From 1998-2006 there were four large, well-funded competitors in the regional theme park industry. In order: Six Flags, Cedar Fair, Paramount Parks, and Busch Entertainment. Of these, Cedar Fair was regarded as having the best operating team. In March 2004, Cedar Fair bought Six Flags Worlds of Adventure (the troubled park in Ohio that doomed Six Flags) for $145 million. Cedar Fair shut it down, presumably to remove a competitor to its flagship park (Cedar Point, only 70 miles away). In June 2006, Cedar Fair bought Paramount Parks for $1.24 billion. Presumably, Cedar Fair overpaid because they thought they could run the parks better than Paramount and extract more profit from them. They quickly found out that this was a false assumption, and that Paramount actually had been an excellent operator. This made Cedar Point massively overleveraged heading into the recession. The Beta of Cedar Fair in 2008 is 0.78, and the standard deviation of annual returns is about 25%. The market value of Cedar Fairs stock is approximately $690 million on December 31, 2008. Download Cedar Fairs 2008 annual report from Blackboard. Financial statements are on pages 34-38, Debt Schedule is on page 49, previously contracted CapEx requirements are on page 29, and EBITDA calculation is on page 17. Pretend that your team works in the finance department at Cedar Fair. Your assignment is to write a report answering the following questions. You must submit an Executive Summary (1/2 page 1 page long), and you must include appendices with all of your calculations.

1) Determine a sustainable debt load for Cedar Fair as of the end of 2008.

2) How do these measures compare to the actual level of debt? Is the firm at risk of becoming insolvent? Pay special attention to the terms of the credit agreement (page 29). You will primarily be graded on the Executive Summary. Treat this as a professional document that you would give to your bosss boss.

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Industry: Amusement Parks and Arcades (NAICS Code 7131)
		1999	2000	2001	2002	2003	2004	2005	2006	2007
Number of Firms		3	4	3	2	2	2	2	2	3
Debt Ratio	Mean	0.472	0.612	0.423	0.527	0.493	0.514	0.496	0.680	0.536
Debt Ratio	Median	0.494	0.628	0.423	0.527	0.493	0.514	0.496	0.680	0.605
Long Term Debt Ratio	Mean	0.428	0.506	0.420	0.523	0.477	0.505	0.487	0.675	0.508
Long Term Debt Ratio	Median	0.493	0.628	0.420	0.523	0.477	0.505	0.487	0.675	0.602
Current Ratio	Mean	0.959	0.853	0.648	0.761	0.658	0.629	0.522	0.556	0.444
Current Ratio	Median	1.040	0.826	0.659	0.761	0.658	0.629	0.522	0.556	0.511
Quick Ratio	Mean	0.845	0.751	0.532	0.596	0.561	0.509	0.403	0.434	0.330
Quick Ratio	Median	0.984	0.707	0.628	0.596	0.561	0.509	0.403	0.434	0.292
Cash Ratio	Mean	0.402	0.233	0.323	0.331	0.432	0.359	0.166	0.137	0.114
Cash Ratio	Median	0.178	0.260	0.346	0.331	0.432	0.359	0.166	0.137	0.131
Interest Coverage Ratio	Mean	2.406	1.911	2.297	2.819	2.963	2.609	3.064	1.417	13.744
Interest Coverage Ratio	Median	0.784	1.274	2.248	2.819	2.963	2.609	3.064	1.417	1.425
Interest Coverage Ratio (dropped firms with negative EBIT)	Mean	4.094	2.622	2.297	2.819	2.963	2.609	3.064	1.417	13.744
Interest Coverage Ratio (dropped firms with negative EBIT)	Median	4.094	1.787	2.248	2.819	2.963	2.609	3.064	1.417	1.425
