Ouimet: "I want to work for Cedar Fair for the rest of my career"

[PREMiERdrum]

SANDUSKY — Cedar Point and its sister amusement parks will remain strong by relying on their legacies and evolving in the future, the new president of Cedar Fair Entertainment Co said.

Matthew A. Ouiment will become chief executive officer of Cedar Fair when current CEO Dick Kinzel retires next year. Ouimet was in Erie County last week for the company’s annual meeting, where he also spoke to reporters about the company that owns Cedar Point and Kings Island, nine other amusement parks, five outdoor water parks, one indoor water park and five hotels.

Ouimet joins the company after working for years in the hospitality industry, including 17 years with the Walt Disney Co., where he developed its vacation club, cruise line and Disneyland resort.

Now Ouimet, 53, said he wants to work for Cedar Fair for “the rest of my career.”

“The best thing we can do for all investors is deliver a great guest experience,” Ouimet said. “That’s true for all our shareholders. So the best thing we can do is make our guests smile and laugh, which will mean more guests will come, which will mean that our shareholders will benefit even more and the area’s economy will benefit more.

Cedar Fair has not finished developing Cedar Point, its flagship park and corporate headquarters, Ouimet said.

“This park needs to stay as vibrant as any park we have in the system,” Ouimet said. “There’s an importance to our business model but there’s more importance to our culture because we’re adjacent to it.”

LINK - Morning Journal

[The Interpreter]

The last paragraph at that link is most interesting. Giving customers what they WANT as proven by revenue...what a concept. Things are definitely going to be changing at Cedar Fair. It's going to be a fun ride.

[Avatar]

That last paragraph is what got my undivided attention too. When I hear comments about trying to satisfy the unit holders by putting the customers first brings a huge smile on my face and know that Cedar Fair's best days are to come. I embrace that theory whole heartedly.

[LongliveKingsCobra]

I wonder if prices through out all of the parks will go down? Maybe, maybe not?

[PREMiERdrum]

I wonder if prices through out all of the parks will go down? Maybe, maybe not?

I wouldn't look for costs to decrease, but I would expect quality (in experience, in foods, in goods, etc) to increase dramatically.

Mr. Ouimet was the one who first started the "righting" of the Disney ship after some serious neglect. He came in and raised the experience level to match the cost, instead of lowering the cost to match the experience level.

Unfortunately, Disney still has some crippling politics and beancounters in charge (evidenced by Meg Crofton's recent promotion), and I suspect that Mr. Ouimet saw that his vision and goals would be hindered by these. Cedar Fair could be an ideal situation for him: A solid portfolio of properties, a very talented staff, and a relatively recent (historically, at least) decline.

[bkroz]

I wonder if prices through out all of the parks will go down? Maybe, maybe not?

My interpretation is that we'll see changes in both directions as certain variables are tested.

As we all hoped, it seems that Mr. Ouimet does truly prioritize guest experience above all else, and asserts that if the guests are made happy on a most basic level while visiting the park, they will return, and that will boost revenue.

That seems so obvious that it's a shame it has to be spoken. If the visitor is made a priority from the parking tolls to the exit hand-stamp, and doesn't feel that they've been given the runaround or squeezed for every drop (do any Disney rides charge $1.00 for 3D glasses - and we're talking rides with real HD 3-D, not disposable cyan-and-red dayglo 3D), then they will return. And when they do, they'll bring friends and family with whom they want to make memories. I think our new president gets that, and even moreso I think that on a very real, deep level, he is excited to implement it.

[AintNutinElse2Do]

Would someone tell me how to pronounce his name? I'm definitely excited for what his leadership may bring and an curious to see how he handles the q.

[PREMiERdrum]

Would someone tell me how to pronounce his name?

"WE-met"

(Which is odd, because a true French pronounciation would be "WE-may", but I digress...)

[Avatar]

As I have stated before it looks like great things are coming to Cedar Fair parks.

Maybe it is just me and maybe it was just a slip on Mr. Ouimet's part or again sloppy reporting, I have always heard that one should never say (especially top management) " I want to work for_____". But rather they should always say "I want to work WITH ____". When one does that they are telling the company they have something to offer by working with them versus giving out a vibe of they are looking to run things as has been or following protocol under their present title. That very sentence says a lot to many who know the difference.

Some of you members who are looking for a job in the future may try to use the "I want to work with_____" approach on your next interview and ones who are currently employed may want to try to use the "I work with___", you may find it helps you try harder and understand you do have something to offer. I know I know my old man rambling is slipping out again but honestly I know that has helped me understand my roles in life and I bet Mr. Ouimet said Work With or meant to, as that is the more truthful situation.

[windshawne]

Looks like things are gonna change-and it needs to!! I am interested to see what is going to happen over the next year. Sounds like he "gets it".

[Thrill_Biscuit]

Hope he likes appropriately grand front gate music. Just sayin....

