Thank you for standing by, and welcome to the Six Flags 2025 Second Quarter Earnings Conference Call. [Operator Instructions] I'd now like to turn the call over to Six Flags management. Go ahead, please.

Thank you, Rob, and good morning, everyone. My name is Michael Russell, Corporate Director of Investor Relations for Six Flags. Welcome to today's earnings call to review Six Flags Entertainment Corporation's 2025 Second Quarter Financial Results. Earlier this morning, we issued 2 press releases, including our earnings release for the second quarter and another release announcing a leadership change. Copies of these press releases are available under the News tab of our Investor Relations website at investors.sixflags.com. 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 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. On the call with me this morning are Six Flags' Chief Executive Officer, Richard Zimmerman; and Chief Financial Officer, Brian Witherow. With that, I'll turn the call over to Richard.

Thank you, Michael, and good morning, everyone. Thanks for joining us today. Before we discuss our financial results, I want to address the leadership announcement we made this morning. I will be stepping down as President and CEO by the end of 2025. I plan to remain in the role until my successor is appointed, and I will work closely with the Board to identify the next leader to guide Six Flags forward. I will continue to serve as a Director of the company, so I will remain actively involved in overseeing the continued execution of our strategic plan. This will be a smooth, orderly succession process. To put this in some context, I've been in the entertainment industry for 38 years, and I've seen it evolve and change. For most of that time, it has been a goal of mine to help create a leading North American operator that can cater to all ages and entertainment styles. With the successful combination of Cedar Fair and legacy Six Flags completed last summer, we've now done that, and I couldn't be prouder of what we've accomplished so far. With that said, we've only just scratched the surface of the enormous potential of our combined company. As you'll hear us discuss in more detail this morning, we experienced some macro and weather-related headwinds in the second quarter. Even so, July was strong and the leading indicators heading into August look good thus far. We are also making great progress on integration and synergy realization. So despite the rainy weekends we saw back in May and June, I've never been more confident in our strategy to optimize our assets or more optimistic in the long-term value potential and opportunities for Six Flags. With that in mind, the Board and I have decided that…

Thanks, Richard. I'll begin with the balance sheet and a recap of use of cash this quarter. In late June, we closed a $500 million fungible add-on to our term loan. We used the net proceeds to pay off $200 million of 2025 notes while using the balance to repay a portion of our outstanding revolver borrowings. Following this transaction, we have no debt maturing until 2027 when the buyout of the noncontrolling interest of our Georgia Park is due in January and $1 billion of bonds come due in April. We intend to address these maturities in the coming months before they go current next year. Despite the headwinds to start the year, our underlying business remains solid. Adjusted EBITDA for the quarter fell well below plan. And nevertheless, we have ample liquidity with no near-term covenant or cash concerns. We ended the quarter with approximately $107 million in cash and cash equivalents and total liquidity of $540 million, including cash on hand and available capacity under our revolving credit facility. During the 3-month period, capital expenditures totaled $168 million, consistent with our previously disclosed expectation to spend $475 million to $500 million for the full year in 2025. During the quarter, we used $122 million on cash interest payments and $10 million in cash taxes. Based on outstanding debt, including forecasted borrowings on our revolver, we expect full year cash interest payments will total approximately $320 million. We now expect 2025 full year cash taxes will total approximately $40 million, reflecting the impact of further tax planning efforts by our team as well as the benefit of bonus depreciation deductions provided under new tax regulations. We are working to identify more cost efficiencies within our future capital programs and are now projecting a total CapEx spend of approximately…

Thanks, Brian. While we are disappointed by the need to lower full year adjusted EBITDA guidance, we believe it is a prudent and realistic measure given uncertain market dynamics and a slower first half than we expected at the outset of 2025. Importantly, we would anticipate much stronger second half results with normalized weather conditions, improved demand trends, a positive response to our 2025 capital program and disciplined expense control. We are mindful of our company's leverage and remain committed to paying down debt as quickly as possible. As Brian noted, we are evaluating an opportunity to monetize noncore assets, which could significantly accelerate deleveraging. The near-term headwinds we faced in the first half of 2025 were ill-timed just as we are coming off an outstanding fourth quarter and hitting our stride as a combined company. But exogenous factors do not change the long-term trajectory or the outlook for Six Flags. We've already seen demand return as weather has improved and believe the strategic actions we are taking will result in the performance we are targeting for the second half of 2025 as well as set us up for a breakthrough 2026 season. As we move through the second half of the year, we are focused on executing the opportunities over which we have control, building upon the momentum we've seen in July and delivering the kind of guest experiences that drive loyalty and sustained growth. A key part of this work is our systems integration project, which is on track to deliver a new ticketing platform, a fully reengineered in-park mobile app and a more interactive e-commerce site, all scheduled to launch in November. To close, let me bring everyone back to the bigger picture. We are building a better business with a more stable cost structure and expanded suite of products and an unrelenting drive to create unforgettable moments for every guest who visits our parks. Our strategy is clear: invest in value-enhancing profitable growth, rapidly reduce leverage and create value for our guests, our associates and our shareholders. Let me leave you with this. Our company is strong, our strategy is sound and the opportunities are real. We will continue to manage this business with discipline with an eye on the long term, knowing that along the way, there will always be difficult cycles, unanticipated surprises and unexpected volatility. What matters, however, that we continue to stay focused on our guests, execute with excellence, invest where we see durable returns. Rob, that concludes our prepared remarks. Please open the line for questions.

