(LA Times - 02/04/14) ... the occupancy at Disney resort hotels also jumped 8% to 89% -- a rate that is as close to completely booked as possible, Disney officials said during an earnings report on the quarter.
Holy guacamole!
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Rob, I want your job! How do you afford to take two weeks in Orlando every year?! I am so jealous right now I may just have to get up and go kick the cat. And it's all your fault!
Some accounting trickery also happening (or so I hear). WDW is removing hotel rooms from "hotel" account and transferring them to Disney Vacation Club account. Fewer rooms but same "heads in beds" means higher occupancy rates.
There's no way. Something isn't right.
So that's what you "hear", eh?
If they are "close to completely booked" I would like for them to start building more resorts.
The Florida resort has had rooms taken out of service as they have been undergoing renovations (Boardwalk, Polynesian, Caribbean Beach, etc.) but I am not sure that would constitute "trickery."
Also it's important to note that the period of time under discussion is (I believe) the quarter bridging October, November and December -- three very big travel months -- with the Christmas and New Year's holidays falling on Thursdays, creating two defacto four-day weekends.
If Disney World was almost completely booked and doing so well why did they fire unexpectedly 500 IT specialists in Orlando this month? Which many are calling a mistake that will hurt Disney World for years to come..... Almost all of us don't see the IT workers, but they are a vital part to keeping a multi entertainment theme park running on a daily basis.
The IT workers laid off were part of the whole My Disney/Next Gen/Wrist Band roll-out and had nothing to do with hotel or park operations, which from the recent earnings call are bringing in money and visitors in record numbers. And like many American companies, those lost IT jobs were back-filled with offshore workers as Disney shifted the support of NextGen software to India. Not saying this change is a good thing, but it seems to be the "American Way" these days as more and more American jobs head offshore.
Here are the specific notes from the earnings call transcript related to this discussion (TH isn't making this stuff up):
"For the quarter attendance at our domestic parks was up 7%, with Walt Disney World and Disneyland Resort each setting an all-time attendance record for any quarter. Per capita spending in our domestic parks was up 4% on higher ticket prices, merchandise, and food and beverage spending.
Occupancy at our domestic hotels was up 8 percentage points to 89%, and per-room spending was up 4%. So far this quarter domestic resort reservations are pacing up 3% compared to prior-year levels, while booked rates are up 4%."
I'm not saying TH is making it up, I'm just saying why lay off 500 IT workers if your earnings are up? I know they give the answer that some of the workers was on the next generation project but no where says how many and it does not take 500 IT guys and gals to do the next gen. If that was the case than why not hire them for the contract instead of putting them on a payroll and then unexpectedly fire them? It seems very shady for a company that promotes exact figures on growth to not want to specify how many were on the next gen project and even how many they let go. I even read where high level management knew about the layoffs a year in advance and decided to move departments not telling any one else to not be one of the 500. You know by the single percent how many people you have in your rooms by the 10s of thousands but can't give a number of employees let go or the number on a specific project that ranges probably around 500? Shady.
Apple Butter asks: "I'm just saying why lay off 500 IT workers if your earnings are up?"
I Respond: Maybe because Disney believes it can sustain and/or improve the performance of its business model without maintaining the services (and carrying the labor costs) of those cast members.
"seems to be the "American Way" these days as more and more American jobs head offshore."
Not only offshore, but onshore too as foreign IT workers take jobs from Americans via foreign worker visas.
I'm sure Disney is only trying to improve their performance but at great cost to their workers. I suppose the comfort is Americans delivered the technology so now they will take their knowledge to other companies who compete directly with Disney.
"WDW is removing hotel rooms from "hotel" account and transferring them to Disney Vacation Club account."
It does seem like Disney is converting hotel rooms to DVC. It is quite evident from the tons of construction go on at the Polynesian and Grand Floridian. Selling the rooms for guaranteed attendance is proving to increase occupancy.
