NEW YORK, NY / ACCESSWIRE / February 14, 2020 / Pomerantz LLP is investigating claims on behalf of investors of Six Flags Entertainment Corporation ("Six Flags" or the "Company") (SIX). Such investors are advised to contact Robert S. Willoughby at email@example.com or 888-476-6529, ext. 9980.
The investigation concerns whether Six Flags and certain of its officers and/or directors have engaged in securities fraud or other unlawful business practices.
On February 14, 2019, Six Flags announced a negative revenue adjustment of $15 million in the fourth quarter of 2018 related to the Company's agreement with Chinese real estate developer Riverside Investment Group Co. Ltd. ("Riverside") due to delays in the expected opening dates of Six Flags-branded theme parks in China, citing Macroeconomic issues in China. As a result, Six Flags reported a 38% decline in the Company's sponsorship, international agreements and accommodations revenue compared to the fourth quarter of 2017. Six Flags also advised investors that it expected weaker than anticipated quarterly revenue from its agreements with Riverside in 2019 and 2020.
On these disclosures, Six Flags' stock price fell $9.00 per share, or 14.09%, to close at $54.87 per share on February 14, 2019.
On October 23, 2019, Six Flags again announced postponement of its park openings in China, stating that "there's a very high likelihood going forward that we will see changes in the timing of park openings" and "it's unrealistic to think it's going to be exactly as we've outlined." As a result, Six Flags reported a 26% decline in sponsorship, international agreements and accommodations revenue for the third quarter of 2019 compared to the third quarter of 2018.
On these disclosures, Six Flags' stock price fell $6.35 per share, or 12.4%, to close at $44.88 per share on October 23, 2019.
Then, on January 10, 2010, pre-market, Six Flags revealed that the future of the Company's China projects was in jeopardy. Specifically, Six Flags announced that the development of Six Flags-branded parks in China continued to encounter challenges and had not progressed as expected. Six Flags further reported that Riverside continued to face significant challenges due to the macroeconomic environment and declining real estate market in China, which caused riverside to default on its payment obligations to Six Flags. Six Flags advised investors that, in the fourth quarter of 2019, the Company would realize no revenue from its agreements with Riverside and expected a negative $1 million revenue adjustment related to those agreements. Six Flags also announced one-time charges totaling approximately $10 million related to Riverside's default.
On these disclosures, Six Flags' stock price fell $7.80 per share, or 17.82%, to close at $35.96 per share on January 10, 2020.
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SOURCE: Pomerantz LLP