Universal sees numbers slide

[Wendy]

Attendance, sales and profits all slid at Universal Orlando in 2008, the company reported this week, with the two-park resort squeezed by a worsening recession even as it spent more money on new attractions.

Combined attendance at Universal Studios Florida and Islands of Adventure sank 1.9 percent in 2008, falling to 10.6 million from 10.8 million a year ago.

Universal did not offer any specifics about how its parks are faring so far in 2009 in what has become the most challenging economic climate in at least a generation. But the resort has implemented widespread cost cuts since January, temporarily closing some attractions, reducing hours at others and laying off employees.

Universal, like Walt Disney World and SeaWorld Orlando, also has been forced to roll out steep discounts on tickets and hotel rooms in order to continue luring reluctant consumers.

“Our business is strong, yet all of us know we are operating in an increasingly challenging economic environment,” Universal Orlando President and Chief Operating Officer Bill Davis said in a written statement.

Total revenue slipped 1 percent for the year to $923 million. Operating profits fell 5.8 percent to $180 million.

The resort blamed the wider profit drop in part on increased spending on new attractions. Universal is building the Hollywood Rip, Ride, Rockit roller coaster, which is scheduled to open at Universal Studios this spring; and the Wizarding World of Harry Potter, which will open sometime next year in Islands of Adventure.

Universal had projected it would spend $150 million on capital projects in 2008up from $95 million in 2007.

The results released Friday, which were issued in advance of a more-detailed regulatory filing expected later this month, did not break out Universal’s performance during the fourth quarter, when economic conditions rapidly deteriorated. Attendance at Disney World, for instance, fell 5 percent between October and December, after climbing through the first nine months of the year.

But it is clear Universal also was hit particularly hard during the period.

Universal’s attendance through the first nine months of the year was down just 1 percent from the same period in 2007, compared with the 2 percent drop the resort reported for the full year. Revenues through the first three quarters of the year were still running slightly ahead of the previous year’s pace, before turning negative near the end of 2008.

Industry experts say conditions have continued to worsen for Orlando’s theme parks in the new year.

“As far as the theme parks and attendance go, I think it’s really just starting now to hit,” said Ady Milman, a professor at the University of Central Florida’s Rosen College of Hospitality Management and coordinator of the college’s theme-park specialty track. “All in all, 2008 was probably not so bad. But the key issue, and we don’t really know, is how 2009 is going to be.”

In January, the resort laid off about 70 of its roughly 13,000 employees. Other workers have had their hours cut.

[Tink]

I can't speak to US/IOA, but I can tell you that we couldn't get an ADR for any table or buffet service in AK, or any resort hotel (not the other parks as our guests didn't have park hoppers) this past Saturday.

WDW isn't seeing numbers drop, from what I can tell.

[Mari]

thats sad..... still... given the choice I would pick Disney over Universal every single time....

[Jodie]

1%, I hardly think a 1% drop is against the same peiod last year is enough to predict doom and gloom! The recession is wide with some companies losing 100% of thier customer base! I can hardly bring myself to feel sorry for a complany that have made £923m!!

[Ursula]

Good! Because some of those CM's have a few manners to learn and should go to Disney to see how it's done!

[Tink]

We stopped by the WS this weekend (Flower and Garden has started) and the place was wicked busy. Hard to believe there are attendance issues. We were at Sea World last weekend. Same thing. Busy!!

'Course, this thread is about US/IOA and we've not gone there, but the other two places seem to be quite busy, so I'm guessing those parks aren't too bad either.

[Kate]

When we were there in December it didnt seem like there were less people there than our last visit!

[josh.p.]

I hate to say this on this forum..... but I like US/IOA better than Epcot

I just find them much more exciting, obviously they are aimed at my age group, but I didn't find the people who worked in US/IOA rude, I found them very polite. Sometimes I think the people at Disney are really really nice, and when you are in the hot Florida heat, it can be a bit *too* much. US/IOA has found a nice medium in my eyes.

I do hope they don't loose too much profit, but 1% loss is nothing at all to worry about compared to others.

[Dawn]

Perhaps if they didn't fleece you for their express passes...

[Skywatcher]

I hate to say this on this forum..... but I like US/IOA better than Epcot
.

s'ok Josh we really love IOA as well , can't get too excited about US tho. When HP opens its going to be right up there and the parks will be full to bursting methinks