As an anecdote as an other brand timeshare owner, I converted my timeshare points for a DVC stay last year. These situations improve occupancy too. Of course, Disney can rent DVC units to guests directly at over $350 a night. DVC rooms are larger while also having reduced housekeeping (no cleaning during a 7 night stay). A win win for Disney.
Because, Apple Butter, Disney wants to make MORE money. Just like any company, at the end of the day it is about making money and getting richer. So if I can let 500 expensive American workers go, and replace them with a smaller support team from a less expensive workforce like India, then why not? Heck, investors scream at companies like Disney all the time for not hiring more people from a cheaper labor force. It even happens here in Missouri, in the Bible Belt, where I work. It is just a matter of time before I am on the chopping block as well, and I get WONDERFUL performance reviews. It's all about the money, money, money....
Sorry for sounding like a broken record, but far more likely than playing shell games with DVC/hotel rooms and allegedly "shady" accounting, I think a big part of these extraordinary stats are due to the period of time under discussion. The economy has picked up, and the numbers are evaluating the quarter bridging October, November and December (Halloween, Thanksgiving, Christmas and New Year's). There is no denying that Walt Disney World was slammed with guests over that period of time.
To back up TH's hotel room occupancy, Parents of 4 on WDW Magic, who does some great accounting reports on WDW and is often critical of them, said that 89% figure was fairly accurate. PO4 said that the rooms closed for DVC conversion and regular refurbishment would have only subtracted apx. 1% from the 89% figure. So it looks like they had a really successful quarter. Now whether they return to their norms of 79-81 % in subsequent quarters remains to be seen......James: Sorry to make you feel bad, but, with only two weeks down there this year I'm actually slumming it. Usually I go for three weeks and will do 3-4 weeks in 2016 when Kong opens at Universal.
Rob, please adopt me. I'll be the best 47 year old son you ever had!
James: So funny.....This is a really good group of people on this site.
Boy, Apple Sauce got quiet kinda quick.
It's Apple Butter, a wonderful tasty delicous spread that can be put on anything instead of some sauce that is merly child's food. Of course I have known to eat some good Motts on occasion! Never mind that you get it right next time, TJ Countryplace. Rob, adoption wouldn't work for me but if your willing to pay my room, board, and expenses I would be a "Disabled Park Guide" for you if it means I could be in orlando for three weeks a year going to theme parks. I mean my ethics and moral compass would be shot but hey expense paid vaca for three weeks every year.....
Disclaimer..... (I would not actually do this so no one text or email me please, I do have a bum arm and limp but wait like everyone else in line)
Apple Butter: Good humor. Take care.
(Chuckle)
I just got out of a presentation that was made by Orange County's property tax appraiser. He reports that timeshare sales in the county number 14,000 per week (DVC, anyone?). That's stunning!
He also reports that Universal Orlando's Cabana Beach Hotel is sold out every weekend.
All (anecdotal) things considered, are Disney's numbers really THAT hard to believe?
And check out the Magic Kingdom's operating hours this week:
Tuesday, Feb. 17 - 8:00 AM to 1:00 AM
Wednesday, Feb. 18 - 8:00 AM to 1:00 AM
Thursday, Feb. 19 - 9:00 AM to Midnight
That's 1:00 AM on a Tuesday and Wednesday? They're SLAMMED!
Considering I_Drive hotels were in the high 70's and low 80's for occupancy rates during this stretch it doesn't seem that out of line. Granted 192 is well below 50%
I was at another meeting earlier this week where a credible company source reported that the Walt Disney World property (parks, hotels, retail and restaurants) drew more than 54 million guests in 2014.
My GOD!
From 'Variety' - "Disney counts 11 franchises (such as 'Frozen' that made $1 billion in retail sales last year and are expected to do so again this year. That includes Disney Channel properties, Mickey and Minnie, Spider-Man and the Avengers."
(Wait for it).
“Stars Wars” isn’t one of them (...) yet, according to the company."
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Great numbers, though I hope they still have the Fall hotel discounts for my 2 week WDW trip.