I don’t know why this is surprising — the entertainment industry always suffers some in down times, as people cut back on things not seen as ‘necessary — but . . . is Six Flags “Too Big To Fail?”
The filing stated that the company and its auditors, KPMG LLP, had “substantial doubt about our ability to continue as a going concern” unless the debt is successfully restructured.
But the company’s CEO said Wednesday that Six Flags’ North America theme parks, including San Antonio, will continue delivering “affordable, family-friendly” entertainment no matter what happens in its debt negotiations. “This is a back-of-house issue exclusively,” Mark Shapiro, the theme park company’s CEO and president, said about debts that include $287.5 million in Preferred Income Equity Redeemable Shares.
While the debt negotiations could lead to a bankruptcy filing, Shapiro said park operations “could not be more healthy.” “The parks themselves will continue to deliver the superior product they have,” he said.
Shapiro could not comment on the Chapter 11 possibilities or on the status of negotiations.
Chapter 11 would allow the parks to reorganize without shutting down; and would allow them to walk away in large part from the crippling debt load they face. In other words, they’re telling the banks ‘Renegotiate our interest rates, or we’ll dump you altogether.”
Good for them. Crippling debt seems to be a hallmark of this recession.
Meanwhile, in other Entertainment news, just how soon are we going to see Elmo in the Unemployment line?
Sesame Workshop, the nonprofit producer of “Sesame Street” and other kids’ programs, is cutting about one-fifth of its work force because of the economic downturn.
The New York-based company said Wednesday that it’s eliminating 67 of 355 staff positions.
Declaring it is “not immune to the unprecedented challenges of today’s economic environment,” the company pronounced a need “to operate with fewer resources in order to achieve our strategic priorities.”
The statement reiterated the organization’s mission “of helping children reach their highest potential here and around the globe.”
Best known as the home of such Muppet characters as Big Bird and Elmo, Sesame Workshop was founded in 1968 as Children’s Television Workshop, then unveiled the groundbreaking “Sesame Street” as a literacy-building initiative a year later. That show, which remains a worldwide hit, was the first step toward a media empire that encompasses television, books, toys and online programing.
Among the company’s early TV efforts is “The Electric Company,” which aired during the 1970s and was revived with new episodes on PBS in January.
Sesame Workshop gets revenue from product licensing and the sale of its programs to PBS and syndication. The company is also funded by government agencies, foundations and corporations.
Total revenue was $145 million in 2008, with operating expenses totaling $141 million, according to the company’s Web site.
So . . . they made a Four Million dollar Profit last year . . . but they’re laying off 20% of their work force?
How is this not “greedy corporate America” then?
And shouldn’t they return the $4 million profit to the government — if they’re getting government funding?