SeaWorld Keeps Tanking

“C’mon SeaWorld. I’m sick to death of this routine, and so is the public.”

The latest earnings report is in, and attendance (and profits and revenues) keep dropping:

Shares of SeaWorld Entertainment Inc. (SEAS) are falling by 6.72% to $17.35 in pre-market trading on Wednesday, as lower attendance at the company’s theme parks hurts earnings for the second quarter in a row.

SeaWorld’s net income for the 2014 third quarter declined to $87.2 million, or $1 per diluted share, compared to $120.7 million, or $1.34 per diluted share for the same period in 2013.

The marine mammal entertainment company reported adjusted net income for the 2014 third quarter of $88.6 million, or $1.01 per diluted share, which fell below the expectations of analysts polled by Bloomberg of $1.13 per share.

Revenue for the most recent quarter fell to $495.8 million versus $538.4 million for the 2013 third quarter. Analysts expected $496.4 million in revenue for the quarter.

SeaWorld reported attendance of 8.4 million guests versus 8.9 million from the same quarter last year.

Trying to explain the continued drop in attendance, SeaWorld continues to avoid the elephant, I mean blackfish, in the room: The company believes the decline in attendance was due to negative media attention resulting from a proposed bill in California that would ban the use of orcas in shows, and a “challenging competitive environment, particularly in Florida.”

Yes, the Blackfish bill is an issue, but the media attention on SeaWorld is focused much less on AB2140 than it is on the very essence of SeaWorld’s business: its reliance on keeping killer whales captive for entertainment.

A few more earnings reports like this one and SeaWorld suits will finally have to confront the fact that their business model is being rejected by the American public. That means SeaWorld needs a new business model that doesn’t rely on killer whale captivity (or at least moves killer whale captivity offshore to China, Russia and the Middle East).

It seems likely that SeaWorld is pursuing the latter strategy of developing its franchise in nations that don’t (yet) care as much about the ethics of killer whale captivity. But powerful ideas (like the idea that it’s not right to confine killer whales for profit) have a way of working their way around the globe. And if SeaWorld simply tries to move its failing business model to new countries, instead of reinventing its business model, it could find itself repeating the history it is experiencing here in the United States, and continuing to struggle.

What SeaWorld really needs is not new spin, but new leadership that is not so invested in the idea of killer whale captivity, and can move beyond that business model and SeaWorld’s history to think clearly and creatively about what will attract and entertain the crowds of the future.

A San Diego Progressive Takes On SeaWorld

Is this the best use of valuable San Diego property?

Not everyone who lives in San Diego thinks San Diego needs to protect SeaWorld. Linda Perine, of the Democratic Womans Club, wades into the fray with facts, links, and a fierce attitude:

Being very well connected and making a lot of contributions to politicians allows a business a fair amount of leeway, especially in San Diego.

As Voice of San Diego pointed out in one of its somewhat boosterish articles Sea World By the Numbers  Sea World employs up to 4,500 people, albeit many are temporary positions and minimum wage.

As was mentioned before, Sea World pays a percentage of its income as rent on a lease to the City that some view as extraordinarily favorable to Sea World.  While putting $14 million into the public coffers may be an attention getter, it is nowhere near what it ought to be.

Sea World is deeply imbedded in the San Diego conservative hierarchy.  It is a heavy contributor to the PACs of the Lincoln Club,the California Restaurant Association’s local chapter and the San Diego Regional Chamber of Commerce.   Sea World has a presence on the board of many local organizations like San Diego County Taxpayers Association, Equinox, San Diego Tourism Authority, the Chamber and many others.

Yes, that is the same Lincoln Club, Taxpayers Association, Chamber and Mayor who oppose increasing the minimum wage so that the workers at Sea World can afford to feed their kids.  So, no, they are not going to get all misty eyed over some “black fish”.

In the interconnected world of Who Runs San Diego it is the mutual back scratching benefit of interlocking boards and contributions to politicians that allows our Mayor and City Council to be so unquestioning in their support of this morally and fiscally compromised corporation.

Sea World is imbedded. It’s a player.  As its Prez said – they make no apologies.  And we are to be grateful?

If you like the attitude, read the rest of Perine’s takedown. There is plenty more.