speaker
Operator
Conference Operator

Ladies and gentlemen, thank you for standing by, and welcome to the Cedar Fair Entertainment Company 2020 First Quarter Earnings Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. To ask a question during the session, you will need to press star 1 on your telephone. Please be advised that today's conference is being recorded. If you require any further assistance, please press star 0. I would now like to hand the conference over to your speaker today, Michael Russell, Corporate Director, Investor Relations. Thank you. Please go ahead.

speaker
Michael Russell
Corporate Director, Investor Relations

Thank you, Christina, and good morning, everyone. Welcome to our 2020 First Quarter Earnings Conference Call. Earlier this morning, we distributed via wire service our earnings news release, a copy of which is available under the News tab of our investors' website at ir.cedarfair.com. On the call with me this morning are Richard Zimmerman, Cedar Fair President and CEO, and Brian Witherow, our Executive Vice President and CFO. 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 the 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. I would like to hand it over now to our CEO, Richard Zimmerman. Richard?

speaker
Richard Zimmerman
President and CEO

Thank you, Michael, and thanks to everyone for joining us this morning. It goes without saying how much the COVID-19 pandemic has impacted our lives and businesses and the reason why our industry will look back at 2020 as a watershed season for decades to come. For the industry, and especially for Cedar Fair, we look forward to this time of year as one of excitement and renewal, a time when we prepare our seasonal parks to welcome guests from countless communities across the nation. It's one of the many reasons why we enjoy this business and why our people work so hard to make the experience we offer our guests so memorable. It's also what we are missing most right now. On any given day of any given year, the health, safety, and well-being of our guests and associates is the highest priority we have. As an organization, Our steadfast dedication to health and safety is what makes this year especially frustrating and why we are abiding by the recommendations of the CDC, as well as state and local officials, related to the COVID-19 pandemic. Unfortunately, until further notice, our parks will remain in a state of readiness while we await governmental restrictions being lifted. Until such time... Our park GMs and their teams are actively addressing and planning for new measures and guidelines that may be necessary inside our parks. Whatever changes are recommended or required, our overarching goal is to ensure the safety and well-being of everyone at our parks, while still providing our guests with a best-day experience. On our 2019 year-end call, we were pleased to report Cedar Fair's best year ever, along with very strong long-linked indicators for a robust year ahead. As anticipated, 2020 started at a record pace, with attendance and revenues through mid-March trending well ahead of last year. Knott's Berry Farm began the year strong, picking up right where it left off last year. And advanced purchase commitments for the 2020 season, including the sale of season passes and related products, had never been stronger. Through early March, the 2020 season was shaping up to be the best year in the company's history. What followed during the next few weeks related to the COVID-19 pandemic dramatically changed our business for 2020 and perhaps beyond. Credit our talented leadership team for quickly recognizing the urgency of the situation and with skill and precision, implementing a comprehensive plan to better position our company to deal with uncertainty in the near term, as well as position us to be a stronger and better company in the long term. Let me summarize for you the current state of our business as well as the actions we have taken to combat the impact of an extended business disruption. From day one, our primary concern and overarching goal was to ensure the safety and well-being of our employees and park guests, which meant abiding by the recommendations of federal health authorities and state and local guidelines. All of the company's non-essential activities were wound down to a halt and our employees were asked to work from home until further notice. To protect our guests and park employees, effective March 14th, we closed our parks as well as other facilities, such as the Cedar Point Sports Center that had opened for the 2020 season. And we indefinitely delayed the scheduled openings of our other parks, several of which were ready to open during the weekends of late March and early April. To reduce operating expenses, expenses and dramatically slow our cash burn, our team went to work implementing cost-cutting and cash-saving measures as quickly as possible, while also suspending up to $100 million of nonessential capital projects planned for the 2020 and 2021 seasons. Many of these actions involved difficult decisions that affected our entire workforce, but these measures were necessary during this extraordinary time to provide the company with additional financial flexibility. Additionally, our board of directors believed it was in the best interest of the unit holders for the company to preserve liquidity through the suspension of the quarterly distribution with a commitment to reinstate a distribution when permitted under our recently revised debt covenants. And finally, to secure additional liquidity and address potential debt covenants, Last week, we completed the issuance of a $1 billion notes offering, obtained debt covenant flexibility through 2021, and expanded the size of our revolving credit facility. We believe the actions taken to date go a long ways towards strengthening our balance sheet and protecting the long-term interests of our unit holders. Collectively, Our proactive measures provide us with financial flexibility and sufficient liquidity to meet our cash obligations through the end of 2021, even if we remain in a minimal revenue environment. For our valued season pass holders, many of whom made their purchase commitments months ago, we wanted to express our appreciation for their continued loyalty while providing meaningful incentives to retain their passes. We did so by, first, suspending the monthly billings of our easy pay installment program until we had better visibility into park reopenings. And second, extending the expiration date of 2020 season passes as well as the add-on products previously purchased through the end of the 2021 season. As a result of these steps, we have seen very positive feedback expressed through social media channels as well as calls and emails directly to our parks. In fact, Our marketing teams claim the response to our season pass extension policy is the most positive feedback they have seen for any previous company announcement. While we executed several important initiatives in a short period of time, their impact will likely be pivotal to our business over the long term. Although it's difficult knowing our parks are closed, we believe that we've taken the proactive steps necessary to effectively weather this storm. I'll stop here and ask Brian to review our financials. Brian?

Disclaimer

This conference call transcript was computer generated and almost certianly contains errors. This transcript is provided for information purposes only.EarningsCall, LLC makes no representation about the accuracy of the aforementioned transcript, and you are cautioned not to place undue reliance on the information provided by the transcript.

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