[Operator Instructions] Your first question comes from the line of Steve Wieczynski from Stifel.

So Richard or Brian, I guess to start, I'm kind of confused in terms of your macro pressure comments. When you refer to macro pressures, are you referring to weather? Or are you indicating that you've seen a material change in customer spending patterns because of macro fears, which aren't weather-related. I just can't figure out what you guys are referring to. Weather headwinds make sense to us. But if you're saying your customer base has slowed or become more cautious in terms of spending, I guess that would be somewhat confusing given spend patterns across a lot of other consumer verticals have remained pretty healthy at this point. So any color there would be helpful.

Steve, let me jump in here, and Brian can weigh in. When we talk about macro factors, weather is clearly a dominant factor, as you said. And when we look at that, clearly, that impact was significant. The other thing that we look at is we look at the spending once people come inside the gate, we've commented on that. We are seeing a little bit of pressure on our lower income consumer. As we look at our demographics and the folks that are coming, we think that there are segments of our markets that are feeling pressure in different ways market by market. Brian?

Yes. The only thing I would add, Steve, is, as Richard noted, the -- we're watching closely the difference between the lower-end consumer and the higher-end consumer. As you noted, Steve, we haven't seen a significant pullback in customer behavior at the parks. When they're there, they're spending, particularly at our more established and largest properties. What we did see in the first half is something I think we've talked about previously, which is the urgency around visitation in the front half of the year is much lower than it is as we get deeper into the year. So I think one of those macro trends, not necessarily a change in consumer mindset -- or I'm sorry, consumer behavior, but maybe more in consumer mindset and the comment that the value proposition needs to be really high. And so we're focused on that lower-end consumer and monitoring where that moves. But we're not seeing significant change in our guest behavior once they're at the parks.

Okay. Got you. And then second question, just trying to understand where we sit today versus back in -- a couple of months ago back in May when you guys provided those 2028 financial targets. So I guess what I'm trying to figure out is, obviously, yes, weather has been a massive headwind here in May and June, but wondering why that would have such a material impact on these goals that were kind of put in place for 3 years out. And maybe saying that a little bit differently. I would have thought your '28 targets would have embedded some pretty significant unperfect weather, macro headwinds, something along those lines that would still kind of allow you to get close to that $1.5 billion target. So I'm not sure if maybe you guys are kind of walking that target back now given the change with Richard and a new CEO coming. I guess I'm just a little bit confused there.

Steve, as we noted in our prepared remarks, we believe the challenges we faced in the first half of the year are largely transient and not reflective of a fundamental change in the consumer that would disrupt, as you said, the long-term potential of the business. With that said, we're going to reassess our long-term guidance after the season is closed and following the release of our full year 2025 financial results. When I look at the recovery we've seen, let me go back to what we've seen in July, 1% for the 5-week up in attendance, 4% on the 4 weeks, more recently in the last 2 weeks of the month, up 8%. When you look at the acceleration, we are seeing tremendous response and people coming back. As a matter of fact, in the first 2 days of this week, we were up 80,000 -- almost 90,000 visits on Monday and Tuesday that just concluded. So as we think about the long- term potential, we still believe that the strategies we're laying in place will drive and let us get to that long-term potential. But we do want to make sure that we take a look at how the second half unfolds. What I've said to the team, and I want to be very clear, while I'm the CEO, we're going to focus on finishing '25 strong and building the strongest possible momentum for '26. And I think that will give us an ability to really focus on those long-term targets and address those once we get to the end of the year and into the first part of next year.

Your next question comes from the line of Arpine Kocharyan from UBS.

So you mentioned accelerating divestitures. Could you give a broader sense of what you're looking at and the timing of those divestitures, fully understanding that some of that is more tied to sort of the transaction markets. But sitting here today, how would you size that opportunity beyond what we already know? And what could that mean for deleveraging targets that you have medium term? And I have a quick follow-up.

Yes. I'll jump in, and again, Brian can weigh in. As we look at the portfolio, we're clearly taking a strategic look at it, working closely with our Board. And we'll have more to share as we go through that. We're trying to execute very quickly on the 2 noncore asset sales that we talked about and have a process underway for each of those. We're also engaged in evaluating the rest of what we think is potential given market conditions and how quickly we can move to potentially divest other things that we would consider noncore. Brian?

Yes. I guess I would just -- Arpine, I would just add with the lion's share of our EBITDA, 90-plus percent of EBITDA coming from our largest 15 or 16 locations. We've said all along our priority when it comes to thinking about optimizing the portfolio lies in several core objectives. One is narrowing management's focus, reducing risk and simplifying our capital needs to those most key and strategic assets. Deleveraging will be a benefit of that, but those remain the priorities when it comes to our focus on optimizing the portfolio.

