment is determined by comparing the fair value of the asset group to its carrying value in a manner consistent with the highest and best use of those assets. The Partnership estimates fair value of operating assets using an income (discounted cash flows) approach, which uses an asset group's projection of estimated operating results and cash flows that is discounted using a weighted-average cost of capital reflective of current market conditions. If the fair value of the assets is less than their carrying value, an impairment charge is recorded for the difference.

Non-operating assets are evaluated for impairment based on changes in market conditions. When changes in market conditions are observed, impairment is estimated using a market-based approach. If the estimated fair value of the non-operating assets is less than their carrying value, an impairment charge is recorded for the difference.

During the third quarter of 2016, the Partnership ceased operations of one of its separately gated outdoor water parks, Wildwater Kingdom, located near Cleveland in Aurora, Ohio. At the date that Wildwater Kingdom ceased operations, the only remaining long-lived asset was the approximate 670 acres of land owned by the Partnership. This land had an associated carrying value of $17.1 million. The Partnership assessed the remaining asset and concluded there was no impairment during the third quarter of 2016. The remaining Wildwater Kingdom acreage, reduced by acreage sold, is classified as assets held-for-sale within "Other Assets" in the unaudited condensed consolidated balance sheet ($16.5 million as of September 24, 2017).

9


(4) Goodwill and Other Intangible Assets:
Goodwill and other indefinite-lived intangible assets, including trade-names, are reviewed for impairment annually, or more frequently if indicators of impairment exist. As of September 24, 2017, there were no indicators of impairment. The Partnership's annual testing date is the first day of the fourth quarter. There were no impairments for any period presented.

A summary of changes in the Partnership’s carrying value of goodwill for the nine months ended September 24, 2017 and September 25, 2016 is as follows:
(In thousands)
 
Goodwill
(gross)
 
Accumulated
Impairment
Losses
 
Goodwill
(net)
Balance at December 31, 2016
 
$
259,528

 
$
(79,868
)
 
$
179,660

Foreign currency translation
 
5,350

 

 
5,350

Balance at September 24, 2017
 
$
264,878

 
$
(79,868
)
 
$
185,010

 
 
 
 
 
 
 
Balance at December 31, 2015
 
$
290,679

 
$
(79,868
)
 
$
210,811

Foreign currency translation
 
4,649

 

 
4,649

Balance at September 25, 2016
 
$
295,328

 
$
(79,868
)
 
$
215,460


During the fourth quarter of 2016, management reassessed its accounting for the deferred income tax effects related to its Canadian disregarded entity temporary differences that were recorded in purchase accounting at the time of the acquisition. As a result, to appropriately reflect these tax effects, the Partnership recorded an adjustment that reduced goodwill and deferred tax liabilities by $33.9 million as of December 31, 2016. The adjustment did not impact the statement of operations and comprehensive income or the statement of cash flows for any period presented.

As of September 24, 2017, December 31, 2016, and September 25, 2016, the Partnership’s other intangible assets consisted of the following:
(In thousands)
 
Gross
Carrying
Amount
 
Accumulated
Amortization
 
Net
Carrying
Value
September 24, 2017
 
 
 
 
 
 
Other intangible assets:
 
 
 
 
 
 
Trade names
 
$
36,794

 
$

 
$
36,794

License / franchise agreements
 
3,361

 
(1,623
)
 
1,738

Total other intangible assets
 
$
40,155

 
$
(1,623
)
 
$
38,532

 
 
 
 
 
 
 
December 31, 2016
 
 
 
 
 
 
Other intangible assets:
 
 
 
 
 
 
Trade names
 
$
35,603

 
$

 
$
35,603

License / franchise agreements
 
3,326

 
(1,092
)
 
2,234

Total other intangible assets
 
$
38,929

 
$
(1,092
)
 
$
37,837

 
 
 
 
 
 
 
September 25, 2016
 
 
 
 
 
 
Other intangible assets:
 
 
 
 
 
 
Trade names
 
$
35,866

 
$

 
$
35,866

License / franchise agreements
 
1,475

 
(911
)
 
564

Total other intangible assets
 
$
37,341

 
$
(911
)
 
$
36,430


Amortization expense of other intangible assets is expected to continue to be immaterial going forward.