[Leland Wykoff]

The light of day can been seen at the end of the tunnel.

Cedar Fair is exiting the dark ride of its recent past.

As other posters have noted, Mr. Ouimet will most likely raise the level of guest experience to the price--not discount the experience. Mr. Ouimet is an excellent executive choice for Cedar Fair. Unitholders applaud his selection as well as the Board for taking such a fresh bold new direction.

The path Mr. Ouimet will blaze is quite a new trail for Cedar Fair. Clues that he has the Board of Directors support for new directions is clear: look at recent departures and additions to both management and the Board. Mr. Ouimet has the opportunity to fill the CFO position with a selection of his choice.

No doubt he will be supported in his selection by the newest member of the Board, Ms. Gina France, who has a superb background in finance. Mr. Ouimet has spoken of his "team" at other professional endeavors and the recent departure of CF's CFO paves the way for Mr. Ouimet to begin putting his Cedar Fair team together.

Other clues about the direction Mr. Ouimet will take Cedar Fair include his stated interest in additional acquisitions. Look for hotels, resorts, water-park facilities (both indoor and outdoor), branded entertainment, shows, concerts, as well as growth in off-park properties which can be fed customers through the marketing efforts of the parks. It is highly likely Ouimet will seek to garner a greater share of the park visitors expenditures when visiting a CF park by capturing revenues currently lost to adjacent competing properties.

It is expected Mr. Ouimet will seek and lead brand extension opportunities, licensing revenues, sponsorship revenues, and a more efficient and effective capital expenditure program.

Guest services and the guest experience will be enhanced quickly and at minimal additional cost. Mr. Ouimet has seven months to transition Kinzel out of the company and himself into the CEO position. The Board, taking the hard learned lessons from revolting shareholders, will protect Ouimet. His new vision for the future will be clearly expressed when the capital budget for next season is announced.

Welcome aboard Mr. Ouimet. The guests, capital community, unitholders, and amusement industry are all glad you have arrived.

[The Interpreter]

Umm...okay

A lot of what you said is spot on, but on two points I diverge with you:

Acquisitions? With the current debt load? Only if properties can be acquired at well below market value would this make much sense right now.

And the 2012 capital spending plan is unlikely to show much influence from Mr. Ouimet. Not yet. Way too early.

[jzarley]

Yeah, I think the debt load issue has to be addressed before CF goes on a buying spree...especially in the current debt market.

That being said, however, I've always thought that Great Wolf would make an attractive acquisition target for Cedar Fair. It would get them deeper into the lodging industry (which Ouimet knows very well from his days heading up Starwood), provide better year-round revenue, and increase their geographic distribution. Plus, GWL is in a pretty big financing hole (I've read they owe more than the value on a few properties) and only have a market cap of slightly north of $100M right now...they might be able to be picked up for a pretty good discount.

If CF *would* acquire GWL, I'd also throw out another idea...rebranding the properties as "Knotts Berry Farm Resorts." The Knotts brand is very well known (growing up, I was always aware of the Knotts brand and I was far from being an "enthusiast" back then) and I think could add some real value as a hotel/indoor waterpark brand. (Plus, GWL already has the well executed "Northwest" theme...rebranding to Knotts wouldn't be that big of a thematic leap...)

[CoastersRZ]

That would be an interesting acquisition, and would definitely help even out their balance sheet across all twelve months of the year. There certainly would be synergies between the two companies, and it would offer CF the chance to expand their lodging properties. However, I just don`t see Cedar Fair taking on any more debt right now. They have been struggling the last few years to pay down the debt that they incurred from their last acquisition, Paramount Parks.

[KIfan73]

While I think that GWL is a nice place, the proximity of its placement to Kings Island has always puzzled me...

Did they purchase the land from KI?

If so, was the idea that GWL would bring people to KI that normally wouldn't go?

If it didn't, why would you let an outsider build a hotel (essentially) in your own parking lot?

With how close it is the park, isn't it on land that could have been developed by the park sometime in the future?

[PhantomTheater]

GWL is built on the former campground, Viacom sold the land to GWL but kept a small ownership. CF sold the remain percentage to GWL.

[Leland Wykoff]

Agreed. Acquisitions are difficult to conceive of given Cedar Fair's debt load.

But, consider that Mr. Ouimet is the one who raised the prospect of acquisitions. He must have something in mind, or up his sleeve. Perhaps an acquisition of a bankruptcy, or a non-cash acquisition such as a merger with a weak competitor. Small acquisitions such as hotels adjacent to CF properties might make sense, while requiring rather small amounts of capital outlay. Think of the recent land acquisition adjacent to one of CF's smaller parks.

No doubt the capital budget will have the fingerprints of both Kinzel and Ouimet for next season. Consider WindSeeker and the Camp Snoopy additions the swan song of Kinzel. I believe next seasons capital budget will be influenced by our new CEO. That will help him make a splash and mark his new tenure at the helm of Cedar Fair. Ouimet may even be given the job of announcing the new cap expenditures.

