New for 2005

Jeff, are you saying there's no better place Cedar Fair could have put the $200 million than an outdoor waterpark in northern Ohio? As I said, the company is in a sad state of affairs if that's true.

Let me reiterate my contention. It's NOT that Geauga Lake cannot be profitable. It's NOT that what they're doing won't improve revenue, improve attendance and maybe even improve profitability.

My contention is that the money could have been better spent. FAR better spent.

What no one seems willing to acknowledge is the "lost opportunity" of (a) doing something else with that $200,000,000, and (b) doing something else with the time and effort of the good people thrown into the Geauga Lake quagmire. GL might turn profitable. That doesn't preclude the fact that a thousand other things could have been even more so.

My opinion is this will be a huge black mark on an otherwise impressive tenure for Mr. Kinzel.

So, are you saying that you'd rather see the park waste away under SF rather than have CF "waste" $200M?? The attendance decline started under SF. Sure the closure of the wildlife side hurt 2004, but the lower gate price will boost it in 2005. Are they buying attendance? Hell yeah they are! It's called supply and demand. Lower prices = more demand. I'm absolutely positive that they're expecting to take hits on a short term basis to ensure profitability in the long term. And I'd bet good money that CF is applying the same basic plan they used for Dorney, MA, and WOF.

So, ShiveringTim, if you had $200M to spend, and you could spend it anywhere in the world, on anything you wanted, your choice would be to buy money-losing Geauga Lake in northern Ohio and try to convert it into a profitable state-of-the-art outdoor waterpark?

Again, I'm not saying Geauga Lake can't be successful. I AM saying that the decision to spend money on THAT was a colossal mistake. The money could have been far more effectively spent.

My contention is that the money could have been better spent. FAR better spent.

Its a LONG TERM INVESTMENT. CF is smart about making parks succesfull for a long term profit, SF is not, and your idea sounds like a SF plan. CF doesnt buy a park and hope to totally turn it around and bring in a huge profit overnight. Thats what SF did and it failed cause after all the hype was over the park still sucked. CF bought the prk cause they know that it will be a major return on investment in the future years to come. They buy a park so it can be succesfull over time and so the company wont have to sell it after 6 years.

Amusement Parks take time and CF knows that very well and thats how they do business, and it works great for them. Instead of looking at numbers from the first two years of the parks being owned why dont you look at CF's track record for everyone of there parks. Look at how they performed ten years after CF took them over. Its a huge improvement, profit and return on investment.

CF is patient and is interested in making a park that will be succesfull in the future. That takes time and money, and there using both. When SFm bought GL they wanted a huge turnaround right away and 4 years later they had to sell the park because it was unsuccesfull. CF looks more than just two years ahead, they ask themsleve "what does this park need to continualy be succesfull for a long period of time"

$200 million could not have been beter spent. If they built a new park it would cost much more money, and probably wouldnt bring in as much money as GL will. CF didnt buy GL so they could build a water park. CF bought GL and decided a water park would be a great investment. Sure it might not make as much as Dorney, CP or Knotts in its first couple of years. But itll will be an improvement, and there going to continue improving the park over time so it will be succesfull and will make the company lots of money for a long time. Water Parks are popular in the midwest and thats why parks keep adding them. Have you not been to an amusement park with a water park in it in 5 years, cause if so youd notice that most of the day the water park is more crowded than the rides part of the parks. Water Parks are a big draw, especially in and around ohio and there is absalutly no debating that. If they wern't then parks all over the area and country wouldnt be adding them, and they know what there doing. GL's new expansion will bring a lot of new people to the park in its first year, but more importantly it will make the park nicer, and better, so people will ahve a reason to return.

You dont seem to realise that you have to spend money to make money, especially in the amusement industry. CF is taking there time and playing it safe so if something goes wrong it wont bring down the whole park. SF didnt play it safe and invested to much at one time, and when it was realized it wasnt what the park need they were screwed because they had spent so much money on it.