10


(5) Long-Term Debt:
Long-term debt as of September 24, 2017, December 31, 2016, and September 25, 2016 consisted of the following:
(In thousands)
September 24, 2017
 
December 31, 2016
 
September 25, 2016
 
 
 
 
 
 
Term debt (1)
 
 
 
 
 
April 2017 U.S. term loan averaging 3.38% (due 2017-2024)
$
735,000

 
$

 
$

March 2013 U.S. term loan averaging 3.25% (due 2013-2020)

 
602,850

 
602,850

Notes
 
 
 
 
 
April 2017 U.S. fixed rate notes at 5.375% (due 2027)
500,000

 

 

June 2014 U.S. fixed rate notes at 5.375% (due 2024)
450,000

 
450,000

 
450,000

March 2013 U.S. fixed rate notes at 5.25% (due 2021)

 
500,000

 
500,000

 
1,685,000

 
1,552,850

 
1,552,850

Less current portion

 
(2,775
)
 
(1,200
)
 
1,685,000

 
1,550,075

 
1,551,650

Less debt issuance costs
(25,374
)
 
(15,864
)
 
(16,979
)
 
$
1,659,626

 
$
1,534,211

 
$
1,534,671

(1)
The average interest rate is calculated over the life of the instrument and does not reflect the effect of interest rate swap agreements (see Note 6).
In April 2017, the Partnership issued $500 million of 5.375% senior unsecured notes ("April 2017 notes"), maturing in 2027. The net proceeds from the offering of the April 2017 notes, together with borrowings under the 2017 Credit Agreement (defined below), were used to redeem all of the Partnership's 5.25% senior unsecured notes due 2021 ("March 2013 notes"), and pay accrued interest and transaction fees and expenses, to repay in full all amounts outstanding under its existing credit facilities and for general corporate purposes. The redemption of the March 2013 notes and repayments of the amounts outstanding under the existing credit facilities resulted in the write-off of debt issuance costs of $7.6 million and debt premium payments of $15.5 million. Accordingly, the Partnership recorded a loss on debt extinguishment of $23.1 million during the second quarter of 2017.

Concurrently with the April 2017 notes issuance, the Partnership amended and restated its existing $885 million credit agreement (the "2013 Credit Agreement"), which included a $630 million senior secured term loan facility and a $255 million senior secured revolving credit facility. The $1,025 million amended and restated credit agreement (the "2017 Credit Agreement") includes a $750 million senior secured term loan facility and a $275 million senior secured revolving credit facility. The terms of the senior secured term loan facility include a maturity date of April 15, 2024 and an interest rate of London InterBank Offered Rate ("LIBOR") plus 225 basis points (bps). The term loan amortizes at $7.5 million annually. The facilities provided under the 2017 Credit Agreement are collateralized by substantially all of the assets of the Partnership.

Terms of the 2017 Credit Agreement include a revolving credit facility of a combined $275 million with a Canadian sub-limit of $15 million. Borrowings under the senior secured revolving credit facility bear interest at LIBOR or Canadian Dollar Offered Rate ("CDOR") plus 200 bps. The revolving credit facility is scheduled to mature in April 2022 and also provides for the issuance of documentary and standby letters of credit. The 2017 Credit Agreement requires the payment of a 37.5 bps commitment fee per annum on the unused portion of the credit facilities.

The April 2017 notes pay interest semi-annually in April and October, with the principal due in full on April 15, 2027. Prior to April 15, 2020, up to 35% of the notes may be redeemed with the net cash proceeds of certain equity offerings at a price equal to 105.375% of the principal amount thereof, together with accrued and unpaid interest and additional interest, if any. The notes may be redeemed, in whole or in part, at any time prior to April 15, 2022 at a price equal to 100% of the principal amount of the notes redeemed plus a "make-whole" premium together with accrued and unpaid interest and additional interest, if any, to the redemption date. Thereafter, the notes may be redeemed, in whole or in part, at various prices depending on the date redeemed.

In June 2014, the Partnership issued $450 million of 5.375% senior unsecured notes ("June 2014 notes"), maturing in 2024. The Partnership's June 2014 notes pay interest semi-annually in June and December, with the principal due in full on June 1, 2024. The notes may be redeemed, in whole or in part, at any time prior to June 1, 2019 at a price equal to 100% of the principal amount of the notes redeemed together plus a "make-whole" premium together with accrued and unpaid interest, if any, to the redemption date. Thereafter, the notes may be redeemed, in whole or in part, at various prices depending on the date redeemed.