Okay. And then a quick clarification question. You highlighted acceleration in cost saves for the back half of about $90 million from what I think was closer to $70 million before today. But then there is about $25 million of pull forward of costs that moved from the back half to Q2. So what's sort of the upside to actual synergies outside of that pull forward of cost? I'm trying to understand a little bit better. On a full year basis, what's the upside today versus what you were looking at it -- what you were looking at in terms of cost synergies?

Yes. Coming into the year, I'll remind you, Arpine, we realized between the 2 combined companies close to $55 million of synergies in 2024. As we roll into '25, our goal was to finish realizing the original $120 million target. And so we had set an objective of $65- plus million of synergies for this year. The $90 million target for the second half of this year, if you look at what we would consider the permanent cost savings, as I said, of the $90 million second half reduction, close to 2/3 of that is permanent cost savings. When we annualize on a run rate, a few of those items like the full-time headcount reductions as one example, we get close to that $65-plus million of permanent cost synergies, in 2025, getting us to that full $120 million. We will continue to look for more cost savings, and there are additional synergies as we roll into 2026. We'll provide more of an outlook on that as we get to the end of this year and we focus on next year. But for this year, we'll have checked the box on realizing the $120 million of original merger-related cost synergies once we execute on the second half objectives and targets.

Your next question comes from the line of James Hardiman from Citi.

So maybe let's just do a little bit of math on the guidance. If we look at the midpoint previously versus today, I think we're talking about a $215 million cut versus the prior guide. Now obviously, you don't give us explicit quarterly guidance, but I get to maybe, I don't know, $160 million miss versus Q2. And ultimately, I'm getting to maybe an implied sort of $50 million to $60 million lower in the second half. Maybe if you could share how we should be thinking about that math. Ultimately, what of the guide down is 2Q versus the back half of the year? And particularly as we think about the second half reduction in expectations, how much of that is just the lost season pass revenues that it's pretty difficult to make up, right, if people weren't there in May and June buying those season passes? And how much of it is sort of everything else? That would be helpful.

Yes, James, it's Brian. I'll try it this way, and you can tell me if I answer it or we can go down another path. I mean when we came into this year and the midpoint of our guidance range of $1.1 billion was largely tied to volume, right? Attendance growth of close to 3- plus percent. A big chunk of that was through the expectation and the goal of driving a significant increase in that active pass base. As you noted and as we said in our prepared remarks, that has not happened in the first half of the year. Things were significantly disrupted. We lost a significant amount of passes, more than 300,000 season pass sales down in the months of May and June, again, all sort of tied back to the weather disruptions that we spoke about. So that is the biggest and most significant headwind that we've seen. In terms of the cost side of the business, I think we're going to execute on not only the cost savings that we had identified coming into the year, there will be incremental savings beyond, but those are more tied towards the lower volume responding to the lower demand levels or the lower attendance levels that we've seen this year. So as we think about -- as we've laid out in the prepared remarks, and we think about the second half of the year, achieving attendance of flat given that shortfall in the season pass base or the active pass base and the elimination of approximately 0.5 million visits associated with the 4 winter events that we're unplugging, that's reflecting growth of 1% to 2% in the balance of the business, again, in spite of a season pass base or an active pass base that is still down on a year-over-year basis.

That is helpful. And then maybe a question about costs. We talked about the fact that you really leaned into advertising spend and I guess, maintenance spend is going to be a little bit different than that. But maybe walk us through the timing of that spending. Obviously, if it's raining and cold, advertising might not really move the needle. So I'm guessing that this was more once weather got a little bit better that you sort of leaned into that. But I'm trying to just figure out how much of that OpEx spend was incremental and what that ultimately looks like next year? Because even when I sort of back out the $25 million of cost that you've laid out, it seems like a lot of growth in terms of operating expenses. So just trying to think through that.

Yes. So let's break it into some pieces. Your comments about the advertising. So the lion's share of the pull forward, as we noted, is advertising. And I agree with your comment that the advertising -- the decision to pull forward advertising, a little bit different animal than the pull forward of maintenance because maintenance expense can fluctuate just based on things that happen sometimes unpredictably during the course of the year. But the advertising pull forward, when we made those decisions to pull forward advertising, it was before necessarily the bad weather really kicked off or really accelerated in the latter half of May, right? You don't just turn advertising on overnight, right? We made that decision as we were turning into Q2, the beginning of the quarter and put those things in motion. So we can look back with hindsight and say, if you'd have known the weather was going to be what it was for 6 or 7 weeks, would you or wouldn't you have done it? But I think in the moment, it was the right strategic decision. And while we didn't see the near term or the immediate lift, I think we still believe that it's benefiting us in July and the results we're putting up over the past 4 or 5 weeks and will benefit us going forward. In terms of other costs or the cost savings, our cost savings objectives coming into this year, as I said in my prepared remarks, we're always more back half loaded. The business, I think, as you know, James, following it as long as you have, is that we're a second half business, right? The biggest months are July, August and October. Between those 3 months, you probably do about based on historical patterns, as much as 80-plus -- 80%, 82% of your full year EBITDA is generated then. And that's where the lion's share of the biggest days are, your highest staffing levels, where you have the most ability to, as I said on the call, meaningfully impact the cost structure without disrupting the guest experience. And so we were always more back half weighted in terms of our goal of realizing cost savings. That has accelerated, though, with the pull forward of -- if you remember in the first quarter, we talked about pulling forward close to $10 million of advertising and maintenance and now another $25 million in the second quarter. So the first half costs are up somewhere in the $30 million to $35 million. Some of those advertising dollars that we pulled forward in the first quarter likely were second quarter. So I'll call it $30 million to $35 million overall. So the second half of the year is going to be where the opportunity is the richest to mine the cost savings. And we've already put in place or in motion the decisions to realize the largest chunks of that $90 million.

