Tourist Spot

Hong Kong Disneyland cuts losses to $308m in year of closure

Hit by mandatory closures for 40% of 2020-21, Hong Kong Disneyland theme park and resort reduced its losses to HK$2.4 billion ($308 million), management reported on Monday.

The park and its hotels operate a fiscal year that runs from October to September and reports numbers nearly six months late. The park and hotels are currently closed, following yet another government order in early January 2022.

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Earlier Monday, the city government indicated that current travel restrictions and quarantine requirements could be reduced from early April. Social distancing measures could then be reduced in phases from April 21, which could allow entertainment facilities such as cinemas and theme parks to reopen from that date.

Separately, the Hong Kong Tourism Board predicted on Monday that the number of visitors this calendar year could reach 9.8 million. This compares to the fewer than 92,000 who arrived in 2021, almost none of whom were traveling for pleasure.

For the year to September 2021, Hong Kong Disneyland theme park admissions increased 64% to 2.8 million, driving gross revenue up 19% to HK$1.7 million ( $218 million). Earnings before interest, tax, depreciation and amortization (EBITDA) for the year 2020-21 improved by 34% to a loss of HK$970 million ($124 million). Net losses, including debt service, improved 12% to HK$2.4 billion.

The previous year (October 2019-September 2020), the theme park was closed for 60% of the period, while the hotels remained open longer. The station had 1.8 million visitors, revenues of $185 million and net losses of $341 million ($2.61 billion).

Hong Kong’s ultra-tight border controls meant that even when the park was open, incoming tourists were unable to travel. In the pre-COVID years, the park managed to attract large numbers of Chinese and Asian visitors from the mainland.

The closures meant an increased reliance on local visitors and in this area the company claimed significant success. “The station’s local attendance grew 117% year-over-year, while the Magic Access (annual subscription) member base grew 55% year-over-year, both at record levels. Local young adult attendance also hit an all-time high, and the number of student Magic Access members jumped 132% from FY20,” HKDL said in a statement.

Station general manager Michael Moriarty said: “I’m extremely optimistic about this financial year once we’re able to open.”

Hong Kong Disneyland is 53% owned by the Hong Kong government, with The Walt Disney Company owning the remaining 47%. Disney has provided the company with a HK$2.1 billion ($270 million) revolving loan. Moriarty said he did not expect to seek additional funds.

The separately owned Shanghai Disneyland announced on Monday that it was closing until further notice due to the growing wave of COVID in mainland China.

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