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"Fading magic takes shine off Merlin’s big attractions"

Rob

Rob

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Well, it looks like Merlin are finally being found out. UBS yesterday downgraded Merlin Entertainments' investment rating from 'neutral' to 'sell' following analysis of customer feedback.

The Times state that analysts went through over 550,000 customer reviews and looked at average queue times at theme parks. Although much of the decline in customer feedback was noticed at Midway attractions, it is a conclusion that will come as no surprise to anyone on here.

Does anyone have a Times account? If so, it would be appreciated if you could copy the text of the full article in to this thread!

Now to wait and see if Merlin take note.
 
“We now have greater concerns that this trend could be the result of poor investment or operational decisions, with cost-cutting and a focus on new business development potentially leaving the core profit drivers of Midway under-resourced. If our data is a leading indicator of site performance, it suggests further weakness in 2019.”

:p
 
I understand Midway's are Merlin's main source of profit but what I don't understand is how the Midway's have had a greater downturn in customer feedback than theme parks.

It is amusing however that changes implemented to appease shareholders (operational cost cutting to maximise profits) has a negative impact on the share value. Hopefully this will cause a rebalancing of budgets and some more guest experience focused changes (less 'its not marketable, we won't invest in it' thinking).
 
But wait. Mr Varney tells us that guest satisfaction is improving year on year. You can’t be saying that those figures aren’t true? Surely not!

New rollercoaster idea. The world’s first rollercoaster design fully dedicated to Merlin’s shareprice. Some good drops there.

FEvjwGD.jpg


 
Lurker said:
I understand Midway's are Merlin's main source of profit but what I don't understand is how the Midway's have had a greater downturn in customer feedback than theme parks.

It is amusing however that changes implemented to appease shareholders (operational cost cutting to maximise profits) has a negative impact on the share value. Hopefully this will cause a rebalancing of budgets and some more guest experience focused changes (less 'its not marketable, we won't invest in it' thinking).
Click to expand...

I think the long queue & high price payoff is worse at a midway. If you pay a lot to get in (maybe a foreign tourist who only wants to do Madame Tussauds) and find there are too many guests inside, things are shabby and worn out and the only decent part is the new this year section then you would leave a poor TripAdvisor review.
At a Theme Park, one long queue doesn't ruin the day if most other queues are OK, plus a majority of visitors are UK based so know about 2for1s and season pass offers.
 
AT86 said:
But wait. Mr Varney tells us that guest satisfaction is improving year on year. You can’t be saying that those figures aren’t true? Surely not!

New rollercoaster idea. The world’s first rollercoaster design fully dedicated to Merlin’s shareprice. Some good drops there.

FEvjwGD.jpg


Click to expand...
You could not have that as a coaster at Alton

Sent from my SM-J600FN using Tapatalk
 
I have a Times account:

friday january 11 2019

MARKET REPORT

january 11 2019, 12:01am, the times

Fading magic takes shine off Merlin’s big attractions

louisa clarence-smith

[https://www]


Merlin Entertainments, the operator of the London Eye, Madame Tussauds and London Dungeon, was in for a scare after UBS raised concerns about the popularity of some attractions.

Analysts sifted through more than 550,000 customer reviews of around 100 Merlin attractions. They also examined a monitor that tracks average queue times at theme parks.

They found a continued decline in average reviews across Merlin’s Midway Attractions brands, which include the Blackpool Tower and Sea Life Centres.

[https://nuk-tnl-deck-prod-static]

Merlin also operates Legoland and resort theme parks including Alton Towers, Chessington World of Adventures and Thorpe Park.

UBS raised the alarm six months after it first expressed concern about increasingly negative reviews at the company’s city centre sites.

“We now have greater concerns that this trend could be the result of poor investment and operational decisions, with cost-cutting and a focus on new business development potentially leaving the core profit drivers of Midway under resourced,” the analysts said, as they hung a “sell” sign over the stock.

They have also turned bearish on Legoland. While conceding its strong brand and potential for roll-out in markets such as China, they cited weak like-for-like growth in 2018 and a significant decline in average reviews at Legoland Windsor. Dampening investors’ hopes of a recovery, the note sent Merlin shares down 17¼p, or 5 per cent, to 327¼p.

[https://video]
 
Matt.GC said:
I have a Times account:

friday january 11 2019

MARKET REPORT

january 11 2019, 12:01am, the times

Fading magic takes shine off Merlin’s big attractions

louisa clarence-smith

[https://www]


Merlin Entertainments, the operator of the London Eye, Madame Tussauds and London Dungeon, was in for a scare after UBS raised concerns about the popularity of some attractions.

Analysts sifted through more than 550,000 customer reviews of around 100 Merlin attractions. They also examined a monitor that tracks average queue times at theme parks.

They found a continued decline in average reviews across Merlin’s Midway Attractions brands, which include the Blackpool Tower and Sea Life Centres.

[https://nuk-tnl-deck-prod-static]

Merlin also operates Legoland and resort theme parks including Alton Towers, Chessington World of Adventures and Thorpe Park.

UBS raised the alarm six months after it first expressed concern about increasingly negative reviews at the company’s city centre sites.

“We now have greater concerns that this trend could be the result of poor investment and operational decisions, with cost-cutting and a focus on new business development potentially leaving the core profit drivers of Midway under resourced,” the analysts said, as they hung a “sell” sign over the stock.

They have also turned bearish on Legoland. While conceding its strong brand and potential for roll-out in markets such as China, they cited weak like-for-like growth in 2018 and a significant decline in average reviews at Legoland Windsor. Dampening investors’ hopes of a recovery, the note sent Merlin shares down 17¼p, or 5 per cent, to 327¼p.

[https://video]
Click to expand...

Pretty spot on isn't it.

How many analysts did it take to work out what we, the customers, have been saying for a long time now?
 
It’s been clear to most people visiting a Merlin attraction for a while now; the maths of the business model do not add up. You cannot achieve both an increase in guest feedback KPIs and a decrease in like-for-like expenditure at any one attraction perpetually.

You can’t keep cutting and expect people to praise you for it.
 
AT86 said:
But wait. Mr Varney tells us that guest satisfaction is improving year on year. You can’t be saying that those figures aren’t true? Surely not!

New rollercoaster idea. The world’s first rollercoaster design fully dedicated to Merlin’s shareprice. Some good drops there.

FEvjwGD.jpg

Click to expand...
If you're going to steal a joke from The Simpsons you should at least credit it ;)
 
I fully anticipate, given the downward momentum of Merlin's financial performance and share-price almost continually since the Alton Towers The Smiler crash, to trigger shareholder activism. This has been consistent for almost 4 years.

The least I would expect is the nomination committee to appoint a new CEO before the shareholders do at the AGM.

Varney is done.
 
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