O.K. now the B.S. starts to show up. GL's closing.
I do think it is time for new leadership, but the fate of GL doesn't play in my reasoning for that. I think that one could expect the personnel at the new parks were going to have some growing pains. I don't think the "veteran" staff should have been expected to be disenchanted by the changes and it is my impression that is exactly what might be happening. That leads me to believe it is a leadership issue.
I'm not saying he hasn't done wonders for Cedar Fair. On the contrary. But, at some point it is time to go and I think even he realized it, until his ego got in the way.
I see a lot of similarities to Eisner. Eisner went into Disney and really went to town. 20 years later the growth had subsided, the natives got restless and out he goes. Look what happened when he left. They healed the relationship with Pixar, are starting to turn Disney's California Adventure around, have seen some growth at the box office, etc. I don't think all of that is coincidence.
There are a LOT of very talented, committed, energetic folks working for Cedar Fair. But, Kinzel's heavy handed management style really stifles those folks. As great as the company has become I just can't help but wonder where they could go if he would let his people be all they can be...pardon the pun. *** Edited 9/27/2007 4:27:39 PM UTC by wahoo skipper***
The hands-on, top-heavy thing is in particular something that bothers me. I don't know the guy outside of interviews and brief chats, but I don't know if it's ego or his almost crippling aversion to risk that influences his hands-on approach, especially at Cedar Point.
Jeff - Editor - CoasterBuzz.com - My Blog
Coasterbuzzer said:
Ensign Smith said:
^Okay, let's clarify. The semi-lame waterpark built three years ago on the smoldering ruins of the former nation's best marine park will be open next year.It's not Geauga Lake. It's "Geauga Lake's Wildwater Kingdom". Even the truth-massagers in Sandusky know they can't present it as being the same.
First, I don't think it's a semi-lame waterpark. WWK actually made me want to give waterparks a chance again. And guess what? I had a blast. I was sorry that I had not been to a waterpark since KI built Water Works. No, it's not Geauga Lake as it was. I only went twice, post CF purhcase and liked it a lot. However, if the two times I went were any indication as to how their park was performing, then I can see why it's being closed. Exactly how long did anyone on this board think that CF should give GL to bounce back? 2-3 years, 5-10 years? Unlimited?
It really does come down to a matter of personal preference. Personally I don't like CF waterparks. They feel as sterile as the corporatizations they foist onto the parks they buy. I think I actually liked SFWoA's waterpark better -- and I didn't even really like that one all that much.
My author website: mgrantroberts.com
Suffice it to say you don't want to cross Mr. Kinzel. He can put you in your place and has a long memory. To question him is to take your chances...at least that is how I felt in my own situation and having worked with others who knew him much longer than I did.
That alone doesn't exactly make for a warm, embracing environment that would foster creativity. Some CEOs like to be challenged by their people. I don't see him with that trait. So, when poor decisions are made you have to wonder when, or if, anyone might risk pointing that out.
Now, admittedly, I'm coming from an employee who was with Cedar Fair over 10 years ago. But, I really doubt his managment style has changed all that much and, with public or private scrutiny he might have even hunkered down a little more.
Jeff said:
It was a good post, but it's still largely emotional.I can in the same breath curse them for failure, but praise them for finally having the nuts to get that albatross off their neck. I've got a lot more cash than I sometimes realize wrapped up in that company, and I don't want my distribution to slip. (Funny how small, monthly contributions add up.
I'm confused by what part of that was emotional -- unless you are to argue that I am emotionally angry that the chain made two bad decisions regarding a property that should have been making money. I have always been more interested in the business side of things, and Paramount decision aside, the decision to purchase GL in the first place needs to be questioned if only three years later it is going to just be a shell of what it was. If Cedar Fair bought it to turn it into a waterpark only, they should have announced that decision immediately and paid less for the park. Somewhere along the line, there was either a gross miscalculation about its prospects, or it was run so wrong that it killed itself in two years.
As for the second part, I don't know if you were saying that yourself or stating that was what I was saying. For the record, I am not commending them in any way for 'getting the albatross off their neck.' I am stating that the fact that they miscalculated (which I assume over poor management because CF is known for having a good structure to its management at properties, at least before the Paramount acquisition), and if they miscalculated on a single park so much that they had to close it after only two years, it really worries me about the companies future.