11


The 2017 Credit Agreement includes a Consolidated Leverage Ratio, which if breached for any reason and not cured could result in an event of default. The ratio is set at a maximum of 5.50x consolidated total debt-to-consolidated EBITDA. As of September 24, 2017, the Partnership was in compliance with this financial condition covenant and all other covenants under the 2017 Credit Agreement.

The Partnership's long-term debt agreements include Restricted Payment provisions. Pursuant to the terms of the indenture governing the Partnership's June 2014 notes, which includes the most restrictive of these Restricted Payments provisions, the Partnership can make Restricted Payments of $60 million annually so long as no default or event of default has occurred and is continuing; and the Partnership's ability to make additional Restricted Payments is permitted should the Partnership's pro forma Total-Indebtedness-to-Consolidated-Cash-Flow Ratio be less than or equal to 5.00x.

As market conditions warrant, the Partnership may from time to time repurchase debt securities issued by the Partnership, in privately negotiated or open market transactions, by tender offer, exchange offer or otherwise.

(6) Derivative Financial Instruments:
Derivative financial instruments are used within the Partnership’s overall risk management program to manage certain interest rate and foreign currency risks. By utilizing a derivative instrument to hedge exposure to LIBOR rate changes, the Partnership is exposed to counterparty credit risk, in particular the failure of the counterparty to perform under the terms of the derivative contract. To mitigate this risk, hedging instruments are placed with a counterparty that the Partnership believes poses minimal credit risk. The Partnership does not use derivative financial instruments for trading purposes.

In the first quarter of 2016, the Partnership amended each of its four interest rate swap agreements to extend each of the maturities by two years to December 31, 2020 and effectively convert $500 million of variable-rate debt to a rate of 2.64%. As a result of the amendments, the previously existing interest rate swap agreements were de-designated, and the amounts recorded in AOCI are being amortized into earnings through the original December 31, 2018 maturity. The amended interest rate swap agreements are not designated as hedging instruments.

The fair market value of the Partnership's swap portfolio was recorded within "Derivative Liability" on the unaudited condensed consolidated balance sheets as of September 24, 2017, December 31, 2016, and September 25, 2016 as follows:
(In thousands)
 
September 24, 2017
 
December 31, 2016
 
September 25, 2016
Derivatives not designated as hedging instruments:
 
 
 
 
 
 
Interest rate swaps
 
$
(14,849
)
 
$
(17,721
)
 
$
(30,185
)

Derivatives Designated as Hedging Instruments
Changes in fair value of highly effective hedges are recorded as a component of AOCI in the balance sheet. Any ineffectiveness is recognized immediately in income. Amounts recorded as a component of accumulated other comprehensive income are reclassified into earnings in the same period the forecasted transactions affect earnings. As a result of the first quarter of 2016 amendments, the previously existing interest rate swap agreements were de-designated and the amended interest rate swap agreements are not designated as hedging instruments. As of September 24, 2017, the Partnership has no designated derivatives; therefore, no amount of designated derivatives are forecasted to be reclassified into earnings in the next twelve months.

Derivatives Not Designated as Hedging Instruments
Instruments that do not qualify for hedge accounting or were de-designated are prospectively adjusted to fair value each reporting period through "Net effect of swaps" in the unaudited condensed consolidated statements of operations and comprehensive income. The amounts that were previously recorded as a component of AOCI prior to the de-designation are reclassified to earnings, and a corresponding realized gain or loss will be recognized when the forecasted cash flow occurs. As a result of the first quarter 2016 amendments, the previously existing interest rate swap agreements were de-designated, and the amounts previously recorded in AOCI are being amortized into earnings through the original December 31, 2018 maturity. As of September 24, 2017, approximately $11.8 million of losses remain in AOCI related to the effective cash flow hedge contracts prior to de-designation, $9.5 million of which will be reclassified to earnings within the next twelve months.


12


The following table summarizes the effect of derivative instruments on income and other comprehensive income for the three months ended September 24, 2017 and September 25, 2016:
(In thousands)
 
Amount of Gain (Loss)
recognized in OCI on
Derivatives
(Effective Portion)
 
Amount and Location of Gain (Loss)
Reclassified from Accumulated OCI into Income
(Effective Portion)
 
Amount and Location of Gain (Loss) Recognized
in Income on Derivatives
Designated Derivatives
 
Three months ended 9/24/2017
 
Three months ended 9/25/2016
 
Designated Derivatives
 
Three months ended 9/24/2017
 
Three months ended 9/25/2016
 
Derivatives
Not Designated
 
Three months ended 9/24/2017
 
Three months ended 9/25/2016
Interest rate swaps
 
$

 
$

 
Interest Expense
 
$

 
$

 
Net effect of swaps
 
$
3,318

 
$
715


During the quarter ended September 24, 2017, the Partnership recognized $3.3 million of gains on the derivatives not designated as cash flow hedges and $2.4 million of expense representing the regular amortization of amounts in AOCI. The effect of these amounts resulted in a benefit to earnings of $1.0 million recorded in “Net effect of swaps.”

