Disney’s Q1 FY21 Earnings Results Webcast - February 11, 2021

[havoc315]

Disney will get a piece of that. Nobody will be traveling to Mexico and even the Caribbean will be limited. People will go plenty of other places too, but there will be an overall surge of pent up travel demand which will be let loose once people get the vaccine. Disney has a unique problem in that lots of people who visit have kids and kids won’t be eligible for a vaccine right away, but it seems like a lot of people with kids are dismissing that risk because of the narrative that kids don’t get as sick with Covid. Some may be more cautious but a lot will not worry about it. I am not saying there will be anything like a return to normal business by the summer but a significant increase from today is still well below normal so it’s possible to be well below normal levels and also see a surge in demand.

And that’s where I completely disagree. You’re saying they will return to their normal attendance levels this summer. (Which is 50-60% of capacity).

I’m saying there is no way that happens before the fall. If they went to normal attendance while still having tons of entertainment, character meets, etc, offline., without the college program staffing, etc.. it would translate into Christmas-like lines all summer.

No signs that operations will return to anything close to normal over the summer. Tons of hotel rooms will still be offline.

So WDW clearly anticipates keeping attendance below historical averages... which translates to capacity between 35-45% or so.

Most likely, WDW will continue to follow CDC recommendations. When CDC drops the warning against large gatherings, WDW will make major changes.

 

[MisterPenguin]

It was announced a month ago, nothing has dramatically changed in the last 4 weeks.
End of April is when there will likely be enough availability where general population can start signing up for appointments. It will still take months thereafter to deliver the doses.

By the end of May, without AZ but with Novavax and J&J, there will be enough vaccines for 425M people in the U.S.

This is being hashed out in the Vaccination thread.

K, thanks.

Update...

Here's what I got so far (in millions):

• Pfizer: 300 doses (150 people vaccinated). End of March, 120 doses. End of May (originally end of June), 100 doses. End of Summer, 100 doses.
• Moderna: 300 doses (150 people vaccinated). End of March, 100 doses. End of May (originally end of June), 100 doses. End of Summer, 100 doses.
• Astrazeneca/Oxford: 150 doses (75 people vaccinated). End of May, 75 doses. End of Summer, 75 doses.
• Novavax: 110 doses (55 people vaccinated). End of May, 110 doses.
• J&J: 200 doses (an extra 100 was ordered) which is 200 people vaccinated (only 1 dose needed). End of March, 60 doses. End of June, 40 doses. End of Summer, 100 doses.

That is a total of 715 people vaccinated. Twice the population of the U.S.


Timeline in adults vaccinated and percentage of all adults:

• End of March: 210 adults vaccinated. 68% of all adults.
• End of May: 280 more adults vaccinated for a total of 490 theoretical adults vaccinated. 159% of all adults.
• End of Summer: 225 more adults vaccinated for a total of 715 theoretical adults vaccinated. 231% of all adults.

We could hit herd immunity by the end of March. Certainly by the end of April unless the three other vaccines never get approved.

 

[MisterPenguin]

You’re ignoring a few key facts:

1. they are planning FOLTK WITH social distancing. If they anticipated phasing social distancing out over the summer, there would be no need to re-design the show.
2. On an average pre-Covid day, attendance was about 50-60% of capacity. 50-60% capacity requires nearly 100% operations. Thus, 50% capacity would be limiting the crowd to an average summer day attendance. Maybe just slightly lower than an average summer day.

Moving beyond 50% capacity would require nearly 100% operations... you think they will be at nearly 100% operations by spring/summer? Seems extremely unlikely.

Things have changed in a month. A month ago, Dr. Fauci wasn't saying that every adult who wants a vaccine can get one by the end of April.

Every week for the past few weeks there have been announcements of increased production.

 

[GoofGoof]

And that’s where I completely disagree. You’re saying they will return to their normal attendance levels this summer. (Which is 50-60% of capacity).

