Disney's financial report: Annual income of 62.7 billion yuan is equivalent to three Wandas

Wang Jianlin, the richest man, said that Shanghai Disney could not make a profit, and Disney released its most beautiful annual report in history: revenue and net profit in fiscal year 2016 exceeded 370 billion yuan and 62 billion yuan respectively, killing Wanda Business, which had previously delisted from Hong Kong stocks.

the words of the richest man Wang Jianlin to make Shanghai Disney unprofitable are still ringing in our ears. Disney released its most beautiful annual report in history: revenue and net profit in fiscal year 2016 exceeded 370 billion yuan and 62 billion yuan respectively, killing Wanda Business, which had previously delisted from Hong Kong shares.

< strong > acquisition renewal: Disney makes record profits < / strong >

Disney recently announced its fiscal year 2016 results: for the full fiscal year ended October 1, 2016, total revenue was $55.632 billion and net profit was $9.391 billion, up 12% from a year earlier. Revenue and profits are both record, which translates to about 371.5 billion yuan and 62.7 billion yuan, respectively.

this report card still far exceeds Wang Jianlin's flagship company, Wanda Business, which was recently delisted on the main board of Hong Kong. The results show that Wanda's revenue and net profit in 2015 were about RMB: 124.8 billion and 30 billion, respectively. Disney's revenue and profit are equivalent to three times and more than twice that of Wanda, respectively.

Disney's profit source is no longer the classic characters such as Mickey Mouse, Donald Duck and Snow White when it was founded. Most of the businesses that now contribute the bulk of Disney's profits come from previous huge mergers and acquisitions.

Disney Chairman and CEO Robert Iger said the record performance in fiscal 2016 was mainly due to the popularity of movies such as Star Wars: the Force Awakens, Captain America 3, finding Nemo 2 and Zootopia. Star Wars grossed more than $2 billion at the box office, while the other three films all grossed more than $1 billion.

and this series of films are all from previous acquisitions such as Pixar, Lux and Marvel Animation, and Disney veterans made little contribution to the box office this year. In 2006, 2009 and 2012, Disney bought Pixar Animation, Marvel Studios and Lucasfilm for $7.4 billion, $4.2 billion and $4.1 billion, respectively; the three acquisitions cost a total of $15.7 billion.

in addition, media networks, which account for nearly 40% of its total revenue, are also acquired. In 1996, Disney bought ABC,ABC for a whopping $190. It owns more than 200 affiliated television stations and dozens of radio stations. In addition, ABC has a stake in ESPN80%, the world's largest sports media. At present, ABC is one of the three major commercial radio and television networks in the United States. In 2001, Disney also bought the FOX home channel for $5.2 billion. Since 1996, Disney has spent nearly $40 billion on acquisitions.

after 20 years of huge acquisitions, Disney is no longer the Disney of Mickey Mouse's birth.

< strong > Shanghai Disneyland break even in 2017? Maybe it doesn't matter at all < / strong >

although Disneyland is still a popular tourist destination, Shanghai Disneyland often scans the screen. But in fact, Disneyland's direct contribution to Disney's profit growth is far less obvious than other parts of the business, and has declined in many places.

although the full-year results hit a record high, Disney reported total revenue of $13.14 billion in the fourth quarter, down 3% from a year earlier, mainly due to a decline in total revenue at Disneyland resorts.

Disney Chief Financial Officer Christine McCarthy said: the main reason for the decline in operating profits in the international market is the nearly $100 million decline in the performance of Disneyland in Paris. Hong Kong Disneyland suffered another huge loss last year, with a loss of HK $148 million, with the overall number of visitors falling from 7.5 million in 2014 to 6.8 million last year. After the opening of Shanghai Disneyland, life at Hong Kong Disneyland has been even more difficult, and layoffs have been exposed in the first half of this year.

Disney officials say Shanghai Disney received 4 million visitors in its first four months of operation, and expects Shanghai Disney to break even in 2017. According to this data, the number of visitors to Shanghai Disneyland is almost twice that of Hong Kong Disneyland.

after the opening of Shanghai Disneyland, China has two Disneyland parks at the same time, which rewrites the record of Disneyland and is backed by China's huge tourism market.

according to the National Bureau of Statistics, the number of domestic tourists in China was 4 billion in 2015, and the domestic tourism revenue reached 3.4 trillion yuan, an increase of more than 10 times compared with 2000.

the rapid growth of tourism in China has promoted the development of theme parks, and the profitability of many theme parks is not good. With the exception of Disney, the construction of theme parks everywhere is accelerating: international theme parks such as Universal Studios, Paramount, six Flags and Lego are stationed in China.

the Analysis report on the Development Model and Investment Strategic Planning of China's theme Park Industry shows that only about 10% of China's theme parks are profitable.

Wanda Group, owned by the richest man Wang Jianlin, has also built Wanda cities across China, directly challenging Disneyland with the strategy of "wolves fighting tigers". "there is only one Disneyland in Shanghai, and Wanda City has 15 to 20 in other parts of the country," Wang said. This park and another park is a completely different format, continuous innovation, indoor and outdoor combination.

High amortization costs and poor earnings records in other parts of the world do make Shanghai Disneyland's profits face a lot of uncertainty. But the question is that whether Shanghai Disney is ultimately profitable may not be the focus of Disney's attention at all; Disney's profits are already outside the park.

Edit: yvette