-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, E0rpniMqZ6Q1STtjt0E6ed2VoSLuG1ARAsl2RKan30PyT7z7YAoSs1kBtR6Fpzo+ 4byanDLuA8x36K6PVGN3aA== 0000811532-96-000013.txt : 19961115 0000811532-96-000013.hdr.sgml : 19961115 ACCESSION NUMBER: 0000811532-96-000013 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19960929 FILED AS OF DATE: 19961113 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: CEDAR FAIR L P CENTRAL INDEX KEY: 0000811532 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MISCELLANEOUS AMUSEMENT & RECREATION [7990] IRS NUMBER: 341560655 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-09444 FILM NUMBER: 96661423 BUSINESS ADDRESS: STREET 1: P O BOX 5006 CITY: SANDUSKY STATE: OH ZIP: 44871 BUSINESS PHONE: 4196260830 10-Q 1 FORM 10 - Q SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 [x] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 29, 1996 OR [ ] 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 (I.R.S. Employer incorporation or organization) Identification No.) P.O. Box 5006, Sandusky, Ohio 44871-5006 (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 . Title of Class Units Outstanding As Of Depositary Units November 1, 1996 (Representing Limited Partner Interests) 22,960,208 CEDAR FAIR, L.P. INDEX FORM 10 - Q FOR QUARTERLY PERIOD ENDED SEPTEMBER 29, 1996 Part I - Financial Information Item 1. Financial Statements 3-8 Item 2. Management's Discussion and 9 Analysis of Financial Condition and Results of Operations Part II - Other Information Item 6. Exhibits and Reports on Form 10 8-K Signatures 11 Index to Exhibits 12 PART I - FINANCIAL INFORMATION Item 1. - Financial Statements CEDAR FAIR, L.P. CONSOLIDATED BALANCE SHEETS (In thousands)
9/29/96 12/31/95 ASSETS Current Assets: Cash and cash equivalents $ 6,966 $ 111 Receivables 14,744 2,468 Inventories 4,489 4,387 Prepaids 970 2,839 27,169 9,805 Land, Buildings and Equipment: Land 28,056 27,999 Land improvements 39,106 36,617 Buildings 91,443 88,910 Rides and equipment 230,850 205,364 Construction in progress 1,565 8,047 391,020 366,937 Less accumulated depreciation (130,289) (113,097) 260,731 253,840 Intangibles, net of amortization 10,800 11,072 $298,700 $274,717 LIABILITIES AND PARTNERS' EQUITY Current Liabilities: Accounts payable $ 5,675 $ 6,409 Distribution payable to partners 14,495 13,335 Accrued interest 461 1,685 Accrued taxes 2,753 2,889 Accrued salaries, wages and benefits 8,671 4,601 Self-insurance reserves 7,327 6,402 Other accrued liabilities 5,842 2,327 45,224 37,648 Other Liabilities 5,624 5,593 Long-Term Debt: Revolving credit loans - 30,000 Term debt 50,000 50,000 50,000 80,000 Partners' Equity: Special L.P. interests 5,290 5,290 General partners 996 531 Limited partners, 22,960 units 191,566 145,655 outstanding 197,852 151,476 $298,700 $274,717 The accompanying Notes to Consolidated Financial Statements are an integral part of these balance sheets. CEDAR FAIR, L.P. CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands except per unit data) Three months Twelve months ended ended 9/29/96 10/1/95 9/29/96 10/1/95 Net revenues $167,503 $161,164 $249,362 $217,066 Costs and expenses: Cost of products sold 16,254 16,427 24,986 22,809 Operating expenses 40,721 37,940 95,739 78,040 Selling, general and 14,202 13,360 28,935 24,114 administrative Depreciation and 10,976 11,140 18,794 16,739 amortization 82,153 78,867 168,454 141,702 Operating income 85,350 82,297 80,908 75,364 Interest expense, net 1,470 1,662 7,058 6,777 Insurance claim settlement - - - (22) Net income 83,880 80,635 73,850 68,565 Net income allocated to 839 806 739 686 general partners Net income allocated to $83,041 $79,829 $73,111 $67,879 limited partners Weighted average limited 23,051 22,774 23,047 22,420 partner units outstanding Net income per limited $ 3.60 $ 3.51 $ 3.17 $ 3.03 partner unit The accompanying Notes to Consolidated Financial Statements are an integral part of these statements. CEDAR FAIR, L.P. CONSOLIDATED STATEMENTS OF PARTNERS' EQUITY (In thousands) Special General Limited Total L.P. Partners' Partners' Partners' Interests Equity Equity Equity Balance at December $ 5,290 $ 531 $ 145,655 $ 151,476 31, 1995 Allocation of net - (157) (15,561) (15,718) loss Distribution declared - (133) (13,202) (13,335) ($.575 per limited partner unit) Balance at March 31, 5,290 241 116,892 122,423 1996 Allocation of net - 194 19,185 19,379 income Distribution declared - (133) (13,202) (13,335) ($.575 per limited partner unit) Balance at June 30, 5,290 302 122,875 128,467 1996 Allocation of net - 839 83,041 83,880 income Distribution declared - (145) (14,350) (14,495) ($.625 per limited partner unit) Balance at September $ 5,290 $ 996 $ 191,566 $ 197,852 29, 1996 The accompanying Notes to Consolidated Financial Statements are an integral part of these statements. CEDAR FAIR, L.P. CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) Three months ended Twelve months ended 9/29/96 10/1/95 9/29/96 10/1/95 CASH FLOWS FROM (FOR) OPERATING ACTIVITIES Net income $ 83,880 $ 80,635 $73,850 $68,565 Adjustments to reconcile net income to net cash from operating activities Depreciation and amortization 10,976 11,140 18,794 16,739 Change in assets and liabilities net of effects from acquisition of Worlds of Fun and Oceans of Fun: Decrease (increase) in inventories 7,258 6,643 (280) 558 Increase in current and other (1,254) (2,867) (1,871) (3,791) assets Decrease in accounts payable (11,660) (13,203) (1,721) (1,961) Increase in self-insurance reserves 887 566 912 41 Increase (decrease) in other (1,359) 877 937 2,687 current liabilities Increase in other liabilities 777 281 1,913 933 Net cash from operating activities 89,505 84,072 92,534 83,771 CASH FLOWS FROM (FOR) INVESTING ACTIVITIES Capital expenditures (3,190) (4,003) (30,573) (27,169) Acquisition of Worlds of Fun and Oceans of Fun: Land, buildings, rides and - (37,404) - (37,404) equipment acquired Negative working capital assumed, - 1,381 - 1,381 net of cash acquired Net cash (for) investing activities (3,190) (40,026) (30,573) (63,192) CASH FLOWS FROM (FOR) FINANCING ACTIVITIES Net payments on revolving credit (71,200) (69,903) (3,200) (10,703) loans Distributions paid to partners (13,335) (12,636) (53,342) (50,546) Acquisition of Worlds of Fun and Oceans of Fun: Borrowings on revolving credit loans for refinancing of - 13,903 - 13,903 assumed long-term debt Issuance of limited partnership - 22,384 - 22,384 units Net cash (for) financing activities (84,535) (46,252) (56,542) (24,962) Cash and cash equivalents: Net increase (decrease) for the 1,780 (2,206) 5,419 (4,383) period Balance, beginning of period 5,186 3,753 1,547 5,930 Balance, end of period $6,966 $1,547 $6,966 $1,547 SUPPLEMENTAL INFORMATION Cash payments for interest expense $ 2,682 $ 2,711 $ 7,128 $ 6,787 The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.
CEDAR FAIR, L.P. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE QUARTERS ENDED SEPTEMBER 29, 1996 AND OCTOBER 1, 1995 (1) Interim Reporting The accompanying consolidated financial statements have been prepared from the financial records of Cedar Fair, L.P. (the Partnership) without audit and reflect all adjustments which are, in the opinion of management, necessary to fairly present the results of the interim periods covered in this report. The Partnership operates four seasonal amusement parks: Cedar Point, located on Lake Erie between Cleveland and Toledo; Valleyfair, near Minneapolis/St. Paul; Dorney Park & Wildwater Kingdom, near Allentown, Pennsylvania; and Worlds of Fun and Oceans of Fun, in Kansas City, Missouri. These parks generate virtually all of the Partnership's revenue during an operating season which starts in April and May and ends in early October, with the major portion concentrated in the third quarter during the peak vacation months of July and August. Due to the highly seasonal nature of the Partnership's operations, the results for any interim period are not indicative of the results to be expected for the full year. Accordingly, the Partnership has elected to present financial information regarding operations for the preceding twelve month periods ended September 29, 1996 and October 1, 1995 to accompany the quarterly results. Because amounts for the 12 months ended September 29, 1996 include actual 1995 fourth quarter operations, they are not necessarily indicative of 1996 full calendar year operations. The Partnership's operating results for the three and twelve months ended October 1, 1995, include the results of Worlds of Fun and Oceans of Fun for the period since they were acquired on July 28, 1995 (see Note 3). (2) Significant Accounting and Reporting Policies The Partnership's consolidated financial statements for the quarters ended September 29, 1996 and October 1, 1995 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, 1995, which were included in the Form 10-K filed on March 29, 1996. 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. 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. To assure that its highly seasonal operations will not result in misleading comparisons of current and subsequent interim periods, the Partnership has adopted the following reporting procedures: (a) depreciation, advertising and certain seasonal operating costs are expensed ratably during the operating season, including certain costs incurred prior to the season and amortized over the season and (b) all other costs are expensed as incurred or ratably over the entire year. (3) Acquisition: As discussed in Note (7) in the 1995 Annual Report to unitholders, on July 28, 1995, the Partnership acquired substantially all of the assets of Worlds of Fun and Oceans of Fun. The table below summarizes the unaudited consolidated pro forma results of operations assuming the acquisition had occurred at the beginning of each of the periods presented, with adjustments primarily attributable to interest expense relating to the refinancing of long-term debt and depreciation expense relating to the fair value of assets acquired.
