Monday, May 21, 2018
Business

Will Oscar snub save SeaWorld, Busch Gardens investors?

Who knew a snub by the Academy Awards would draw high fives at SeaWorld and Busch Gardens?

On Thursday, shares in publicly traded SeaWorld Entertainment Inc., the Orlando-based owner of SeaWorld and Busch Garden theme parks, rose a healthy 8.4 percent. Analysts credited the big bump to the surprise failure of the heavily promoted Blackfish documentary, so critical of the theme-park operator's treatment of captive killer whales, to win an Oscar nomination.

Talk about an odd business intersection of investors and animal activists.

A corporation that runs major Central Florida theme parks presumably will profit from less bad publicity now that a film, bought by and aired on CNN in October, will be left out of the spotlight leading up to the Academy Awards on March 2.

Analyst Timothy Conder at Wells Fargo Securities said investors "overwhelmingly" expected the documentary to receive an Oscar nomination. Its failure to do so removed an overhang on the theme parks' stock. Conder has an outperform rating on SeaWorld Entertainment shares.

Unfamiliar with Blackfish? The anti-Shamu documentary film premiered at the 2013 Sundance Film Festival one year ago today. It tells the story of SeaWorld's 12,500-pound Tilikum, the largest bull orca anywhere in captivity. And it explores its role in the deaths of trainers at different sea parks, especially the grisly 2010 death in Orlando of veteran SeaWorld trainer Dawn Brancheau.

The movie's message? It's dangerous and inhumane to keep orcas in captivity, and SeaWorld's heavy corporate spin of Brancheau's death was misleading and self-serving.

By coincidence this same week, SeaWorld chief executive officer Jim Atchison — a familiar name at Busch Gardens Tampa where he used to work — celebrated SeaWorld's 50th anniversary by visiting the New York Stock Exchange.

"We have great issue with the film," he told Bloomberg TV. "We don't agree with the premise of the film. It is an activist-driven agenda film."

Atchison was quick to point out that SeaWorld Entertainment just reported record fourth quarter and annual results. Attendance at the SeaWorld parks hit an all-time high in the fourth quarter. The company expects record annual revenues when its books close in March.

• • •

SeaWorld Entertainment went public last April, its stock approaching a peak of nearly $40 a share by early summer.

Blackfish was released in July.

To counter the film's buzz, SeaWorld adopted an aggressive campaign. It was encouraged by SeaWorld's majority owner, investment firm Blackstone Group, which was anxious to protect its recent theme park spin-off.

With guidance from public relations consultants 42West, SeaWorld sent critiques of the film to 50 critics considered likely to review Blackfish. The film's producers returned fire, rebutting SeaWorld. And SeaWorld responded by making its executives and animal caretakers available for interviews to debunk the film's claims that captive killer whales can exhibit psychotic and potentially dangerous behavior.

By documentary standards Blackfish has reached a wide audience, largely thanks to CNN. The film is compelling and often emotional, rich with disturbing footage of captive killer whales at multiple sea parks in this country and abroad involved in life-threatening actions with their trainers. SeaWorld complains that some of that footage, plus selective portions of testimony by its theme park employees, is misrepresented by the film.

By late August, company shares had dropped under $30.

Shares closed Friday at $33.25, buoyed by investors hopeful the lack of an Oscar nomination will soon backburner Blackfish. SeaWorld Entertainment shares, though, remain well below their initial highs.

While Oscar hype might have re-energized Blackfish, its influence on SeaWorld Entertainment is hardly over. Responding to activists and Blackfish fans, scheduled musical acts from Willie Nelson to Heart at Orlando's SeaWorld and Pat Benatar and the Beach Boys at Tampa's Busch Gardens have canceled their shows.

• • •

The orca protest also targets some of SeaWorld's "corporate partners" like Coca-Cola and Southwest Airlines that have marketing agreements to pitch their brands with the theme park company.

Southwest says it is keeping its ties with SeaWorld. On Jan. 8, the airline explained on its website blog.

"We have a longstanding relationship with SeaWorld that is based on travel and bringing families together," wrote Southwest's Marilee McInnis, senior manager of culture and communications. "We are engaged with SeaWorld related to the recent concerns being raised. We are in a listening and education mode with the goal of upholding our commitments as a good corporate citizen."

So far, that blog post has spurred more than 100 online comments. Most are critical of Southwest's unwillingness to end its relationship with SeaWorld. A few applaud the airline for not being bullied.

Some comments are more thoughtful. "There's a very sticky ethical question about whether orcas should be kept in captivity at all much less be put into shows," states one. "I hope to see this dialogue continue and hope that Southwest and their employees look at this as a long-term ethical issue and not a short-term bottom line decision."

How much of this fight between Blackfish and SeaWorld — and by common ownership, Busch Gardens — is reaching the general theme park visitor?

SeaWorld is trumpeting strong theme park attendance as evidence that the film has persuaded few visitors to stop coming. But SeaWorld also began offering lower admission prices and more deals to entice visitors.

Following price hikes by Universal Orlando and Disney, SeaWorld Orlando raised its one-day admission to $92 for adults and $84 for children in June.

Later in 2013, it dropped those prices to $82 for adults and $77 for kids. Now, for $92 and $87, respectively, adults and children can get yearlong admission tickets.

For now, SeaWorld visitors can thank Blackfish for at least part of the cheaper admission.

But long run, the film may bring more substantive changes to the world of Shamu.

Robert Trigaux can be reached at [email protected]

 
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