Knott’s Berry Farm has had trouble getting a new thrill ride up and running and recently closed an older coaster, but that doesn’t mean the theme park has fallen on hard times this summer. In fact, park officials say they are on track to post near-record numbers this year.
Though parent company Sandusky, Ohio-based Cedar Fair, which purchased Knott’s in 1997, does not disclose attendance figures, park spokesman Bob Ochsner said both Knott’s and Soak City, the company’s new water park, are doing well.
Knott’s, he said, is on pace with last year’s attendance, which he called a “record year,” while Soak City has exceeded expectations.
“It’s outperforming other water parks in the Cedar Fair system,” Ochsner said. “It was close to capacity (7,000) a couple of days.” The company’s other water parks are in Ohio, Missouri and Chula Vista.
Ochsner said about 5,000 season passes have been sold to the water park, suggesting it has become an attraction for locals, something Ochsner said might distinguish it from a water park that many believe will be the first phase of Disney’s recently announced “third gate.”
Cedar Fair CEO Richard Kinzel said in a statement on the company’s financial performance for the quarter ended June 25 that visitor spending at its five theme parks was up about 6% through the first six months of the year.
In addition, Kinzel told attendees at the company’s recent shareholders meeting in Buena Park that Soak City in Chula Vista, formerly known as White Water Canyon, set attendance records by the end of July. That 3-year-old park was purchased out of foreclosure by Cedar Fair last year and reopened as Soak City in May.
In response to the strong showings of the California water parks, the company recently extended their weekend schedules through Oct. 22, from the originally planned Sept. 21 season close.
Meanwhile, the Radisson Resort at Knott’s (formerly the Buena Park Hotel), in its first full year of operation by Knott’s after Cedar Fair sank $28 million into its purchase and renovation in 1999, has attracted its share of attention, too. Though it has only 321 rooms, resort packages that combine a hotel stay with park attendance at Knott’s and Soak City have helped drive business to the hotel.
The hotel’s Snoopy floor, where halls bear cutouts of Peanuts characters and rooms include stuffed animals and Snoopy-themed amenities like blankets and soap dishes, is especially popular with Japanese tour groups. Peanuts characters are “more popular with the Japanese than the Mouse,” Ochsner said.
Interest from the Japanese market was especially strong this year, the 50th anniversary of the Peanuts comic strip. Knott’s was designated an official site for the Peanuts 50th anniversary celebration, but when creator Charles Schultz retired and then died earlier this year, inquiries about that celebration peaked.
“The day he retired there was a spike in interest,” Jack Falfas general manager of Knott’s, said earlier this year.
The park, which actively markets to Japanese tour operators, also is seeking to beef up its meetings business at the hotel.
New director of sales Sally Brayton said the hotel’s group business is picking up, but isn’t yet fully booked for next year.
“We’re fortunate to be far enough away (from Anaheim) to market ourselves as easy access, away from traffic, and all in one property,” Brayton said.
In May, the hotel opened the upscale Cucina! Cucina! restaurant onsite, the first franchise operation of the Bellevue, Wash.-based company. To bolster mid-week business there, the restaurant last Friday launched a promotion for its new $7.95 lunch buffet, suggesting to locals they can get in and out in 50 minutes.
Ochsner said the company would like hotel business eventually to drive theme park attendance, which would require about another 700 rooms. To do that, he said, Cedar Fair first will work with more area hotels to offer packages, but eventually might add another hotel of its own.
That might not be the only expansion in Cedar Fair’s sights. The company owns another 30-plus acres in Chula Vista, where Soak City has been enthusiastically welcomed this year and where a companion park could attract the same cross-border traffic that some experts believe is a key to Soak City’s strong attendance numbers.
But Kinzel said plans for that acreage are at least a couple of years away.
“We want to wait and see what happens at the water park,” he said.
Closer to home, the dismantling of racing coaster Windjammer due to alleged design flaws begs the question of what might replace it, but Falfas would say only that the company is “looking at several ideas” for the space.
Cedar Fair’s management team was in town for a special shareholders’ meeting to approve a revision of the partnership’s existing general partner fee and executive compensation system. Under the approved plan, the limited partnership agreement was amended to eliminate fees paid by Cedar Fair to its general partners retroactive to Jan. 1. In addition, an equity incentive plan allowing the award of options and other forms of equity as a portion of compensation to senior management and other key employees was established. The moves will cost about $8.5 million in one-time cash payments this year, with options for 2.33 million shares issued to the company’s senior management.
The change has not had much effect on Cedar Fair’s stock price, which was around 18 last week, about the same as before the vote, though near the company’s 52-week low of 17 7/16. Last week, most analysts were rating the stock a moderate buy. For the quarter ended June 25, the company posted a 4% year-to-year increase in revenue to $129.5 million, but earnings per share were 36 cents, 2 cents below original projections.
Kinzel, who said the company is sometimes criticized by Wall Street for passing on potential acquisitions, told the audience the company doesn’t want too much debt and won’t make an acquisition if management believes it will drag down dividends.
“We’d rather pay the (share)holders than the bank,” Kinzel said. n