I do, as a matter of fact, hold onto the stock strictly because of the great distribution, although the GL issue has definitely made me decide that if the management of the parks appears to slip any more, I will be dumping it.
As to why I invested in it versus other companies is because I understand and follow the theme park industry. I like some of the Cedar Fair parks, but not all of them, but when I invested I thought their business strategy was sound and they were doing well. Since then, they have done very well for me.
At this point in time, I wouldn't personally invest in them. There are too many questions, and I don't see them as a short-term growth stock at all, and other than the distributions, not a long term one either. But for the moment, I will hold them and keep watching.
Oh -- and this investment strategy of purchasing stock in companies that I can easily explain and understand what they do -- that comes from Warren Buffet, and is a sound strategy for making money, much better than purchasing stock which you expect to rise for various other reasons.
wahoo skipper said:
I see a lot of similarities to Eisner. Eisner went into Disney and really went to town. 20 years later the growth had subsided, the natives got restless and out he goes. Look what happened when he left. They healed the relationship with Pixar, are starting to turn Disney's California Adventure around, have seen some growth at the box office, etc. I don't think all of that is coincidence.
I read the first few lines of your post and without having yet read this, I was already thinking of Eisner. I guess it's pretty much the same as professional sports coaches and managers- at some point they let their egos get in the way, they grow too comfortable in their positions or their "players" start to tune them out.
Like Eisner, I like what Kinzel did in his early years- not only will I not take that away from him, I will admit that the company would not have grown like it did had he not been doing what he did. But also like Eisner, I think he long passed his expiration date and it's time for new blood... new leadership... new ideas.
I'm in a real flux about him (not unlike how I felt about Eisner). I like Mr. Kinzel and think he is a decent guy. I think he raised some pretty good kids and I always admire a good father.
I think Kinzel did some remarkable things (with the help of many) to make a small player in the amusement park business a giant. I really admire that.
And, at the same time, I think he is a hell of a micromanager. I think he has too much influence on the Cedar Fair board. I don't think he truly values his managers...particularly when they have differing views. I don't think he has a handle on the importance of technology, infrastructure, the seasonal workforce and how those can be assets to him just as Magnum is an asset.
I'm not a disgruntled employee. I left the company on my own terms and for reasons not directly attributable to my experience there. I do think they are a good employer (at least for full time staff) and I hold them in high regard.
I just think it is time for a change and I would really look forward to seeing what would come of a post-Kinzel Cedar Point and Cedar Fair.
Granted, some folks don't care for the look of the two properties but I think their impact was for the positive.
At what point was Disney "almost destroyed" under Eisner? As much as people grew to dislike him you are the first person I have ever heard say that he almost destroyed it.
The Dolphin and Swan were the first HUGE mistakes. First of all, they're not operated by Disney which dilutes the brand because not everyone knows that. They're on Disney property, so people assume Disney runs them. So, if they have a horrific experience there, it reflects poorly on Disney. Secondly, while I am a huge fan of Michael Graves, these hotels are grossly over scaled.
The FIRST rule of Disney theme park design is to control the site lines inside the park. You should never be able to see anything outside of the park while you are inside. The buildings inside the park are all designed with a forced perspective. So, they seem bigger than they really are. It's all about tricking the eye. So, when the Dolphin and Swan tower over Epcot from World Showcase, it destroys the forced perspective and the buildings then appear as cartoony and fake. The Eiffel Tower now looks tiny because it really is. It used to look closer to the correct size. Besides that, you are supposed to be in a "fantasy world" and should never be able to see the "outside world" from inside any park. The Dolphin and Swan set the tone for Michael's reign. His main interest was money and that was it. He gave the operations to someone else and created massive towers to be able to lease them for more money. That's not what Disney was about.
Along the same lines, he leased off huge portions of Disney's property to 3rd party companies like McDonalds. These pieces of land are now controlled by someone else for 99 years. Walt worked so hard to obtain all that land to keep the outside world out of his park to maintain the magic. That's the entire reason WDW even exists - because of what happened in California. So, what's Michael go and do? Start leasing it off and inviting the outside crap INTO the resort. Why? To make money. Again - totally against the Disney way of thought.
What else did he do? Closed the entire Florida division of Animation and ran off the only remaining Disney family member. What started the Disney empire? Animation.
