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Coronavirus Impacting Theme Parks

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5 minutes ago, malem said:

That's not to discount the physical risk to younger patients who get sick. Permanent lung damage is no joke, and it's a real danger with this virus.

You're just making this part up. There's per-xactly zero evidence of permanent lung damage to the younger crowd. There IS evidence of lung damage for those hard-hit, but again these are not the under-50's for the most part.

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6 minutes ago, bjcolglazier said:

You're just making this part up. There's per-xactly zero evidence of permanent lung damage to the younger crowd. There IS evidence of lung damage for those hard-hit, but again these are not the under-50's for the most part.

How many people over 50 do you know that vape?

https://www.google.com/amp/s/time.com/5807214/vaping-coronavirus/%3famp=true

 

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1 hour ago, bjcolglazier said:

This is an over 50 disease. The rest of us are going to move on. Protecting the over-50's. But let's call it what it is.

The quickest way to move on would be to build herd immunity quickly.  If we were to round up younger individuals and put them in internment camps with the intention that everyone who goes to the camps gets the disease.  About a week after it can be confirmed that they have gotten sick, and recovered, they can be released, because we need to make sure they are not released until after they can no longer spread the disease, the average stay would likely be around a month.  Once about half of the country has gotten sick, and recovered we will basically have reached herd immunity and the spread will largely slow to a manageable rate.  At that point we should be able to go back to normal.

We can choose if we just let it spread like wildfire through the camps or if we infect them on purpose as they are put into the camp.  But either way we need to make sure that everyone gets sick.

These are the individuals who face the least risk from the disease and by doing it this way we can keep the elderly and those at risk separated.  Rounding up those at risk and trying to protect them would put them at more risk because it will basically be impossible to keep the disease from spreading in those groups.

Either that or we can just wait until the spread dies down, and implement mitigations which should help slow the spread.  Like face masks, and testing to find infected individuals, and then have individuals they have had contact with get tested.

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20 minutes ago, bjcolglazier said:

You're just making this part up. There's per-xactly zero evidence of permanent lung damage to the younger crowd. There IS evidence of lung damage for those hard-hit, but again these are not the under-50's for the most part.

While it’s true that younger people are less likely to die from the illness, if they are admitted to the hospital they will likely require ventilators and evidence has shown those that need a ventilator, regardless of age, are showing signs of lung damage...

My neighbors niece is in her 20s, non smoker or vaper, had covid and has been in hospital for several weeks.  Still on oxygen.  Doctors say she has lung damage.

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9 minutes ago, disco2000 said:

While it’s true that younger people are less likely to die from the illness, if they are admitted to the hospital they will likely require ventilators and evidence has shown those that need a ventilator, regardless of age, are showing signs of lung damage...

My neighbors niece is in her 20s, non smoker or vaper, had covid and has been in hospital for several weeks.  Still on oxygen.  Doctors say she has lung damage.

Yeah it happens. I'm reading articles now about ventilators doing lung damage. Crazy times.

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@kenban I like this but you did a terrible job selling it.  No camps, they will never go for it. Think free month long vacation in Ibiza but colder.  Night clubs galore, micro brewery’s, room service with avocado toast. Take over all the cruise ships as well for both transportation and partying. These camps Resorts could be in the Aleutian Islands, Newfoundland, the Yukon, Colorado ski resorts if in winter, maybe we could buy Greenland since it would be for a good cause. Have all the infrastructure built and ready to go for next time.  Maybe even put all the out of work Imagineers to work on Disneyland Greenland. 
 

We could use the selective service and travel agencies for consultations so everyone could have their preferred destination all picked out and even roommate requests. 

Fail to plan, plan to fail.

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I thought this was telling and also was applicable to this thread....CF should be having a Q1 statement soon as well that should provide some additional thoughts on where their thinking is....

1 hour ago, Kenban said:

https://investors.sixflags.com/news-and-events/press-releases/2020/04-08-2020-211458352

Six Flags put out an investor update.  They have enough liquidity that they believe they can last until opening of the 2021 season, even if the parks do not open this year.  They did cancel $40-50 million dollars of projects intended for 2020, no details on exactly what was cut.  But people have been putting together some clues, SFDK for instance has deleted the pages from their website associated with the new ride that was supposed to open this year.

