For those that say "Disney doesn't spend money on the parks"

[skier_pete]

So, I was looking through the 2009 Financial Report for the Walt Disney Company (looking for something else) and noticed this under "Investing Activities":


2008 Capital Expenditures - Parks & Resort Domestic : $793 million
2009 Capital Expenditures - Parks & Resort Domestic : $1,039 million

Disney INCREASED capital expenditures last year by 31 %! That is huge! This figure is described as being "principally for theme parks and resort expansion, new rides and attractions, cruise ships recurring capital and capital improvements." They indicate the rise "reflected spending on Disney's California Adventure expansion and construction progress payments on two new cruise ships". Note none of this counts as the Fantasyland expansion.

My point is, those that complain about Disney World not putting in enough new rides, or not putting in a new country in Epcot, or expanding AK, or whatever, and saying the reason is "Disney is too cheap!" is not looking at the numbers properly.

When you complain that Disney is not spending money...your really complaining that Disney is not spending money where YOU want them to. I myself believe once the DCA expansion is complete, we will see additional investment in Florida past the Fantasyland expansion.

Disney-haters - flame-on!

 

[TisBit]

I agree that Disney does invest in their parks. Most people might not see a brand new state of the art ride every year, but the rides that are there and are classics don't look old or in need or repair, like you find at many other theme parks. Disney doesn't have to reinvent the wheel or constantly rip rides out to make new ones to keep people coming.

As for the numbers....I am sure a large part of that expenditure is for the Wonder, so people at WDW or even DL won't see where the investment was made.

Truth is, if everyone is so disappointed in Disney and the parks, why are they still going. Disney doesn't have to justify themselves to a few posters online, they will base their business model off of the number of people coming to the parks every day.

 

[Oglet]

I agree that Disney does invest in their parks. Most people might not see a brand new state of the art ride every year, but the rides that are there and are classics don't look old or in need or repair, like you find at many other theme parks. Disney doesn't have to reinvent the wheel or constantly rip rides out to make new ones to keep people coming.

As for the numbers....I am sure a large part of that expenditure is for the Wonder, so people at WDW or even DL won't see where the investment was made.

Truth is, if everyone is so disappointed in Disney and the parks, why are they still going. Disney doesn't have to justify themselves to a few posters online, they will base their business model off of the number of people coming to the parks every day.

So very true however I would like to see new Monorails put in to service, its honestly time they replaced them.

I have to give Disney credit, what other company could decide to build a path and manage to have people buy every brick needed to complete it?

 

[mousermerf]

Not to be too pessimistic but:

Disney Cruise Line is part of Parks and Resorts. Thus, building new ships and the expense related to it reflects on the "Parks" statement, while it was effectively not money spent at all on a park.

 

[nytimez]

I believe the costs of building a DVC resort are also part of this. I wonder how much of it is purely on theme parks, and of that what's at WDW alone -- and how that number has changed from year to year.

But i think even that number would surprise people -- Disney has been steadily adding major attractions at all its theme parks in recent years, and the Fantasyland expansion will be a huge project.

But as OP stated, people will complain if the money isn't spent where they want to see it spent.

 

[mousermerf]

I believe the costs of building a DVC resort are also part of this. I wonder how much of it is purely on theme parks, and of that what's at WDW alone -- and how that number has changed from year to year.

But i think even that number would surprise people -- Disney has been steadily adding major attractions at all its theme parks in recent years, and the Fantasyland expansion will be a huge project.

But as OP stated, people will complain if the money isn't spent where they want to see it spent.

Orlando Sentinel ran an article about construction at WDW using permits pulled from official records and counting the number of permits per year and the amount of money cited in the permits. The last few years were down ridiculously in comparison to the past. It's starting to trend up a little with Fantasyland being expanded.

 

[skier_pete]

Disney doesn't have to justify themselves to a few posters online, they will base their business model off of the number of people coming to the parks every day.

So true!

I have to give Disney credit, what other company could decide to build a path and manage to have people buy every brick needed to complete it?

And charge $95 a brick to do it...and the people are thrilled! A company like that's gotta make money, huh?

Not to be too pessimistic but:

Disney Cruise Line is part of Parks and Resorts. Thus, building new ships and the expense related to it reflects on the "Parks" statement, while it was effectively not money spent at all on a park.

Yes, in my OP I clearly stated that that money is in the Cruise line. But, that is still part of capital. When you are a division of a company, you are only given a certain amount of capital to spend. Each segment of that division can request capital, but overall the capital will be limited by some amount. I was just impressed by how MUCH capital was being spent, regardless of where...companies rarely increase capital expediture by that much.