I’m saying there is no way that happens before the fall. If they went to normal attendance while still having tons of entertainment, character meets, etc, offline., without the college program staffing, etc.. it would translate into Christmas-like lines all summer.

No signs that operations will return to anything close to normal over the summer. Tons of hotel rooms will still be offline.

So WDW clearly anticipates keeping attendance below historical averages... which translates to capacity between 35-45% or so.

Most likely, WDW will continue to follow CDC recommendations. When CDC drops the warning against large gatherings, WDW will make major changes.

I never said they would return to normal attendance levels this summer. You want to argue against that but I’m not actually saying it. I said repeatedly it won’t be a return to normal levels. I don’t see little or no change to Covid restrictions before end of year. I think there will be a gradual changes starting soon and continuing through the summer. We can agree to disagree on that at this point.

 

[havoc315]

I never said they would return to normal attendance levels this summer. You want to argue against that but I’m not actually saying it. I said repeatedly it won’t be a return to normal levels. I don’t see little or no change to Covid restrictions before end of year. I think there will be a gradual changes starting soon and continuing through the summer. We can agree to disagree on that at this point.

ok. But you suggested my 40-50% summer capacity projection was too low. Any higher than that would be normal attendance. I expect attendance limits — meaning capacity remaining below 50% — until fairly late in the year. And that’s simply reading the tea leaves.

Happy to respectfully agree to disagree.

 

[GoofGoof]

ok. But you suggested my 40-50% summer capacity projection was too low. Any higher than that would be normal attendance. I expect attendance limits — meaning capacity remaining below 50% — until fairly late in the year. And that’s simply reading the tea leaves.

Happy to respectfully agree to disagree.

My opinion is demand will dictate capacity not limits. So on a random Tuesday at the end of August it won’t matter if there is a capacity limit because demand won’t be there. On Juiy 4th or a busy Saturday in July/August I don’t believe Disney will still limit all 4 parks to 40% capacity. They can ramp up staffing on the weekends and will continue that into the summer.

 

[HauntedPirate]

Spend $10k for reduced offerings at WDW, or spend half that, or even less depending on the destination, to go someplace warm and on a beach? My decision is simple right now. Many places WANT your business and are willing to show you that. Disney isn’t one of those places. And I say that as someone who is going next month with the family (to show one of our kids why we don’t go around his birthday, because prices have been and continue to be quite high), which could be my last planned trip there for a while.

 

[seabreezept813]

Spend $10k for reduced offerings at WDW, or spend half that, or even less depending on the destination, to go someplace warm and on a beach? My decision is simple right now. Many places WANT your business and are willing to show you that. Disney isn’t one of those places. And I say that as someone who is going next month with the family (to show one of our kids why we don’t go around his birthday, because prices have been and continue to be quite high), which could be my last planned trip there for a while.

I’m wondering if people will just want a beach trip this year from burnout.. I can’t be the only one totally exhausted from all of this especially with no opportunities to go out without the kids (think date night etc.). Another factor is the planning for wdw takes like a year plus. With everything being in limbo it might actually be tough to plan a trip for this summer.. or maybe that’s just me who plans meticulously.

 

[the.dreamfinder]

I’m wondering if people will just want a beach trip this year from burnout.. I can’t be the only one totally exhausted from all of this especially with no opportunities to go out without the kids (think date night etc.). Another factor is the planning for wdw takes like a year plus. With everything being in limbo it might actually be tough to plan a trip for this summer.. or maybe that’s just me who plans meticulously.

You could rent a two story beachblock house for the same nightly rate as the GF or BW.

