Source of this article: Times Finance Author: Lin Xinlin
After losing money for consecutive years, Hong Kong Disneyland finally showed signs of turning its losses around.
Image source: Tuchong Creative
html On June 25, Hong Kong Disneyland announced its results for the 2023 fiscal year (October 2022-September 2023). The park revenue for this fiscal year was HK$5.7 billion, a year-on-year increase of 156%; interest and tax Earnings before depreciation and amortization (ebitda) increased to HK$924 million, a year-on-year increase of 207%.During the period, Hong Kong Disney recorded a net loss of HK$356 million, a year-on-year decrease of 83%.
Entering 2024, Hong Kong Disney has changed its past decline and recorded its best quarterly revenue and net profit in the first quarter since the park opened.
Loss narrowed, Hong Kong Disney received 6.4 million passengers per year
"We have entered a new era." Hong Kong Disneyland CEO Mok Wai-ting said in the financial report.
Mo Weiting expressed this emotion not without reason. In 2005, Hong Kong Disneyland opened with high hopes, becoming the second Disneyland in Asia after Tokyo Disneyland in Japan, and the smallest Disneyland under Walt Disney.
But the good times did not last long. With the opening of Shanghai Disney in 2016, mainland tourists were diverted, and Hong Kong Disney began to suffer annual losses. According to statistics, Hong Kong Disney recorded a total loss of HK$8.113 billion in the fiscal year 2015-2022. Among them, affected by the new crown epidemic, Hong Kong Disney suffered a total loss of HK$7.2 billion in the 2020-2022 fiscal year.
In the 2023 fiscal year, Hong Kong Disneyland’s performance improved significantly, recording a net loss of HK$356 million, a year-on-year decrease of 83%.
Hong Kong Disneyland pointed out that in the past fiscal year, the number of local admissions in Hong Kong hit a record high. At the same time, the number of admissions from mainland and overseas guests rebounded strongly compared with before the epidemic, exceeding the rebound in the overall number of visitors to Hong Kong.
In fiscal year 2023, Hong Kong Disneyland recorded a total of 6.4 million admissions, an increase of 87%; the overall occupancy rate of official hotels increased by 23 percentage points to 47%. The growth momentum continued in the first quarter of 2024, with a particularly strong rebound in attendance from mainland guests.
Mok Wei-ting attributed the improvement in Hong Kong Disney’s performance to the launch of a number of new unique Disney performance experiences, as well as the newly launched “Frozen World” park at the end of last year, which have become the “trump cards” for attracting tourists to Hong Kong.
Previously, Hong Kong Disneyland has been criticized by the outside world for its small park area and low level of equipment innovation. In November 2023, "Frozen World", which has been in preparation for seven years, will open. This park is Hong Kong Disney's largest expansion in recent years and is also the world's first "Frozen" theme park. Lin Huanjie, president of
China Theme Park Research Institute, pointed out to Times Finance that the recovery in Hong Kong Disneyland’s passenger flow is also closely related to Hong Kong’s loosening of immigration control in mid-2022 and the resumption of customs clearance with the mainland in early 2023, which has brought about an increase in the number of mainland tourists and Southeast Asian tourists.
At the same time, the Hong Kong SAR government has launched a series of measures to enhance Hong Kong’s tourism attractiveness and improve the convenience of travel services for mainland tourists, which has also indirectly stimulated Hong Kong Disneyland’s passenger flow.
On March 6 this year, Xi'an and Qingdao were newly added as "individual travel endorsement" cities for Hong Kong and Macao, and the number of "individual travel visa" cities from mainland China to Hong Kong and Macao increased to 51. A set of data from Ctrip shows that 1 out of every 8 mainland tourists visiting Hong Kong will visit "Hong Kong Di".
"There are more people than expected." Consumers who have recently visited Hong Kong Disneyland told Times Finance that most of the park's rides still require queuing, and each ride takes 15-30 minutes, while the Frozen attraction is more crowded. It’s so dense that you have to queue for 45-60 minutes.
However, this consumer believes that compared to Shanghai Disney, where queues for items often start at one hour during the peak season, Hong Kong Disney’s queue time is relatively “friendly”.
competes with Shanghai Disney for customers and boosts its presence in the mainland market.
In addition to the launch of new parks, the reason for the improvement in performance of Hong Kong Disneyland is also the proactive price adjustment.
Before the "Frozen World" park was put into operation, Hong Kong Disneyland had conducted a round of price adjustments.In September 2023, Hong Kong Disney released a ticket grading system and price adjustment announcement. The original adult tickets for "specific days" and "specific peak days" were increased from HK$699 and HK$759 to HK$719 and HK$799 respectively, and a fourth ticket was added at the same time. Class ticket price is HKD 879.
This is almost the same as the "trick" of Shanghai Disneyland.
In May 2023, Shanghai Disneyland implemented its fourth price adjustment since the park opened, with tickets selling for a maximum of 799 yuan; in September, annual passes resumed sales, and the prices of many annual passes increased by more than 300 yuan. In December, Shanghai Disney’s “Zootopia” theme park officially opened to the public.
But it is not easy for Hong Kong Disneyland to compete for mainland tourists.
Lin Huanjie pointed out that Shanghai Disney’s impact on Hong Kong Disney is long-term. Although the new Frozen-themed park has a diversion effect, it will tend to slow down after a certain growth. Relatively speaking, Shanghai Disney is still very attractive, and the costs of hotels, catering, transportation, etc. are also more advantageous than Hong Kong. " Hong Kong Disney needs to find differentiation. "
Walt Disney is also adjusting its layout strategy in the Asian market and providing certain tilt and support to Hong Kong Disneyland to balance the profitability of disadvantaged projects.
Lin Huanjie pointed out that Hong Kong Disney’s tours and performances in the past two years have maintained certain differences with Shanghai and Tokyo Disney.
In addition, Hong Kong Disney has also been more proactive in external promotion. "You can see advertisements for Hong Kong Disneyland in airports, high-speed trains, and subways in mainland China, Indonesia and other Southeast Asian countries." Lin Huanjie said.
Hong Kong Disney mentioned in its financial report that Hong Kong Disney restarted its customer source market in the past fiscal year, launched large-scale marketing and sales activities, deepened penetration in the international and mainland markets, and rekindled overseas tourists' interest in visiting Hong Kong. Will.
According to Times Finance, in June this year, Hong Kong Disneyland Resort opened its first exhibitions in Southwest and Central China in Chongqing and Wuhan, introducing two popular Disney IPs "Frozen" and "Duffy and Friends" to the local area. Earlier, Hong Kong Disneyland Resort and Guangzhou Taikoo Hui jointly created the first "Duffy and Friends" themed exhibition in South China.
It is not difficult to see that Hong Kong Disneyland is accelerating its pace to compete for mainland tourists.
"The day when Hong Kong Disneyland can turn around from losses to profits should not be far away." Lin Huanjie said. In his view, the current losses of Hong Kong Disneyland come from some historical issues, including the fact that Hong Kong Disneyland was built on reclaimed land, and the amortization cost of land construction is high; and due to factors such as employment population security, the scale of the number of people served by the park It is large and has high human resource costs, making operating costs heavy.