Ouimet is a finance guy and an operations guy. Watch for him to figure out additional ways to reduce the debt load. CF had a "loss" last year due to the write-down of goodwill at Great America. That park may yet be taken for stadium development. In that event CF would have a cash infusion as well as a stable of rides to relocate and re-theme at other properties.

It struck me as odd CF took a write-down of value on a park which may be subject to eminent domain. One would think CF would desire to argue the park is under valued--not over valued--when facing a potential government taking. This is a clue to either the future of the park, or a sign of a huge management mistake.

Cedar Fair's Board of Directors must be extreamly eager to put the recent unpleasantness behind them. The Kinzel Jack Falfas firing episode alone is a corporate embarrassment which had to strike deep at the board. The board will give Mr. Ouimet wide latitude.

[The Interpreter]

Be aware that California's Great America is on land only leased, not owned, by Cedar Fair. . .

[Leland Wykoff]

Concerning Great Wolf Lodge:

I had the pleasure of attending the Great Wolf Annual Shareholders Meeting last year. Other than board and management shareholders, I was the only stockholder in attendance. The CEO was gracious, and welcoming, as was the non-management, independent, Chair of the Board.

Great Wolf has worked hard developing the Great Wolf brand, as well as other brands, including an ice cream shop brand, the first stand-alone of which opened recently at the Mall of America. GW also has acquired controlling interest in MagicQuest an amusement operated at several of their Lodges.

The decline in the economy has been brutal to the capital intensive hotel sector. Great Wolf has suffered under declining property values, and is, in fact, upside down on at least two properties. Those are two of the first generation Lodges which have fewer guest rooms than the second generation Lodges, which they view as the growth vehicle.

Revenues per available room, as well as average daily revenues per room, held up well during the recent economic distress. This will make going-forward comparables tough. Great Wolf will fail to show large year-over-year increases in ADR--but this is due to the ADR having held up under the economic downturn.

Make no mistake, Great Wolf has sever challenges. But they have a fantastic Board of Directors exhibiting some of the most forward corporate governance policies of any company. They understand they are in large measure a content company delivering superior guest experiences. They have developed proprietary brands and guest services that set them apart from the pack (sorry for the pun!).

Great Wolf is the largest operator of indoor water park resorts. They have transitioned from a development company to an operating company under the harshest and most difficult circumstances. They may, or may not, survive intact. Great Wolf has grasped the necessity of improving operations, lowering costs, developing efficient business practices, all the while maintaining high quality and guest experiences.

In a cruel twist of irony Great Wolf Lodges is the employer of two of Richard Kinzel's children (yes, that Dick Kinzel).

Makes one wonder why Cedar Fair failed to develop more water park resorts.

[TylerRider]

Adding on to the acquisition thing, I would LOVE to see Cedar Fair aqurire The Beach Water Park. I went last year, and it was just plain disgusting. They also have rotting slides in the parking lot. I could totally see Cedar Fair fix up the property and turn it into a Kings Soak City or something along those lines. They would probably remove certain attractions like the water zip-line and the high dives, but they could add a show or better eating attractions.

[Leland Wykoff]

Here are a couple of links to articles about Ouimet tour of Kings Island. Note the article indicates he will be making the cap announcement for next season. Note also Ouimet indicates a park type acquisition is not on the planning board at this time. But other acquisitions might be under consideration:

http://news.cincinnati.com/article/20110713/BIZ01/307130124/Cedar-Fair-high-K-?odyssey=nav|head

http://www.bizjournals.com/cincinnati/blog/2011/07/cedar-fair-ceo-ouimet-hints-at-new.html?page=all

Interesting Kinzel is no where in the picture.

[windshawne]

I could be wrong. but there appears to be more openness with the new leader. I like that.

[Vortex]

I don't think the virtual pass will go over to well at Kings Island. The lines are not that long.

[CedarPointer]

Adding on to the acquisition thing, I would LOVE to see Cedar Fair aqurire The Beach Water Park. I went last year, and it was just plain disgusting. They also have rotting slides in the parking lot. I could totally see Cedar Fair fix up the property and turn it into a Kings Soak City or something along those lines. They would probably remove certain attractions like the water zip-line and the high dives, but they could add a show or better eating attractions.

KI already has a waterpark...

[Avatar]

I don't think the virtual pass will go over to well at Kings Island. The lines are not that long.

Well your answer just sums it up and it looks like the virtual pass will be a true winner for everyone. People like myself who reduce their visits due to lines on the weekends will be able to go during the busier times of the season to enjoy some rides. Cedar Fair will make some more money to satisfy the shareholders by pleasing some of their guests. The non virtual pass guests won't mind watching other guests pass them by in line because the lines are not that long . Sounds like a win win for everybody and the new Cedar Fair president has just showed his brilliance in being able to please everyone.