During the quarter ended September 25, 2016, the Partnership recognized $0.7 million of gains on the derivatives not designated as cash flow hedges and $2.4 million of expense representing the amortization of amounts in AOCI. The effect of these amounts resulted in a charge to earnings of $1.7 million recorded in “Net effect of swaps.”

The following table summarizes the effect of derivative instruments on income and other comprehensive income for the nine months ended September 24, 2017 and September 25, 2016:
(In thousands)
 
Amount of Gain (Loss)
recognized in OCI on
Derivatives
(Effective Portion)
 
Amount and Location of Gain (Loss)
Reclassified from Accumulated OCI into Income
(Effective Portion)
 
Amount and Location of Gain (Loss) Recognized
in Income on Derivatives
Designated Derivatives
 
Nine months ended 9/24/2017
 
Nine months ended 9/25/2016
 
Designated Derivatives
 
Nine months ended 9/24/2017
 
Nine months ended 9/25/2016
 
Derivatives
Not Designated
 
Nine months ended 9/24/2017
 
Nine months ended 9/25/2016
Interest rate swaps
 
$

 
$
(4,671
)
 
Interest Expense
 
$

 
$
(851
)
 
Net effect of swaps
 
$
3,378

 
$
(2,596
)

During the nine-month period ended September 24, 2017, the Partnership recognized $3.4 million of gains on the derivatives not designated as cash flow hedges and $7.1 million of expense representing the regular amortization of amounts in AOCI. The effect of these amounts resulted in a charge to earnings of $3.7 million recorded in “Net effect of swaps.”

During the nine-month period ended September 25, 2016, the Partnership recognized $2.6 million of losses on the derivatives not designated as cash flow hedges and $6.3 million of expense representing the amortization of amounts in AOCI. The effect of these amounts resulted in a charge to earnings of $8.9 million recorded in “Net effect of swaps.”


13


(7) Fair Value Measurements:
The FASB's Accounting Standards Codification (ASC) 820 - Fair Value Measurements and Disclosures emphasizes that fair value is a market-based measurement that should be determined based on assumptions (inputs) that market participants would use in pricing an asset or liability. Inputs may be observable or unobservable, and valuation techniques used to measure fair value should maximize the use of relevant observable inputs and minimize the use of unobservable inputs. Accordingly, FASB ASC 820 establishes a hierarchal disclosure framework that ranks the quality and reliability of information used to determine fair values. The hierarchy is associated with the level of pricing observability utilized in measuring fair value and defines three levels of inputs to the fair value measurement process. Quoted prices are the most reliable valuation inputs, whereas model values that include inputs based on unobservable data are the least reliable. Each fair value measurement must be assigned to a level corresponding to the lowest level input that is significant to the fair value measurement in its entirety.

The three broad levels of inputs defined by the fair value hierarchy are as follows:

Level 1 – inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets.
Level 2 – inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument.
Level 3 – inputs to the valuation methodology are unobservable and significant to the fair value measurement.

A financial instrument’s categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The table below presents the balances of assets and liabilities measured at fair value as of September 24, 2017, December 31, 2016, and September 25, 2016 on a recurring basis as well as the fair values of other financial instruments:
(In thousands)
Unaudited Condensed 
Consolidated Balance Sheet Location
Fair Value Hierarchy Level
 
September 24, 2017
 
December 31, 2016
 
September 25, 2016
 
Carrying Value
Fair 
Value
 
Carrying Value
Fair 
Value
 
Carrying Value
Fair 
Value
Financial assets (liabilities) measured on a recurring basis:
Short-term investments
Other current assets
Level 1
 
$
688

$
688

 


 


Interest rate swap agreements not designated as cash flow hedges
Derivative Liability
Level 2
 
$
(14,849
)
$
(14,849
)
 
$
(17,721
)
$
(17,721
)
 