Beachfront House w/ POOL at 5 94th St. Stone Harbor & Avalon PERFECT LOCATION - Stone Harbor

House - $967 avg/night - Stone Harbor - Amenities include: Swimming pool, Internet, Air conditioning, Pets welcome, TV, Satellite or cable, Washer & dryer, Parking, No smoking, Heater ✓ Bedrooms: 5 ✓ Sleeps: 14 ✓ Pet friendly ✓ Minimum stay from 3 night(s) ✓ Bookable directly online - Book...

www.vrbo.com

 

[GoofGoof]

You could rent a two story beachblock house for the same nightly rate as the GF or BW.

Beachfront House w/ POOL at 5 94th St. Stone Harbor & Avalon PERFECT LOCATION - Stone Harbor

House - $967 avg/night - Stone Harbor - Amenities include: Swimming pool, Internet, Air conditioning, Pets welcome, TV, Satellite or cable, Washer & dryer, Parking, No smoking, Heater ✓ Bedrooms: 5 ✓ Sleeps: 14 ✓ Pet friendly ✓ Minimum stay from 3 night(s) ✓ Bookable directly online - Book...

www.vrbo.com

That was true pre-Covid too. WDW hasn’t been a cheap vacation since I was kid.

 

[the.dreamfinder]

That was true pre-Covid too. WDW hasn’t been a cheap vacation since I was kid.

@ParentsOf4 ’s charts would suggest otherwise on account of the dramatic acceleration in prices when Iger took over.

 

[GoofGoof]

@ParentsOf4 ’s charts would suggest otherwise on account of the dramatic acceleration in prices when Iger took over.

It depends on your definition of cheap. I would say you need to go back into the 80s to see real bargains. The point is Iger took over years before Covid. In 2019 people still went to WDW despite the deluxe resort prices being outrageous and years of price run up.

 

[doctornick]

I’m wondering if people will just want a beach trip this year from burnout.. I can’t be the only one totally exhausted from all of this especially with no opportunities to go out without the kids (think date night etc.).

Everyone is different but I think the opposite - those who are in a position to travel (due to finances, time off, etc) are going to be looking for something more active and exciting after being cooped up in their houses. And with foreign countries mostly not being options, we’ll probably see a good bit of domestic US travel in the short to medium term due to pent up demand.

I actually don’t think local beach vacations will be much stronger than average. Weren’t most beaches open last summer? Almost everyone I know did beach stuff as their only/primary vacation in the past year because it was available and an experience not dramatically impacted by COVID.

I firmly believe that once Disney is back to “normal” that there will be a big influx to the parks. There will probably be a lull though after 6-12 months of more busy activity once the initial pent up surge lessens and can’t be filled in by larger masses since some portion of Disney’s potential pool has been hit by COVID. Just my gut read on the situation.

 

[doctornick]

That was true pre-Covid too. WDW hasn’t been a cheap vacation since I was kid.

Exactly this. I’m not saying that WDW isn’t an expensive vacation - it is - but it was pre COVID as well. If the prices weren’t deterring people in 2019 - and by the crowds that existed it doesn’t seem like it was - than I don’t see the prices really being a limitation among those who have been financially secure during COVID

I will say though that it will be interesting to see how the benefit cuts (eg no DME, EMH loss, no free magic bands, no FP+ advantage) will impact resort bookings going forward.

 

[GoofGoof]

Exactly this. I’m not saying that WDW isn’t an expensive vacation - it is - but it was pre COVID as well. If the prices weren’t deterring people in 2019 - and by the crowds that existed it doesn’t seem like it was - than I don’t see the prices really being a limitation among those who have been financially secure during COVID

I will say though that it will be interesting to see how the benefit cuts (eg no DME, EMH loss, no free magic bands, no FP+ advantage) will impact resort bookings going forward.

Yes, I would say lack of offerings will have a much bigger impact than price or lack of discounts.

Everyone is different but I think the opposite - those who are in a position to travel (due to finances, time off, etc) are going to be looking for something more active and exciting after being cooped up in their houses. And with foreign countries mostly not being options, we’ll probably see a good bit of domestic US travel in the short to medium term due to pent up demand.