And that's what I was trying to get across...you may argue with where Disney is spending the money...but you can't claim they aren't spending money.

I believe the costs of building a DVC resort are also part of this. I wonder how much of it is purely on theme parks, and of that what's at WDW alone -- and how that number has changed from year to year.

But i think even that number would surprise people -- Disney has been steadily adding major attractions at all its theme parks in recent years, and the Fantasyland expansion will be a huge project.

But as OP stated, people will complain if the money isn't spent where they want to see it spent.

DVC is most certainly included in this, but I am not sure how big that chunk was in fiscal 2009, BLT was completed in 2008,and the Hawaii project is underway, but not being built at THAT fast a rate. I DID try to get a more specific breakdown, but the report didn't break it down that far. I'm sure a big chunk is the Disney Wonder and DCA...again, I really think DCA is the big reason we haven't seen much going into WDW parks in 2008-2011. But then once DCA goes away, the capital will shift back to WDW. Fantasyland is a part of that, but not all. I would almost bet we will see something similar to the 2006-2007 when every park was getting something new, such that in 2012-2014 we will see something new in DHS and AK, as well as a major attraction overhaul in Epcot (Wonders of Life or Imagination perhaps?). All speculation on my part...and tangential to my original post.

 

[mousermerf]

My stance has always been that they spend money in the wrong places - I never claimed they don't spend money.

Everest, M:S, and SSE are prime examples of mismanagement of funds in the parks themselves. A large part of Everest's money was put into the broken-for-over-a-year Yeti that is only shown for 3 seconds on the ride. That's a total waste, no matter how "cool" the technology was.

Like using a fully self aware android as an iPod.

Similarly M:S focused so much on the ride system that is effectively forgot about the show. The graphics are subpar, the loading/unloading area is abysmal and unthemed.

Then Spaceship Earth spent all of its money on the screens which are used twice during the ride - why not use them throughout? - and to the point that the refurb ran out of money and entire planned show scenes are missing and replaced permanently with black curtains.

 

[nytimez]

So true!

DVC is most certainly included in this, but I am not sure how big that chunk was in fiscal 2009, BLT was completed in 2008,and the Hawaii project is underway, but not being built at THAT fast a rate.

I don't have the specifics, but usually major expenditures such as construction are financed. The completion of BLT in 2008 doesn't mean the project is paid in full, or even close to it. My guess is they're still paying for Kidani, Saratoga Springs, etc. as well.

 

[movie77]

count me as not impressed with their investment in WDW. Even the vaunted Fantasyland redo is only one new ride. Let's see what they announce in the next few years as a follow-on

 

[skier_pete]

My stance has always been that they spend money in the wrong places - I never claimed they don't spend money.

Everest, M:S, and SSE are prime examples of mismanagement of funds in the parks themselves. A large part of Everest's money was put into the broken-for-over-a-year Yeti that is only shown for 3 seconds on the ride. That's a total waste, no matter how "cool" the technology was.

Like using a fully self aware android as an iPod.

Similarly M:S focused so much on the ride system that is effectively forgot about the show. The graphics are subpar, the loading/unloading area is abysmal and unthemed.

Then Spaceship Earth spent all of its money on the screens which are used twice during the ride - why not use them throughout? - and to the point that the refurb ran out of money and entire planned show scenes are missing and replaced permanently with black curtains.

While I'll agree on the Yeti as a spectacular failure in and of itself (and showing it for only 3 seconds was poor design as well...I don't think the ride is in any way a misuse of funds. It not only did what it intended to do (drive people to AK) it is a pretty unique roller coaster that's very entertaining without being so thrilling as to scare a vast majority away from riding it. Did WDI blow it on the yeti...yes...but the average guest experience isn't affected by that. I don't think that comes down to mismanagement of funds.

M:S I will agree with you 100 %. (Though Soarin' came after it and was a good use of money spent in Epcot.)

SSE is irrelevant to the argument, because the money spent there was miniscule compared to numbers we are discussing. But, to get into it, I don't think you WANT those screens used throughout the ride. It's a DARK ride. If the screens were used throughout, it would distract to much from the actual ride...and the cost of those screens have to be absolutely trivial. (Plus, our family loves the little movies at the end.)

I don't have the specifics, but usually major expenditures such as construction are financed. The completion of BLT in 2008 doesn't mean the project is paid in full, or even close to it. My guess is they're still paying for Kidani, Saratoga Springs, etc. as well.

