SeaWorld Stock Drops: Is ‘Blackfish’ to Blame?
After more than a year of public criticism surrounding the treatment of its killer whales, SeaWorld has released a statement saying it will build new, larger environments at its theme parks and will fund additional research focusing on the animals, ocean health and whales in the wild.
The company, headquartered in Orlando, Florida, also stated that the plans for larger enclosures are not a result of mounting pressure caused by the documentary ‘Blackfish’ but have been in the pipeline for some time.
The company's shares, which are trading near their lowest point since SeaWorld listed its stock on public markets last year, rose Friday. But it remains to be seen if the renovations will fully address concerns about keeping large marine mammals in captivity.
Documentary ‘Blackfish’ Left a Sour Taste
The 2013 documentary ‘Blackfish’ suggests that the conditions in which whales were being kept in at SeaWorld promotes violent behavior. It also suggested that SeaWorld’s treatment of the whales led to the death of trainers.
Since its release, a number of high-profile entertainers have declined to perform at the theme park, long-time marketing partner Southwest Airlines backed out of working with the company and SeaWorld stocks have plummeted.
Too Little, Too Late?
Amid ailing profits and negative public opinion, SeaWorld says it will build a tank with 10 million gallons of water at its San Diego Park, which is almost twice the size of the current tank with a depth of up to 50 feet. The new environment will be called the Blue World Project, and SeaWorld said it would include features that will be more stimulating for the whales, for example a fast water current that will allow them to swim against moving water.
According to reports the new facility will open to the public in 2018, and if successful SeaWorld will make similar changes at its Orlando, Florida and San Antonio parks.
The company said the cost of the project will be in the hundreds of millions of dollars but would not specify the exact budget.
SeaWorld is also pledging $10 million to support research focused on threats to killer whales, or orcas, in the wild. It also announced a $1.5 million commitment to a partnership focused on ocean health.
Despite these changes however, ‘Blackfish’ director Gabriela Cowperthwaite said the lives of the whales – nor public opinion – will improve. She stated that the size of the pool was not the only concern, but also the mental wellbeing of the animals in captivity.
“None of this would change in a bigger pool,” she said. “What people are upset about is that whales are not suitable to captivity.”
Cowperthwaite said SeaWorld should instead create oceanic sanctuaries that will let the whales live out their lives in more natural environments.
Drop in Income
On Wednesday SeaWorld reported net income and revenue that fell short of Wall Street expectations and the company withdrew its financial outlook for the year. Its revenue in the second quarter was about $40 million less than analysts had expected, and the company acknowledged that ‘Blackfish’ hurt attendance.
SeaWorld stock rose 66 cents, or 3.7 percent, to $18.66 Friday. The shares have dropped 35 percent this year.
Six issues at the top of tax and finance leaders’ agenda
New Deloitte research reveals that tax leaders are under increasing pressure to add strategic value as companies accelerate business model transformation, from undergoing digital transformations to rethinking their supply chains or investing in green initiatives.
According to Phil Mills, Deloitte Global Tax & Legal Leader, to “truly deliver value to the business, the tax function needs to rethink its resourcing model and transform its technology infrastructure to create capacity and control costs”.
And the good news, according to Mills, is that tax and business leaders have more options at their disposal to achieve this.
Reflecting the insights of global tax and finance executives at global companies, Deloitte’s Tax Operations in Focus study reveals the six issues at the top of tax and finance leaders’ agenda.
Trend 1: Businesses seek more strategic counsel from tax
Companies are being pushed to develop new digital products and distribution channels and accelerate sustainable transformation and this is taking them into uncharted tax territory. Tax leaders say their teams must have the resources and skills to give deeper advisory support on digital business models (65%), supply chain restructuring (49%) and sustainability (48%) over the next two years. This means redrawing the boundaries of what tax professionals focus on, and accelerating adoption of advanced technologies and lower-cost resourcing models to meet compliance requirements and free up time.
According to Joanne Walker, Group Tax Director, BT Group PLC, "There’s still a heavy compliance load today, but the vision for the future would be that much of that falls away, and tax people become subject matter experts who help program the machine, ensure quality control, and redirect their time to advisory activity.”
Trend 2: Tipping point for resourcing models
Business partnering demands in the tax department are on the rise, but 93% of tax leaders say their department’s budget is remaining flat or falling. To ensure that the tax function can redefine itself as a strategic function at the pace that is required, leaders are choosing to move increasing amounts of compliance and reporting to a combination of shared service centers, finance departments, and outsourcing providers that have invested in best-in-class technology.
Trend 3: Digital tax administration is moving faster than expected
in addition to the rising focus of the corporate tax department partnering with their business counterparts, transformative changes to the way companies share tax information with revenue authorities is also creating an imperative to modernize operations at a faster pace. Nine in 10 (92%) respondents say that shifting revenue authority demands on digital tax administration will have a moderate or high impact on tax operations and resources over the next five years—and several heads of tax said the trend is moving faster than expected.
"It’s really stepped up in the last couple of years," says Anna Elphick, VP Tax, Unilever. "Tax authorities don't just want a faster turnaround for compliance but access into a company’s systems. It's not unreasonable to think that in a much shorter time than we expect, compliance will be about companies reviewing a return that's been drafted by the tax authorities."
Trend 4: Data simplification and lower-cost resourcing are top priorities
Tax leaders said that simplifying data management (53%) and moving to lower-cost resourcing models (51%) must be prioritized if tax is to become more proactive at delivering strategic insights to the business. Many tax teams are ensuring that they have a seat at the table as ERP systems are overhauled, which is paying dividends: 56% of those that have introduced NextGen ERP systems are now highly effective at supporting the business with scenario-modeling insights. Only 35% of those with moderate to low use of NextGen ERP systems said the same.
At Stryker, “we automated the source P&L process for transfer pricing which took a huge burden off of the divisions," says David Furgason, Vice President Tax. "Then we created a transfer price database to deposit and retrieve data so we have limited impact on the divisions. We are moving to a single ERP platform which will help us make take the next step with robotics.”
Trend 5: Skillsets are shifting
Embedding a new data infrastructure and redesigning processes are critical for the future tax vision. Tax leaders are aligned — data skills (45%) and technology process experience (43%) are ‘must have’ skills in a tax department of the future, but more traditional tax specialist knowledge also remains key (40%). The trick to success will be in tax leaders facilitating the way these professionals, with their different backgrounds, can work together collectively to unlock lasting value.
Take Infineon Technologies, which formed a VAT technology and governance group "that has the right knowledge about how to change the system to ensure it generates the right reports", according to Matthias Schubert, Global Head of Tax. "Involving them early was key as we took a greenfield approach, so we could think about what the optimal processes would look like and how more intelligent systems could make an impact
Trend 6: 2020 brought productivity improvements
Improved productivity (50%) and accelerating shifts to remote working (48%) were cited as the biggest operational benefits to emerge from COVID-19-driven disruption. But, as 78% of leaders now plan to embed either hybrid or fully remote models in the tax function long term, 34% say maintaining productivity benefits is a top concern. And, as leaders think about building their talent pipeline and strengthening advisory skill sets, 47% say they must prioritize new approaches to talent recognition and career development over the next two years, while 36% say new processes for involving tax in business strategy decisions must be established.