Americans are back at Disney Parks, profits up 73 percent!

[Rumors Rocks]

http://skift.com/2013/05/07/americans-are-back-at-disney-parks-profits-up-73-percent/

Profits soared across the Walt Disney Co.’s vacation businesses during the first three months of 2013, surging 73 percent on the strength of new investments in cruise ships and theme-park attractions in Florida and California

A booming parks business helped lift Disney to 32 percent profit growth during the second quarter of its fiscal year, the Burbank, Calif.-based company announced Tuesday afternoon.

Disney said it turned a companywide profit of $1.5 billion for the quarter, up from $1.1 billion a year ago. Sales climbed 10 percent to nearly $10.6 billion.

“We’re obviously pleased with our second quarter,” Disney Chairman and Chief Executive Officer Bob Iger said in a prepared statement.

No unit performed better for Disney than its parks division, where Disney has plowed close to $6 billion into new projects over the last few years.

Operating income at Walt Disney Parks and Resorts skyrocketed 73 percent to $383 million, up from $222 million a year ago. Revenue jumped 14 percent to $3.3 billion.

Disney reported gains across its holdings, including higher attendance and guest spending at Walt Disney World and Disneyland in Anaheim, Calif. Hotel bookings also rose in Orlando, where Disney last year opened the roughly 2,000-room Art of Animation Resort.

Another big boost came from the Disney Fantasy, the second of two new cruise ships that Disney has added to its fleet. The 4,000-passnger ship, which is based at Port Canaveral in Brevard County, had not yet begun sailing during Disney’s second quarter last year.

The U.S. businesses benefited from the favorable timing during the quarter of the New Year’s and Easter holidays.

Disney reported lesser growth at its international parks, thanks to higher guest spending at Disneyland Paris and larger crowds at Hong Kong Disneyland. ___

(c)2013 The Orlando Sentinel (Orlando, Fla.)

Visit The Orlando Sentinel (Orlando, Fla.) at www.OrlandoSentinel.com

Distributed by MCT Information Services

 

[Peter Pirate 2]

http://skift.com/2013/05/07/americans-are-back-at-disney-parks-profits-up-73-percent/

And what does the average cast member make?

 

[DRDISNEYMD]

~Wow, I just read another article explaining how more CEO's should aspire to be like Iger -- he has set the gold standard for all CEO's to follow.

~Anyway, how can this be true??? I thought "everyone" cancelled their trips because of Magic Bands, FP+ and Avatarland! LOL.

 

[Peter Pirate 2]

~Wow, I just read another article explaining how more CEO's should aspire to be like Iger -- he has set the gold standard for all CEO's to follow.

~Anyway, how can this be true??? I thought "everyone" cancelled their trips because of Magic Bands, FP+ and Avatarland! LOL.

If the goal of your company is singularly to make money then guys like MBA bob are your guy. Is this what you want for Disney? WWWD?

 

[DRDISNEYMD]

If the goal of your company is singularly to make money then guys like MBA bob are your guy. Is this what you want for Disney? WWWD?

~I really don't know, Mr. Pirate. I really am shocked by these numbers, and Disney hasn't done much of anything to deserve it. While, Universal is working day and night to bring their guests new innovative experiences in record breaking time, it is somewhat disheartening as a loyal Disney fan, who has yet to visit a Universal Park.

 

[Tonka's Skipper]

Hi Dr. , I disagree, this is not just WDW its all of Disney parks. In the last 2 years or so they have totally redone California adventure, the star is Car lands, which is bring piles guests to the park and driving up attendance.

New overseas parks.

WDW has Fantasy land and plans for avatar, likely cars land and of course Star Wars.........new resorts.........DVC and the rebuild of DTD. They are doing a lot!

I grant you more needs to be done faster in WDW.

Uni, they are building to the thrill ride market which is limited and always will be. Disney builds to the broad market of everyone. Over all their product is just so much better.

Yes they did a wonderful job on Hairy Potter( except for layout) the question is how long with harry potter last. ..No new books, no new movies!......Add to that, the fact you can buy Hairy Potter DVD's in stores for $5.00 or less, does not lead one believe its popularity will continue as high levels.

As to the profits, all the parks in Orlando and the country in general have has increases in profit..............Se world 300%...........6 flags up, all because the economy is plain better.


Pay scales are what pay scales are, in all parks, Companies all pay what the market will bear.

It easy to point at Disney......but to be honest about it, if your worried about low pay...one has to point at all the companies.


