Was browing through loQ history and was wondering what the effect will be on LoQ when their leasing deal for the installed equipment at the parks finishes in 2008. Will they then be able to take out a new lease at a much lower cost as the financing company will have recovered their investment. If this were the case then would that help loQ profits going forward.
Also wondering who will foot the bill for installing the equipment into the 2 new parks. As i understand it, the new product requires a lot less investment but will loQ foot the bill as they did for the initial install, or will they again have to sign a lease as I dont think they have the resources currently to pay for it.
And finally, i think the profit forecast of 1m is a little optimistic. The 2 new parks will probably be loss making this year because of investment costs and also the fact that its a new concept. I would imagine that as a first time visitor to a new park with loQ you wouldnt be able to see the benefits of its system. After waiting in a queue for 2 hours and then watching users who have brought loQ gently trotting up having waited only 15 minutes, you would then the next time you visit buy it. That seems to have been the pattern so far but hopefully better weather, increased visitors, better sales in parks where loQ are now selling directly, should help compensate so that we make significant progress this year.
All we need now is confirmation that the contract has been extended.
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