SeaWorld stock plunges; company says orca controversy hurt attendance
08/13/2014 6:35 PM
08/13/2014 6:36 PM
Shares of SeaWorld Entertainment took a record drop Wednesday after the company’s earnings missed Wall Street expectations.
The Orlando-based company also conceded for the first time that attendance at its theme parks has been hurt by negative publicity concerning accusations by animal-rights activists that SeaWorld mistreats killer whales, stemming from the death of a trainer at SeaWorld Orlando in 2010.
In the past, SeaWorld executives attributed declining attendance numbers to a rise in ticket prices and a shift in the timing of the Easter holiday this year.
SeaWorld shares dropped $8.69, or about 30 percent, to $19.45 in midday trading on Wall Street.
The company reported 6.6 million visitors in the April-to-June period, nearly flat compared with the same period in 2013. Net income jumped to $37 million, or 43 cents per share, compared with a loss of $15.8 million a year earlier. Analysts had expected 60 cents per share.
Company executives announced cost-cutting efforts as a result of the latest earnings report.
“In order to drive growth, we are undertaking a number of initiatives, including a detailed review of our company-wide cost structure with the goal of driving significant cash cost savings in 2014 and 2015,” Jim Atchison, chief executive and president of SeaWorld Entertainment, said in a statement.
Bloomberg News quoted Atchison as saying SeaWorld will step up promotions, such as weekday discounts, to increase traffic at its parks. The company will promote events around the Halloween and Christmas holidays to boost attendance in the second half of the year.
SeaWorld has been under harsh criticism since the release last year of a documentary titled Blackfish, which accuses the parks of mistreating the killer whales that are featured in their shows. The documentary argues that the stress of living in captivity may have caused one, an orca named Tilikum, to kill his longtime trainer Dawn Brancheau.
SeaWorld has launched a counterattack on social media, posting online video of trainers talking about their love for the orcas and stepping up promotion of its rescue and rehabilitation of manatees, sea turtles and other sick or injured wild animals.
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