06 Feb 2019
Disney’s parks make losses despite revenue gains in Q4 2018
BY Luke Cloherty
Disney’s latest financial results show that its Parks, Experiences and Consumer Products division made increased year-on-year revenues in Q4 2018 but is still unable to turn a profit.
Revenues rose in the quarter to US$6.8bn (€6bn, £5.2bn) from Q4 2017’s figure of US$6.5bn (€5.7bn, £5bn), a 4 per cent rise.
Operating income also rose, reaching US$2.2bn (€1.9bn, £1.7bn) in Q4 2018, a 9 per cent increase on Q4 2017’s US$2bn (€1.8bn, £1.5bn) figure.
The division is still running at a loss, however, and actually significantly worsened in the quarterly profit/loss column, dropping to a US$12m loss from US$7m in Q4 2017, a 48 per cent negative increase.
Parks and Resorts had a balance of US$291m (€255.5m, £224.5m) at the quarter’s end.
While hotel occupancy rose three points from 91 per cent to 94 per cent and park per capita guest spending stayed at 7 per cent year-on-year, labour cost inflation at Disney’s theme parks and resorts contributed towards a cost of services increase of 3 per cent for the quarter.
"The increase in theme parks admissions revenue was due to an increase of 8 per cent from higher average ticket prices, partially offset by decreases of 1 per cent from an unfavourable foreign currency impact and 1 per cent from lower attendance," said the group's quarterly results statement.
"Parks and Experiences merchandise, food and beverage revenue growth was due to an increase of 5 per cent from higher average guest spending.
"Cost of services for the quarter increased 3 per cent, or US$240m (€210.7m, £185.1m), to US$7.6bn (€5.9bn, £5.2bn) due to higher sports programming and production costs and labour cost inflation at our theme parks and resorts."
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