Cash Coverage Ratio	Mean	3.808	3.109	3.650	3.956	4.298	3.942	4.484	2.250	15.065
Cash Coverage Ratio	Median	1.579	2.288	3.718	3.956	4.298	3.942	4.484	2.250	2.313
Cash Coverage Ratio (dropped firms with negative EBITDA)	Mean	3.808	3.109	3.650	3.956	4.298	3.942	4.484	2.250	15.065
Cash Coverage Ratio (dropped firms with negative EBITDA)	Median	1.579	2.288	3.718	3.956	4.298	3.942	4.484	2.250	2.313
Industry: Amusement, Gambling, and Recreation Industries (NAICS Code 713)
		1999	2000	2001	2002	2003	2004	2005	2006	2007
Number of Firms		60	63	62	56	56	54	50	48	44
Debt Ratio	Mean	0.428	0.469	0.400	0.427	0.389	0.317	0.333	0.349	0.341
Debt Ratio	Median	0.448	0.412	0.333	0.371	0.296	0.258	0.279	0.297	0.254
Long Term Debt Ratio	Mean	0.377	0.387	0.352	0.354	0.353	0.263	0.301	0.322	0.282
Long Term Debt Ratio	Median	0.399	0.331	0.230	0.255	0.228	0.209	0.270	0.281	0.220
Current Ratio	Mean	1.405	2.992	1.197	1.024	1.057	1.253	1.112	1.411	1.635
Current Ratio	Median	1.005	0.829	0.885	0.802	0.868	0.993	0.972	1.058	0.973
Quick Ratio	Mean	1.282	2.979	1.125	0.966	1.000	1.206	1.068	1.366	1.672
Quick Ratio	Median	0.786	0.724	0.850	0.740	0.840	0.920	0.925	0.970	0.921
Cash Ratio	Mean	0.902	2.215	0.672	0.650	0.668	0.832	0.714	0.932	1.090
Cash Ratio	Median	0.401	0.300	0.346	0.321	0.449	0.487	0.565	0.553	0.579
Interest Coverage Ratio	Mean	15.035	10.239	-3.646	-16.562	41.099	-20.465	8.512	74.943	29.275
Interest Coverage Ratio	Median	0.473	0.920	0.983	1.236	1.474	1.145	1.351	1.732	0.980
Interest Coverage Ratio (dropped firms with negative EBIT)	Mean	46.201	21.982	17.525	16.752	52.349	18.165	23.633	92.103	42.305
Interest Coverage Ratio (dropped firms with negative EBIT)	Median	1.807	1.651	1.793	2.252	1.875	2.651	2.196	2.192	2.094
Cash Coverage Ratio	Mean	21.097	13.074	3.129	-12.164	53.032	-13.999	14.516	98.925	43.576
Cash Coverage Ratio	Median	1.169	1.804	1.697	2.211	2.493	2.193	2.565	2.964	2.062
Cash Coverage Ratio (dropped firms with negative EBITDA)	Mean	50.196	22.787	21.454	19.854	61.997	22.943	27.813	114.955	57.480
Cash Coverage Ratio (dropped firms with negative EBITDA)	Median	2.790	2.982	3.242	2.929	3.053	3.637	3.393	3.468	3.036

	Attendance of Largest Theme Parks in North America
* Lists Theme Parks that are in the top 50 in attendance 1997-2005 according to Amusement Business; top 20 in attendance 2006-2008 according to Themed Entertainment Association/Economics Research Associates
* Attendance in Thousands
Walt Disney Attractions
Park Name	Location	1997	1998	1999	2000	2001	2002	2003	2004	2005	2006	2007	2008	Comments
The Magic Kingdom at Walt Disney World	Lake Buena Vista, FL	17,000	15,640	15,200	15,400	14,784	14,044	14,044	15,170	16,160	16,600	17,000	17,000
Disneyland	Anaheim, CA	14,250	13,680	13,450	13,900	12,350	12,750	12,720	13,360	14,550	14,700	14,800	14,700
Epcot at Walt Disney World	Lake Buena Vista, FL	11,773	10,596	10,100	10,600	9,010	8,289	8,620	9,400	9,917	10,400	10,900	10,900
Disney MGM Studios at Walt Disney World	Lake Buena Vista, FL	10,526	9,473	8,700	8,900	8,366	8,031	7,870	8,260	8,670	9,100	9,510	9,600
Disney's Animal Kingdom at Walt Disney World	Lake Buena Vista, FL	N/A	6,000	8,600	8,300	7,772	7,306	7,300	7,820	8,210	8,900	9,490	9,540	Opened April 22, 1998
Disney California Adventure Park	Anaheim, CA					5,000	4,700	5,311	5,830	5,830	5,950	5,680	5,560	Opened in 2001
