SeaWorld's shares have fallen 27% to about $20.50 after a disappointing earnings report and projections of even tougher times ahead.
Even though attendance of 6.6 million at the company's theme parks was roughly flat year-over-year, its revenues of $405 million were well below the $445 million Wall Street analysts expected.
The company said in its earnings release that it "believes attendance in the quarter was impacted by demand pressures related to recent media attention surrounding proposed legislation in the state of California." A bill proposed in the California state assembly earlier this year sought to ban the park's signature live orca shows.
Its net income of $37 million should have cheered investors — swinging from a $16 million loss in the second quarter of last year — but the company's lowered guidance for future revenue has led to a sell-off of its shares. SeaWorld said that it expects its 2014 revenue to fall between 6% and 7% while its earnings before interest, taxes, depreciation, and amortization (or EBITDA) are expected to fall between 14% and 16%.
"We were pleased to report attendance growth in the quarter despite a challenging industry and competitive environment," SeaWorld CEO Jim Atchison said in a statement. "The increase in attendance results from the shift in the timing of Easter and favorable weather, partially offset by lower attendance at our destination parks."
SeaWorld's short life as a newly public company — the private equity firm Blackstone sold shares to the public in April of last year — has been marked by unprecedented public skepticism and outright protest following the release of the documentary Blackfish, which was released early last year and garnered massive ratings when it was aired on CNN in October. In its regulatory filings before it went public, the company said that it "receives media attention, is the topic of a book, film, documentary or is otherwise the subject of public discussions."
Earlier this year, on a conference call with analysts, SeaWorld CEO Atchison responded to a question about whether Blackfish had an effect on its business by saying, "As much as we're asked that, we can see no noticeable impact on our business," and described accusations that it mistreats animals as "a fundamental mischaracterization." The documentary, which focuses on how the animals that are the primary attraction at SeaWorld theme parks are treated and examines the death of a whale trainer, spurred protests against SeaWorld as well as public condemnations and boycotts from celebrities, including Breaking Bad star Aaron Paul.