Changes for Galaxy's Edge Temporarily On Hold

[wdwmagic]

They're not losing huge sums of money with those parks being closed.

They are, and you can bet it will be a significant point of discussion at the next earnings report.

 

[Sirwalterraleigh]

This... does not make any sense at all. The Asia parks are undoubtedly covered by business interruption insurance. They're not losing huge sums of money with those parks being closed.

I don’t think the two are related at all...but that won’t stopped Disney from making domestic cuts as an excuse.

Americans like nothing better than foreigners to blame...it cures all ills

 

[Sirwalterraleigh]

They are, and you can bet it will be a significant point of discussion at the next earnings report.

But is that spin? 25%? 50% 90%?

(That’s a rhetorical question...you know the answer)

 

[The_Jobu]

I'm no business man but this seems entirely counter-intuitive to me.

If some parks are closed, wouldn't you want to announce some discounts and encourage more attendance at your parks?

Why would you raise prices, lower staff, decrease guest satisfaction and de-incentivize attendance?

 

[Sirwalterraleigh]

I'm no business man but this seems entirely counter-intuitive to me.

If some parks are closed, wouldn't you want to announce some discounts and encourage more attendance at your parks?

Why would you raise prices, lower staff, decrease guest satisfaction and de-incentivize attendance?

Good management would.

Those with a countdown calendar to retirement are never “good” managers.

This is an opportunity to use the crisis, roll out a ton of promos, increase attendance and the potential to rake in more high profit ancillary spending on merch and nonsense from the customers. Easy profit, in many ways.

But the stock slaves will threaten heads will roll if the price drops $0.50 for a few months.

Not an option

 

[orky8]

I'm no business man but this seems entirely counter-intuitive to me.

If some parks are closed, wouldn't you want to announce some discounts and encourage more attendance at your parks?

Why would you raise prices, lower staff, decrease guest satisfaction and de-incentivize attendance?

Because Disney doesn’t think these things affect attendance short term and they can just save money to smooth out the quarter. Short term they might be right and vacations are booked at least for WDW. Long term damage is someone else’s problem.

 

[CaptainAmerica]

They are, and you can bet it will be a significant point of discussion at the next earnings report.

They are for now, until the insurance payments come through in about a year.

Jay Rasulo, 2012 Q2 earnings call: "At our international parks and resorts, better results from the Tokyo Disney Resort reflect the negative impact of the Tokyo earthquake during Q2 last year and the related business interruption insurance proceeds we received in Q2 this year."

...

So there's -- there are a lot of moving parts for our Tokyo results and, ultimately, their impact on the overall Parks and Resorts margins for the quarter. But the -- it was a driver. We had - first of all, we had the comparison between last year when Tokyo Disney Resort was closed for 3 weeks in the quarter versus the current week. Secondly, we had a business interruption payment this year that we received relative to that quarter. And finally, the performance of Tokyo Disney Resort actually improved over the comparable operating weeks compared to the prior year. So the aggregate benefit of all of these effects was about $50 million in Q2.

Benjamin Swinburne - Morgan Stanley, Research Division: Any -- can you quantify the onetime insurance piece of that just for our benefit?

James A. Rasulo: I'm -- yes, I'm not sure it's frankly relevant compared to the fact that the park was closed in prior year. But roughly, it's $15 million.

 

[CaptainAmerica]

I'm no business man but this seems entirely counter-intuitive to me.

If some parks are closed, wouldn't you want to announce some discounts and encourage more attendance at your parks?

Why would you raise prices, lower staff, decrease guest satisfaction and de-incentivize attendance?

I'm guessing their concern is cash flow, not revenue.

 

[ImperfectPixie]

Good management would.

Those with a countdown calendar to retirement are never “good” managers.

This is an opportunity to use the crisis, roll out a ton of promos, increase attendance and the potential to rake in more high profit ancillary spending on merch and nonsense from the customers. Easy profit, in many ways.

But the stock slaves will threaten heads will roll if the price drops $0.50 for a few months.

Not an option

Good management is very rare. And I really feel focusing so much on keeping stockholders happy is super bad for business in the long term.

 

[Sirwalterraleigh]

I'm guessing their concern is cash flow, not revenue.

Lol...why do I feel like the cashout room at Shanghai goes something
Like this:

“One for Disney....9 for the central committee”

 

[Lilofan]

Again, those are only contingencies that occur if Asian parks need to stay closed for weeks and weeks. As for cost of mini-golf... you're looking at probably four cast members per shift, two shifts per day. That's sixteen a day if both locations are "under refurbishment". Plus those locations require almost no maintenance when closed (as opposed to other outdoor locations). Extending the Typhoon Lagoon "refurbishment" significantly reduces labor costs on a much higher scale, but it still demands significant horticulture work.

I can see other cuts that guests don't see. Reduction of cast member hours, potential layoffs of salaried teams, non guest facing projects out on hold, essential and non essential expenses put on hold for guest and non guest facing departments. If companies start cutting back on business conferences, then Disney Institute, resorts that cater to convention business would be heavily impacted. And do the Disney execs still get their bonuses?

 

[CaptainAmerica]

Lol...why do feel like the cashout room at Shanghai goes something
Like this:

“One for Disney....9 for the central committee”

I'm sure Disney's insured position is commensurate with their stake in the overall venture.

 

[Sirwalterraleigh]

Because Disney doesn’t think these things affect attendance short term and they can just save money to smooth out the quarter. Short term they might be right and vacations are booked at least for WDW. Long term damage is someone else’s problem.

It is when your ceo is leaving with no succession plan...

I say this all the time and nobody wants to hear it...which makes me cranky because I have to wait to be proven right

 

[Sirwalterraleigh]

I'm sure Disney's insured position is commensurate with their stake in the overall venture.

So the Chinese insurance regulators act like those in Manhattan?

Boy that’s a lot to swallow

 

[monothingie]

I don't have any information that current construction projects could be delayed. Many of those projects would cost significantly more if delayed.

Perhaps “scaled back” would be a better description?

 

[monothingie]

They are, and you can bet it will be a significant point of discussion at the next earnings report.

Remember the big deal that was made about the Hurricanes closing WDW and the week long slow down afterwards?

 

[networkpro]

How did we get from "Changes for Galaxy's Edge Temporarily on Hold" to EPCOT Redevelopment gripes pre-20th post in the thread?

Squirrel!

 

[Family_Man]

think opening times of 10 am for non-MK parks

So. Freaking. Annoying.

 

[HauntedPirate]

A little birdie told me Disney is desperately looking at a new business venture due to the ongoing closures in Hong Kong and Shanghai:

Squirrel!

One of my son's has that shirt. It's appropriate.

 

[HauntedPirate]

Anywho, back on topic.

Not shocking at all that TWDC has gone into full panic mode, with a potential halting of any Galaxy's Edge additions for the foreseeable future - Iger's retirement depends on a robust stock price.