Yes, James, let me go back to the advertising question. It's Richard. And when we look back on 2024, we knew coming into '25 that we had -- a lot of our growth is going to be tied to season pass. We want to make sure we supported that program in the spring strategically. We did. If you go back and look at 2024, we put in the market more advertising in the late July through August time frame to try and drive a stronger second half of the summer. Didn't see what we want to see out of that, but it did, to Brian's point, really help drive a 20% increase in the October attendance. So there's always residual impact from the advertising when you put it out there, remind consumers that you're still there. So always difficult to always look at it one for one. But we wanted to make sure coming into the year that we gave ourselves the firepower we needed to really chase the season passes. Now what we're seeing now is that there may be some residual impact from what we put in the market because we were off to a really strong start, really strong start to the 2026 season, which will also help underpin our second half performance. So we're pleased with that, but we've got a long ways to go.

Your next question comes from the line of Ben Chaiken from Mizuho.

Maybe just a clarification on cost. I don't totally follow the variables. So I guess your guide prior to this quarter was for cash cost to be down 3%. That's kind of like what we were talking about on 1Q. But then attendance was materially lower with incremental park closures. I think you kind of suggested in the prepared remarks somewhere around 30 incremental park closure days year-over-year. So why is minus 3% still the right answer? Shouldn't that be an opportunity for cost to be much lower?

We're going to continue to look, Ben, for incremental savings beyond. But at the same time, as I mentioned, the need to balance investing in the parks that are underperforming and establishing the momentum that we need going into '26, that becomes sort of the trade-off, right? So as we think about the biggest areas to take cost out of are always labor, maintenance costs. Those are -- and we've already addressed the advertising. Labor, seasonal labor most notably and maintenance are our biggest areas to have impact. So as we evaluate the opportunities to take more cost out, that weighs into that decision. Now where there will be incremental savings opportunities, what's not reflected in that 3% target is cost of goods. So to the extent that fluctuates up or down with demand, that will provide some incremental tailwind around the cost savings. But the cash operating costs that we're talking about, our goal is to still deliver close to that -- or that 3%, which would be close to a $60 million reduction from the combined spend last year.

Yes. I guess I'm just trying to figure out if the parks were not even open, like what's the offset if there's -- again, these are round numbers, but 30 incremental park closure days, where is -- can you help us with the offset of what the costs went up maybe that are keeping you at that minus 3%?

Well, so you're talking about within the second quarter. Yes. I mean, listen, within the second quarter, we had...

No, I'm talking about for the full year cash costs, the goal is still to be down 3%, but you -- which is the same as the original goal, which is minus 3%. But you had 30 days park closures.

Yes. We are adding days back in the -- adding more days in the second half of the year. So there's a year-over-year comparison issue that goes the other way, to your point about the more closed days in the second quarter this year. We're adding 30 to 35 incremental days in the fall as we look to tap into the strong demand for the Halloween events that we offer, Fright Fest, Haunt, et cetera. And so that puts pressure on that number going the other way, but still in line with achieving the original target of 3%.

Okay. And then as you've seen demand come back in the last few weeks, does that give you any confidence in the ability to push price? Maybe you could kind of expand on your price thought process in the back half of the year under different demand scenarios, right? You talked about the last 4 weeks being up 4%, the last 5 weeks being up 1% and the expectation that pricing will be down 3%...

Ben, we're looking closely at pricing. Yes, when we see demand, we're taking price. We're looking at the parks that are doing extremely well and being able to do that. As we've always said, Halloween, in particular, is the gift that keeps on giving. We've added days because we think not only can we drive attendance, but that's where we've got our most pricing power. So when we look at the pricing on the pure admission side, we think we've got an ability to be careful with the value-conscious customer, drive that season pass, but particularly take price on our bigger days. We've been particularly aggressive on our front-of-line experience and have seen tremendous response at the parks that we've been able to lean into pricing for that. So we're taking pricing where we can and where we see that demand. The other thing that I'll say that Brian touched on is if you look at the last year comparison in the second quarter, very choppy schedule, operating schedule last year as well with some parks not being opened quite as long. And we've extended -- as I said in my prepared remarks, we've added some incremental operating hours to the parks to get longer length of stay and give the guest a little more value when you compare that year-over-year.

