Despite the pandemic, some Universal parks see profits, raising hopes for upcoming earning reports from Disney and SeaWorld

This week Disney will share its latest earnings results. With multiple theme park resorts still closed and retail sales lagging, results are expected to be muted. But Orlando theme park peer Universal gives a good indication that parks and resorts may not be as bad off as many had expected.

During its own recent earnings report, Universal parent company Comcast confirmed that the company's three Universal Studios resorts were nearing profitability thanks largely to impressive numbers out of the open-for-business Orlando theme park.

Universal Studios Hollywood, on the other hand, has yet to reopen with only small sections of CityWalk welcoming guests. Meanwhile, Japan has seen multiple waves of COVID-19 infection that has led to decreased attendance at the nation’s theme parks. The Japanese Universal outpost closed nearly a month before Orlando or Hollywood and reopened two weeks after Orlando.

Universal’s numbers remained in the red overall due to pre-opening costs related to its upcoming Beijing resort property. Without that $45 million Beijing-related expenses, EBITDA would’ve been $30 million in the black.
The Beijing resort, estimated to cost more than $6 billion, will be the most expensive resort project Universal has ever undertaken. Opening the resort while the pandemic is still ongoing could be risky, but Comcast remains adamant that the resort will be a success.

While there were multiple mentions of the Beijing project in the earnings report, there were none for the next major project post-Beijing: Orlando’s Epic Universe. That project has been delayed with some speculating that it may be canceled, though this seems unlikely. Still, there's plenty of uncertainty regarding the future of the park.

Comcast CEO Brian Roberts pointed to Orlando as a good indicator for the company’s theme parks and, while remaining silent on Epic Universe, indicates that Comcast has confidence the industry will bounce back from the current pandemic-related slowdowns.

“What we saw this fourth quarter, especially in Orlando, gives us even more conviction in the momentum that our theme parks will experience when we reach a sustainable recovery," said Roberts. "We may experience some near-term setbacks with the most recent pickup in COVID cases, but I'm optimistic as ever about the long-term trajectory of this very special business.”

The long-term capital investments push by Comcast is in stark contrast to Disney, where $900 million in capital projects was cut due to the pandemic. It’s unclear if many of those projects will ever be revived.
Unlike Disney, SeaWorld has taken a more bullish approach to the pandemic with multiple projects, though delayed, moving forward in the last year with other projects also in the works. The company has gone so far as to express its interest in expanding its holdings.

And also unlike Disney, SeaWorld has worked to keep its parks, including SeaWorld San Diego, open in some form or fashion. That meant no rides were operating for the California park, with the park pivoting to a more zoological focus.

SeaWorld San Diego also recently hosted a drive-thru experience. Like Busch Gardens Williamsburg, it embraced food- and holiday-focused events as a way to stay open even while unable to operate large portions of their amusement parks. Meanwhile, in Florida and Texas, SeaWorld’s parks have remained open since midsummer. This should help the Orlando-based theme park giant’s bottom line.

SeaWorld will be reporting its fourth quarter and fiscal 2020 financial results on Feb. 25, a day after Six Flags.

Disney, which operates on a fiscal year that begins in October, will report its Q1 results after the markets close on Thursday afternoon.