Walt Disney Company stock closed out the day at $49.81, 73 cents off its all time high. Standard & Poor’s reiterated its “Strong Buy” rating on the stock earlier today and raised the target price $3 to $55. The conference call, hosted by Bob Iger (Chairman and Chief Executive Officer), and Jay Rasulo (Senior Executive Vice President and Chief Financial Officer) is coming up at 5pm EST. Listen along here. Relevant updates will be posted as they become available.
“Live updates:”
- Disney beat on earnings per share, recording a record $1.01 per share, compared to estimates of 93 cents per share. Revenue came in weak at 11.09 billion, compared to estimates of 11.30 billion. The stock is trading down after hours between one and two percent.
- Parks and Resorts revenue came in at 3.44 billion.
- Bob Iger on CNBC: Spending is up “nicely” at Parks and Resorts. The consumer is still flocking to products they find valuable. “No problem” attracting people to Parks. Europe affecting results the most. “Modest declines” in visitation from Europe. Asia is very strong in China and Tokyo. People “willing to pay for a product they believe in.” Disney “invests in this.” Disney has done a “good job increasing pricing.” “Still room to increase prices, but have to keep investing.” Brought up Cars Land as an example. Believes “outlook is favorable.”
From the Conference Call:
- Made significant investments in Parks and Resorts. Completely transofrmed California Adventure, new cruise ships, enhancing and enlarging Fantasyland. California Adventure is the “perfect neighbor to Disneyland.” Attendance and guest satisfaction up. Most days, California Adventure pulls more than 50% of attendance, up from 25%.
- Cruise ship bookings at 94% occupancy
- Fantasyland is largest expansion since Walt Disney World opened. Bulk of investment completed by end of fiscal year. This fiscal year is “peak spending” on Parks and Resorts.
- Avengers third highest grossing movie of all time with nearly 1.5 billion in receipts.
- May 3, 2013 – Iron Man 3 release date
- Thor 2 – November 2013
- Captain America 2 – April 2014
- Avengers sequel in the works. Joss Whedon on contract to develop TV show for ABC and direct Avengers 2.
- Revenue up 9% at Parks and Resorts thanks to Tokyo Disney doing better after last year’s disaster.
- Attendance at domestic parks up 1%. Per capita spending up 8%. Resort occupancy decreased 1.5% to 79%. Domestic inventory up with Aulani and Art of Animation opening. Fourth quarter bookings are up 1%.
- Cars remains the strongest property for consumer products, outpacing Avengers.
- Q3 international attendance at Walt Disney World was identical to last year’s number. A mix shift, Europe and Canada were down, picked up entirely by Brazil and Argentina. Currency swings could affect attendance, but hasn’t been an issue thus far.
Conference Call concluded.
Overall, it sounds like a good quarter for Disney. They’re seeing what seems like a significant return on investment at Disney’s California Adventure as attendance, guest spending, and satisfaction have increased significantly. With attendance gaining in California and declining in Florida, hopefully the suits will decide to invest more money in expanding the Florida theme parks. The “problem” in Florida is that so much of their profits are driven by international visitors from South America that plan to visit one time. They are overwhelmingly more satisfied than European or domestic visitors and also spend more money.
It would not surprise me to start hearing more rumblings about a significant expansion at Disney’s Hollywood Studios, though I don’t expect to see anything related to Cars Land. There’s nothing to indicate Avatar is on hold at Animal Kingdom. Disney has been moot on the subject only because they don’t want to take the focus away from Cars Land and the Fantasyland Expansion.
As of 6pm EST, Walt Disney Company stock is trading down just over 1% to $48.18, just over a dollar off its all time high.
{ 14 comments… read them below or add one }
Yeah…take THAT disboards!!!! These results brought to you because of easyWDW!!! It’s a New World Order happening before your very eyes!!!
“Attendance at domestic parks up 1%. Per capita spending up 8%. Resort occupancy decreased 1.5% to 79%.”
Are you/they saying “resort occupancy is at 79% which is 1.5% lower than last year”? At first I thought it meant that some resorts occupancy went down by 79%.
Assuming I’m correct, I find it interesting that attendance is slightly up, occupancy is slightly down and Disney’s response is to cut EMH.
Resort occupancy as in hotel occupancy in California, Florida, and Hawaii. Over the last two years or so, they’ve quoted occupancy in the 80% – 82%. It’s now down to 79%, or about 1.5% lower than last year. However, it’s important to note that inventory is also much higher with rooms coming online at Aulani in Hawaii and Art of Animation in Florida.
“Cruise ship bookings at 94% occupancy”
This doesn’t sound very good, especially for Disney. Occupancy levels for cruise ships usually only count 2 people per stateroom, so occupancy can go over 100% when you add in 3rd/4th passengers.
Not my properties and I don’t own Disney stock, but if I had an ownership stake, I’d look at an Avengers-themed expansion in HS and scrap the weak co-op with Avatar. Simply more money and a higher degree of passion with kids and the Avengers characters.
Rob, I agree 100%!
They don’t have rights to the Marvel characters for theme park use in Florida, so that’s impossible.
josh really nipped that one in the bud, eh?
Karl I had the same thoughts looking at the cruise ship occupancy. Isn’t 100% occupancy for cruise ships 2 people per room and with Disney having family friendly staterooms wouldn’t they expect greater occupancy? Or does Disney consider their occupanct based on their Max capacity of say 2500 per Magic Class and 4000 per Dream class. If that is the case 94% occupancy doesn’t sound bad but if it is on cruise standards of 94% occupancy that does sound bad.
On the flip side that could be good for 2014 pricing – maybe they will decrease their prices and stop pricing themselves out of the market.
I just went back to the Q2 report and the DCL bookings were up 30% with 90% occupancy so I guess 94% occupancy is even better now. I’m guessing that Disney has to count occupancy different then other cruise lines.
Man resort occupancy at 79%, wonder if that counts rooms that are refurbished to new themes. The way they talked to me back in slow ass January was that all the rooms were booked and there was no way to move me around. Meh!
“Still room to increase prices, “, I disagree… keep it up Disney execs and you’ll price me right out of there. I’ll be spending my dollars at Schlitterbahn and Six Flags which are only 2.5-3 hours away from my home instead of 22. At least I can still get my near daily Disney fix here thanks to you Josh! and your wonderful pics (even the surreal crazy hi-def ones you are so fond of) and of course you tell it like it is and don’t sugar coat the news. Good or bad, I feel like when you say something it carries more credibility than when I hear it elsewhere because of that brutal honesty. You do have a way of getting right to the heart of a matter and I really like your crazy sense of humour. Even if I don’t always “get it”. Can I move up to Wizard level for sucking up??? ‘Cos remember I’m on a tight budget.
Kristie — I think you are right, DCL must calculate it differently then other cruise lines.
I believe you mean Disney has been “mute” on the subject of Avatar Land, not “moot.”