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  1. #1

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    HK Disney taking a loss, Paris Disney profiting in hotels

    Just an article in Hong Kong Disney from the HK Standard. Low attendance is hurting the park for further funding.

    Disney facing finance poser

    Benjamin Scent

    Thursday, May 10, 2007


    Declining attendance numbers and guest spending at Hong Kong Disneyland are likely to leave Walt Disney Co unable to draw on a US$294 million (HK$2.29 billion) revolving credit facility, the company said. "Hong Kong Disneyland may require alternative sources of financing to meet its operating and development needs," Burbank, California-based Disney said in a filing with the US securities regulator.
    "Hong Kong Disneyland is engaged in discussions with the Walt Disney Company and Hong Kong Disneyland's other shareholder regarding financing options aimed at advancing its long-term financial and development needs," a spokesperson for Hong Kong Disneyland said.
    The Hong Kong government owns 57 percent of Hongkong International Theme Parks, which operates Hong Kong Disneyland in a joint venture with the US giant, which holds the remaining 43 percent interest.
    "Our discussion does not involve seeking additional funds from the government," the spokesperson said.
    Disney expects to make an additional investment as part of the new financing arrangement. Alternative financing arrangements would need to be completed before September 30, when the performance stipulations of the revolving credit facility will be measured.
    "Although there is no assurance that acceptable financial arrangements can be obtained prior to September 30, 2007, management currently expects that Hong Kong Disneyland will be successful in developing financial arrangements necessary to meet
    its financial and development needs," Disney said.Disney announced Wednesday that second-quarter profits jumped 27 percent on the success of road-trip movie Wild Hogs and growth at cable sports channel ESPN.
    Second-quarter revenues from Disney's parks and resorts division climbed 9 percent to US$2.4 billion and segment operating income increased 19 percent to US$254 million.
    Revenue increases from higher theme park attendance, guest spending, and hotel occupancy at Disneyland Resort Paris "were partially offset by lower guest spending and theme park attendance at Hong Kong Disneyland Resort," Disney said. Hong Kong Disneyland also saw a decline in operating income during the second quarter ended March 31.
    "We're launching several marketing initiatives to boost attendance and address seasonality of the [Hong Kong] park," Disney senior executive vice president and chief financial officer Tom Staggs said in a conference call with analysts.
    "We view Hong Kong Disneyland as a valuable asset in a rapidly growing market and we're confident in and committed to this project. We'll likely continue to invest in the park to help ensure its long-term success."
    A spokesperson for Hong Kong Disneyland said the park recognizes that attendance and guest spending have fallen short of initial expectations, although "guest satisfaction continues to climb higher, reflecting continuous improvement in park operations and guest service."
    Meanwhile, the Tourism Commission said the SAR government has no plans to use public funds to increase its investment in the Hong Kong Disneyland joint venture.

  2. #2

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    Re: HK Disney taking a loss, Paris Disney profiting in hotels

    I think they need new rides and fast if this article has merit.

    Even in Disneyland California you see new rides opening every year. Even though I'm no expert on theme parks, not having a new ride open in 2007 was a big mistake especially when many complain about not having enough things to do there.

  3. #3

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    Re: HK Disney taking a loss, Paris Disney profiting in hotels

    Poor DLP. It has HKDL on it's back now. It just can't get a break.
    "As usual he's taken over the coolest spot in the house"- Father re: Orville 1963

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  4. #4

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    Re: HK Disney taking a loss, Paris Disney profiting in hotels

    Anybody knows how HKDL performed during the China Golden Week?

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    Re: HK Disney taking a loss, Paris Disney profiting in hotels

    Just as Paris is looking up HK pulls it down...

    Disney needs to start investing in HK urgently. They built it to small and they wonder why no one is coming, people need to see something to come! Just look at WDS in Paris, one has to ask why they built HK in the same vien...

  6. #6

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    Re: HK Disney taking a loss, Paris Disney profiting in hotels

    ORGOCH: 'Cause they's stupid an' don't know how ta learn from their past mistakes!!!

  7. #7

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    Re: HK Disney taking a loss, Paris Disney profiting in hotels

    I hope Disney is taking note that a major catalyst to drive Paris' initial rise to profitability was the opening of Space Mountain in 1995. The resort apparently made money between Space Mountain opening and the construction of Walt Disney Studios Park, which hit the resort hard with a lot of debt, negative publicity and poor patronage.

    If HKDL learnt anything from Paris it is hopefully that an amazing, unique and extremely memorable E-ticket can do wonders for a park that is under-performing. Such an attraction gives it something that people associate with the park, offering an experience that can't be matched anywhere, even at other Disney parks.