Three Months Ended Twelve Months Ended 9/29/96 10/1/95 9/29/96 10/1/95 (In thousands except per unit data) Net revenues $167,503 $168,454 $249,362 $237,747 Net income 83,880 83,423 73,850 67,135 Net income per $3.60 $3.59 $3.17 $2.89 limited partner unit
These pro forma results have been prepared for comparative purposes only and do not purport to be indicative of what would have occurred had the acquisition been made at the beginning of the periods presented, or of results which may occur in the future. Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Results of Operations Net revenues for the third quarter ended September 29, 1996, which included one less week of operations than the prior year, increased 4% to $167.5 million from $161.2 million for the quarter ended October 1, 1995. Net income for the period was $83.9 million, or $3.60 per limited partner unit, compared with $80.6 million, or $3.51 per unit, in 1995. Operating results for the current quarter were significantly impacted by seven fewer days of operations compared to the same period last year, partially offset by the contribution of Worlds of Fun for the full quarter in 1996 compared to last year, when the park was acquired on July 28, 1995. Including Worlds of Fun for the full quarter in 1995 and on a comparable number of operating days, net revenues and net income for the quarter increased 6% and 7%, respectively, on a 6% increase in guest per capita spending and a slight increase in combined attendance. For the quarter, combined attendance at the Partnership's original three parks was relatively flat between years, while guest per capita spending continued to rise, increasing 8% to $33.22 in the current period from $30.77 in 1995. For the entire operating season, combined attendance at the four parks was 6.9 million, up 10% from the previous year, with Worlds of Fun's full year contribution accounting for most of the increase. Included in costs and expenses are approximately $1,179,000 of incentive fees payable to the managing general partner relating to the 1996 third quarter distribution, which exceeded the minimum distribution as defined in the partnership agreement by 28.25 cents per unit, or $6.5 million in the aggregate. This compares to $1,012,000 of incentive fees in the 1995 third quarter. Financial Condition The Partnership's $95 million revolving credit facility is adequate to meet seasonal working capital needs, planned capital expenditures and quarterly distributions. The negative working capital ratio of 1.7 at September 29, 1996 is the result of the Partnership's highly seasonal business and careful management of cash flow. Current assets are at normal seasonal levels and credit facilities are in place to fund current liabilities as required. Partnership Tax Status: Under current law the Partnership's tax status as a publicly traded partnership is scheduled to end on December 31, 1997. The Partnership is well along in the process of reviewing its alternatives in preparation for the change in its tax status, and expects to be able to report on its plans early in 1997. PART II - OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K Exhibits: (a) Exhibit (20) 1996 Third Quarter Report and Cash Distribution Notice. (b) Reports on None. Form 8-K. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. CEDAR FAIR, L.P. (Registrant) By Cedar Fair Management Company Managing General Partner Date: November 11, 1996 By: Bruce A. Jackson Bruce A. Jackson Vice President (Chief Financial Officer) By: Charles M. Paul Charles M. Paul Controller (Chief Accounting Officer) EXHIBIT INDEX Exhibit Page 20 Report to Unitholders, November 11, 1996 13 EX-27 2
5 3-MOS 12-MOS DEC-31-1996 DEC-31-1996 SEP-29-1996 SEP-29-1996 6,966 6,966 0 0 14,744 14,744 0 0 4,489 4,489 27,169 27,169 391,020 391,020 130,289 130,289 298,700 298,700 45,224 45,224 0 0 191,566 191,566 0 0 0 0 6,286 6,286 298,700 298,700 167,503 249,362 167,503 249,362 16,254 24,986 82,153 168,454 0 0 0 0 1,470 7,058 83,880 73,850 0 0 0 0 0 0 0 0 0 0 83,880 73,850 3.60 3.17 0 0
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