Walt Disney Co. (DIS) – Get report Shares fell Thursday after the company said it would delay the reopening of its hotels and theme parks in the state of California amid a further surge in coronavirus infections.
Disney said it will release a new reopening calendar early next month after receiving new guidelines from state officials in Sacramento. Disneyland Park and Disney California Adventure Park were due to reopen on July 17, but two consecutive days of record increases in the infection rate have forced health authorities, as well as Governor Gavin Newsom, to a more conservative strategy.
The decision could also raise questions about the fate of the NBA playoff plans, slated to begin next month at Walt Disney World in Orlando.
“Given the time required for us to bring thousands of cast members to work and restart our business, we have no choice but to delay the reopening of our theme parks and resort hotels until we receive approval from government officials,” he said. the company in a statement.
Disney shares were marked 2.5% lower at $ 109.33 each in early Thursday trading, a move that would expand the year-to-date decline to around 24.5%.
California is one of 30 states where the number of cases is growing by 5% or more based on an average of 7 days, according to a CNBC analysis of data compiled by Johns Hopkins University. The seven-day state average of new Covid-19 cases increased nearly 46% compared to a week ago, CNBC reported.
Disney also operates four theme parks at its Walt Disney World Resort in Orlando, Florida, which attracts more than 150 million visitors each year, and has planned a phase reopening that will begin on July 11.
The Florida sites are also expected to host the truncated playoffs of the National Basketball Association, a 22-team tournament that was approved by the owners of the league on June 4.
The training is slated to begin July 9, with players located in what the league has called ‘isolation housing’ on the Disney campus as part of the Florida state quarantine rules for newcomers.
Florida’s confirmed coronavirus case count rose to 109,000 this week, after a record increase of 5,508 on Wednesday.
“Now they are testing more than they were sure of, but they are also testing positive at a higher rate than before,” Gov. Ron DeSantis said Tuesday. “So that will tell you that there has probably been an escalation in the transmission in the last seven to 10 days.”
Disney began closing its theme parks in January when the coronavirus began to establish itself in China, where Shanghai Disneyland operates, while Disney’s theme parks in the United States have been closed since mid-March.
In the financial year that ended in September 2019, Disney said its Parks, Experiences and Products division, the company’s largest, generated $ 26.3 billion in annual revenue.
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