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Major Operational Changes for 2018
- Thread starter Rob
- Start date
EuroSatch
TS Member
Some points/thoughts. (Acknowledge that some of these have already been made):
* Alton Towers receive their funding allocation from Merlin. Alton Towers Resort Operations Ltd act as an agent for Merlin, hence exempt from filing detailed financial accounts. Merlin in effect own all trade and assets of Alton Towers, which as an agent leases off Merlin, and their funding is through group treasury
* Alton Towers no doubt makes decisions over all its operating costs, and with an asset intensive business like this, there is little flexibility in this. Therefore, if margins are already thin, there is very little wriggle room. ‘Something’ has to give, if they have budgetary constraints
* Building new rides/hotels has no bearing on whether operations are loss-making, as this is capital investment and is an asset on the balance sheet. In fact, if you have little cash to play with, it makes sense to capitalise costs where you can, as you appear more favourable to lenders if you have assets for security/collateral
* Any losses they make will be born by Merlin. Merlin *will* bail them out, or risk their own credibility as a publicly listed company. This will not happen for as long as Merlin are listed
* The more than Alton Towers pulls at the purse strings of Merlin, the more pressure there will be to dispose of the asset, particularly if the wider group finances start showing some weakness as a direct result. There is no group structure complicated enough to prevent an asset being disposed of, however as theme parks are a core enterprise of Merlin, this will need a severe rethink of their strategy. Again, not going to happen in the short term
So, what’s the answer? It’s a tug of war between two players that ultimately make up part of a larger whole. I half wonder whether AT are making the cuts as visible as possible, as they know this will *have* to eventually drive a rethink in Merlin. It comes down to the fact that the place is simply to expensive to run how Merlin wants it to, and this needs to be demonstrated. If poor KPIs result from this then Merlin will likely go for a shake up of management and see what happens. But Alton also need to play this correctly and demonstrate effectively that there is an issue. Management there need to speak up *effectively* to Merlin, if they truly agree with what is being said here and Facebook. If not, then unfortunately they are in agreement with Merlin and there is only so far their mollifying talk of ‘we’re doing what we can, but we have no control’ to pay lip-service to enthusiasts can go. If you have no control, then what are you there for??? People before have stressed that AT management care. Well, they don’t care enough.
I feel sorry for the lower level staff who, I assume begrudgingly by AT, will be getting national living wage, and minimum wage where it can be got away with, yet face returning to a workplace with further cuts to their hours/roles. And this is not to mention that with these operations, revenue will take a further hit from lower F&B sales, given that you could now the times the park is open will easily fill the time between meals, and little else.
I won’t be going this year anymore. I liked the cheaper season pass, but they don’t deserve my gate figure, not even once. I won’t give them the satisfaction, not even if I could get in for free.
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* Alton Towers receive their funding allocation from Merlin. Alton Towers Resort Operations Ltd act as an agent for Merlin, hence exempt from filing detailed financial accounts. Merlin in effect own all trade and assets of Alton Towers, which as an agent leases off Merlin, and their funding is through group treasury
* Alton Towers no doubt makes decisions over all its operating costs, and with an asset intensive business like this, there is little flexibility in this. Therefore, if margins are already thin, there is very little wriggle room. ‘Something’ has to give, if they have budgetary constraints
* Building new rides/hotels has no bearing on whether operations are loss-making, as this is capital investment and is an asset on the balance sheet. In fact, if you have little cash to play with, it makes sense to capitalise costs where you can, as you appear more favourable to lenders if you have assets for security/collateral
* Any losses they make will be born by Merlin. Merlin *will* bail them out, or risk their own credibility as a publicly listed company. This will not happen for as long as Merlin are listed
* The more than Alton Towers pulls at the purse strings of Merlin, the more pressure there will be to dispose of the asset, particularly if the wider group finances start showing some weakness as a direct result. There is no group structure complicated enough to prevent an asset being disposed of, however as theme parks are a core enterprise of Merlin, this will need a severe rethink of their strategy. Again, not going to happen in the short term
So, what’s the answer? It’s a tug of war between two players that ultimately make up part of a larger whole. I half wonder whether AT are making the cuts as visible as possible, as they know this will *have* to eventually drive a rethink in Merlin. It comes down to the fact that the place is simply to expensive to run how Merlin wants it to, and this needs to be demonstrated. If poor KPIs result from this then Merlin will likely go for a shake up of management and see what happens. But Alton also need to play this correctly and demonstrate effectively that there is an issue. Management there need to speak up *effectively* to Merlin, if they truly agree with what is being said here and Facebook. If not, then unfortunately they are in agreement with Merlin and there is only so far their mollifying talk of ‘we’re doing what we can, but we have no control’ to pay lip-service to enthusiasts can go. If you have no control, then what are you there for??? People before have stressed that AT management care. Well, they don’t care enough.