$
(30,185
)
$
(30,185
)
Other financial assets (liabilities):
March 2013 term debt
Long-Term Debt (1)
Level 2
 


 
$
(600,075
)
$
(603,075
)
 
$
(601,650
)
$
(603,154
)
April 2017 term debt
Long-Term Debt (1)
Level 2
 
$
(735,000
)
$
(740,513
)
 


 


March 2013 notes
Long-Term Debt (1)
Level 1
 


 
$
(500,000
)
$
(510,000
)
 
$
(500,000
)
$
(520,000
)
June 2014 notes
Long-Term Debt (1)
Level 1
 
$
(450,000
)
$
(472,500
)
 
$
(450,000
)
$
(462,375
)
 
$
(450,000
)
$
(477,000
)
April 2017 notes
Long-Term Debt (1)
Level 2
 
$
(500,000
)
$
(527,500
)
 


 



(1)
Carrying values of long-term debt balances are before reductions for debt issuance costs of $25.4 million, $15.9 million, and $17.0 million as of September 24, 2017, December 31, 2016, and September 25, 2016, respectively.

Fair values of the interest rate swap agreements are determined using significant inputs, including the LIBOR forward curves, which are considered Level 2 observable market inputs.

The carrying value of cash and cash equivalents, revolving credit loans, accounts receivable, current portion of term debt, accounts payable, and accrued liabilities approximates fair value because of the short maturity of these instruments. There were no assets measured at fair value on a non-recurring basis as of September 24, 2017, December 31, 2016, or September 25, 2016.

14


(8) Earnings per Unit:
Net income per limited partner unit is calculated based on the following unit amounts:
 
Three months ended
 
Nine months ended
 
9/24/2017
 
9/25/2016
 
9/24/2017
 
9/25/2016
 
(In thousands, except per unit amounts)
Basic weighted average units outstanding
56,078

 
55,948

 
56,062

 
55,922

Effect of dilutive units:
 
 
 
 
 
 
 
Deferred units
44

 
33

 
41

 
30

Performance units

 

 
48

 
43

Restricted units
284

 
253

 
292

 
266

Unit options
185

 
131

 
188

 
131

Diluted weighted average units outstanding
56,591

 
56,365

 
56,631

 
56,392

Net income per unit - basic
$
3.41

 
$
3.13

 
$
2.82

 
$
3.30

Net income per unit - diluted
$
3.38

 
$
3.10

 
$
2.79

 
$
3.27


(9) Income and Partnership Taxes:
Under the applicable accounting rules, income taxes are recognized for the amount of taxes payable by the Partnership’s corporate subsidiaries for the current year and for the impact of deferred tax assets and liabilities, which represent future tax consequences of events that have been recognized differently in the financial statements than for tax purposes. The income tax provision (benefit) for interim periods is determined by applying an estimated annual effective tax rate to the quarterly income (loss) of the Partnership’s corporate subsidiaries. In addition to income taxes on its corporate subsidiaries, the Partnership is subject to a publicly traded partnership tax (PTP tax) on partnership-level gross income (net revenues less cost of food, merchandise and games). As such, the Partnership’s total provision (benefit) for taxes includes amounts for both the PTP tax and for income taxes on its subsidiaries.

As of the end of the third quarter of 2017, the Partnership has recorded $0.7 million of unrecognized tax benefits including interest and/or penalties related to state and local tax filing positions. The Partnership recognizes interest and/or penalties related to unrecognized tax benefits in the income tax provision. The Partnership does not anticipate that the balance of the unrecognized tax benefit will change significantly over the next 12 months.

(10) Contingencies:
The Partnership is a party to a number of lawsuits arising in the normal course of business. In the opinion of management, none of these matters are expected to have a material effect in the aggregate on the Partnership's financial statements.

15


(11) Changes in Accumulated Other Comprehensive Income by Component:
The following tables reflect the changes in accumulated other comprehensive income related to limited partners' equity for the three months ended September 24, 2017 and September 25, 2016:

Changes in Accumulated Other Comprehensive Income by Component (1)
(In thousands)
 
Gains and Losses on Cash Flow Hedges
 
Foreign Currency Translation
 
Total
Balance at June 25, 2017
 
$
(11,963
)
 
$
16,949

 
$
4,986

 
 
 
 
 
 
 
 
Other comprehensive income before reclassifications
 

 
(11,143
)
 
(11,143
)
 
 
 
 
 
 
 
 
Amounts reclassified from accumulated other comprehensive income, net of tax ($371) (2)
 
1,994

 

 
1,994

 
 
 
 
 
 
 
 
Net other comprehensive income
 
1,994

 
(11,143
)
 
(9,149
)
 
 
 
 
 
 
 
 
Balance at September 24, 2017
 
$
(9,969
)
 
$
5,806

 
$
(4,163
)

(1)
All amounts are net of tax. Amounts in parentheses indicate debits.
(2)
See Reclassifications Out of Accumulated Other Comprehensive Income table below for reclassification details.