AKK

 

[mvk]

Hi Dr. , I disagree, this is not just WDW its all of Disney parks. In the last 2 years or so they have totally redone California adventure, the star is Car lands, which is bring piles guests to the park and driving up attendance.

New overseas parks.

WDW has Fantasy land and plans for avatar, likely cars land and of course Star Wars.........new resorts.........DVC and the rebuild of DTD. They are doing a lot!

I grant you more needs to be done faster in WDW.

Uni, they are building to the thrill ride market which is limited and always will be. Disney builds to the broad market of everyone. Over all their product is just so much better.

Yes they did a wonderful job on Hairy Potter( except for layout) the question is how long with harry potter last. ..No new books, no new movies!......Add to that, the fact you can buy Hairy Potter DVD's in stores for $5.00 or less, does not lead one believe its popularity will continue as high levels.

As to the profits, all the parks in Orlando and the country in general have has increases in profit..............Se world 300%...........6 flags up, all because the economy is plain better.


Pay scales are what pay scales are, in all parks, Companies all pay what the market will bear.

It easy to point at Disney......but to be honest about it, if your worried about low pay...one has to point at all the companies.


AKK

Great post.

 

[jagfanjosh3252]

While I will always be a Disney fan. With the profits, they really need to step up their game. Look at what Universal is doing with HP and Transformers and everything else. HP is truly immersive. New Fantasyland no where near it. Lately it seems that Disney is just coasting and Universal is putting the foot on the pedal. I truly hope Disney will announce something grand like Star Wars Land or even final plans for AvatarLand.

 

[ChipnDale79]

While I will always be a Disney fan. With the profits, they really need to step up their game. Look at what Universal is doing with HP and Transformers and everything else. HP is truly immersive. New Fantasyland no where near it. Lately it seems that Disney is just coasting and Universal is putting the foot on the pedal. I truly hope Disney will announce something grand like Star Wars Land or even final plans for AvatarLand.

Disney doesn't have to do what Universal is doing, this article just kind of proves it. Disney can continue to coast or adding attractions that aren't mind blowing like Universal is, yet people will still go.

As long as attendance is still up, Disney will continue to do the least they can and try to get every penny out of their guest. It's no longer about Customer Service, it's all about bottom line now.

 

[skier_pete]

This is what I see reading this article:

Better attendance = Less discounts for me.

I am beginning to suspect we won't be seeing the free DDP for Oct-Dec this year.

 

[sachilles]

It's no longer about Customer Service, it's all about bottom line now.

NOW? It's a business, of course the goal is to increase the bottom line and it has been from day one. They are not a charity nor a non-profit. The goal is to create something people want, and take their money as often as they'll give it to you. IF you fail to meet expectations, you'll lose market share, and your profits will fall. Tourism is up which is good. All park profits are up including non disney parks, that is good for the economy of the area. This allows them to re-invest in their business. I'd argue that a better universal park is good for business, as it is one more draw to the orlando area.
I'd counter that it is very much about customer service. Good service is always good for the bottom line.
One can argue that happier employees offer better service and I'd be on board with that. I was just there this past week, and I'd say I encountered a total of 2 employees that were not having their best day. They weren't bad by most standards, but you could tell it wasn't their favorite day to be at work.

 

[ChipnDale79]

NOW? It's a business, of course the goal is to increase the bottom line and it has been from day one. They are not a charity nor a non-profit. The goal is to create something people want, and take their money as often as they'll give it to you. IF you fail to meet expectations, you'll lose market share, and your profits will fall. Tourism is up which is good. All park profits are up including non disney parks, that is good for the economy of the area. This allows them to re-invest in their business. I'd argue that a better universal park is good for business, as it is one more draw to the orlando area.
I'd counter that it is very much about customer service. Good service is always good for the bottom line.
One can argue that happier employees offer better service and I'd be on board with that. I was just there this past week, and I'd say I encountered a total of 2 employees that were not having their best day. They weren't bad by most standards, but you could tell it wasn't their favorite day to be at work.

I understand what a business is, I'm not stupid. Nor did I say it was a charity, please go back and read what I said, I never said that anywhere.

I fully believe that companies including Disney should make a profit, that's what they are in business for in the first place. I do however think there is a fine line that companies must take, if companies begin to appear greedy, it does in fact turn some customers away from said company. I've seen it first hand.

Disney is a little different in the fact that it has become a "milestone" or a "rite of passage" vacation for many people. I've know many people that have taken their children to Disney once, because "every child should go to disney", and have heard the parents say, "We went, enjoyed it, but we won't be going back, it's so expensive."

