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January 16, 2008
Dan Snyder's Six Flags amusement park chain, which has lost money in three of the last four quarters, plans to cut expenses by as much as $60 million this year.
The company called park attendance over the last two years disappointing.
Six Flags will cut cash operating expenses by as much as $30 million by reducing what it spends on advertising. That will include firing one of its three advertising agencies, and spending less money on radio commercials and more on Internet advertising. It will save an additional $30 million by cutting its full-time headcount, primarily through early retirement, and removing what it calls inefficient rides from parks.
Six Flags also says it is in talks to open theme parks in the Middle East, India and East Asia, and may consider selling two or three existing parks to raise capital. It will introduce eight new roller coasters at existing parks this year.
Six Flags made the announcements during an investor conference Wednesday.
Since winning control of Six Flags (NYSE: SIX) in a boardroom fight in 2005, Snyder and his team have worked to increase park attendance and reduce debt. The company sold 7 theme parks last year.
The company had third-quarter net income of $89.7 million, down more than 40 percent from $164.7 million in net income a year earlier. Sales fell 1.9 percent to $365.2 million.
It's 21 parks drew 24.9 million visitors last year, barely changed from 24.8 million in 2006.
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