 

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Here is an interesting article I found yesterday about how Microsoft thinks the world will change because of this pandemic:

https://www.theverge.com/2020/4/9/21214314/microsoft-teams-usage-coronavirus-pandemic-work-habit-change

Spoiler alert:

Spoiler

I am all for the future of working at home (or at least some days in the office and some days at home. Also, the PC is back, baby!

 

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4 hours ago, disco2000 said:

I thought this was telling and also was applicable to this thread....CF should be having a Q1 statement soon as well that should provide some additional thoughts on where their thinking is....

 

I wonder how much cost they would have with extended down time. You would have security and maintenance to pay. Oh and of course all the big wigs. 

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2 hours ago, MDMC01 said:

Here is an interesting article I found yesterday about how Microsoft thinks the world will change because of this pandemic:

https://www.theverge.com/2020/4/9/21214314/microsoft-teams-usage-coronavirus-pandemic-work-habit-change

Spoiler alert:

  Reveal hidden contents

 

 

I was wondering that myself. I think having alot of office workers working at home would save companies a good deal of overhead costs. They may have to come in for that occasional meeting. 

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Add in the taxes and fees they pay to local and state entities. Plus depreciation on physical assets. I don't know how they do amortization, but the books that shows that Orion is worth $30 million this year may show it's worth $24 million next year ( assuming a 20% per year depreciation).

Sent from my Pixel 2 XL using Tapatalk

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3 minutes ago, coaster sally said:

I don't feel rides depreciate, they are more like houses.

They absolutely do.  If they didn't you'd see more resale rides on the market.  This is why it was cheaper to scrap Vortex and Firehawk than to sell them.  Look at what Coney Island is selling their rides for vs. what they likely cost new.

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^ Yeah they forgot to throw in there. Gee, what can we shut down today? They seem to enjoy shutting things down.

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39 minutes ago, Shawn Meyer said:

^ Yeah they forgot to throw in there. Gee, what can we shut down today? They seem to enjoy shutting things down.

This is a ridiculous statement. You can argue they haven't always made the optimal decisions, but to claim they are enjoying shutting things down is a bit over the top.

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1 hour ago, teenageninja said:

They absolutely do.  If they didn't you'd see more resale rides on the market.  This is why it was cheaper to scrap Vortex and Firehawk than to sell them.  Look at what Coney Island is selling their rides for vs. what they likely cost new.

A 30 year arrow vs a one year old b&m?  No way it depreciates 20% in the first year.  Its not like a automobile that depreciates as soon as it leaves the lot.

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2 minutes ago, coaster sally said:

A 30 year arrow vs a one year old b&m?  No way it depreciates 20% in the first year.  Its not like a automobile that depreciates as soon as it leaves the lot.

It depends what you're measuring. There's a difference between market value and accounting value. Many assets are allowed to be depreciated more heavily in early years, for tax purposes.

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3 minutes ago, MoreFogPlease said:

It depends what you're measuring. There's a difference between market value and accounting value. Many assets are allowed to be depreciated more heavily in early years, for tax purposes.

I am taking about market value.

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1 minute ago, coaster sally said:

I am taking about market value.

Well then you are probably correct. I was just pointing that out, because the original comment was talking about taxation.

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3 hours ago, coaster sally said:

I don't feel rides depreciate, they are more like houses.

Rides absolutely depreciate for IRS accounting and tax purposes.  If you were looking to purchase a park, like The Beach for example, this article explains how from a tax purpose you would go about allocating value of rides, land, etc....plus how the selling price is generated...If you want more information, refer to IRS publications...

 

3 hours ago, flightoffear1996 said:

Yes but you could look at The Beast as well which is likely worth wel more than the $4 million the park paid for it. 

What is costs to build now is much different than the salvage value...Market value would be essentially close to salvage value.  It would be the price someone is willing to pay to buy it from a park, which is why Vortex and Firehawk were scrapped. 

Now the marketing value a ride brings to the park is different and one cannot interchange the rides cost (actual or salvage price) with the marketing value a ride brings to a park.

 

2 hours ago, MoreFogPlease said:

It depends what you're measuring. There's a difference between market value and accounting value. Many assets are allowed to be depreciated more heavily in early years, for tax purposes.