I feel sorry for the lower level staff who, I assume begrudgingly by AT, will be getting national living wage, and minimum wage where it can be got away with, yet face returning to a workplace with further cuts to their hours/roles. And this is not to mention that with these operations, revenue will take a further hit from lower F&B sales, given that you could now the times the park is open will easily fill the time between meals, and little else.
I won’t be going this year anymore. I liked the cheaper season pass, but they don’t deserve my gate figure, not even once. I won’t give them the satisfaction, not even if I could get in for free.
Sent from my iPhone using Tapatalk
Stuntman707
TS Member
- Favourite Ride
- Nemesis
It's so sad to see enthusiasts on different forums declaring they are done visiting Alton Towers tonight. Really says a lot and I understand why even the most loyal guests over the years feel that way now.
EuroSatch
TS Member
Umm..
https://beta.companieshouse.gov.uk/company/06127441
Alton Towers Resort Operations Ltd.
As I said, it’s an agent company. It still exists, and is the operating entity for AT, but all liability is borne by Merlin
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https://beta.companieshouse.gov.uk/company/06127441
Alton Towers Resort Operations Ltd.
As I said, it’s an agent company. It still exists, and is the operating entity for AT, but all liability is borne by Merlin
Sent from my iPhone using Tapatalk
I had a lovely full day out today at our local zoo, no staggering animal viewing, it was open a full 6 and a half hours and I could count on one hand the amount of visitors they had through the gate.
I got home to read this staggering news and it ruined myday year 
Someone has started up a petition on FB, for what it's worth, I signed it
https://www.petitions24.com/stop_cut_backs_and_staggered_ride_opening_times_at_alton_towers
I've also voiced my dismay on both Alton's and Merlin facebook page.
I got home to read this staggering news and it ruined my
Someone has started up a petition on FB, for what it's worth, I signed it
https://www.petitions24.com/stop_cut_backs_and_staggered_ride_opening_times_at_alton_towers
I've also voiced my dismay on both Alton's and Merlin facebook page.
WickerManiac
TS Member
- Favourite Ride
- Colossus
Hmm, weird.
I thought this because I remember a couple of years back they made all the employees sign new contracts from ATROL to MAOL stating this was because the company was homogenising into one entity.
I stand corrected, sorry!
Dar
TS Member
- Favourite Ride
- Taron
Obviously there's some creative accounting, along with bits not filed due to exemptions, but it's very interesting that for the year ending 31st December 2016 Towers made more profit (£1,172,000) than Thorpe (£676,000) and Chessington (£452,000) combined. Yet again though, they're being used as the scapegoat because The Smiler offers a nice convenient excuse.
Mind you, that figure for 2016 was £130,000 less than 2015 and nearly half the money they made in 2014 (£2,498,000).
But remember, the cuts are working and the cuts are necessary and Merlin are good.
WickerManiac
TS Member
- Favourite Ride
- Colossus
Yalnix
TS Member
- Favourite Ride
- Helix
I desperately want to stay positive. I always do, in the past when many other enthusiasts have taken a negative stance I tried to be positive. I enjoyed my time at the Towers last year very much and seriously thought that this would be the year that Merlin recover the park post-crash.
But this... This is absolutely shambles. Why wouldn't I go to Birmingham international and fly to Basel or Cologne for the same price as the petrol to get to Towers.
