Herschend Entertainment Co. LLC

Overview Key strengths Key risks Significant barriers to entry in the market due to the high cost of developing a theme park near a desirable population center. A high level of seasonality, which can magnify the effect of extreme weather events and unexpected sales missteps when they occur. Strong brand recognition at its Dollywood and Silver Dollar City parks. Reliance on consumer discretionary spending, which can be volatile over the economic cycle. Low leverage and sufficient liquidity to fund ongoing development spend. Limited scale and geographic diversity compared with other larger rated leisure operators. Herschend modestly underperformed our forecast for the first nine months of 2024, largely due to significant disruptions from Hurricane Helene in the second half of the

...We expect Herschend Entertainment Co. LLC's leverage will be in the low-2x area through 2025. Herschend modestly underperformed our forecast for the first nine months of 2024, largely due to significant disruptions from Hurricane Helene in the second half of the year. The storm damaged some of the company's properties along with critical public roadways around four of the company's parks (Callaway Gardens, Wild Adventures, Dollywood, and Kentucky Kingdom) and hindered the local economy. As a result, Herschend reported a loss of operating days and lower attendance and revenue. We now expect revenue to grow 7%-8% in 2024, below our prior expectation of 10%-15%. We expect the company's EBITDA to compress to the low-...

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