Changes in Accumulated Other Comprehensive Income by Component (1)
(In thousands)
 
Gains and Losses on Cash Flow Hedges
 
Foreign Currency Translation
 
Total
Balance at June 26, 2016
 
$
(19,938
)
 
$
15,747

 
$
(4,191
)
 
 
 
 
 
 
 
 
Other comprehensive income before reclassifications, net of tax ($803)
 

 
1,397

 
1,397

 
 
 
 
 
 
 
 
Amounts reclassified from accumulated other comprehensive income, net of tax ($371) (2)
 
1,994

 

 
1,994

 
 
 
 
 
 
 
 
Net other comprehensive income
 
1,994

 
1,397

 
3,391

 
 
 
 
 
 
 
 
Balance at September 25, 2016
 
$
(17,944
)
 
$
17,144

 
$
(800
)

(1)
All amounts are net of tax. Amounts in parentheses indicate debits.
(2)
See Reclassifications Out of Accumulated Other Comprehensive Income table below for reclassification details.

Reclassifications Out of Accumulated Other Comprehensive Income
Details about Accumulated Other Comprehensive Income Components
 
Amount Reclassified from Accumulated Other Comprehensive Income
 
Affected Line Item in the Statement Where Net Income is Presented
(In thousands)
 
Three months ended
9/24/2017
 
Three months ended
9/25/2016
 
 
Interest rate contracts
 
$
2,365

 
$
2,365

 
Net effect of swaps
Provision for taxes
 
(371
)
 
(371
)
 
Provision for taxes
Losses on cash flow hedges
 
$
1,994

 
$
1,994

 
Net of tax



16


The following tables reflect the changes in accumulated other comprehensive income related to limited partners' equity for the nine months ended September 24, 2017 and September 25, 2016:

Changes in Accumulated Other Comprehensive Income by Component (1)
(In thousands)
 
Gains and Losses on Cash Flow Hedges
 
Foreign Currency Translation
 
Total
Balance at December 31, 2016
 
$
(15,950
)
 
$
18,891

 
$
2,941

 
 
 
 
 
 
 
 
Other comprehensive income before reclassifications
 

 
(13,085
)
 
(13,085
)
 
 
 
 
 
 
 
 
Amounts reclassified from accumulated other comprehensive income, net of tax ($1,113) (2)
 
5,981

 

 
5,981

 
 
 
 
 
 
 
 
Net other comprehensive income
 
5,981

 
(13,085
)
 
(7,104
)
 
 
 
 
 
 
 
 
Balance at September 24, 2017
 
$
(9,969
)
 
$
5,806

 
$
(4,163
)

(1)
All amounts are net of tax. Amounts in parentheses indicate debits.
(2)
See Reclassifications Out of Accumulated Other Comprehensive Income table below for reclassification details.

Changes in Accumulated Other Comprehensive Income by Component (1)
(In thousands)
 
Gains and Losses on Cash Flow Hedges
 
Foreign Currency Translation
 
Total
Balance at December 31, 2015
 
$
(19,300
)
 
$
22,591

 
$
3,291

 
 
 
 
 
 
 
 
Other comprehensive income before reclassifications, net of tax $711 and $3,131, respectively
 
(3,960
)
 
(5,447
)
 
(9,407
)
 
 
 
 
 
 
 
 
Amounts reclassified from accumulated other comprehensive income, net of tax ($990) (2)
 
5,316

 

 
5,316

 
 
 
 
 
 
 
 
Net other comprehensive income
 
1,356

 
(5,447
)
 
(4,091
)
 
 
 
 
 
 
 
 
Balance at September 25, 2016
 
$
(17,944
)
 
$
17,144

 
$
(800
)

(1)
All amounts are net of tax. Amounts in parentheses indicate debits.
(2)
See Reclassifications Out of Accumulated Other Comprehensive Income table below for reclassification details.