When you work as an Imagineer for Disney, you have a completely different understanding of the values that Walt put into this park and why they are so successful. Michael didn't care about those ideals. He only cared about making a buck. What he didn't realize is that they were so wildly successful because of those design ideals. It is the little details that keep people coming back for more. People can go to a Planet Hollywood or Virgin Megastore in almost any city in the US. They don't need to travel to Orlando to do that.
I'm not sure how you get two years out of four seasons. While I get what you're saying, it's not the "getting it right" part that concerns me, it's the fact that they bought it at all without really understanding the environment for the park.
thecoasterguy said:
...and if they miscalculated on a single park so much that they had to close it after only two years, it really worries me about the companies future.
But all that aside, I hear a lot of confidence from people in the organization that the Paramount Parks debt will be paid down relatively quickly, by 2012 even. I don't know if the EBITDA really supports that, but I guess we'll see. This will probably be the first year I look really hard at the annual report.
Jeff - Editor - CoasterBuzz.com - My Blog
^ I'm sure the debt will be paid down in another five years, but will all those Paramount parks be profitable? I think that's just as important a question.
*** Edited 9/27/2007 7:15:20 PM UTC by Rob Ascough***
I wouldn't be at all surprised if CF can get the PP acquisition debt off their books within 5 years...esp. with the Canadian dollar being so strong...LOL! :)
Jeff said:
I'm not sure how you get two years out of four seasons. While I get what you're saying, it's not the "getting it right" part that concerns me, it's the fact that they bought it at all without really understanding the environment for the park.
Sorry for the quick wording on that. What I meant is that they only seemed to try to make improvements to the park for two seasons before they started picking at the bones of it to send to other parks. While they did own the property for four years, it took them only two to determine it wasn't going to work and change course.
But, what you said at the end of this statement is exactly what I'm trying to say -- if they purchased one park without understanding the environment it was in, what confidence should I have in them properly purchasing and paying for a whole chain?
On top of that, just in general, I know that a lot of people think that people would either go to GL or CP only. I think it could've been one heck of a cross marketing opportunity. Selling two day passes with one day for each park, or trying similar things could have worked even with the closed animal side. For those people who said GL probably wouldn't have existed without Sea World, I tend to agree, although I think that the park would have still existed had it never been bought out, as they could have continued to operate it as a small park. I think the additions that Six Flags made to it when they 'Flagged' the park, followed by the price and product changes doomed it as a full park.
But all that aside, I hear a lot of confidence from people in the organization that the Paramount Parks debt will be paid down relatively quickly, by 2012 even. I don't know if the EBITDA really supports that, but I guess we'll see. This will probably be the first year I look really hard at the annual report.
I wouldn't doubt that to be the plan, but I'm sure that when Premier bought the Six Flags chain, they were planning on paying down the debt quickly and then going from there. Unfortunately for Premier, things didn't work out that way, and I believe Six Flags, Inc is still losing money based on that original purchase.
I'm also positive that the plan wasn't to close GL five years in, and that a year or two after purchasing it insiders would have been excited at the prospect of it turning a profit (or a larger profit -- the park may still be profitable, just not enough to justify keeping it open) soon. Unfortunately, the reality of the situation is that GL is being closed. You can blame it on a bad purchase, bad management, not understanding the market, or whatever, but the bottom line is it didn't work out how they expected.
So... I'm just a little more worried now about the Paramount deal not working out to be quite like I expected. I'll also be reading through the report *very* carefully this year.
The comparison to Six Flags isn't really a fair one though, because it wasn't so much the acquisition of parks for them as much as it was the acquisition plus ridiculous cap ex every single year. Cedar Fair has been pretty modest so far toward the new parks (and several get "new" bonus rides! :)).
Jeff - Editor - CoasterBuzz.com - My Blog
CF parks have equal or better RIDES than the PPs had - but Paramount IMO always had better landscaping and friendlier staff. At the CF parks, it seemed more like you were "riding, eating, or shopping". The Paramounts had better shows, and were more geared to a place where you could just "hang out"...whether you brought toddlers or grandma, they were just more....comfortable.
Maybe it's just me?
http://www.cleveland.com/solonheraldsun/news/index.ssf?/base/features-0/1190830902193170.xml&coll=4&thispage=1 *** Edited 9/27/2007 9:41:29 PM UTC by villiageidiot***
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