I still think the rides at Towers are the UKs best. Unfortunately Blackpool just falls a tad short. But I try to remain positive about both. Icon looks awesome though. It just seems the preferable place to go because of operations being thousands of times better.
Shame really. I hope we would see the return of Sub Terra and the biggest ride line up since the Crash. Oh well.
Towers I hope to god you can get your act together because I, and I hope the rest of you, don't want you to fail.
But this... This is absolutely shambles. Why wouldn't I go to Birmingham international and fly to Basel or Cologne for the same price as the petrol to get to Towers.
I still think the rides at Towers are the UKs best. Unfortunately Blackpool just falls a tad short. But I try to remain positive about both. Icon looks awesome though. It just seems the preferable place to go because of operations being thousands of times better.
Shame really. I hope we would see the return of Sub Terra and the biggest ride line up since the Crash. Oh well.
Towers I hope to god you can get your act together because I, and I hope the rest of you, don't want you to fail.
Godscrasher
TS Member
I hardly ever post here, but visited Alton Towers for the first time in 97.
Can someone tell me where exactly is the 'magic' I'm supposed to enjoy on this fulfilling day out having travelled from Newcastle for maybe 5 hours of entertainment.
I was all for the Alton Towers pass but this doesn't make it worth the while if the day is so short I cannot actually make 'a day of it'.
Hopefully this fiasco gets sorted because I love the place and so does my daughter.
Can someone tell me where exactly is the 'magic' I'm supposed to enjoy on this fulfilling day out having travelled from Newcastle for maybe 5 hours of entertainment.
I was all for the Alton Towers pass but this doesn't make it worth the while if the day is so short I cannot actually make 'a day of it'.
Hopefully this fiasco gets sorted because I love the place and so does my daughter.
ChristmasPud
TS Member
I believe they have already rethought their strategy. Their focus as I'm sure they made clear recently is now on midways and brands only. Particularly going by Varney's public update explaining the long-term scaling back on capital investment for resort theme parks.
Their main company focus is "to become the world's largest attraction operator" which means opening new Legolands as often as they can, seemingly at the severe neglect of their resort theme park division, which (at their current structure) is less profitable than the other divisions. You can't copy and paste Alton Towerses like you can the pre-fab Legolands and midways.
It's diseconomy of scale, a result of Merlin's extremely rapid globalisation and new shareholder influence.
Matt.GC
TS Member
They clearly cannot afford to operate this park anymore without seriously denting their EOY.
In layman's terms, Merlin are caught in a classic trap that many listed companies are in where they're prisoners to speculative trading. This won't change until a new board is installed.
It's probably a good buy to buy Merlin shares to some whilst they're sat on the floor after the humiliatingly disasterous bungle that was the half year trading update. A quick look at the balance sheets over previous years and it gives you a good idea of how the company and the CFO behaves. I thought that it was a likely they would do whatever it takes to deliver the End Of Year, even if that does long term damage to the company.
So to say they only care about shareholders isn't strictly true. They're living from update to update, headline to headline and some people could be coming in and buying shares cheap in the belief that they'll do whatever it takes to post some good news at the end of the year. Long term shareholders however, haven't been having a good time as of late and should probably be looking for a good time to exit.
So I hope that clears up some of the questions that some.have been posting about how bizarre it seems that they are doing long term damage to their own product. Because it's probably a case of it's EOY 17/18 first, 18/19 half year second and Alton Towers long term viability as a going concern is next year's problem!
Not saying it's anywhere near this bad at Merlin, but I would suggest some further reading on the way Carillon was traded in the years before the profit warnings came in thick and fast. Interesting stuff.
Of course, for legal reasons, I must stress that the above post is completely my own personal opinion.
In layman's terms, Merlin are caught in a classic trap that many listed companies are in where they're prisoners to speculative trading. This won't change until a new board is installed.
It's probably a good buy to buy Merlin shares to some whilst they're sat on the floor after the humiliatingly disasterous bungle that was the half year trading update. A quick look at the balance sheets over previous years and it gives you a good idea of how the company and the CFO behaves. I thought that it was a likely they would do whatever it takes to deliver the End Of Year, even if that does long term damage to the company.
