Disney anticipates a combined $175-million dollar hit from two theme parks in Asia due to the recent coronavirus outbreak if they remain closed for two months. That includes a $135-million squeeze on operating income at Shanghai Disneyland and $40 million from Hong Kong Disneyland. Both are temporarily shuttered due to the epidemic, which has emptied out all of China’s public areas.
There are about 2,900 cases of the virus, which has been spreading quickly, with the death approaching 500. Movie theaters in China are shut and film production halted. Businesses in every sector are closing. Ralph Lauren, Hyundai and Apple are some of the latest companies to announce work is stopping at factories and retail stores across the country.
“The current closure is taking place during the quarter in which we typically see strong attendance and occupancy levels due to the timing of the Chinese New Year holiday,” Disney CFO Christine McCarthy said during a conference call Tuesday to discuss earnings announced earlier.
“The precise magnitude of the financial impact is highly dependent on the duration of the closures and how quickly we can resume normal operations,” she said.
The Hong Kong park had already been underperforming due to protests. Between coronavirus and the unrest in Hong Kong, operating income at the park is expected to decline by $145 million in the second quarter.