Your next question comes from the line of Ian Zaffino from Oppenheimer.

I wanted to just drill a little bit into the in-park spend, and I guess the decline you're talking about of 4%. What is basically driving that? I know you talked about some promotions, but then you kind of said the customer was okay. So why do we need the promotions at this point? Is that just for the low end? And then also, when you talk about mix, you're talking about -- explain that a little bit to me because if season passes are down, you'd be expecting more daily passes, right, as far as attendance. So would that have the opposite effect? And then I have a follow-up.

Yes, Ian, when you look at the attendance mix, I'll start with that one first, and particularly in the second quarter. Season passes will come and get their visits in, as we've always said. And when you have a higher percent of season pass, that puts pressure on the per cap. But when you get extreme weather events like we had through those 7 weeks when we were down significantly, you lose almost all your demand tickets, your 1-day tickets. So as we think about that, that puts a lot of pressure on the per cap. As we look at it now, when we talk about promotional offers, we're making sure that we're trying to target the -- get the customer to come, give them an opportunity to visit lower price on a Tuesday versus a Saturday. We're leaning more and more into the demand that we're seeing and changing prices on the fly as our business intelligence team and our revenue management team looks at the trends each week, they're taking prices up during the week. So we continue to do what we can to try and drive as much. Brian, do you want to comment on the down 4%, anything you want to add on that?

Yes. I mean I think I'll just go back to what you were saying in terms of mix. Ian, mix cuts a few different ways. You touched on one, which is channel mix. Within the channel mix, we're also seeing, as an example, season pass a little bit more migration this year as we harmonize the legacy programs to align with one another. We're seeing in terms of the '25 pass mix, a little bit of a migration down at our Six Flags parks to some of the lower-priced products in that mix. So that's putting a little bit of pressure. It's not only mix between season pass and single-day tickets, but it's also within the individual channels as well. As we think about promotions, as Richard said, going forward, our focus is to try and add value. As we said, the consumer seems much more value conscious this year than the last couple of years. And what we've tried to do historically is instead of discounting tickets, provide more value in products, whether that be season pass or single-day tickets to get people to move. And we do that out of the goal of not eroding price integrity of our ticketing structure, right? And so things like the all-park add-on as a benefit for those migrating up to the highest tier passes in our system for next year. The objective there is to test that, again, what has proven successful historically and get folks migrating back up to those higher-priced products that maybe they had in '25 bought down as we harmonize the products. So that's the mix comment that we're talking about.

Okay. And then just quickly, there's just -- there's a lot of noise as far as cost in the quarter. What would you kind of point us to as a decremental margin or like a normalized decremental margin if there wasn't all these moving pieces in this quarter?

Yes. So I guess as it relates to margin, I mean I'll try and answer it this way for you, Ian. The impact of pulling forward some costs into -- or into the second quarter in 2025, certainly without getting the return in incremental demand has put pressure on margin. The loss of just -- I mean, again, this is a volume-driven business, right? And so the first attendance that we lose is the highest margin attendance, particularly as we're staffing our parks these days. The staffing model today is very different than it was 5 or 6 years ago because the cost of labor is so much higher. So we staff our parks at more of a base level and then increase staffing as needed and as might be available. Historically, it used to be the opposite. You'd staff higher and pull staffing out as you didn't need it. That's changed over the last 4 or 5 years. So when we lose attendance, losing 1.4 million visitors over the last 6 weeks of the second quarter, that's all very high-margin attendance lost. You're talking about attendance that's falling out depending on the park at a level that could be as high as 55% to 70% margin attendance that's falling out of the system.

Your next question comes from the line of David Katz from Jefferies.

We've sort of had a lot of discussion about the quarter and the back half of the year. I wanted to maybe just focus on the analyst meeting forecast, right, which it would seem as called into question or however we would classify it, which wasn't that long ago. Can you just walk us through sort of what's changed or what aspects could have been different within that guide, right? The weather is the weather, but that was a little longer-term vision.

Yes. I'll take it the guide and then let Richard to...

Let me jump in, Brian. David, when we talk about longer-term guidance and we look at what we think the full profit potential of our portfolio of parks is, I don't think our view of that has changed. I think we think there is still that potential. I strongly believe that. When you look at that and we look back at the building blocks of that, and Brian touched on this in his answer, we always said this is a volume business and that -- our goal was to recover the 10 million of visits, 8 million of those visits are going to come from season pass. So our view of the world hasn't changed from that perspective, which is why we're going to wait to reassess the long-term guidance until early next year. When you see the -- when we say that we're up 700,000 in our active pass base in July, double the amount that we were up last year when you look at 2024, same month of July. Then we're starting to see what we would want to see and traction in the areas we want to see traction. So yes, weather is weather. Yes, we've had a -- the second quarter is a tough quarter, particularly those 7 last weeks. That doesn't change our view of the longer-term potential or the profit potential of the parks. As Brian said in his remarks, where we've invested capital and the weather has cleared out and normalized, we're starting to see the consumer reaction we would expect. So all of those things underpin our view of the world as we saw it when we were with you on May 20. And as we look forward to what we think the potential of this business is, those are the building blocks that are still the right building blocks for us to focus on and to keep sharing with you our progress on that. Brian?

