Disneyland Paris revealed that it made an operating profit of $51 million (47 million euros) last year in record revenue of $2.6 billion (2.4 billion euros), as the lifting of pandemic restrictions and the opening of a new Marvel superhero-themed park led to an influx of visitors.
With two parks and seven hotels, Disneyland Paris is one of the jewels of the European tourism sector. So his good results indicate that the good old days seem to be gradually returning to Mickey after the Covid-19 pandemic. Those results are all the more remarkable considering Disneyland Paris has rarely turned a profit since opening its ornate iron gates in 1992, when the theme park was known as Euro Disney.
Michael EisnerDisney, then CEO of Disney, chose France rather than Spain to lay the foundations for the new theme park, despite concerns about weather conditions. In a recent interview with Times of LondonHe said, “Disney executives in Burbank, Calif., but also theme park and resort managers in Anaheim and Orlando, think winter will kill park and hotel operations.”
“I come from New York. Unless there’s a northeast storm, people go out, and if there’s a subway at the entrance, no problem. Later I insisted that stoves be installed in the lobby of every Euro Disney hotel, but that’s another story. As it was done Tokyo Disneyland opened in the spring of 1983 and proved successful from the start, so we had hands-on experience with a Disney theme park in a snowy location,” he adds.
Disneyland Paris covers an area of 22.3 km2, about a fifth the size of Paris. This excludes competitors in the area and allows Disney to carefully control the land standards surrounding its parks. To acquire such an area, the French government asked Disney to enter into a public-private partnership. Thus, Disneyland Paris entered Euronext Paris with only 49% in Disney hands. Since the Disney group did not own the company per se, it gave it loans rather than pouring money into it. In addition, Disneyland Paris also financed its construction using bank loans in the amount of $1.8 billion (1.7 billion euros) whose financial costs fueled the losses.
Michael Eisner says, “People have been hooked from day one. I think we entertained ten million people in the first year, which is more than the Louvre.” However, he adds that “various factors, including the high costs associated with striving for excellence, building A castle where castles were real, the financing costs of a high-impact entity structure, and low per capita spending by visitors using whatever they’ve been allocated. vacation time, etc. ; All of these factors affected results for ten years.”
Debt relief came in 2012 when Disney unblocked bank loans and, five years later, took full control of Disneyland Paris in an effort to acquire 2.17 dollars (2 euros) per share. The company is no longer listed on Euronext, which reduces visibility of its finances as it is no longer required to publish quarterly figures.
The documents provided by Disney only give general indications of the results of the various parks and their financial performance is not detailed. However, the company that operates its French subsidiary, Euro Disney Associates, is still providing financial statements. These show that their turnover has gone from $968 million (893 million euros) in 2021 AD $2.6 billion For the year ending September 30, 2022. This increase significantly exceeded57.8% increase of the company’s costs of $2.5 billion (€2.3 billion), resulting in an operating profit of 51 million dollars. This is the highest result for ten years and a significant improvement in operating loss 627 million dollars (579 million euros) recorded the previous year.
The cost increase is due to the reopening of the resort’s theme parks in June 2021. This has resulted in Disneyland Paris hiring 9.4% increase in the number of employeesthe total 15,450 people. Disneyland Paris is the largest private employer in the Paris region and its employees are known as cast members because of their role in the themed setting. their total compensation by 30.8% Last year to reach the record total amount 825 million dollars (761 million euros).
Disneyland Paris is also the most visited tourist attraction in Europe, and according to infrastructure analysts AECOM, the resort has hosted 15 million visitors In 2019. As I mentioned before The Daily Telegraph At the time, Disneyland Paris’ finances were doing well thanks to significant growth in guest spending and increases in average daily room rates at its hotels.
Taking advantage of this situation, the company has invested $216 million (199 million euros) in 2018 and said that “it was driven by costs incurred to develop the resort and improve existing assets. These costs also include expenses related to the renovation of theme parks and hotels.” like Forbes We reported in 2017 that Disneyland Paris was set to open a game-changing attraction in 2024, but COVID-19 has changed those plans.