TTD sinking, you need to give CF time, your to inpatient, if your not happy with what they did then sell your stock. CF does what has worked for them in the past and what has worked for other parks in the area. Water Parks work, they bring in the people. It may not make someone come from across the country, but it gets people in the area and families to go to the park. People love the idea of going to a water park and being refreashed during the summer. When most people outside of enthusiasts think of amusement parks they think of standing in line ion the hot sun for hours for a roller coaster. When they think of Water Parks they think of playing in the wave pool and being refreshed. Thats why Water Parks draw the crowds and thats why parks build them. GL will have an ammasing improvement in 2005 from 2004, and it will only improve over time, as Cf continualy adds to the park.

GL was moey well spent atnd time will show this to be true. *** Edited 11/11/2004 11:09:58 PM UTC by RockingRollerFarm*** *** Edited 11/11/2004 11:14:54 PM UTC by RockingRollerFarm***

Obviously, Cedar Fair disagrees with you. And so does the stock market. FUN has been up on the news of the expansion.

MrScott

So you didn't get what you want, and that makes it a bad decision, and the company is in a "sad state?" You don't get it.

The company spends money in a manner in which they feel they can recover the investment. This is not a piggy bank they draw from like the one you have. Cap ex at individual parks is made where they expect it will generate enough extra attendance to recover the cost of the investment in a year or two.

Park acquisitions are more of a long-term investment. They've said this time and time again in conference calls and even on the interview on this site. When they had the call following the purchase announcement, they flat out said this park would take a few extra years to pay-off. Still, you're talking about fewer than ten years. Do you have any idea how fast of a debt retirement that is?

They didn't "have" $200 million in the bank somewhere. They financed it with the intention of growing the business.

Cedar Point hasn't always been on the up and up, it almost crashed and burned a few times in it's history. Investors put money into the place when it wasn't a guaranteed money maker; and look what happened to it! Was that a 'waste of money' too? *** Edited 11/12/2004 2:44:38 AM UTC by Mathew***

TTD is sinking too! said:
So, ShiveringTim, if you had $200M to spend, and you could spend it anywhere in the world, on anything you wanted, your choice would be to buy money-losing Geauga Lake in northern Ohio and try to convert it into a profitable state-of-the-art outdoor waterpark?

What would you, TTD is sinking too, have spent it on? Four roller coasters next season? Another roller coaster for 2006? Would you save money by cutting the hospitality portion of the employee training course ;)? (I know this last situation probably didn't happen, but who knows?) Think long-term, not short-term. This isn't RollerCoaster Tycoon.

edit: spelling *** Edited 11/12/2004 4:53:28 AM UTC by Junior***

He wouldn't spend it because he wouldn't have it. The board wouldn't allow you to borrow that money unless you could be damn sure you could pay it back quickly.

TTD sinking, CF is building a Water PArk as part of the park. They are not turning the entire park into a water park. In order for GL to be a great all around park and atract families and locals it needs to have a waterpark as part of the park. The old WP was beyond repair for CF standards. It was obvious that the water park could be in a beter location, and since CF was going to have to totally redo the place anyways why not start over new in a better loaction. Thats what they did, and its gonna work out great for them. It puts the water park in a more fitting area, and it makes use of unused space, and clears up lots of room for expansion of the rides side.

If I had enough analysis and data saying the purchase and development plan would lead to future profitibility, yes, I would buy the park. The parks aren't out there to satisfy our thrillseekin' geeky needs. Their sole purpose is to make money. It's been said already - this is a long term move. I have no doubt in my mind that Kinzel and Co. planned to do as soon as they knew they had the park. The only problem is that they had no time to get it done until now.

If you don't mind my asking, what exactly would you have done with $200M, TTD Sinking? Throw it into new attractions with no real vision of the future? SF did and does that, and we all know the state they're in now.

However, I do agree that they will need something other than a waterpark expansion, but not right now. To me, it seems that GL is following the PKI plan rather than the CP plan. The family angle has been working in Mason for years. Why not try it in Aurora?

*** Edited 11/12/2004 1:41:26 PM UTC by ShiveringTim***

Many young families don't have the desire or means to vacation far from home (that which requires airfair or more than a day's drive).

That's who Cedar Fair is targeting as guests...errr...I mean customers.

MrScott

For those who want to know in 1992 CF acquired Dorney Park. Dorney did not have a profitable year till 1997 the quote is from Dorney's web site. Yes it took a coaster to put them over the top. The park I have been tolled was a mess before CF took control and in the time between 92-97 CF made improvements that made what is Dorney park the same as GL will be. And the market is a hell of allot titer in PA than here in OH.

