Market Spotlight: Theme parks may ride through slump

The weak economy is expected to help boost attendance at regional theme parks, as families opt for entertainment that doesn't require as much travel.

"It's going to be a close-to-home year," predicted Dennis Speigel, president of International Theme Park Services, an industry consulting firm. While the economy "isn't going to help anybody," he said, companies like Six Flags Inc. and Cedar Fair LP may benefit from the expectation that vacationers "will not be traveling as far because of gasoline prices."

Companies have started promotions early to attract more people, Speigel said. Six Flags, for example, cut its entrance fees by $10 for most of its 19 U.S. parks, if tickets are purchased online.

Six Flags Chief Financial Officer Jeff Speed said the company has seen in past economic slowdowns that attendance at regional parks tends to be resilient. "They're not going to do away with vacations, but they scale back a little bit," he said.

Keybanc Capital Markets analyst Scott W. Hamann agreed.

"To fly down to Orlando might not be in the budget for some people," he said, noting that regional parks get 80 percent of their attendance from within 150 miles.

So-called "destination" parks, like Disney World, Universal Studios and Busch Gardens, are not expected to feel much of a pinch, even if fewer people head there from the U.S., observers said, because the weak dollar has drawn more foreign travelers to this country, and many will make a stop at those iconic locations.

With few exceptions, regional parks attract few foreign visitors.

While it's still very early in the theme park season--July will draw the most attendance and August is the second-most popular month--Lee Alexakos, vice president of marketing and advertising for Cedar Fair, said the company had an "outstanding" Memorial Day weekend.