Universal Studios Recreation Group
Park Name	Location	1997	1998	1999	2000	2001	2002	2003	2004	2005	2006	2007	2008	Comments
Universal Studios Orlando	Orlando	8,900	8,900	8,100	8,100	7,290	6,853	6,850	6,700	6,130	6,000	6,200	6,230
Universal Studios Hollywood	Universal City, CA	5,368	5,100	5,100	5,200	4,732	5,200	4,570	5,000	4,700	4,700	4,700	4,580
Universal Studios Island of Adventure	Orlando			3,400	6,000	5,520	6,072	6,072	6,130	5,760	5,300	5,430	5,290	Opened in May 1999
Anheuser-Busch Theme Parks
Park Name	Location	1997	1998	1999	2000	2001	2002	2003	2004	2005	2006	2007	2008	Comments
Sea World Florida	Orlando	4,900	4,900	4,700	5,200	5,100	5,000	5,200	6,300	5,600	5,700	5,800	5,920
Busch Gardens	Tampa Bay, FL	4,200	4,200	3,900	5,000	4,500	4,600	4,300	4,100	4,300	4,360	4,400	4,410
Sea World California	San Diego	3,978	3,700	3,600	3,600	4,100	4,000	4,000	4,000	4,100	4,260	4,260	4,140
Busch Gardens the Old Country	Williamsburg, VA	2,500	2,400	2,300	2,300	2,700	2,600	2,500	2,400	2,600	2,813	3,150	3,090
Sea World Texas	San Antonio	1,700	1,700	1,700	1,700	1,800	1,600	1,700	1,400	2,100	N/A	N/A	N/A
Sea World Ohio	Aurora, OH	1,400	1,400	1,400	1,300	Sold								Sold to Six Flags in 2001 and later re-branded Six Flags Ohio in 2000
Six Flags Inc
Park Name	Location	1997	1998	1999	2000	2001	2002	2003	2004	2005	2006	2007	2008	Comments
Six Flags Great Adventure	Jackson, NJ	3,718	3,421	3,800	3,500	3,560	3,250	3,150	2,800	2,968	2,730	2,720	2,760
Six Flags Magic Mountain	Valencia, CA	3,374	3,070	3,200	3,300	3,200	3,100	3,050	2,700	2,835	2,550	N/A	N/A	Attendance fell out of the top 20 in 2007
Six Flags Great America	Gurnee, IL	3,090	2,905	3,100	2,875	2,900	2,700	2,575	2,300	2,825	2,620	2,630	2,660
Six Flags Over Texas	Arlington, TX	3,098	2,819	2,700	2,775	3,000	2,675	2,600	2,200	2,310	N/A	N/A	N/A
Six Flags Over Georgia	Atlanta	2,796	2,321	2,500	2,400	2,400	2,250	2,100	1,950	2,050	N/A	N/A	N/A
Six Flags Fiesta Texas	San Antonio	1,700	1,700	2,400	2,200	2,075	1,875	2,600	1,800	2,310	N/A	N/A	N/A
Six Flags Marine World	Vallejo, CA	1,103	1,831	2,100	2,100	2,120	1,900	1,725	1,450	1,537	N/A	N/A	N/A
Six Flags New England	Agawam, MA	1,272	1,590	1,600	2,000	1,950	1,875	1,750	1,500	1,695	N/A	N/A	N/A	Formerly Riverside Park
Six Flags St, Louis	Eureka, MO	2,047	1,556	2,050	1,900	1,860	1,750	1,675	1,350	1,377	N/A	N/A	N/A
Six Flags Astroworld	Houston, TX	2,088	1,900	1,900	1,825	1,775	1,800	1,700	1,400	1,330	N/A	N/A	N/A	Shut Down in 2005
Geauga Lake / Six Flags Ohio	Aurora, OH	1,300	1,300	1,200	1,700									Major expansion in 2000. Combined with Sea World Ohio to become Six Flags Worlds of Adventure in 2001
Six Flags Worlds of Adventure	Aurora, OH				1,700	2,750	2,150	2,000	Sold					Formerly Six Flags Ohio & Sea World Ohio. From 2001-2003 Six Flags Worlds of Adventure, Sold in 2004 to Cedar Fair & most of the big rides were taken away to other parks.
Six Flags Darien Lake	Darien Center, NY	1,670	1,520	1,704	1,625	1,640	1,525	1,460	1,250	1,275	N/A	N/A	N/A
Six Flags America	Largo, MD	983	1,170	1,700	1,600	1,620	1,550	1,425	1,150	1,180	N/A	N/A	N/A	Formerly Adventure World
Six Flags Elitch Gardens	Denver	1,500	1,500	1,600	1,525	1,500	1,500	1,350	1,050	1,155	N/A	N/A	N/A
Six Flags Kentucky Kingdom	Louisville	1,105	1,348	1,300	1,235	1,190	N/A	N/A	N/A	N/A	N/A	N/A	N/A	Attendance fell out of the top 50 in 2002.
