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News New Gondola Transportation - Disney Skyliner -
- Thread starter danlb_2000
- Start date
davis_unoxx
Well-Known Member
hahaha get it.
Goofyernmost
Well-Known Member
Yup, but, we aren't even close to knowing any of them. Even they only know what the bosses say... don't be so naive.
Goofyernmost
Well-Known Member
I certainly does answer that question. They didn't want to open it before then. What is so difficult to understand that they don't run on your personal timeline. They have reasons and money is not really one of them when you consider that everyday it isn't open they lose revenue. Again, what is so difficult to understand about that. I know you all would like a simple reason like "to spread the cost out", but, any accountant will tell you that is not how Capital construction works. No amount of anything is really a concern because once the thing is open the asset goes from a cash asset to a property asset, no change in net worth at all. Net worth doesn't change until cash starts to flow in because of customer (guest) paying to see it.
lazyboy97o
Well-Known Member
You still haven’t addressed why start so early. You’re only talking about the end date and dismissing the issue of duration.
Goofyernmost
Well-Known Member
Nope, unless they work for Disney it means that they know a lot about other peoples accounting systems not Disney's. Do their companies build attractions in theme parks. The one case where size doesn't matter.
Goofyernmost
Well-Known Member
Listen you guys go ahead and believe what you want to believe. Stay on the single tract as if only one thing will enter into a decision of timing. It doesn't matter to me, you want to believe it, don't let me stop you.
Goofyernmost
Well-Known Member
There is no need to address that, because it has no relevance at all. They didn't even start that land very early. Check out all the complaints, of which I am sure you were one of the complainers, that were so upset about the fact that then left that part of the park untouched for ages. And the argument of the coaster taking so long. Really? The rest of the place isn't done yet and there still is a lot of work to do to finish the land. By far, the easiest part of the land was the coaster, it's been sitting there ready to go, waiting for the rest to be finished. It has absolutely nothing to do with anything. Try again! But, leave me out... all I have tried to do is explain that there are other reasons that the build in the speed that they choose. You want to make it sinister and have it be because of some fabricated, not even solid, procedure in accounting because you think that they run their finance like you do your home budget. They do not.
GoofGoof
Premium Member
Spreading a project across multiple quarters can also be done as part of the capital spend budget process. It’s managing actual cash spend on multiple projects not managing the accounting debits and credits related to depreciation. Each year TWDC throws off a certain amount of free cash flow that can be used for things like reinvestment in existing businesses (capital spend), smaller acquisitions or stock buybacks. The short sighted Wall Street analysts want as much of that cash to go to stock buybacks. Management has to manage their capital spend so that enough cash is left for buybacks to please the street with still enough left over for growing the business.
Remember that P&R is just one segment and has multiple parks, hotels and timeshares around the world to invest in plus cruise ships. They have to time out the spend over all of the needs. Certain projects may get fast tracked, but most have to get in line and follow the plan.
I don’t work for Disney but I do work in finance for a Fortune 500 company that faces a lot of these same challenges.
WDWtraveler
Well-Known Member
Photo update as of Tuesday, April 3, 2018. A "perspective view" of the run from the Hollywood Studios station (foreground), through the parking lot, through the cleared trees, to the Caribbean Beach station in the far distance. Beyond that you can see the Bonnet Creek high rise resorts. The photo is somewhat cluttered with all the rebar for the Hollywood Studios station in the foreground.
But didn't they cut down all the trees in the route of travel?
Hey, you'd better get conversant with the Star Wars universe -- it's all part of Disney now...
Goofyernmost
Well-Known Member
Again the is assuming that Disney is using their own money and not using borrowed construction capital. Their cash reserve really doesn't have to alter that much. Now I will admit that I don't know what they do, but, like I said, with the financial position of TWDC I would bet that the loan rate for them is quite low. Why take the cash used for buybacks and tie it up in construction phases. My point was that there is very little, if any, evidence that they extend time in building simply to spread the actual cash costs out over different quarters. It's the year end profit statement that people really care about or at least, that is what I would be concerned with.
GoofGoof
Premium Member
They could borrow at a very low rate, but they don’t seem to do that very often. You can look at their quarterly financial statements and see that they are not borrowing a whole lot of cash. Their debt is low for a company that size and doesn’t fluctuate a whole lot. From time to time on an earnings call or in some other presentation they will layout the capital spend budget for the next 5 years or so. Analysts have a model to project an estimate of the total cash available but they need to hear from management what the capital allocation plan is to know how much will be reinvested and how much will be available to be returned to shareholders.
It makes no sense to spread out projects over multiple quarters to try to manage their net income. Large theme park additions are depreciated over long periods of time so starting the depreciation a year or 2 later is not going to matter much over much of the life. Having an extra half a billion to spend on stock buybacks is a much bigger benefit. I actually think it makes good business sense to spread some of the cash spending out. The parks are not hurting for business and the new additions will provide decades of future earnings so waiting a year or 2 to bring them online isn’t hurting Disney from a business perspective. It sucks sometimes as a fan of the parks.
EvilChameleon
Well-Known Member
Forgive me for not knowing the vernacular, but how are systems like this... "strung up"?
Same amount of time it took to issue FPs for the buses and monorail.
Creathir
Premium Member
Very interesting...
I understand the main reason for not going higher is likely for emergency purposes, but standing at the front of DHS and getting a clear view of the new Skyliner appearing to go straight to a competitors hotel is definitely not cool.
They should have taken the Skyliner higher, up and over the trees in this area. It would have reduced the towers needed as well as kept the competition slightly more hidden.
It also would have offered an amazing vantage to be descending into DHS, helping to transport you to a new world.
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nickys
Premium Member
Which is why I said the tree line, not the actual trees.
The tree line being the height of the surrounding trees.
They are.
Goofyernmost
Well-Known Member
All the more reason why they wouldn't drag their feet on the projects. If true they would want to replenish their cash supply. They have no reason to delay the generation of income if their cash supply is being invaded. The incentive then would be to get it open and producing revenue as quickly as possible. They cannot start to generate depreciation until it is completed and they cannot charge the entire outlay off as an expense. Accounting wise it just goes from a cash asset to a property asset, no change in status. They can charge off interest and misc. expenditures, but those have a limited application. Unless they are doing something illegal (which is suppose is more then possible) there is absolutely no incentive to use their own liquid cash.