What CF learned in Dorney will help them hear. GL has titer hight restrictions same as Dorney. Dorney has picky nabores that complained about the noise, traffic and the unsightly natcher of an amusement park the same as GL. the thing is CF has done it once and they will do it agen.

In the last 20 years Ohio has lost 2 parks one to fire the other to a privet indevidual. Besides the parks we lost two 1920 coasters I thank God that GL is in CF hands. GL has the only 1920 coaster left in Ohio. Scary isn't it that we could have lost it to bad management under SF

"In 1997, Dorney Park & Wildwater Kingdom made the most significant addition to the Park since the opening of Wildwater Kingdom. Rising 200 feet in the air as the longest, tallest and fastest coaster in the Northeast, Steel Force altered the landscape of Dorney Park & Wildwater Kingdom and set it apart from all other parks." *** Edited 11/13/2004 6:26:56 AM UTC by Twisterdm*** *** Edited 11/13/2004 6:29:19 AM UTC by Twisterdm*** *** Edited 11/13/2004 8:54:45 AM UTC by Twisterdm***

I have to chime in with a few observations.

One, GLP was quite profitable in the past with a 750,000 attendance. And it can be again with proper management. Not to say that 2004 was a poor management year, it sounded to me to be the opposite. There were just to many unusual circumstances.

Two, I would imagine that CF opened up the books and looked at what was driving GLP/SFO to the profits that made the park so desirable to different companies in the first place. I can tell you it was season pass holders and company/group picnics. Roughly one half the revenue from the F/S dept back in the day was from "catering". On the other hand the water park was a serrogate local pool for many in the area and is quite a return draw for pass holders, who don't do anything for the per cap but boost the bottom line.

SFI didn't fail at GLP because of not having a plan, it was because they didn't stick to the plan for that park. Until the purchase of SWO the park was on track updating and improving the ride lineup as well as the infrastructure. Remember 2000 was a banner year for the park in attendance and profit. That is the standard this park must be held to. 1.7 mil attendance is more than enough to drive the GLP moneymaker.

By the time SFI impetuously bought SWO they were overextended with the number of properties to begin with. Knowledgable management became rare within (i would argue). The comany was hurting for money and the merger of the two parks will go down as one of the biggest fiascos in the industry's history. So clearly there was a need to unload property, make some capital to go against debt, and you might as well move what isn't making money. To look at what CF has done in less than one calender year, and cast aspersions on a calculated risk that can pay off big in the not so distant future is a little short-sighted and ignorant. The plan CF is on right at this moment has been proven before at this park in this market. *** Edited 11/13/2004 6:48:25 AM UTC by gener***

Oh and another thought.

I argue that the price drop isn't a desperate move at all. Not only does the park offer less attractions than SFWOA (which doesn't bother me at all), but SFI priced that park way to high. The current price is much more in line with the value of the park. In fact i question why the parking hasn't gone down in price.

Bottom Line:

Cedar Fair WINS.

Good move, I may buy some "Units".

MrScott

gener...

Why would parking go down in price?

I mean, it's not like there aren't any "attractions" that were removed from the parking lot...

Parking is the same everywhere. I think the parking price is a good business move. People are willing to pay the extra buck just to park.

Everyone seems to have forgotten that CF also got a campground and a hotel out of the deal. This is even more of a money maker for the company. I can see a boost in the amount of people staying the night at these places. Especially after the waterpark is completely moved to the other side.

aww whats gonna happen to the beautiful stadiums and the fun pearl diving pit? They definalty need the shade boomerang bay was dissapointment and well still sucks. I hope seaworld and Gl didnt bury animal remains and waste there that would be one hell of a surprize during construction.

Parking isn't the same everywhere. Just like the gate price, parking should be a measure of the value of the purchase. Just like the GLP gate should be significantly less than the CP price, so too should the parking. Gouging is part of what brought down GLP in the first place. I would argue that a park is much better off in this day to eliminate the parking fee and tack a buck or two to the gate. Perception is the key, even if people are paying for it, at least you don't have to hit them in the face before they even get into the park.