Don't know how Disney does it, but typically Capital reported in an annual report is the actual cost of the construction during that time. This is why big corporations don't like spending capital...it hits the bottom line NOW. The capital is then depreciated over a period of time, usually much shorter than the actual use time (typically 5-10 years), but the write-down of the capital takes much longer than the actual capital spend. Financing done by a company is usually kept as a separate bucket completely. Though - truthfully DVC MAY do things differently - I didn't get into that.

 

[skier_pete]

count me as not impressed with their investment in WDW. Even the vaunted Fantasyland redo is only one new ride. Let's see what they announce in the next few years as a follow-on

Well, I would argue it's also a potentially pretty cool restaurant...the rest is pretty much trifle.

But let's give Disney it's due here: Name the last time something of this scale has been added to an existing park in WDW? The last new ride in MK (and we're not talking a re-furb of an existing ride structure like Pooh or Buzz or Alien Encounter) was Splash Mountain almost 20 years ago. A NEW ride is a genuine big deal at MK. (And please don't come back at me with "but they are just replacing 20,000 leagues!" That's been dead and gone 15 years, and it does not count.)

 

[TheRustyScupper]

My point is, those that complain about Disney World not putting in enough new rides, or not putting in a new country in Epcot, or expanding AK, or whatever, and saying the reason is "Disney is too cheap!" is not looking at the numbers properly.

1) Sure we are.
2) Rides and attractions impact us.
3) And park ride capacity (to reduce crowding)
4) Other expenditures do not.
5) Besides, how much of the spending was
. . . crusie line ?
. . . parks in other coutries ?
. . . general maintenance and upkeep ?

 

[skier_pete]

1) Sure we are.
2) Rides and attractions impact us.
3) And park ride capacity (to reduce crowding)
4) Other expenditures do not.
5) Besides, how much of the spending was
. . . crusie line ?
. . . parks in other coutries ?
. . . general maintenance and upkeep ?

First off...international parks is a separate bucket - so the answer there to that one in $0. International capital spending was flat (around $145 million) versus the 31 % increase on US spending.
Second, general maintenance and upkeep would not normally be considered under a capital expenditure, unless it was a full replacement. (You paint the facade of a structure - not capital. You tear down and replace - could be capital.)
Cruise line is definitely included.

But what I am saying is that ARE spending money on Ride / Attractions / Capacity, things that impact the guest...just not so much in Florida right now because it's being spent in California. You can't realistically expect a company to make that huge investment in one location and at the same time at another.

An analogy would be you want to have both your kitchen and your main bathroom remodelled, but you only have the money to do one. Which do you choose. Well, you just did a bunch of stuff in the bathroom a few years ago but still looks pretty good, but the guy who installed the kitchen when it was built did a lousy job of it, the cabinets are too small and the dishwasher leaks, and the tiles are pealing off the walls. You choose the kitchen, and the bathroom has to wait a few years.

 

[Disco]

Disney is definitely spending a ton of money lately. Unfortunately one of their largest ticket expenditures is for correcting a mistake. Throwing a billion dollars at redoing their newest park in the US is just an epic failure in everyone’s book. If they built it right in the first place they would probably been able to redo an older park that is more deserving of the money (DS or Epcot).
Also many of their recent expenditures have been on things most people don't care about. DVC is a total waste in my view. It obviously hasn't contributed anything major to Disney's bottom line as well. All it has done is maybe shifted some of the crowd base from their deluxe hotels to their time shares. It didn't significantly attract new park goers and it didn't entice people to come more often. They may be getting a little more money on an individual basis but considering the capital investment it seems pretty irrelevant. If they spent the money on park upgrades instead they would have definitely increased park attendance. Look at how much one stupid little ride (TSM) has helped out the Studios attendance.
Now we have this assonating Golden Oaks project that is just Disney selling (out) its valuable assets that should be reserved for entertainment only. If every couple years Disney wants to sell off a bit of land for a quick buck the whole point of DW land purchase would have been completely in vain.
The LM is just a replacement for 20,000 Leagues it's just 10 years late in coming (probably due to their billion dollar epic mistakes). I'll hold my judgment till I ride it but considering that the new ride fits in the corner of the attraction it is replacing, I can't conceive it as being nearly as good. The only thing that could possibly be considered an expansion in the FL refurb is the restaurant and in my current opinion that is at the sacrifice of a good ride.

 

[Disco]

An analogy would be you want to have both your kitchen and your main bathroom remodelled, but you only have the money to do one. Which do you choose. Well, you just did a bunch of stuff in the bathroom a few years ago but still looks pretty good, but the guy who installed the kitchen when it was built did a lousy job of it, the cabinets are too small and the dishwasher leaks, and the tiles are pealing off the walls. You choose the kitchen, and the bathroom has to wait a few years.

