Attendance decline of 10% projected for Disney Parks

[crazy4wdw]

From the Orlando Sentinel:

Analysts project 10 percent attendance decline at Disney's U.S. parks
posted by Jason Garcia on Mar 30, 2009 10:58:24 AM

Analysts at Goldman Sachs are forecasting attendance at Disney’s U.S. parks will fall as much as 10 percent this year.

The firm, which downgraded shares in the Walt Disney Co. from “buy” to “neutral” last week, expects attendance declines at Walt Disney World and Disneyland to accelerate later this year. Goldman estimates that year-over-year attendance fell 4 percent during Disney’s second fiscal quarter, which ended Saturday, and that it will fall 5 percent in the third quarter and then 10 percent in the fourth, which runs from July through September.

Attendance at Disney World and Disneyland fell about 5 percent during the company’s first quarter, which ended Dec. 27.

Goldman says the attendance declines would be stepper were it not for Disney’s buy four nights, get three free hotel promotion. But that comes with its own costs – the firm projects that Disney’s hotel-room revenue will sink as much as 30 percent from a year ago.

 

[chevyrules05]

From the Orlando Sentinel:

I work at disney and I haven't seen it, it seems more busy than ever, Pops is booked solid for 3 months

 

[Condorman]

I tend to agree that the parks are more crowded than they have been in many years. However, Disney is definitely not turning a profit. Goldman Sachs is a joke with regards to analysts' assessments, so I wouldn't put much credence in their outlook.

I've said it all along, Disney would have been better off keeping it business as usual than giving away so many freebies that they can barely break even. I see them extending Free Dining through the end of the year (excluding holidays), and that will only hurt them even more.

 

[racefanof88]

I work at disney and I haven't seen it, it seems more busy than ever, Pops is booked solid for 3 months

That is funny. I was looking at rooms for a friend at Pop and she gave me 3 different dates to try 5/23-6/6, 6/6-6/12 and 7/18-7/24 and all of these dates were available. Now, she just has to decide .

 

[Mouseaholic!!!]

When you think about it - that's not far off.

Disney has already announced an 8% downturn for the first quarter ending December 2008. That's only an additional 2% as the economy has gotten worse.

Let's hope the second quarter does not live up to the rumors going around inside Disney now.

 

[Opie100]

I've said it all along, Disney would have been better off keeping it business as usual than giving away so many freebies that they can barely break even. I see them extending Free Dining through the end of the year (excluding holidays), and that will only hurt them even more.

Free Dining requires folks to pay full fare for everything else, so I doubt that will be the source of any substantive accounting pains (I believe they offer this promotion somewhat regularly). As the article read, attendance would be worse without the promotions. It's like a cruise ship, you need people in the park (or on the boat) to make your revenue targets. And it's clear projections have been revised downward to account for the economy, and labor has been reduced in step.

 

[cmash95]

Disney isn't losing money as long as they have bodies in the rooms. Funny thing is that attendance was up in january and february and they had to readjust park hours because of greater than expected crowds in march. disneyland is different, it tends to draw more on the local population to keep things going except in the summer months. ONe thing of note, while people are coming to florida, the trend is that they are driving, staying shorter stays and spending less on souveniers in the parks.

 

[Mouseaholic!!!]

Disney isn't losing money as long as they have bodies in the rooms. Funny thing is that attendance was up in january and february and they had to readjust park hours because of greater than expected crowds in march. disneyland is different, it tends to draw more on the local population to keep things going except in the summer months. ONe thing of note, while people are coming to florida, the trend is that they are driving, staying shorter stays and spending less on souveniers in the parks.

I suppose you didn't have a chance to read the Disney reports about the first quarter of this fiscal year. Park attendance down 8% and they earned 53% of each $1 earned in 2007.

I guess they are offering all these discounts on rooms because they just want to give all of us a group-hug VS a desperate attempt to get bodies into the beds.