Yes. The only thing I was going to add, Richard, and just to underscore what you said is that a transient disruption like we've seen here in the second quarter of 2025 doesn't change our outlook -- long-term outlook for the business. What I think is responsible is waiting to see how the balance of the year performs, not so much for what it means to 2025. This is a challenging year, and the results are going to be disappointing no matter what compared to what they were coming into the year. But what's important is to see the momentum that we've built, the base that we've established in terms of those long lead indicators, most notably season pass sales or the active pass base, group business, resort bookings to have an outlook going into '26 as much around the pacing going forward to those long-term targets. I think we're not walking away from our long-term objectives, but I think it's important to understand coming out of this year, what it means to the near-term pacing of getting to those long-term targets.

I think that's fair. And just to follow up, is it also fair that we should think about much of what's occurred within the 6 legacy parks more so than the Cedar Fair legacy parks, the implication being that those have maybe turned out to be a bit of a different animal than what was expected. Is that something we should take away here, too?

No, I wouldn't say that. What I would say is I think we've talked about underpenetrated parks on both sides of the legacy portfolios. We've had -- and we've commented on the parks that performed well on both sides. We're happy to see 6% on the legacy Six Flags, 8% on the legacy Cedar. But there's also other parks, Dorney Park a year after Coaster. You don't expect them to maintain their attendance level. That's the way we invest. You've got other parks that are underpenetrated with opportunity on both sides of the portfolio. So in any given year, you try and really optimize where you're driving the demand while you're managing where you're not investing and make sure you're being really disciplined on delivering on free cash flow and doing other things at those other parks. The other thing that I'll say is we've -- strategically, we talked about this on Investor Day as well, really invested a lot into food and beverage and continue to get great feedback from the guests on both sides of the portfolio with all the things that we've done on food and beverage and how we've reconfigured that program and are continuing to reconfigure it. So that both drives revenue, but it also drives higher guest satisfaction. And as we've always said, when we get higher guest satisfaction, we see repeat visitation from season passes, we also get higher renewal rates, which is one of the things we're really focused on, making sure we start to see convergence and increasing on the renewal rates of season passes on both sides of the portfolio. So I do think there's opportunity on both. We see that this year with a strong performance out of Canada and out of Cedar Point and a few other places. So when you look at where the opportunities are, I don't think they're specific to either side of the portfolio. But obviously, we want to go get, as we said, those 10 million visits back over the next few years.

Your next question comes from the line of Lizzie Dove from Goldman Sachs.

I just wanted to ask on the CapEx side of things. Firstly, just to clarify, I think you said $400 million. I just want to check if that was -- I think it was '26 or whether it was '25. And then how you think about that? Because you mentioned when you do add new rides into the parks, like you mentioned with Canada's Wonderland, you do see attendance grow. But of course, there's cash considerations and leverage considerations. And so with pulling back on that CapEx, how do you kind of balance that and think about the attendance opportunity as a result?

Good question, Lizzie. Thanks for the question. When we think about making sure we've got what we need from a marketable capital perspective, you want to get full benefit out of the strong program we put in this year, we don't think we've gotten full benefit. We think we can lean on that a little bit next year as well. For instance, Canada is having a great month of July, but they only opened their coaster on July 12. And typically, on the bigger products, we see a little bit of carryover into the following year. So when we think about that calendar year $400 million, that will be the spending on 2 or 3 programs, certainly on '26, also a little bit of '27. We've already spent on '26 because we've signed contracts and done things like that. We're going to continue to invest in food and beverage. We've got a lineup of some really impactful products, but we're coming off a year where we really didn't get as much traction as we wanted in part because of the ill-timed weather. And we think we can lean into getting benefit of some of what we added this year and next year while continuing to invest in the amenities in the park, while continue to invest in food and beverage and other things that will drive our demand. Brian, anything you want to add?

No, I'd just clarify to your question at the beginning, Lizzie. The CapEx spend for this year is still in the $475 million to $500 million range, and we'll continue to update that as we get closer to year-end. Next year's is the $400 million, 2026.

Got it. And then just to kind of follow up on David's question a little bit on the legacy 6 parks. The attendance decline was somewhat similar at legacy 6 and legacy Cedar, but the EBITDA result or the pressure was a lot worse at legacy 6. I think the margins are about 16%. And so I'm curious just like how you think about like reinvestment needs in those parks and how kind of quickly those kind of initiatives can kind of come through over the next few years?