    Thus Disney should hurry up and arrange a financing deal to build a huge, cut-above-the-rest E-ticket masterpiece to get this park on the right track, because IASW certainly isn't going to meet such requirements.
    The rumored Pirates land with POTC ride as a centerpiece could achieve such a goal if done correctly - an amazing, superior version of the classic as Paris' Space Mountain was a unique version of that attraction.
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  8. #8

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    Re: HK Disney taking a loss, Paris Disney profiting in hotels

    It needs something that will blow away Chinese audiences and the competing Ocean Park.

  9. #9

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    Re: HK Disney taking a loss, Paris Disney profiting in hotels

    Why is it that Disney can't get it right the first time when they open a new park? Just look at the problems they've had with DLP, WDS, AK, DCA, and HKD.

  10. #10

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    Re: HK Disney taking a loss, Paris Disney profiting in hotels

    Quote Originally Posted by kirbilicious View Post
    Why is it that Disney can't get it right the first time when they open a new park? Just look at the problems they've had with DLP, WDS, AK, DCA, and HKD.
    You forgot to put Disneyland, Tokyo Disneyland, MGM, and TDS as parks that had problems the first time they opened. Wow the Epcot and the Magic Kingdom at WDW are the only parks that had no problems.

  11. #11

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    Re: HK Disney taking a loss, Paris Disney profiting in hotels

    ORDDU: The problems Disneyland and Tokyo had don't begin to compare with the problems Hong Kong Disneyland is currently having. When Hong Kong Disneyland was in development, Mr. Eisner and Mr. Pressler were in charge of things. That says it all.

    ORWEN: Of course a witch has to wonder why Bob Iger hasn't done more to come to the rescue of this little half-baked park. It's almost as if he's unaware it exists.

  12. #12

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    Re: HK Disney taking a loss, Paris Disney profiting in hotels

    Quote Originally Posted by MickeyMoose View Post
    You forgot to put Disneyland, Tokyo Disneyland, MGM, and TDS as parks that had problems the first time they opened. Wow the Epcot and the Magic Kingdom at WDW are the only parks that had no problems.
    How did Tokyo DisneySea have problems when it first opened? It was the fastest theme park to reach 10 million visitors, which it did in only 10 months after its opening date. Tokyo DisneySea had the most successful opening out of any Disney park.
    ~ Tokyo DisneySea’s Arabian Coast at nighttime ~


  13. #13

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    Re: HK Disney taking a loss, Paris Disney profiting in hotels

    Do you really see Disney funding this massive E-Ticket that the park needs? I dont think so.

    All the park will get is clones of some Fantasyland Atrractions...

    HK Disney is currently in serious trouble...

  14. #14

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    Re: HK Disney taking a loss, Paris Disney profiting in hotels

    Good point about Tokyo DisneySea.

  15. #15

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    Re: HK Disney taking a loss, Paris Disney profiting in hotels

    Quote Originally Posted by CaliforniaAdventurer View Post
    Good point about Tokyo DisneySea.
    Here's the article about Tokyo DisneySea's immediate success if anyone is interested (special thanks to JoeInJpn) :

    Disney's new Japan theme park hosts 10 million visitors in shortest time

    TOKYO - Walt Disney Co.'s newest amusement park in Japan welcomed its ten-millionth visitor since opening last year — reaching the milestone in the shortest time recorded so far, a spokeswoman said Monday.

    The new mark came Sunday, 307 days after the DisneySea amusement park's Sept. 4 opening, said Oriental Land Co. spokeswoman Marie Iwamoto.

    Oriental Land Co. is the Japanese developer that operates DisneySea and the older Tokyo Disneyland, which are built next to each other in a suburb of Japan's capital.

    The previous shortest period needed to attract 10 million guests at any amusement park in the world was in March, 338 days after the opening of a Universal Studios facility in the western Japanese city of Osaka, according to figures monitored by Oriental Land.

    Iwamoto said that Tetsuya Goto, a civil servant from Oita prefecture (state) in southwestern Japan, received a certificate marking the milestone Sunday. He was visiting DisneySea with five other family members.

    The park's attractions include a roller coaster that shoots through a tunnel filled with luminescent creatures and "20,000 Leagues Under the Sea," a ride over an artificial water terrain of anemone and coral viewed through bubbly glass.

    Of the 10 million visitors at DisneySea, Iwamoto said that nearly 97 percent were Japanese, while the remainder cam from abroad, mostly other Asian countries.
    ~ Tokyo DisneySea’s Arabian Coast at nighttime ~


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