Shanghai Disneyland will reopen next week, as Disney begins the process of recovering from the pandemic that has hammered the company's operations around the world.
The Walt Disney Company reported its second quarter results today, as the company's theme parks remain closed due to the pandemic. Theme park segment revenue was down 10 percent to $5.543 billion during the three months ending March 31, 2020, with operating income dropping 58 percent to $639 million.
"We estimate the total impact of COVID-19 on segment operating income in the quarter was approximately $1.0 billion," Disney said in its earnings report. "Prior to the closure of our domestic parks and resorts, volumes and guest spending were higher compared to the prior-year quarter."
Disney said that theme park attendance was down 11 percent for the quarter, with the closures responsible for an adverse impact of 18 percent on attendance growth. Disney attributed more than half of the billion-dollar Covid-19 hit to its domestic parks, with the international parks and cruise line closures accounting for the balance.
"While it's too early to predict when we'll be able to begin resuming all of our operations, we are evaluating a number of different scenarios to ensure a cautious sensible and deliberate approach to the eventual reopening of our parks," Disney CEO Bob Chapek said during Disney's conference call with investors.
"As you know, our parks have been closed around the world: Shanghai and Hong Kong since January, Tokyo since February, and our US and Paris parks since mid-March. The approach we take may include implementation of guest capacity and density control measures, as well as health and prevention procedures that comply with state and federal guidelines.
"We are seeing encouraging signs of a gradual return to some semblance of normalcy in China, and in light of the lifting of certain restrictions in recent weeks, and the successful reopening of our park adjacent retail and food and beverage area, Disneytown, we and our government partners, Shanghai Shendi Group, plan to open Shanghai Disneyland on May 11.
"We will take a phased approach with limits on attendance, using an advanced reservation and entry system control guests tend to be using social distancing and strict government required health and prevention procedures. These include the use of masks, temperature screenings, and other contact tracing and early detection systems."
Disney's chief medical officer for its theme parks has published more details about Disney's potential new operational procedures once its theme parks reopen.
Chapek said that Disney's parks will reexamine some of its capital plans as well as changing its operations, as the company looks to recover from the pandemic.
"Obviously, we had a lot of really big plans in the park so we still continue to have big plans," he said. "Things that were good ideas before COVID are going to be really good ideas after."
"There are certain you know trimmings that we're doing here and there, to be responsible from a financial standpoint, but we have such great intellectual property in our Imagineers over at our theme parks, where the majority of our capital goes - they have done such a tremendous job of planning out future experiences for our guests that we're just going to go ahead and take a slightly finer-tooth comb, if you will, through those expenditures, but essentially I plan on investing behind those businesses like we always have."
Returning to Shanghai, Chapek said that the government has requested that Shanghai Disneyland open at no more than 30 percent of its 80,000 person per day capacity but that the resort will admit fewer guests than that when it first reopens, before ramping up to that new, 24,000 person per day standard. All guests will be required to wear masks to enter, as well.
Here is Shanghai Disneyland's reopening press release, with more details for potential visitors. For presale tickets to Shanghai Disneyland, please visit our travel partner's Shanghai Disneyland tickets page.Tweet
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