I actually don’t think local beach vacations won’t be much stronger than average. Won’t most beaches open last summer? Almost everyone I know did beach stuff as their only/primary vacation in the past year because it was available and an experience not dramatically impacted by COVID.

I firmly believe that once Disney is back to “normal” that there will be a big influx to the parks. There will probably be a lull though after 6-12 months of more busy activity once the initial pent up surge lessens and can’t be filled in by larger masses since some portion of Disney’s potential pool has been hit by COVID. Just my gut read on the situation.

I agree with this. Last summer was one of the best in recent years for people renting out beach houses up in the Northeast. People didn’t want to have to fly and wanted to stay local and the beach is outdoor and easy to stay distant. This summer should be another great year for beach towns. Many people may still be reluctant to go to Mexico or the Caribbean depending on Covid cases and cruise lines won’t be back yet in any meaningful way. I do think airfare will pick up this summer as people get vaccinated and airfare is still relatively cheap. There are deals to be had for flights.

 

[seabreezept813]

Everyone is different but I think the opposite - those who are in a position to travel (due to finances, time off, etc) are going to be looking for something more active and exciting after being cooped up in their houses. And with foreign countries mostly not being options, we’ll probably see a good bit of domestic US travel in the short to medium term due to pent up demand.

I actually don’t think local beach vacations won’t be much stronger than average. Won’t most beaches open last summer? Almost everyone I know did beach stuff as their only/primary vacation in the past year because it was available and an experience not dramatically impacted by COVID.

I firmly believe that once Disney is back to “normal” that there will be a big influx to the parks. There will probably be a lull though after 6-12 months of more busy activity once the initial pent up surge lessens and can’t be filled in by larger masses since some portion of Disney’s potential pool has been hit by COVID. Just my gut read on the situation.

Makes sense. I’m just thinking that at some point there’s going to be almost this needed rest period. Especially for front line workers. I’m not sure we’ve really absorbed this whole situation yet. I miss Disney terribly but I know we’re canceling this summer. I’d blame it on my baby on the way, but even without that I’m attached to the old Disney ways—buffets where my fam can all find whatever they like, drink stations, fastpass, parades, night shows, entertainment, character meets, dining plan. And while some might be back, I’m not willing to settle for just some at Disney’s price point. But then again one of my best friends is planning one of their once in a lifetime trips (they might go one more time after) and is still committed likely because of her kids ages. My stepdaughter is 17 so we got her childhood trips in and my daughter is almost 3 so plenty of time to still get in that magic. Other people might have the clock ticking on those magic ages.

 

[ParentsOf4]

@ParentsOf4 ’s charts would suggest otherwise on account of the dramatic acceleration in prices when Iger took over.

It depends on your definition of cheap. I would say you need to go back into the 80s to see real bargains. The point is Iger took over years before Covid. In 2019 people still went to WDW despite the deluxe resort prices being outrageous and years of price run up.

First, to a working class family, WDW was an expensive vacation in 1971. But this is relative. For example, for the price of an All Star Resort room today, you could stay at the Contemporary or the Polynesian from 1971 to 1984. In addition, WDW tickets were much more expensive than local amusement parks, even in 1971. But, adjusted for inflation or household income, ticket park tickets were only a fraction of today's prices.

This started to change when Michael Eisner took charge. Eisner and Frank Wells significantly increased WDW prices but after 4 years of double-digit increases beginning in 1984, price increase slowed down appreciably. Relatively speaking, WDW prices held steady under Eisner until what I consider to be the modern era, which started when Paul Pressler was promoted to Parks & Resorts Chairman in 2000.

The short of it is there are 3 basic eras of WDW pricing:

• Those who worked directly for the Disney brothers kept prices relatively low. Many executives in the industry felt they were keeping prices too low, making it difficult to operate amusement parks at a profit through the 1970s and 1980s.
• Eisner instituted 4 years of double-digit price increases but then settled down, keeping prices relatively stable throughout the 1990s.
• Pressler introduced the concept of "whatever the market will bear" to WDW pricing in 2000, which effectively is where we are today.