Reclassifications Out of Accumulated Other Comprehensive Income
Details about Accumulated Other Comprehensive Income Components
 
Amount Reclassified from Accumulated Other Comprehensive Income
 
Affected Line Item in the Statement Where Net Income is Presented
(In thousands)
 
Nine months ended
9/24/2017
 
Nine months ended
9/25/2016
 
 
Interest rate contracts
 
$
7,094

 
$
6,306

 
Net effect of swaps
Provision for taxes
 
(1,113
)
 
(990
)
 
Provision for taxes
Losses on cash flow hedges
 
$
5,981

 
$
5,316

 
Net of tax




17


(12) Consolidating Financial Information of Guarantors and Issuers:
Cedar Fair, L.P., Canada's Wonderland Company ("Cedar Canada"), and Magnum Management Corporation ("Magnum") are the co-issuers of the Partnership's June 2014 notes (see Note 5). The notes have been fully and unconditionally guaranteed, on a joint and several basis, by each 100% owned subsidiary of Cedar Fair (other than Cedar Canada and Magnum) that guarantees the Partnership's senior secured credit facilities. There are no non-guarantor subsidiaries.

The following consolidating schedules present condensed financial information for Cedar Fair, L.P., Cedar Canada, and Magnum, the co-issuers, and each 100% owned subsidiary of Cedar Fair (other than Cedar Canada and Magnum), the guarantors (on a combined basis), as of September 24, 2017, December 31, 2016, and September 25, 2016 and for the three-month and nine-month periods ended September 24, 2017 and September 25, 2016. In lieu of providing separate unaudited financial statements for the guarantor subsidiaries, the Partnership has included the accompanying unaudited condensed consolidating financial statements.


18


CEDAR FAIR, L.P.
UNAUDITED CONDENSED CONSOLIDATING BALANCE SHEET
September 24, 2017
(In thousands)
 
 
Cedar Fair L.P. (Parent)
 
Co-Issuer Subsidiary (Magnum)
 
Co-Issuer Subsidiary (Cedar Canada)
 
Guarantor Subsidiaries
 
Eliminations
 
Total
ASSETS
 
 
 
 
 
 
 
 
 
 
 
 
Current Assets:
 
 
 
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
 
$

 
$

 
$
92,047

 
$
160,593

 
$
(2,694
)
 
$
249,946

Receivables
 

 
1,285

 
33,158

 
837,594

 
(819,734
)
 
52,303

Inventories
 

 

 
2,423

 
31,817

 

 
34,240

Other current assets
 
275

 
12,843

 
743

 
16,829

 
(12,066
)
 
18,624

 
 
275

 
14,128

 
128,371

 
1,046,833

 
(834,494
)
 
355,113

Property and Equipment, net
 

 
842

 
183,205

 
1,396,463

 

 
1,580,510

Investment in Park
 
566,548

 
1,016,857

 
224,464

 
222,953

 
(2,030,822
)
 

Goodwill
 
674

 

 
64,730

 
119,606

 

 
185,010

Other Intangibles, net
 

 

 
14,443

 
24,089

 

 
38,532

Deferred Tax Asset
 

 
32,190

 

 

 
(32,190
)
 

Other Assets
 

 

 
53

 
17,354

 

 
17,407

 
 
$
567,497

 
$
1,064,017

 
$
615,266

 
$
2,827,298

 
$
(2,897,506
)
 
$
2,176,572

LIABILITIES AND PARTNERS’ EQUITY
 
 
 
 
 
 
 
 
 
 
 
 
Current Liabilities:
 
 
 
 
 
 
 
 
 
 
 
 
Accounts payable
 
$
478,416

 
$
345,150

 
$
6,431

 
$
26,141

 
$
(822,428
)
 
$
33,710

Deferred revenue
 

 

 
7,137

 
79,595

 

 
86,732

Accrued interest
 
292

 
195

 
9,209

 
14,232

 

 
23,928

Accrued taxes
 
1,589

 

 
14,910

 
74,224

 
(12,066
)
 
78,657

Accrued salaries, wages and benefits
 

 
28,306

 
2,360

 

 

 
30,666

Self-insurance reserves
 

 
12,090

 
1,725

 
13,734

 

 
27,549

Other accrued liabilities
 
2,985

 
7,772

 
499

 
9,306

 

 
20,562

 
 
483,282

 
393,513

 
42,271

 
217,232

 
(834,494
)
 
301,804

Deferred Tax Liability
 

 