I guess they are having all these layoffs and cost cuts because they have made a record profit?

Now we wait to see the results of the second quarter....to be announced in a couple of weeks.

 

[Opie100]

I guess they are offering all these discounts on rooms because they just want to give all of us a group-hug VS a desperate attempt to get bodies into the beds. I guess they are having all these layoffs and cost cuts because they have made a record profit?

I don't read desperation in any of Disney's moves. Even with the discounts, there are cheaper 3-4 star accommodations in the Orlando area, and even on the Disney property. And the layoffs, as a percentage of their Orlando workforce, were not outrageously large.

 

[Mouseaholic!!!]

I don't read desperation in any of Disney's moves. Even with the discounts, there are cheaper 3-4 star accommodations in the Orlando area, and even on the Disney property. And the layoffs, as a percentage of their Orlando workforce, were not outrageously large.

....but don't forget Disney has been quietly reducing it's workforce for years. We will have to see if this will impact the guest experience but a direct quote from a Disney employee in California regarding DL layoffs last week....."it's a bloodbath out here".

You BET there are great deals outside Disney gates.....Orlando just reported a 26% drop in hotel occupancy the last week in March.....hotel taxe revenue is down dramatically.


As we all know, Disney doesn't give away any discount unless they have to. The fact that you cannot go anywhere (print media, online, television, bounceback offers) and easily get discounts up to 40%, major layoffs at all Disney cost centers, reductions in the quality of dining.....and more....doesn't sound like this is going to be a banner year of success for Disney.

Desperate? Let's hope not. Worried and dealing with a very soft market....certainly yes.

There was a 2-page article in our local paper's travel section about finding affordable solutions for summer travel......first section......affordable choices OTHER than Disneyworld. Hummmmmm....not what Disney wants to see in the sunday papers.

I'm sure you realize how challenging this economy is for places like Florida...heck...look at what's happening in Las Vegas!

Disney will pull through....their pockets are deep....but it's not pretty behind the curtain right now.

 

[61292cna]

If I'm mistaken, I'm sorry, but wasn't Goldman Sachs one of the companies that was so busy dissing everyone else, that they couldn't see they were standing in poo & sinking fast? again if I'm wrong, I'm sorry.

 

[black562]

Well what I don't understand is over the past few days, the parks have been at capacity. The Magic Kingdom has been closed due to overcrowding and I've been during this time of year before and not seen anything near what they've been saying about crowd levels this year.

I know there are discounts out there, but what gives?

 

[doubletrouble_vb]

It's spring break and easter all rolled up into one. The combination makes it busy.

 

[chevyrules05]

That is funny. I was looking at rooms for a friend at Pop and she gave me 3 different dates to try 5/23-6/6, 6/6-6/12 and 7/18-7/24 and all of these dates were available. Now, she just has to decide .

I meant for the deals they offer over the summer months


every day this week magic kingdom has stop letting people in because they are capacity

 

[cmash95]

I suppose you didn't have a chance to read the Disney reports about the first quarter of this fiscal year. Park attendance down 8% and they earned 53% of each $1 earned in 2007.

I guess they are offering all these discounts on rooms because they just want to give all of us a group-hug VS a desperate attempt to get bodies into the beds.

I guess they are having all these layoffs and cost cuts because they have made a record profit?

Now we wait to see the results of the second quarter....to be announced in a couple of weeks.

for those of you who doin't know disney's fiscal year starts october 1. so their first quarter was october, november an december of last year!!!
for their profits to only fall 33 percent that tells you what condition things are like financially for the parks. attendance was up in january for all of orlando attractions and college breaks are traditionally in march, so we shall see howthings went. I have read that eventhough people are taking vacations, they are cutting back on the amount of merchandise and extra snacks they buy while there and that is a large chunk of money for the parks right now. but now that they have combined the DL and WDW merchandise depts, I am sure that won't matter as much as they will have basically the same items for sale on both coasts. but then they have been doing that for a couple of years now.