An employee cleans the grounds behind the closed gates of Disneyland Park on the first day of the closure of Disneyland and Disney California Adventure theme parks, in Anaheim, California, on March 14, 2020.
DAVID MCNEW | AFP | Getty Images
Disney again suffered a financial blow during the fiscal first quarter, as restrictions on attendance at its open theme parks and the continued closure of its California parks weigh heavily at the lower end.
There is currently no timeline for the reopening of Disneyland, as the state of California has said it will not be possible to reopen theme parks until the cases of coronavirus in the surrounding community have dropped significantly. Although the 7-day average daily new Covid cases dropped from the previous week in California, more than 1,000 new cases are diagnosed each day in the state, according to a CNBC analysis of data from Johns Hopkins University.
‘Where we have been able to reopen our limited capacity theme parks, guests have consistently shown a willingness and desire to visit, which we believe is a testament to the fact that they have confidence in the health and safety protocols we have had. has. put in place, ”CEO Bob Chapek said during a revenue call on Thursday.
The company said the outbreak cost this division about $ 2.6 billion in lost operating revenue during the December quarter.
Revenue from Disney’s parks, experiences and products fell 53% to $ 3.58 billion.
Disney has reported similar losses in each of its last three earnings. In the fourth quarter, the company said the coronavirus outbreak cost it about $ 2.4 billion in lost operating revenue. In the second quarter, the company reported losing $ 1 billion in operating income due to the pandemic, and in the third quarter, the pandemic reduced its operating income by $ 3.5 billion.
Walt Disney World in Florida and the Shanghai Disney Resort were open during the first quarter, while Disneyland and all of Disney’s cruise line business were suspended.
Disneyland Paris was open until late October, about a third of the quarter, and Hong Kong Disneyland was open until early December, or about two-thirds of the quarter. The company expects to reopen its location in Hong Kong during the second quarter.
“As for the prospects for the parks for the rest of the year, and the capacity, that will really be determined by the vaccination of the public,” Chapek said. “It seems to us to be the biggest leverage we can use to take and enlarge the parks that are currently under limited capacity or to open parks that are currently closed.”
CFO Christine McCarthy said the company was able to make a profit from guests for the parks that were open. The income earned by park visitors outweighed the cost of being open. She also noted that the company is happy with the number of bookings and bookings he sees.
As parks increase capacity and reopen, Chapek said the rest of the year will wear some social distance and mask.
“Dr. Fauci said earlier today that he hopes there will be vaccines for everyone who wants them by April this year,” Chapek said. “When that happens, it’s a game changer, and it can speed up our expectations and give people the confidence they need to get back to the parks.”
“Will there be some overlap until we know we have hit herd immunity?” he said. “Of course, but do we also believe that in 2022 we will be in the same state as wearing social foot and mask in 2022? Absolutely not.”