My wife and I have been multiple times, but we've started to pull the amount of time we go back. Why? because there are other places to go for cheaper than what we would spend on a Disney vacation. We also have two kids now, and yes we will bring them to Disney, but for the first time we are looking at going to other places in Orlando while there, because well, they have other things we want to do. That hasn't been the case before.

We all work hard for our money year round, some of us are ok with spending thousands of dollars on a vacation and getting the same thing year after year, or less year after year. Some of us aren't ok with that, we've seen large increases on prices of tickets, hotel rooms, and even the dining plan over the past couple of years (yes, during a bad economy), when in return for that, we've seen a couple of new things added, some taken away, but mostly things have stayed the same of gotten worse.

I think if Disney would offer some type of incentive program, or points program like hotel chains offer, I actually think that Disney would see more return visitors, which would mean more money for the bottom line.

I'm not a Disney apologist, if I see something I don't like it, I'll say it. I'm tired of the wallet dump that Disney does on you, but the only way to stop them from getting every cent of my vacation budget, is to stop going as often.

 

[tjkraz]

Disney is a little different in the fact that it has become a "milestone" or a "rite of passage" vacation for many people. I've know many people that have taken their children to Disney once, because "every child should go to disney", and have heard the parents say, "We went, enjoyed it, but we won't be going back, it's so expensive."

My wife and I have been multiple times, but we've started to pull the amount of time we go back. Why? because there are other places to go for cheaper than what we would spend on a Disney vacation. We also have two kids now, and yes we will bring them to Disney, but for the first time we are looking at going to other places in Orlando while there, because well, they have other things we want to do. That hasn't been the case before.

Thing is, Disney park visits have been a rite of passage for generations now and that supply of business keeps coming. No question prices are higher than ever and rising much faster than inflation. But people keep going.

With regard to people visiting other attractions in Orlando, again that's a frequent refrain. Harry Potter opened in June 2010...nearly three years ago. And since then I've read countless people make similar comments: Never been off Disney property before but now I'm going to Universal (or Sea World, or Legoland.)

Yet here we sit 3 years later--with a mediocre Fantasyland expansion as Disney's only response--and profits are up 73% in the quarter.

That said, we don't really know how much (if any) of that 73% can be attributed to WDW. Much of it could be Disneyland and Disney Cruise Line. As always, the question comes down to how much Disney is willing to invest in WDW to try pushing the numbers upward.

I think if Disney would offer some type of incentive program, or points program like hotel chains offer, I actually think that Disney would see more return visitors, which would mean more money for the bottom line.

Problem with that is, it costs money. There are costs associated with running the program itself and if it's to have any results, you actually have to give away meaningful product along the way.

The question Disney has no doubt asked is why they should give away free (or discounted) hotel nights or other product when people are still paying full price. They may stand to earn extra dollars from YOU if those program rewards are enough to entice you to spend more $$$, but they end up losing dollars from others who would pay full price in the absence of discounts.

It's similar to any other discount program. Earlier this year Disney reduced the Premium Annual Pass merchandise discount from 20% to 10%. Many passholders immediately concluded Disney would "lose" since they would spend far less on merchandise due to the lower discount.

Thing is, there are many others still buying MILLIONS of dollars worth of plastic Chinese crap with a discount of just 10%...or even 0% for non-passholders. Disney may lose dollars from some individuals who decide not to buy without the 20% discount, but on every other product they are selling the profit margins are much higher by slashing that discount.

 

[rteetz]

Hi Dr. , I disagree, this is not just WDW its all of Disney parks. In the last 2 years or so they have totally redone California adventure, the star is Car lands, which is bring piles guests to the park and driving up attendance.

New overseas parks.

WDW has Fantasy land and plans for avatar, likely cars land and of course Star Wars.........new resorts.........DVC and the rebuild of DTD. They are doing a lot!

I grant you more needs to be done faster in WDW.

Uni, they are building to the thrill ride market which is limited and always will be. Disney builds to the broad market of everyone. Over all their product is just so much better.

Yes they did a wonderful job on Hairy Potter( except for layout) the question is how long with harry potter last. ..No new books, no new movies!......Add to that, the fact you can buy Hairy Potter DVD's in stores for $5.00 or less, does not lead one believe its popularity will continue as high levels.

As to the profits, all the parks in Orlando and the country in general have has increases in profit..............Se world 300%...........6 flags up, all because the economy is plain better.

Pay scales are what pay scales are, in all parks, Companies all pay what the market will bear.