As we look at -- Lizzie, good question. I think back to where we successfully revived underpenetrated parks, certainly that I've been involved with. We've talked at length about the Knott's example, the Carowinds example. It's as much about consistent investment in things that the guests see and touch, the amenities, the food and beverage, the other things we've referenced, along with making sure when you put something in that it really drives demand. So we try and balance that in every year, but particularly on the underpenetrated parks and some legacy 6, a couple in the legacy Cedar, consistent investment in the amenities, touching a section of the park, letting the guests know that you're taking care of and you're giving them more value. We see it that over time, that's as important as the level of investment.

Your next question comes from the line of Brandt Montour from Barclays.

So just one for me. Can you hear me?

Yes, we can hear you, Brandt.

Okay. Great. So for the July stats, and I know you gave a lot of stats. I was hoping for a sort of a system-wide look at July attendance, excluding hurricane-affected markets because I know hurricanes created a really easy comp somewhere throughout the month at various parks in various regions. And obviously, the point is that with attendance up 1% for that month, we want to get confidence against that 1% to 2% implied second half guide that you kind of gave ex the winter events.

Yes, Brandt. So I'll answer it this way. You're right. I mean, last year, July's numbers were impacted by some hurricane events. By comparison, the first week of July was sort of that last week of the really bad weather we saw at the end of the second quarter. So the 6 weeks that finished up the second quarter, there was that seventh week, the week of July 4, that was really sort of a slow start. That's why we talked about the last 4 weeks of July, the strength we saw up 4% versus for the whole month, only 1%. So when you push those 2 things together, the weather comps actually this year aren't really all that aided by what happened last year. The other part that was that more of our small parks, our stand-alone water parks and some of our smaller parks were more impacted last year. While this year, we saw some of our largest parks in the system that were impacted parks like Cedar Point, Canada's Wonderland, Great America in Chicago, to name a few. And so it's always a question of when and where. And the where was much worse this year for the first week of July than what we saw last year with the hurricane challenges we faced.

Okay. Actually, I do have one more, if I may. You guys pulled forward -- you opened up pass sales earlier this year. You pulled forward advertising. I think the benefits or the potential benefits you're aiming for there are pretty self-explanatory. The question I have is, what are the opportunity costs of those moves? I mean, just presumably, if it was super obvious and there were no costs associated with that, you would kind of do that every year, right? So I guess, are there any sort of knock-on effects or sort of pull forward that we need to think about that maybe like in terms of '26 attendance that those moves perhaps might create on the negative side?

No, I think it's a fair question. Most of the impact, Brandt, is really situated in this year, not next year. I'll go back to my prepared remarks. When we have a really strong second half season pass sales in the fall and through the winter, it sets up a really strong first half to the next year. One of the things that we've always said is when we open new product, we want to tie that to the sales cycle. One of the reasons we went earlier with Canada's Wonderland is we didn't want to open the coaster and not give the people -- not give the consumer an ability to buy something they really saw value with. We know that you're in the wind-down phase of season pass launch when you get to July, you're about to launch the new one. Our customers are trained to know that. I think the knock-on effects could be a little bit season pass instead of a single-day ticket. We like that. That's a trade we'll take every day, go back to our Investor Day presentation. Season pass holders worth $250, $275 over the course of a year in terms of spending versus an $80 to $90 on a single-day visitor. So when you put all those things together, I think the benefit of increased volume typically leads to a really strong back half of the year and a much stronger front half of the following season.

Your next question comes from the line of Chris Woronka from Deutsche Bank.

So this will be another season pass question, but maybe in a slightly different way. I think you guys have said in the past, you're adding something like 20% or 25% of your visits from passes. And knowing you can't predict the weather, you're somewhat similar to the ski industry, right? And I think there's at least one ski company out there that is consistently saying they're now getting 70% of their lift ticket revenue from pass sales. I'm curious whether you guys have done the math. And if you -- they had to take a price and cut initially to get there or they launched the big pass. Have you guys done the math on whether something like that works for you? Is there a consideration to creating some kind of epic -- longer path and maybe getting more commitment upfront, albeit at a lower price. Is that -- can you get to that level, do you think?

Well, the way -- Chris, let me answer it this way, and Brian can weigh in. The way we structure our program, the lowest price is always in the fall, and then we take price and step up price to drive urgency. But one of the reasons we wanted to -- we talked about the potential of this merger just like with epic pass. The value is in all the mountains you can go to if you step up to epic pass. Brian touched on this in his prepared remarks. We've layered in the all-park access to this early offer to really test what kind of demand we can drive and not just in unit sales, but how much interest is there and how can we strategically reinforce the value of all 42 of our parks. So we're trying to tap strategically the same thing that I think others have done Vail or Icon in the number of mountains that they have. And whether or not you visit the other mountains, you can, and it's the appeal of the product. So I think that's really what we're testing, and we're pleased so far with what we're seeing. I also think we're going to be pleased with what the early response we're getting in terms of renewals already. Brian?

