Theme Parks & Resorts Fourth Quarter Results Revealed
Disney have announced their earnings for its fourth quarter and fiscal year ended October 1st 2016, as part of the report, details were revealed about how the Parks and Resorts division has done.
Here are the official details:
Parks and Resorts revenues for the quarter increased 1% to $4.4 billion, and segment operating income decreased 5% to $699 million due to a decrease at our international operations, partially offset by an increase at our domestic operations.
The decrease in operating income at our international operations was due to lower results at Disneyland Paris and Hong Kong Disneyland Resort, partially offset by the benefit of the first full quarter of operations for Shanghai Disney Resort. Lower results at Disneyland Paris were primarily due to decreases in attendance and occupied room nights. At Hong Kong Disneyland Resort, the decrease in operating income was due to lower attendance.
The increase at our domestic operations was primarily due to growth at Walt Disney World Resort, partially offset by a decrease at Disneyland Resort. The improvement at Walt Disney World Resort was due to lower costs and guest spending growth, partially offset by lower volumes. Guest spending growth was driven by higher average ticket prices and room rates and increased food and beverage spending. Lower volumes reflected the Fiscal Period Impact, which more than offset increases in attendance and occupied room nights on a comparable fiscal period basis. Results at Disneyland Resort reflected lower attendance, partially offset by higher average ticket prices and lower costs. The decrease in attendance reflected the impact of the 60th Anniversary celebration in the prior-year quarter and an unfavorable Fiscal Period Impact. Lower costs at both Walt Disney World Resort and Disneyland Resort were due to a favorable Fiscal Period Impact.
With Shanghai Disney Resort now operating, this means income is starting to come in, which has previously just been going out, however Hong Kong Disneyland did suffer from lower attendance. Both Disneyland in California and Paris also saw decreases in attendance, which has been blamed on the 60th anniversary ending in California. While no reason wasn’t given for the decrease in attendance at Disneyland Paris, there could be many reasons, such as visitors holding out for next years 25th anniversary or the terrorists events in the previous quarter putting off visitors. Walt Disney World also had lower attendance but was offset by more spending by guests and lower costs.
There is concern for investors that this is the second straight quarter of decrease attendance for the theme parks.
What do you think of this news?