It easy to point at Disney......but to be honest about it, if your worried about low pay...one has to point at all the companies.

AKK

This is a great post. I think when and if Avatarland is finished it will be an amazing addition to AK but just all the pre construction stuff is making it seem like a hassle. New fantasyland is huge for MK and will help the park greatly. Disney plans for the future and has many series at this time that will last into the future especially with Star Wars and Marvel. Adding additions and completely new parks in general will continue to come in the future. Disney can do these things every year and continue to strive for perfection because they are such a large company. I also agree if we look 20-30 years down the road will Harry Potter still be as big as it is today? Me personally I don't think so but disney marketing works a certain way to make sure things last longer than other companies. This is what is great about the disney company.

Sent from my iPad using DISBoards

 

[mm1971]

Hi Dr. , I disagree, this is not just WDW its all of Disney parks. In the last 2 years or so they have totally redone California adventure, the star is Car lands, which is bring piles guests to the park and driving up attendance.

New overseas parks.

WDW has Fantasy land and plans for avatar, likely cars land and of course Star Wars.........new resorts.........DVC and the rebuild of DTD. They are doing a lot!

I grant you more needs to be done faster in WDW.

Uni, they are building to the thrill ride market which is limited and always will be. Disney builds to the broad market of everyone. Over all their product is just so much better.

Yes they did a wonderful job on Hairy Potter( except for layout) the question is how long with harry potter last. ..No new books, no new movies!......Add to that, the fact you can buy Hairy Potter DVD's in stores for $5.00 or less, does not lead one believe its popularity will continue as high levels.

As to the profits, all the parks in Orlando and the country in general have has increases in profit..............Se world 300%...........6 flags up, all because the economy is plain better.


Pay scales are what pay scales are, in all parks, Companies all pay what the market will bear.

It easy to point at Disney......but to be honest about it, if your worried about low pay...one has to point at all the companies.


AKK

Good post. All great points.

Everyone really needs to stop comparing US and Disney. Honestly, if Disney were not in Florida none of the other parks would nearly as successful as they are. Disney is a vacation spot. You can spend 2 weeks and still have not done everything. US is an amusement park. The rides and attractions at US are well done and yes, they are putting in a great effort. But lets be honest. How many families are going to US for a week or more each year? Not nearly as many as Disney and that doesn't even include the DVC members that are there all the time.

Good news that the profits are there. Please be assured that a goo chunk of those profits are needed and will be used to continue updating and expanding the options at the parks. I still think the cost is reasonable for what my family gets.

 

[sachilles]

I don't think your are stupid, nor did I write or imply that.
Simply stated, if they cared more about lining their pockets, than re-investing in the company, they'd be a little more understated about their earnings.
Announcements like this are trying to bolster consumer confidence and reassure folks things are going well, so that they considering making a visit.
Combined with having to sell space at downtown disney, you need people to think you are successful. I think Disney sees this a very encouraging sign, that future growth can be supported.

I can understand you don't want your business to look greedy, but what is line between greedy and not greedy? 10% increase isn't anything to sneeze at but I don't think it shows greed.

I do think customer return rates play a large part in peoples perception of the place. I think that those that return annually or even more frequently expect a bit more than is realistic. Someone that goes once every other year or so, views the place much differently. Somebody who's first visit is during a busy time is very likely to have a different experience if the visit was during an off peak time.

My opinion, is I don't see the greed in this announcement, nor from this company. I'm not snowed into thinking the company is perfect by any means, but i'm not seeing the business greed that has folks bent out of shape.
I'm not a disney apologist. I can't afford to go as much as I'd like, my recent visit was the first of my adult life at 39. I'd enjoy going more often, but our vacation priorities vary too much. There is a lot of competition out there for the vacation dollar.

 

[DRDISNEYMD]

Hi Dr. , I disagree, this is not just WDW its all of Disney parks. In the last 2 years or so they have totally redone California adventure, the star is Car lands, which is bring piles guests to the park and driving up attendance.

New overseas parks.

WDW has Fantasy land and plans for avatar, likely cars land and of course Star Wars.........new resorts.........DVC and the rebuild of DTD. They are doing a lot!

I grant you more needs to be done faster in WDW.

Uni, they are building to the thrill ride market which is limited and always will be. Disney builds to the broad market of everyone. Over all their product is just so much better.

Yes they did a wonderful job on Hairy Potter( except for layout) the question is how long with harry potter last. ..No new books, no new movies!......Add to that, the fact you can buy Hairy Potter DVD's in stores for $5.00 or less, does not lead one believe its popularity will continue as high levels.