Yes. I would just -- I would add. I mean, I think the decisions around pass pricing, Chris, are always made at the individual park level because they vary park to park. I understand the scenario that you sort of laid out. As I look across the system and what we've tried to migrate to is a good, better, best in terms of pricing and benefits associated with the pass program. We really don't have any passes or park level programs out there that at this point are uber priced, at least at the core gold product, which is where the majority of the buyers slot to and where we really sort of steer them. We -- I think maybe just to provide a little history, we did execute a very similar playbook to what you described at Cedar Point. We installed at that park around 110,000, 120,000 season passes, and we really only had one product. It was at the time called Platinum now would be the equivalent of Prestige. That pass was over a couple of hundred dollars, more than double most of our other parks passes, could never get ourselves confident to chase more volume, eventually, through a lot of analysis, got there and cut the pass price basically in half and saw 120,000 passes become 400,000 passes where -- and the park has remained for the last half decade. So we execute that at a park level where appropriate. I don't know as I look across the system right now that, that opportunity lies anywhere, but we'll continue to evaluate. I think the bigger goal here is and what Richard laid out is driving more volume, right, add more value to the pass, drive more volume and the trade-off for the -- any perceived revenue risk is easily overcome by that incremental volume that you drive.

A quick follow-up, if I can. And it's a follow-on question to that, which is, do you think is there -- as your pass product lineup stands today and the tweaks you're planning to make, do you think there's enough kind of direct attachment to ancillary? I mean, sometimes it sounds like ancillary is almost -- you kind of get it and you say, we wish we had more. Is there a way to tie more of that into the season pass? I'm not suggesting you go back to the unlimited dining plan at all, but are there maybe ways to encourage more ancillary spend attached to that pass product?

Yes. We always focus on the all-season add-ons. And one of the reasons we're coming out with our new e-commerce site and our new mobile app will be to really make that path to purchase a lot easier and a lot more engaging with our guests. We've seen over time that those penetration rates have consistently gone up as the consumers realize the value in all those. So I think it's part making sure we're conveying the value they can get, part making a little bit easier on the path to purchase. But the other piece is as those penetration rates go up, we've always said this. the more people that buy the all-season dining, all-season beverage, the higher the renewal rate. So I think it all feeds together, Chris.

Your final question today comes from the line of Thomas Yeh from Morgan Stanley.

Just to clarify on the 2026 pass cycle, on an apples-to-apples Gold or Prestige basis, is the initial pricing you're launching with starting at a lower level versus last year? And how much of that is promotional versus a reaction to the incremental pressure that you flagged on the low-end consumer?

Yes, Thomas, in terms of pricing, again, going to vary a little bit park to park in general and what you're comparing to, right? Are you comparing to where we let off, in which case, as Richard noted, fall is always much lower than where the previous season is letting off with its peak summer pricing. So from that perspective, if you're comparing there, you're going to see all the parks down. But if you're comparing back to last fall, for the parks where the comparison is easy, and it's a little bit more challenging as we weren't necessarily fully harmonized on some of our Six Flags parks last year to the program we're offering now. I would say on the Cedar side, the price is flat to up. On the Six side, it's going to vary a little bit across the good, better, best menu. But I would say at the Gold and Prestige, more of the incentive, if you want to call it, incentive, is in the value add, not in a price reduction.

Okay. Understood. And then maybe I could just follow up on the second half guidance for attendance, assuming a normalized weather environment. Obviously, crapshoot to predict weather. But is a normalized comparison against last year? I believe October was a great weather month for you. Is there some expectation that you are assuming that, that replicates the same way or a more normalized version would be kind of like over a longer period of time?

Yes. I think as it relates to weather, you're exactly right. We're not -- while we spend an unending amount of time focused on it, it's not something that we're experts in or can predict with 100% accuracy. And so as we think about the comparison or weather over the balance of this year, it's not -- it's more so Thomas, to last year on a comparable basis, meaning last year, we had some good weather. As you noted in October, we had some challenging weather, particularly the last 7 to 10 days of September and a little bit as we got into -- deeper into the fourth quarter. We would expect that there's going to be good and bad this year. It's not that we're looking for ideal or we're expecting the 5 weeks of October last year to replicate itself exactly this year. Helping to offset it, as I mentioned earlier on the call, we're adding some days and even in the process of reviewing the opportunity for more days here or there if demand levels warrant it. And so that provides us a little bit of an insurance to the downside if weather were to be markedly worse during a key week or weekend than it was last year.

And that concludes our question-and-answer session. I will now turn the call back over to Richard Zimmerman for closing remarks.

Thanks, everybody, for joining us on today's call. For those of you who were unable to visit Cedar Point during our Investor Day, we hope you'll have a chance to visit one of our parks in your area before the end of the '25 season. Excited to see -- for you to see many of the improvements we've made since the completion of the merger. On our next earnings call in early November, we'll update you on our performance of our parks during the busy Halloween season, which should produce once again some of our biggest days of the year. Meantime, we'll keep you posted on other developments as things develop. Michael?

Thanks, Richard. Please feel free to contact our IR department at (419) 627-2233. As Richard mentioned, our next earnings call will be in November after the release of our 2025 third quarter results. Rob, that concludes today's call. Thanks, everyone.

Thank you, everyone, for your participation. You may now disconnect.