Universal rebounds in 2nd quarter
Scott Powers | Sentinel Staff Writer
Posted August 17, 2006
Universal Orlando turned around its slide in attendance during its second quarter of 2006 but still has not fully overcome the slow turnstiles that plagued its two theme parks earlier in the year.
In a financial report filed Wednesday with the Securities and Exchange Commission, Universal's parent company reported that the combined paid attendance for Universal Studios and Islands of Adventure was up 6 percent in the quarter that ended July 2, to 3.1 million, compared with the same three months in 2005.
Universal City Development Partners also reported a $27.5 million operating profit for the quarter, up 57 percent compared with last year's second quarter. The bottom line was improved not just by the bigger theme park crowds but because visitors were buying more food, drink and merchandise this year. Universal's revenue during the second quarter of 2006 increased 9 percent to $249.7 million, compared with $228.4 million during the same period in 2005.
But Universal's first quarter was so bad -- a 15 percent plunge in attendance and a $25.7 million operating loss overall -- that the good news from the spring only brings the company a slim profit, $1.7 million, for the year so far. And its 2006 total revenue and attendance still trail the six-month numbers for 2005.
In May, the company blamed much of its first-quarter problems on the fact that the Easter vacation season, which fell in the first quarter of 2005, did not occur until the second quarter of this year. That meant the big Easter crowds and all the money they spent showed up in the first-quarter report in 2005, but not in 2006. And now Universal credited the timing of Easter with helping the latest quarterly report look good.
The company's theme parks also saw an 11 percent drop in attendance in 2005, so it has been a long time since attendance has been going up.
Universal President Bob Gault credited the company's promotions and the opening of the new ride, the High in the Sky Seuss Trolley Train Ride.
That ride opened in late June and had less than a couple of weeks to affect the second-quarter totals. Likewise, Universal opened a new CityWalk nightclub, the Red Coconut, in June and a new restaurant, the Bubba Gump Shrimp Co. Restaurant & Market, in July. What's more, Universal Studios' new nightly show, Universal 360, opened July 1. If those new attractions help, they'll likely do so most during the company's third quarter, which started July 3.
On the other hand, Universal raised its base ticket price $4 to $67 last week.
Analysts said Universal, as the kind of place many people travel long distances to visit, is vulnerable to possible economic downturns and rising gas and airline ticket prices.
Entertainment business analyst Harold Vogel of Vogel Capital Management said the increased revenue from the ticket price increase might help Universal's bottom line initially. He thought the second half of Universal's fiscal year should be about the same or slightly better than last year. "Next year might be a whole different story if the economy slows down," Vogel said.
Universal spokesman Tom Schroder said the company's "difficult year-to-year comparisons we've seen are mostly behind us. We expect less dramatic year-to-year changes."
For its first six months of 2006, Universal's total paid attendance is 5.3 million, which still is about 4 percent lower than the first six months of 2005, when Universal sold 5.6 million tickets to Universal Studios and Islands of Adventure.
Scott Powers can be reached at 407-420-5441or spowers@orlandosentinel.com.
Scott Powers | Sentinel Staff Writer
Posted August 17, 2006
Universal Orlando turned around its slide in attendance during its second quarter of 2006 but still has not fully overcome the slow turnstiles that plagued its two theme parks earlier in the year.
In a financial report filed Wednesday with the Securities and Exchange Commission, Universal's parent company reported that the combined paid attendance for Universal Studios and Islands of Adventure was up 6 percent in the quarter that ended July 2, to 3.1 million, compared with the same three months in 2005.
Universal City Development Partners also reported a $27.5 million operating profit for the quarter, up 57 percent compared with last year's second quarter. The bottom line was improved not just by the bigger theme park crowds but because visitors were buying more food, drink and merchandise this year. Universal's revenue during the second quarter of 2006 increased 9 percent to $249.7 million, compared with $228.4 million during the same period in 2005.
But Universal's first quarter was so bad -- a 15 percent plunge in attendance and a $25.7 million operating loss overall -- that the good news from the spring only brings the company a slim profit, $1.7 million, for the year so far. And its 2006 total revenue and attendance still trail the six-month numbers for 2005.
In May, the company blamed much of its first-quarter problems on the fact that the Easter vacation season, which fell in the first quarter of 2005, did not occur until the second quarter of this year. That meant the big Easter crowds and all the money they spent showed up in the first-quarter report in 2005, but not in 2006. And now Universal credited the timing of Easter with helping the latest quarterly report look good.
The company's theme parks also saw an 11 percent drop in attendance in 2005, so it has been a long time since attendance has been going up.
Universal President Bob Gault credited the company's promotions and the opening of the new ride, the High in the Sky Seuss Trolley Train Ride.
That ride opened in late June and had less than a couple of weeks to affect the second-quarter totals. Likewise, Universal opened a new CityWalk nightclub, the Red Coconut, in June and a new restaurant, the Bubba Gump Shrimp Co. Restaurant & Market, in July. What's more, Universal Studios' new nightly show, Universal 360, opened July 1. If those new attractions help, they'll likely do so most during the company's third quarter, which started July 3.
On the other hand, Universal raised its base ticket price $4 to $67 last week.
Analysts said Universal, as the kind of place many people travel long distances to visit, is vulnerable to possible economic downturns and rising gas and airline ticket prices.
Entertainment business analyst Harold Vogel of Vogel Capital Management said the increased revenue from the ticket price increase might help Universal's bottom line initially. He thought the second half of Universal's fiscal year should be about the same or slightly better than last year. "Next year might be a whole different story if the economy slows down," Vogel said.
Universal spokesman Tom Schroder said the company's "difficult year-to-year comparisons we've seen are mostly behind us. We expect less dramatic year-to-year changes."
For its first six months of 2006, Universal's total paid attendance is 5.3 million, which still is about 4 percent lower than the first six months of 2005, when Universal sold 5.6 million tickets to Universal Studios and Islands of Adventure.
Scott Powers can be reached at 407-420-5441or spowers@orlandosentinel.com.
