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SeaWorld 2013 Attendance Off 3% From 2012

SeaWorld San Diego and its Florida-based parent company both saw visitor declines in 2013, even as revenue improved, going against a continued global trend of rising theme park attendance in an improving economy, according to the latest annual report by the Themed Entertainment Association and consulting firm AECOM.

The Mission Bay attraction still ranked as the 11th-most-visited park in North America and placed 22nd globally, even as attendance dropped an estimated 3 percent from the prior year to 4.3 million.

Parent company SeaWorld Entertainment Inc. of Orlando, which runs 11 parks nationwide, finished 2013 at No. 8 among the world’s park operators, as attendance declined 4.1 percent to an estimated 23.4 million.

By contrast, the top 10 global operators collectively saw attendance rise 5.4 percent to more than 377 million visitors. The world’s top 25 parks experienced a total increase of 4.3 percent, reaching 215 million visits, and the top 20 North American venues saw a 2.7 percent gain, with 135 million people passing through their gates.

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SeaWorld (NYSE: SEAS) officials and the report’s researchers are not assigning direct blame for the decline in visitors to ongoing controversies related to the treatment of killer whales, noting that the documentary film “Blackfish” that touched off activists’ calls for boycotts aired in fall 2013, well after SeaWorld’s peak summer visitor season concluded.

Instead, AECOM consultant John Robinett said, SeaWorld’s national performance can likely be traced to its falling behind competitors — led by Walt Disney Co. (NYSE: DIS) and Merlin Entertainments Group — when it comes to updating parks with new rides, hotels, shows and other attractions.

Constantly updated features are crucial to keeping visitors coming back, especially local residents. Robinett said SeaWorld’s nationwide attendance may also have been lowered by ticket price increases in 2012 and 2013.

Investing a Given at Theme Parks

While the 50-year-old SeaWorld San Diego has seen several recent additions, including the Manta roller coaster and the newly opened Explorer’s Reef attraction, Robinett said the company as a whole has been outflanked by rivals when it comes to adding flashy attractions involving huge capital investments.

“It’s a commandment in the theme park industry — thou shalt invest,” said Robinett, senior vice president of economics in AECOM’s Los Angeles office.

Recent high-impact examples include the addition of Cars Land at Disney’s California Adventure, which has played a significant role in reversing years of flagging attendance at that Anaheim park; and the Harry Potter attraction now under construction at Universal Studios Hollywood, as Universal Parks and Resorts looks to duplicate the success of a similar feature at its Florida location.

In the local market, U.K.-based Merlin Entertainments built a new Lego-themed hotel and added family-friendly water park features at its Legoland California Resort in Carlsbad. Robinett said those types of additions help extend visitor stays and boost on-site spending.

SeaWorld San Diego spokesman David Koontz noted that figures in the theme park industry report for the Mission Bay attraction are researchers’ estimates and do not serve as confirmed attendance data. Although the company — formerly known as SeaWorld Parks & Entertainment before becoming publicly traded recently — does not report attendance or revenue figures for its individual locations, it’s pleased with its overall financial performance.

“Last year SeaWorld Parks generated its third consecutive year of record revenue and operating profit, based in part on strong attendance in our SeaWorld-branded parks,” Koontz said in an email.

SeaWorld Entertainment reported revenue of more than $1.46 billion for 2013, up 3 percent from 2012 despite the nationwide year-over-year decline in visitors. Pretax earnings reached $439.1 million for the year, an increase of 6 percent.

Discussing the 2013 results in March, SeaWorld CEO Jim Atchison said controversy over its performing whale shows, spurred by the documentary “Blackfish,” had “no noticeable impact” on the company’s 2013 revenue.

Cutting Back on Discounts

Company officials said the visitor decline was attributable to pricing and “yield management” strategies that increased revenue while reducing discounted and free attendance.

Parks, in general, are relying less on discounted tickets, which during the recession served as loss leaders to bring visitors on site to spend money on things like food and souvenirs.

The national economic recovery and California’s steadily improving tourism climate are generally bolstering theme park attendance in markets including San Diego, Anaheim and Los Angeles, AECOM’s Robinett said.

In the latest report by the Themed Entertainment Association, an international nonprofit trade group based in Burbank, Walt Disney Attractions led the industry pack in 2013 with global park attendance topping 132.5 million, up 4.8 percent from 2012.

Coming in second was Merlin Entertainments, taking in 58.8 million global visitors for a 10.7 percent jump, followed by Universal Parks and Resorts with 36.3 million, up 5.3 percent.

Among individual parks, Magic Kingdom at Walt Disney World near Orlando topped the global rankings with 18.6 million visitors, rising 6 percent, followed by Tokyo Disneyland at 17.2 million, up 15.9 percent, and Disneyland in Anaheim at 16.2 million, up 1.5 percent.

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