Laronde	Montreal	1,111	1,200	1,000	1,154	1,200	1,350	1,275	1,200	1,254	N/A	N/A	N/A	La Ronde was owned and administered by the City of Montreal until it was sold to Six Flags on May 4, 2001
Cedar Fair Ltd
Park Name	Location	1997	1998	1999	2000	2001	2002	2003	2004	2005	2006	2007	2008	Comments
Knott's Berry Farm	Buena Park, CA	3,400	3,400	3,600	3,456	3,589	3,625	3,800	3,580	3,470	3,670	3,630	3,560
Cedar Point	Sandusky, OH	3,208	3,400	3,300	3,432	3,100	3,250	3,300	3,170	3,110	3,070	3,120	3,190
Knott's Camp Snoopy	Bloomington, MN	2,600	2,600	2,600	2,600	2,418	2,520	2,469	2,590	2,200	N/A	N/A	N/A	Park is inside the Mall of America
Dorney Park	Allentown, PA	1,300	1,300	1,400	1,260	1,510	1,600	1,400	1,430	1,500	N/A	N/A	N/A
Paramount Parks
Park Name	Location	1997	1998	1999	2000	2001	2002	2003	2004	2005	2006	2007	2008	Comments
Paramount's Kings Island	Mason, OH	3,301	3,400	3,320	3,200	3,350	3,183	3,280	3,330	3,330	3,050	3,050	3,120
Paramount's Canada Wonderland	Maple, Ontario	2,881	3,025	2,900	2,975	2,975	2,826	2,680	3,420	3,660	3,230	3,250	3,380
Paramount's Kings Dominion	Richmond, VA	2,279	2,325	2,200	2,150	2,250	2,093	2,100	2,180	2,220	N/A	N/A	N/A
Paramount's Carowinds	Charlotte, NC	1,838	1,875	1,900	1,900	1,850	1,850	1,776	2,010	2,130	N/A	N/A	N/A
Paramount's Great America	Santa Clara, CA	2,253	2,050	1,800	1,800	1,750	1,820	1,911	1,930	2,070	N/A	N/A	N/A
Others - not owned by a chain
Park Name	Location	1997	1998	1999	2000	2001	2002	2003	2004	2005	2006	2007	2008	Comments
Hershey Park	Hershey, Pa	2,162	2,400	2,340	2,450	2,560	2,629	2,551	2,500	2,700	2,690	2,940	2,840
Morey's Piers	Wildwood, NJ	2,885	3,000	3,300	3,300	3,400	3,400	3,230	3,100	3,130	N/A	N/A	N/A
Santa Cruz Beach Boardwalk	Santa Cruz, CA	3,200	3,040	3,000	3,000	3,000	3,000	3,000	3,000	3,000	N/A	N/A	N/A
Adventuredome at Circus Circus	Las Vegas	2,667	2,800	2,800	2,977	3,400	4,500	4,300	4,400	4,500	N/A	N/A	N/A
Dollywood	Pigeon Forge, TN	1,947	2,200	2,300	2,300	2,060	2,300	2,150	2,100	2,360	N/A	N/A	N/A
Silver Dollar City	Branson, MO	1,951	2,010	2,060	2,000	2,080	2,080	1,900	1,800	1,910	N/A	N/A	N/A
Casino Pier	Seaside Heights, NJ	1,589	1,700	1,610	1,600	1,650	1,700	1,580	1,580	1,750	N/A	N/A	N/A
Legoland California	Carlsbad, CA			1,450	1,450	1,375	1,300	1,300	1,430	1,430	N/A	N/A	N/A	Opened in 1999
Kennywood	West Miffin, PA	1,302	1,380	1,380	1,380	1,380	1,250	1,300	1,330	1,200	N/A	N/A	N/A
Knoebels Amusement Resort	Elysburg, PA	1,101	1,200	1,250	1,250	1,300	1,326	1,215	1,250	1,288	N/A	N/A	N/A
Lagoon	Farmington, UT	1,111	1,200	1,230	1,150	1,118	1,094	1,150	1,170	1,152	N/A	N/A	N/A