 
19,511

 
125,350

 
(32,190
)
 
112,671

Derivative Liability
 
8,933

 
5,916

 

 

 

 
14,849

Other Liabilities
 

 
1,398

 

 
10,942

 

 
12,340

Long-Term Debt:
 
 
 
 
 
 
 
 
 
 
 
 
Term debt
 

 
127,402

 

 
595,983

 

 
723,385

Notes
 

 

 
444,874

 
491,367

 

 
936,241

 
 

 
127,402

 
444,874

 
1,087,350

 

 
1,659,626

 
 
 
 
 
 
 
 
 
 
 
 
 
Equity
 
75,282

 
535,788

 
108,610

 
1,386,424

 
(2,030,822
)
 
75,282

 
 
$
567,497

 
$
1,064,017

 
$
615,266

 
$
2,827,298

 
$
(2,897,506
)
 
$
2,176,572



 


19


CEDAR FAIR, L.P.
UNAUDITED CONDENSED CONSOLIDATING BALANCE SHEET
December 31, 2016
(In thousands)
 
 
Cedar Fair L.P. (Parent)
 
Co-Issuer Subsidiary (Magnum)
 
Co-Issuer Subsidiary (Cedar Canada)
 
Guarantor Subsidiaries
 
Eliminations
 
Total
ASSETS
 
 
 
 
 
 
 
 
 
 
 
 
Current Assets:
 
 
 
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
 
$

 
$

 
$
65,563

 
$
58,178

 
$
(1,025
)
 
$
122,716

Receivables
 

 
1,409

 
28,019

 
576,975

 
(570,989
)
 
35,414

Inventories
 

 

 
1,371

 
24,905

 

 
26,276

Other current assets
 
173

 
796

 
2,229

 
9,833

 
(1,761
)
 
11,270

 
 
173

 
2,205

 
97,182

 
669,891

 
(573,775
)
 
195,676

Property and Equipment, net
 

 
844

 
175,358

 
1,363,018

 

 
1,539,220

Investment in Park
 
798,076

 
937,626

 
200,075

 
324,282

 
(2,260,059
)
 

Goodwill
 
674

 

 
59,381

 
119,605

 

 
179,660

Other Intangibles, net
 

 

 
13,255

 
24,582

 

 
37,837

Deferred Tax Asset
 

 
33,303

 

 

 
(33,303
)
 

Other Assets
 

 
2,000

 
108

 
18,680

 

 
20,788

 
 
$
798,923

 
$
975,978

 
$
545,359

 
$
2,520,058

 
$
(2,867,137
)
 
$
1,973,181

LIABILITIES AND PARTNERS’ EQUITY
 
 
 
 
 
 
 
 
 
 
 
 
Current Liabilities:
 
 
 
 
 
 
 
 
 
 
 
 
Current maturities of long-term debt
 
$

 
$
572

 
$
64

 
$
2,139

 
$

 
2,775

Accounts payable
 
428,396

 
145,258

 
740

 
18,471

 
(572,014
)
 
20,851

Deferred revenue
 

 

 
5,601

 
77,164

 

 
82,765

Accrued interest
 
4,613

 
3,207

 
2,057

 
109

 

 
9,986

Accrued taxes
 
405

 
18,653

 

 
41,661

 
(1,761
)
 
58,958

Accrued salaries, wages and benefits
 

 
29,227

 
1,131

 

 

 
30,358

Self-insurance reserves
 

 
12,490

 
1,321

 
13,252

 


 
27,063

Other accrued liabilities
 
2,282

 
3,018

 
193

 
4,434

 

 
9,927

 
 
435,696

 
212,425

 
11,107

 
157,230

 
(573,775
)
 
242,683

Deferred Tax Liability
 

 

 
12,838

 
125,350

 
(33,303
)
 
104,885

Derivative Liability
 
10,633

 
7,088

 

 

 

 
17,721

Other Liabilities
 

 
1,236

 

 
11,926

 

 
13,162

Long-Term Debt:
 
 
 
 
 
 
 
 
 
 
 
 
Term debt
 

 
123,672

 
13,598

 
456,958

 

 
594,228

Notes
 
292,075

 
203,140

 
444,768

 

 

 
939,983

 
 
292,075

 
326,812

 
458,366

 
456,958

 

 
1,534,211

 
 
 
 
 
 
 
 
 
 
 
 
 
Equity
 
60,519

 
428,417
<