Jump to content
Yoshi

Cedar Fair Adding In Park Advertising

Recommended Posts

https://www.marketwatch.com/press-release/cedar-fair-entertainment-company-selects-reflectmedia-for-strategic-in-park-advertising-and-sponsorship-management-2019-02-05

 

Quote

Reflect, the premier turnkey solutions provider for place-based media, today announced that Cedar Fair Entertainment Company, one of the largest amusement-resort operators in the world, has chosen ReflectMedia to activate a strategic in-park advertising and sponsorship program. This agreement represents not only a continuation of a partnership that started in 2014 but also an expansion of Reflect's role with Cedar Fair.

 

It will be interesting to see if they get any of the complaints that Six Flags always gets on other park and coaster message boards about the same kind of advertising. 

Share this post


Link to post
Share on other sites

Hopefully they don't go as blatant as Six Flags has. There is a way to work advertising and corporate sponsorships into a park and a way not to...

  • Like 1

Share this post


Link to post
Share on other sites

Think of all the untapped ad space on the Top Thrill Dragster tower.  Listening to the earnings call this morning and looking at the presentation Cedar Fair provided was a bit alarming.  The new long term strategy gave me deja vu of Shapiro's strategy for Six Flags in 2006.

Share this post


Link to post
Share on other sites

Yeah, it sounds like they're following Six Flags lead now with memberships, in-park advertising, cost cutting on new capex, etc. 

Share this post


Link to post
Share on other sites

Well this sucks. Operations at Dorney have already degraded by a large amount over the past few years. Seems like SF is somewhat of an industry leader, in a bad way. 

Edited by The Master

Share this post


Link to post
Share on other sites

 It is all Wall Street driven. Every major amusement park company has done/is doing this except perhaps Universal because they need to play catch-up after being stagnant for so many years. 

Share this post


Link to post
Share on other sites

Here are a couple of big things I found concerning. 

 

1) Cedar Fair management predicted in 2015, 2016, and 2017 that they would meet their goal of having an Adjusted EBITDA of 500+ million by early 2018.  The chart in today's presentation shows they moved the goal to $575 million Adjusted EBITDA by 2023 because they have had two years of negative EBITDA growth and were unable to achieve the goal.

722288-15416118943226979_origin.png

 

sYX2eYs.png

 

2) If 2019 is another weak year, future growth of the dividend will be reconsidered or reviewed.

 

Quote

Brian Witherow

Yes. James, it’s Brian, just dovetailing on Richard’s comment. The balance sheet over the last several years was rebuilt really at management’s urging and the board’s urging to sustain a year like a 2018 where the growth in EBITDA wasn’t there not because of a fundamental shift in the underlying business or a change in the consumer, but because of sort of a macro disruptive event like the weather that we saw for six to seven weeks during the key months of June and July. So, as Richard said, the board’s confidence, our confidence in the business model underscored that.

 

But your point is a good one or a question is a good one in terms of 2019, we need to deliver the growth that we’ve indicated as is available to us. Minus that, if that were not to happen I would say that the distribution isn’t at risk. Growth in the distribution would be reviewed should 2019 not turn out to be as strong of a year as we believe it it’s going to be, but the distribution in terms of sustaining where it’s at isn’t at risk in our minds. But growing it would be would be up for discussion.

https://seekingalpha.com/article/4240755-cedar-fair-l-p-fun-ceo-richard-zimmerman-q4-2018-results-earnings-call-transcript?page=12

Share this post


Link to post
Share on other sites

CF is probably pushing high EBITDA figures to distract investors from the firm's profitability level. 

 

I don't want to even think about what new sources of cashflow they will come up with to put into their parks. Hopefully not upcharge lockernazis. 

Edited by The Master

Share this post


Link to post
Share on other sites

I'm expecting them to change SP price structure to be more inline with Six Flags. Their multi-park passes are priced way too high compared to Six Flags.

  • Like 1

Share this post


Link to post
Share on other sites
2 hours ago, GAcoaster said:

I'm expecting them to change SP price structure to be more inline with Six Flags. Their multi-park passes are priced way too high compared to Six Flags.

But don't all SF pass levels access all the parks though?

Share this post


Link to post
Share on other sites
7 hours ago, GAcoaster said:

I'm expecting them to change SP price structure to be more inline with Six Flags. Their multi-park passes are priced way too high compared to Six Flags.

I agree the Platinum prices are too much. When I was renewing my Dorney pass for 2015, I wasn't sure if I was going to Ohio or not and didn't get the Platinum Pass because I didn't want to spend an almost extra $75 to upgrade to Platinum without being sure I would visit other parks. It was almost the same price to buy a Dorney Gold Pass and buy a Kings Island and Cedar Point Combo ticket for around $175 vs around $180 for the Platinum Pass although I had to pay around $12 each at both Ohio parks for parking. In 2006, I think my Dorney pass got me into all the parks at no extra cost and for 2007, it was only $10 to upgrade to have access to all the parks.

 

 

Share this post


Link to post
Share on other sites

Their Platinum Passes are way too high. I suspect they will try pushing memberships like SF to allocate payments over time to create a more consistent cashflow. 

Share this post


Link to post
Share on other sites
On 2/13/2019 at 8:33 AM, GAcoaster said:

Hopefully they don't go as blatant as Six Flags has. There is a way to work advertising and corporate sponsorships into a park and a way not to...

 

No point in paying for advertising that isn't blatant.  Subtlety is lost on the masses.  

Share this post


Link to post
Share on other sites

Yep, the formula for advertising is attention, interest, desire, and action (which is hopefully to buy).

Share this post


Link to post
Share on other sites

But if it's done as a sponsorship the way it used to be, it's relatively unobtrusive. It's the coaster wraps, banners, and billboards in the parks that are too much. Just about every park has had sponsorships of attractions and food since the beginning of theme parks. It's generally been something that (when done right) works with the theme and isn't a blatant ad in your face.

Share this post


Link to post
Share on other sites
3 hours ago, GAcoaster said:

But if it's done as a sponsorship the way it used to be, it's relatively unobtrusive. It's the coaster wraps, banners, and billboards in the parks that are too much. Just about every park has had sponsorships of attractions and food since the beginning of theme parks. It's generally been something that (when done right) works with the theme and isn't a blatant ad in your face.

 

They're also the most lucrative.  I used to say if it keeps the passes cheap, so be it.  But you get the feeling now that it's not going to keep the passes cheap or the parks upt to date but rather right into shareholder dividends.  

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...

×
×
  • Create New...