So to say they only care about shareholders isn't strictly true. They're living from update to update, headline to headline and some people could be coming in and buying shares cheap in the belief that they'll do whatever it takes to post some good news at the end of the year. Long term shareholders however, haven't been having a good time as of late and should probably be looking for a good time to exit.
So I hope that clears up some of the questions that some.have been posting about how bizarre it seems that they are doing long term damage to their own product. Because it's probably a case of it's EOY 17/18 first, 18/19 half year second and Alton Towers long term viability as a going concern is next year's problem!
Not saying it's anywhere near this bad at Merlin, but I would suggest some further reading on the way Carillon was traded in the years before the profit warnings came in thick and fast. Interesting stuff.
Of course, for legal reasons, I must stress that the above post is completely my own personal opinion.
Matt N
TS Member
- Favourite Ride
- Mako (SeaWorld Orlando)
I reckon it would solve some of Merlin's financial problems if they took all their shares off the stock market and became a private company again. Because that way, they wouldn't have shareholders to answer to. In fact, what actually are the advantages of going public? As it seems to have been nothing but trouble for Merlin.
I reckon someone at Towers/Merlin should have a long, hard think about the impact this will have. Even though I don't personally think that the staggered openings are as bad as the closed rides were in 2016, they will still have an impact. I do not want Merlin to sell Alton Towers, all I want is for them to have a long, hard think and get the park at least back to where it was pre-2015. I believe in second chances, and Merlin deserve a chance to u-turn this decision and make 2018 the best year in years at AT. If they don't u-turn this, then I honestly can't tell what Alton's future will be like...
I reckon someone at Towers/Merlin should have a long, hard think about the impact this will have. Even though I don't personally think that the staggered openings are as bad as the closed rides were in 2016, they will still have an impact. I do not want Merlin to sell Alton Towers, all I want is for them to have a long, hard think and get the park at least back to where it was pre-2015. I believe in second chances, and Merlin deserve a chance to u-turn this decision and make 2018 the best year in years at AT. If they don't u-turn this, then I honestly can't tell what Alton's future will be like...
Bert2theSpark
TS Member
KingNemesis
TS Member
Sure there will be!
It will become Merlin's museum of corroding coasters! Come one come all and witness the greatest spectacle known to man!
Come see the majestic nemesis creature crumble away in front of your very eyes!
Come see the dark forest, home to a once, over hyped, poorly marketed coaster now mangled and twisted in the very trees that once protected it from prying eyes of disappointed teens!
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Nothing surprises me anymore when it comes to Merlin.
In the season that a new coaster opens, it is ridiculous that a trading entity has to leak details of cuts to get enthusiasts (and non enthusiasts) in such a rage that there is a backlash against the park and Merlin. It may be the only way to get more of a budget, however damage to the brand is the result.
Nothing will ever change until they are hit financially, the only way to do that is to not give them any revenue.
I stand by my decision in June 2015 not to renew my pass and I haven't been to a Merlin park since then and have no desire to pay for a ticket now.
In the season that a new coaster opens, it is ridiculous that a trading entity has to leak details of cuts to get enthusiasts (and non enthusiasts) in such a rage that there is a backlash against the park and Merlin. It may be the only way to get more of a budget, however damage to the brand is the result.
Nothing will ever change until they are hit financially, the only way to do that is to not give them any revenue.
I stand by my decision in June 2015 not to renew my pass and I haven't been to a Merlin park since then and have no desire to pay for a ticket now.
KingNemesis
TS Member
I can see them reversing some of the decisions made, seems to be the case every year...
jon81uk
TS Member
If the park is truly not profitable then they need to stop pushing cheap Merlin passes and try to get a decent profit on admissions without needing to rely on F&B etc. But of course they would need to offer a full length day out to be able to charge a proper £35 gate price to everyone.
KingNemesis
TS Member
Just thought... Early ride time is going to be fun if Wicker Man doesn't open at the start of the season... Spinball or Cbeebies, Woo hoo! Even once it opens it will probably have teething issues, so in the same situation again.
They are really banking on it not having any issues.
They are really banking on it not having any issues.
