Disney assumes coronavirus outbreak could keep Shanghai and Hong Kong theme parks closed for two months
Disney assumes the coronavirus outbreak in China that has forced the temporary closure of Shanghai Disneyland and Hong Kong Disneyland could keep the two Asian theme parks closed for at least two months.
The temporary closure of Shanghai Disneyland and Hong Kong Disneyland due to China’s coronavirus outbreak could result in a $175 million loss in Disney’s upcoming second quarter, Disney chief financial officer Christine McCarthy said. The loss assumes the closure of both parks for two months, McCarthy said.
“The recent closure of our parks in both Shanghai and Hong Kong due to the ongoing coronavirus situation will negatively impact second quarter and full year results,” McCarthy said during the company’s latest earnings call. “The precise magnitude of the financial impact is highly dependent on the duration of the closures and how quickly we can resume normal operations.”
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Shanghai Disneyland and Hong Kong Disneyland will remain closed indefinitely amid the coronavirus outbreak that has killed hundr, infected thousands and restricted millions from traveling. The closure of the two Disney theme parks came at the beginning of the week-long Lunar New Year holiday, one of the busiest travel seasons of the year in China.
“At Shanghai Disney Resort, we currently estimate the closure of the park could have an adverse impact on second quarter operating income of approximately $135 million assuming the park is closed for two months during Q2,” McCarthy said.
“At Hong Kong Disneyland, we currently estimate the closure of the park could have an additional adverse impact on operating income of about $40 million for the second quarter,” McCarthy said. “Again, this assumes that the resort is closed for two months.”
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Coronavirus symptoms include fever, coughing and difficulty breathing. Coronavirus cases have been confirmed in more than two dozen countries outside mainland China. The U.S. Centers for Disease Control and Prevention has identified at least 11 coronavirus cases in the United States, including in California.
The coronavirus outbreak hasn’t had an impact on visitation at Disney’s U.S. theme park, McCarthy said. Disney’s U.S. parks don’t draw a significant amount of visitors from Asia, McCarthy said. Approximately 1 in 5 visitors to Disney’s domestic parks come from international markets, McCarthy said.