United Parks: Debt repayment not a priority; leverage is comfortable

By Devika Patel

Knoxville, Tenn., Feb. 28 – United Parks & Resorts Inc., formerly known as SeaWorld Entertainment, Inc., lowered its net total leverage ratio to 2.53x at year-end 2023, and management has no plans to pay down debt anytime soon, since this is a comfortable leverage level for the Orlando, Fla.-based theme park and entertainment company.

“We are comfortable with current leverage levels and expect further deleveraging from future EBITDA growth,” chief executive officer Marc Swanson said on the company’s fourth quarter and year ended Dec. 31, 2023 earnings conference call on Wednesday.

“Given our low leverage levels and the current cost of debt, paying down debt is not a current priority,” Swanson said.

The company refinanced some bank debt this quarter.

“The strong balance sheet gives us flexibility to continue to invest in and grow our business and to opportunistically allocate capital with the goal to maximize long-term value for shareholders,” interim chief financial officer and treasurer James Forrester said on the call.

“Just a few weeks ago, we refinanced our term loan B, locking in a more favorable interest rate that will save the company approximately $5 million in annual interest expense going forward,” Forrester said.

As of Dec. 31, 2023, United Parks had approximately $618.5 million of total available liquidity, including over $246.9 million of cash on the balance sheet.

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