LOL it wasn't the guy who installed the kitchen that did the lousy job. You decided to put all the appliances in the separate corners of the kitchen segregated by a maze of cabinets totally disrupting any logical workspace flow. You also decided to use dated 60's decor and styling (avocado green fridge, country oak cabinets and puke brown plaid wall paper) because that was what everyone else in the area was using.
Now your wife is nagging at you for wasting a ton of money to redo what you just built. All the while her new SUV is sitting in the driveway; because the garage is full of boxes, and you will not have the money to expand it into that three car garage you’ve been promising her.
Oh yea, I have the marriage life analogies down pat…

 

[skiingfast]

Disney is definitely spending a ton of money lately. Unfortunately one of their largest ticket expenditures is for correcting a mistake. Throwing a billion dollars at redoing their newest park in the US is just an epic failure in everyone’s book. If they built it right in the first place they would probably been able to redo an older park that is more deserving of the money (DS or Epcot).

A large part of the money Disney spent when building DCA was on a hotel, DTD and a parking garage. They are only fixing the smallest component.

Also consider how DCA would of turned out if they were given 2 billion the first go around instead of 1 then and 1 later.

Really take time to think about what was there that needed fixing, if it was redone or repainted. Think about how much wasn't there in the first place that is part of this new expense.

 

[skiingfast]

When you complain that Disney is not spending money...your really complaining that Disney is not spending money where YOU want them to. I myself believe once the DCA expansion is complete, we will see additional investment in Florida past the Fantasyland expansion.

Disney-haters - flame-on!

This is a great point, posters seem to think if it isn't in Florida that nothing is being done.

Honk Kong is getting a DL expansion, another land. The bay where it is built now has a plot mirroring the first park of roughly the same area. DLP studios got a huge expansion. The new ships are coming in at 1.5 billion.

This is a lot coming from a TV/Movie company when US theme park companies are of more value for the land they sit on than the business they operate.

The tune of nothing being done will change when people are in the FLE.

 

[Disco]

A large part of the money Disney spent when building DCA was on a hotel, DTD and a parking garage. They are only fixing the smallest component.

Also consider how DCA would of turned out if they were given 2 billion the first go around instead of 1 then and 1 later.

Really take time to think about what was there that needed fixing, if it was redone or repainted. Think about how much wasn't there in the first place that is part of this new expense.

True that they are spending money to expand as well as renovate DCA. However, I highly doubt that CA was the "smallest component" of the entire original project. They are spending 1 billion just to renovate that smallest component and expand it by about 25%.

 

[eliza61]

So, I was looking through the 2009 Financial Report for the Walt Disney Company (looking for something else) and noticed this under "Investing Activities":


2008 Capital Expenditures - Parks & Resort Domestic : $793 million
2009 Capital Expenditures - Parks & Resort Domestic : $1,039 million

Disney INCREASED capital expenditures last year by 31 %! That is huge! This figure is described as being "principally for theme parks and resort expansion, new rides and attractions, cruise ships recurring capital and capital improvements." They indicate the rise "reflected spending on Disney's California Adventure expansion and construction progress payments on two new cruise ships". Note none of this counts as the Fantasyland expansion.
.

Disney-haters - flame-on!

First of all, we don't have to be disney haters to want to see collective changes. I actually think it's the opposite. I think alot of the complainers are like myself, people who go to Disney a lot, who remember when Disney was the epitome of service and quality and want a return to those days.
and I simply do not buy the argument "every one is cutting back" or any other excuses we give disney a free pass on.

Now I rarely read companies budget sheets so I can't comment on the dollar figure but I can comment on some issues that I see.

Let's see, how many times has that stupid Yeti been inoperable? Sorry its a relatively new ride and it's never been fully functional.
Getting rid of live entertainers that made your trips more than just about the rides (4 for a dollar, the adventurers club)
The "generic-sizing" of every thing. Gifts shops now simply carry the same stuff park after park, resort after resort.

Common complaint of mediocre food. Sorry, once again I don't care if it's caused by free dining, the ddp, or a rise in food cost. Fix the problem. My family owned and operated a restaurant in NYC for 40 years until my uncle and grandfather died. Don't tell me quality food cannot be served to a large number of peple. millions of places do it every day. Any time you go to a steak house and people rave about the bread (Le Celliar) that's a problem.

Sorry I love the world and I fully admit to suffering from "back in the dayitis" but for me I don't want the fastest, latest rollar coaster. I want the 1st class service (too many complaints about lousy or mediocre housekeeping) that Disney was built on to return.

So I guess you're right, maybe they aren't spending it on the things I want but look at it this way, if you're seeing an increase in complaints here on the DIS all these people aren't haters.