Second, there are several ways to look at the cost of a WDW vacation. I tend to focus on ticket price versus household income. With this in mind, here's a couple of graphs I generated years ago.

The first graph compares WDW ticket prices with median household income as a ratio, starting with a ratio of "1/1" in 1971.

The second graph shows how prices accelerated under Bob Iger. Compound that acceleration over the 15 years of Iger's stewardship, and the gap has grown tremendously.

 

[havoc315]

By the end of May, without AZ but with Novavax and J&J, there will be enough vaccines for 425M people in the U.S.

This is being hashed out in the Vaccination thread.

End of June, not May. And that assumes they catch up to the production goals.
You still need to distribute and administer the vaccines... convince enough people to take them, and wait 2-4 weeks after final dose for effectiveness.
Optimistically... that’s July-September.. if variants cause greater difficulty, if not enough people voluntarily rush out to get a vaccine... things could stretch much further.

 

[havoc315]

Things have changed in a month. A month ago, Dr. Fauci wasn't saying that every adult who wants a vaccine can get one by the end of April.

Every week for the past few weeks there have been announcements of increased production.

Actually, he and others have basically been saying that for several months.

From September:

Fauci tells Congress the U.S. could have enough coronavirus vaccine doses for every American by April

Fauci also said there's "growing optimism" that scientists will find one or more safe and effective vaccines by the end of the year or early 2021.

www.google.com

November.. he continued to state there would be enough vaccine for all adults by end of April..

Dr. Anthony Fauci Says Americans Who Want Coronavirus Vaccine Should Be Able to Get One by April

If approved by the FDA, a vaccine could begin getting distributed in December

www.google.com

In December, he was being optimistic and thought we might even reach herd immunity by April:

Fauci Predicts U.S. Could See Signs Of Herd Immunity By Late March Or Early April

Dr. Fauci said once the vaccine becomes widely available, if by "April, May, June, July, we get as many people vaccinated as possible, we could really turn this thing around" by the end of 2021.

www.npr.org

Again, none of this is new. It was always anticipated that vaccine supply would continue to increase.
The main changes recently:
AZ, which had been expected to provide lots of March/April doses, is looking like it won’t happen.
Pfizer/Moderna have slightly sped up production, slightly moving up their delivery goals.
JNJ is looking like it will deliver, but a bit slower than originally hoped.

 

[MisterPenguin]

Actually, he and others have basically been saying that for several months.

From September:

Fauci tells Congress the U.S. could have enough coronavirus vaccine doses for every American by April

Fauci also said there's "growing optimism" that scientists will find one or more safe and effective vaccines by the end of the year or early 2021.

www.google.com

November.. he continued to state there would be enough vaccine for all adults by end of April..

Dr. Anthony Fauci Says Americans Who Want Coronavirus Vaccine Should Be Able to Get One by April

If approved by the FDA, a vaccine could begin getting distributed in December

www.google.com

In December, he was being optimistic and thought we might even reach herd immunity by April:

Fauci Predicts U.S. Could See Signs Of Herd Immunity By Late March Or Early April

Dr. Fauci said once the vaccine becomes widely available, if by "April, May, June, July, we get as many people vaccinated as possible, we could really turn this thing around" by the end of 2021.

www.npr.org

Again, none of this is new. It was always anticipated that vaccine supply would continue to increase.
The main changes recently:
AZ, which had been expected to provide lots of March/April doses, is looking like it don’t happen.
Pfizer/Moderna have slightly sped up production, slightly moving up their delivery goals.
JNJ is looking like it will deliver, but a bit slower than originally hoped.

Thanks for that info.

However, with these rosy April predictions by Fauci, why does it seem you think that things won't normalize until a few month later in the summer?