As to the profits, all the parks in Orlando and the country in general have has increases in profit..............Se world 300%...........6 flags up, all because the economy is plain better.


Pay scales are what pay scales are, in all parks, Companies all pay what the market will bear.

It easy to point at Disney......but to be honest about it, if your worried about low pay...one has to point at all the companies.


AKK

~Tonka, well done! This is a fabulous post! But, the underlined in the aforementioned comment is my bone of contention with Disney. I believe we are in agreement, for the most part.

While I will always be a Disney fan. With the profits, they really need to step up their game. Look at what Universal is doing with HP and Transformers and everything else. HP is truly immersive. New Fantasyland no where near it. Lately it seems that Disney is just coasting and Universal is putting the foot on the pedal. I truly hope Disney will announce something grand like Star Wars Land or even final plans for AvatarLand.

~Great post! With this news, I have to wonder if Disney has any incentive left to continue on with building. I really don't know.

Disney doesn't have to do what Universal is doing, this article just kind of proves it. Disney can continue to coast or adding attractions that aren't mind blowing like Universal is, yet people will still go.

As long as attendance is still up, Disney will continue to do the least they can and try to get every penny out of their guest. It's no longer about Customer Service, it's all about bottom line now.

~Great post! I totally agree. Disney wants to coast and it shows, they have adopted a reactive approach to WDW instead of proactive. Disney is acting like they're moving the moon & stars with this mine train. I am so happy with this Universal news -- 2014 will be a very exciting year!!!

Good post. All great points.

Everyone really needs to stop comparing US and Disney. Honestly, if Disney were not in Florida none of the other parks would nearly as successful as they are. Disney is a vacation spot. You can spend 2 weeks and still have not done everything. US is an amusement park. The rides and attractions at US are well done and yes, they are putting in a great effort. But lets be honest. How many families are going to US for a week or more each year? Not nearly as many as Disney and that doesn't even include the DVC members that are there all the time.

Good news that the profits are there. Please be assured that a goo chunk of those profits are needed and will be used to continue updating and expanding the options at the parks. I still think the cost is reasonable for what my family gets.

~Great post! But, I will always compare WDW to Universal -- they are rivals and "answer back" to each other in many quirky ways such as Butter Beer vs Lefrou's Brew, it has always been this way. We may not have four parks at WDW to enjoy today if it weren't for Universal coming along to add some spark. Of course, this is a win-win for all theme park lovers.

~Also, Universal is not just an "amusement park" -- it's not like Cedar Point. They are well on their way to becoming to world class destination. There's a new resort on the way, and the new expansion boasts a brand new Hogwarts Express Train to facilitate transport -- bridging the gap between both parks. It's true that I won't spend an entire week there, but I look forward to staying onsite at Universal for a few days.

 

[eeyorepixie]

This is what I see reading this article:

Better attendance = Less discounts for me.

I am beginning to suspect we won't be seeing the free DDP for Oct-Dec this year.

You and me are reading the same thing, and it is all at this moment that I care about.

 

[uccats97]

Actually, free dining for Oct-Dec was emailed out a few days ago to certain guests in the form of a pin code.

 

[jagfanjosh3252]

Disney doesn't have to do what Universal is doing, this article just kind of proves it. Disney can continue to coast or adding attractions that aren't mind blowing like Universal is, yet people will still go.

As long as attendance is still up, Disney will continue to do the least they can and try to get every penny out of their guest. It's no longer about Customer Service, it's all about bottom line now.

Lol. They do have to answer to Universal. Like someone said. They are competitors. Why would I keep going to one place where it adds nothing new, yet everything keeps going up in price, when the other place has newer attractions and even better discounts? I'm an AP holder to both parks. But let's say I wasn't. I can spend $100 for two days at Universal. Or I can spend $150 for two days at Disney. While Disney has done what in the past 5 years? Refurbished Test Track, added a clone of a ride in DCA with Little Mermaid, put a second Dumbo Spinner and jazzed Story Time With Belle up and are adding another slightly innovative coaster with the Mine Train. Universal has added (IMO) the BEST themed area anywhere with Harry Potter, about to open up a 2nd land which I'm sure will be equally immersive, added a clone of a FANTASTIC ride with Transfomers and are opening up a whole Springfield area (not to mention the ride which is right at the 5 year mark) and Rip Ride Rockit and Despicable Me.


Disney is coasting. Going by what they had been known before. Unless they do somehow grand soon, they will be playing catch up with Universal.