According to the latest estimates, attendance is down to fair 5.4 million visitors in 2021, but has gone up significantly since the resort reopened post-pandemic. In a recent article, Forbes It revealed that five of the seven Disneyland Paris hotels alone were constructed $102.2 million of sales volume in the twelve months prior to September 30, 2021, despite having been closed for more than seven months. Their financial statements show that these earnings have by 497% last year to reach the record $617.8 million (570.2 million euros).
This positive trend will continue in 2023 as revealed Christine McCarthyDisney’s chief financial officer, last month. Announcing Disney’s results for the quarter ending December 31, 2022, Christine McCarthy declared, “This quarter we did very well, especially compared to last year at Disneyland Paris.” Disney’s earnings release stated that hotel footfall and occupancy increased in the quarter, while guests spent more money due to an “increased average ticket price” and “increased average daily rates for hotel rooms.”
Weak currencies and high ticket prices have made Disney parks in the United States unavailable to many European travelers. “Disneyland Paris took advantage of this situation and made the most of it by opening new attractions,” explains Christine McCarthy.
The park celebrated its 30th anniversary this past April with the launch of the first ever drone show at a Disney park. Three months later, he opened the doors to a new park themed to the hugely successful Marvel superhero movies.
The lavish opening ceremony was attended by a Hollywood star Brie Larson, who embodies the super-powered Captain Marvel on the big screen, and whose character is at the center of the roller coaster attraction. Another ride uses motion-sensing cameras to make visitors feel like they’re filming cobwebs from their wrists on a 3D screen alongside Spider-Man. Disneyland Paris does not stop there.
Marvel’s theme park is the first step in a multi-billion dollar expansion revealed in the paper pass In 2017. Euro Disney Associates financial statements show that $410 million (378 million euros) in assets They were built in the year 2022 and most of them are for a theme park based around the hit animated movie snow Queen which will open its doors in the next few years. Another theme park set in a world was to follow star Warsbut the head of Disneyland Paris, Natasha RafalskiRecently, she expressed her doubts about it. She told France Info that Disneyland Paris “is still working on the third theme. We will announce this when we are ready.”
The third park is rumored to be themed to the franchise symbol pictureafter the success of the second part of the series, which recently became the third-highest-grossing film in history, with total box office revenue of $2.3 billionAccording to analyst Box Office Mojo. Pandora – The World of Avatar is one of the most iconic locations at Walt Disney World in Orlando. So it may be the touch of magic Disneyland Paris needs to remain profitable.
Shortly after beginning his second term at the helm of Disney last November, Bob Iger He made it a priority to make America’s parks more accessible. Since then, it has increased the number of discounted tickets to Disneyland in California, removed parking fees at Walt Disney World hotels, and lifted restrictions on pass holders after 2 p.m. Other measures can still be taken.
At the beginning of March, Bob Iger stated during the press conference for Morgan Stanley “I think in our rush to increase profits, we may have been a little aggressive in setting some prices. I think it is possible to continue to grow our business, but by practicing more reasonable pricing in order to maintain brand value in terms of accessibility. Lower prices may Tickets to Disney parks in the United States will increase competition for Disneyland Paris, and this is not the only challenge that may be on the horizon.
In 2016, Disneyland Paris said so 32% of its visitors We arrived by plane or by train, as there is a direct line between the resort and the UK which is one of its biggest markets after France. However, this direct service will be suspended in June to reduce congestion at stations caused by post-Brexit requirements for passengers’ passports to be stamped when crossing borders. A new entry/exit system is expected to replace these controls, but the technology has been repeatedly delayed and is now expected to be introduced towards the end of the year.
If this inconvenience prompts British travelers to return to American Disney parks again, along with increased benefits for ticket holders, Disneyland Paris could lose a lucrative market. Since Brits have to travel longer distances to Disneyland Paris than many of their European counterparts, they often stay longer to get the most out of it. So any move to reduce Disneyland Paris’ appeal to the UK market means staying in the spotlight may not be a picnic.
Translated article from the American magazine Forbes – Author: Caroline Reed
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