More capital spending will be coming to Walt Disney Parks & Resorts in coming years, according to Walt Disney Co. Chief Financial Officer Tom Staggs. In an address on on the Web-based Merrill Lynch U.S. Media Conference this morning, Staggs said that the theme parks division can expect more capital investment. That spending will be driven for a couple of years by the cost of the two new cruise ships Disney is buying to expand Disney Cruise Lines, but he said the theme parks also will benefit.
The division's capital spending has fluctuated from about $1 billion in 2004 to $1.4 billion in 2005 and down to $900 million last year, reflecting the cost of opening Hong Kong Disneyland in 2005. Disney's investment in domestic parks -- Walt Disney World, Disneyland and Disney's California Adventure -- slid about 8 percent last year to $667 million, according to the corporation's annual report. "We think we'll see capital expenditures come up from the somewhat low levels we've seen over the past years," Staggs said. Does that mean a new park is in the works? Skaggs refused to support or dismiss continuing industry speculation that Disney is planning to build its next theme park in mainland China, but suggested that, at best, it would be a ways off. "The answer is, we don't know," Staggs said. "I think there certainly is a potential market there for a theme park. But for that to happen we'd have to have an agreement that makes sense for us and also for the Chinese government. I think we're not going to rush that by any stretch."