Here is an example depreciation table.  While this table shows a steady % spread over each year of it's effective life (which may or may not be the same as the number of years the ride operates), there are so many tax regulations that a good accountant will absolutely use the Modified Accelerated Cost Recovery System (MACRS), which is a tax depreciation system allowed in the United States, to provide their employer or client with the best tax rate available (this basically depreciates it heavier on the front end and usually accelerates the asset value faster like in 7-10 years, so it could depreciate 20% in it's second year..):

image.png

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I'm actually a tax accountant, so I'll explain some stuff if you'd like. A majority of companies in the US use what is effectively called Double Declining Depreciation. This method is also recommended by the IRS as it encourages additional spending from businesses purchasing capital assets. What it effectively does, is that you take the published age of the asset's life from the IRS guidelines. You then take the initial purchase price + what it costs to install the asset and make it operational (construction, initial maintenance, electricians, ect.) minus the salvage/resale value (almost all assets have one, it's rarely 0). You then take this number and divide it by the age of the asset and multiply by 2. Repeating this calculation every year by subtracting 1 from the denominator and taking the current book value for the numerator.

 

For example, say you had a $11 million asset that has a useful life of 10 years and a salvage value of $1 million. You'd depreciate $2 million in the first year, $1.778 million the second year, $1.556 million the third year, and so on. This method of depreciation allows companies to incur larger capital expenditures in the first few years of owning an asset which would reduce their overall tax liability for that tax year, thus encouraging spending.

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FTR, I was only using 20% as a round number.  Like I said, I have no idea how they do their accounting/amortization.   But I do know that corporations do account for it.  Whether or not they account for goodwill on branding, I have no idea.

RE:  The Beast--If the ride were destroyed and rebuilt exactly as it is today, footers to trains, it would cost more than the original price, of course due to inflation.  But if the park were to be redeveloped and the ride removed, it would not have any value except for scrap--but the cost of removal would likely outweigh any scrap value so it would be an expense vs an asset.  

All this ties into the discussion of the virus impacting the park.  My point being that even if the park were to remain closed this year, there are many tangible and intangible costs that would figure into that equation.  Any income gained by opening the park would go against those costs.

 

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29 minutes ago, BeeastFarmer said:

FTR, I was only using 20% as a round number.  Like I said, I have no idea how they do their accounting/amortization.   But I do know that corporations do account for it.  Whether or not they account for goodwill on branding, I have no idea.

RE:  The Beast--If the ride were destroyed and rebuilt exactly as it is today, footers to trains, it would cost more than the original price, of course due to inflation.  But if the park were to be redeveloped and the ride removed, it would not have any value except for scrap--but the cost of removal would likely outweigh any scrap value so it would be an expense vs an asset.  

All this ties into the discussion of the virus impacting the park.  My point being that even if the park were to remain closed this year, there are many tangible and intangible costs that would figure into that equation.  Any income gained by opening the park would go against those costs.

 

Excellent Beast example!  But of course people will say they could sell the wood to enthusiasts...but I still doubt they would sell enough to make it an asset for ride removal versus expense LOL...

Yes, they have fixed costs whether the park is open or not...and they are finding ways to reduce that further (cutting full-time hours, reducing marketing costs, etc.).

But at some point "Any income gained by opening the park would go against those costs" is not a true statement...

Let's for example say fixed costs stay the same. 

If the park opens, they then have operational expenses (electricity, staffing, marketing, payroll, etc.) that get added on top of fixed costs and that becomes part of the cash input versus cash output equation.

Fixed costs stay the same, so if the operational expenses are a larger number than the income generated by opening later in the year, what financial incentive do they have to open this year? 

If for every dollar they make, it costs them $10 dollars in operating expenses to make that $1, why open?

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10 minutes ago, MoreFogPlease said:

All I know is, this was not supposed to be a day for discussing tax accounting practices on this site...

Had this not happened, I would be at work right now. I probably would have just gotten back from lunch, thinking about when I could ride Orion and looking forward to putting m first ever meal plan to use. I would be planning to take my girlfriend out somewhere nice for dinner, looking forward to my next wedding video edit, and internally grumbling because my free day to ride Orion would have probably been bought out for a company picnic. Sigh. 

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25 minutes ago, disco2000 said:

If for every dollar they make, it costs them $10 dollars in operating expenses to make that $1, why open?

Because I think they they will make tons of money, even if it is just for Haunt and Winterfest.  I just know it, it is in my gut.  

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