- On a consolidated basis, both revenues and operating income decreased compared with the same period of the previous fiscal year, due to declines in total attendance and revenues per guest at the two parks. In addition, loss on disposal of facilities associated with the conclusion of events in the previous period was also a factor that constrained operating income.
- Liabilities were reduced due to the repayment of interest-bearing debt. While facility investments were made, the overall impact of depreciation and amortization of Tokyo Disney Resort facilities resulted in a decrease in assets.
Revenues and Operating Income
Consolidated revenues for the interim period fell 3.8% compared with the same period of the previous fiscal year to ¥157,198 million (US$1,415.6 million), while consolidated operating income fell 28.1% to ¥14,296 million (US$128.7 million).
Composition of Business Segments of the Oriental Land Group
* As of the fiscal year ended March 31, 2004, The Disney Store Japan was separated from "Other Businesses" to constitute a segment of its own under "Retail Business."
Theme Park Segment
Revenues fell 4.9% compared with the same period of the previous fiscal year to ¥131,352 million.
Total attendance at the two parks fell 2.3% compared with the same period of the previous fiscal year to 12,029 thousand guests. While every effort was made to limit the falloff after the end of the Tokyo Disneyland 20th Anniversary events last year, including aggressive business initiatives at the two theme parks such as the introduction of the new attraction, "Buzz Lightyear's Astro Blasters," at Tokyo Disneyland and "BraviSEAmo!," a large-scale nighttime entertainment starting in July, results were nevertheless affected by record-breaking summer heat and others. Revenues per guest fell 3.7% to ¥9,047. This was primarily due to the decline in strong sales of Tokyo Disneyland 20th anniversary products in the same period of the previous fiscal year.
Operating income fell 30.4% to ¥11,247 million. With respect to costs, the ratio of costs of goods sold in the Theme Park segment improved due to such factors as a review of ordering methods to suppliers. However, loss on disposal of facilities associated with various events implemented previous fiscal year an increase in expenses related to renovation and improvement resulted in the decline.
Commercial Facilities Segment
Revenues rose 1.5% compared with the same period of the previous fiscal year to ¥10,793 million. At IKSPIARI, directly managed stores demonstrated favorable performance as marketing activities, such as seasonal events, also contributed to raising attendance. At Disney Ambassador Hotel, banquet revenues rose, while room charge revenues decreased. Operating income fell 4.1% to ¥1,154 million, due to such factors as increased expenses from the strengthening of marketing activities.
Retail Business Segment
Revenues rose 1.1% compared with the same period of the previous fiscal year to ¥11,247 million. This resulted from the opening of a new store in June and the start of sales of merchandise of The Disney Store Japan products through Disney's official Internet shopping site in July. Operating income fell 20.3% to ¥1,427 million, primarily due to such factors as increased sales personnel expenses and store rents associated with the opening of the new store and efforts to strengthen product development.
Other Business Segment
Revenues rose 12.1% compared with the same period of the previous fiscal year to ¥3,806 million. This was the result of the solid performance maintained by the monorail business and favorable sales at Rainforest Café theme restaurant inside IKSPIARI. Operating income fell 48.5% to ¥293 million due to factors including increased expenses related to legally mandated monorail inspections.
Consolidated net income decreased 28.3% compared with same period of the previous fiscal year to ¥7,188 million (US$64.7 million). This was due to a one-time settlement of the excess cost-over-book value of affiliated companies accounted for by the equity method, which was booked as an extraordinary loss.
Total assets at the end of the interim period were ¥637,498 million (US$5,740.6 million), a decrease of 2.6% from March 31, 2004.
Current assets were ¥78,046 million (US$702.8 million), a decrease of 1.4% from March 31, 2004. While cash and cash equivalents increased due to the issuance of the sixth issue of unsecured bonds (¥20,000 million) in May, marketable securities were used to redeem ¥20,000 million worth of the third issue of unsecured bonds in June. Property and equipment totaled ¥510,399 million (US$4,596.1 million), down 1.5%, despite progress in the construction of new attractions, as depreciation and amortization of Tokyo Disney Resort facilities progressed.
Total liabilities were ¥258,278 million (US$2,325.8 million), a decrease of 7.9% from March 31, 2004, mainly due to steady repayment of debt. Total stockholders' equity was ¥379,112 million (US$3,413.9 million), an increase of 1.4% primarily due to an increase in earned surplus, and stockholders' equity rose 2.4 percentage points to 59.5%.
Cash and cash equivalents at the end of the interim period increased ¥14,508 million (US$130.6 million) from the beginning of the period to ¥44,128 million (US$397.4 million).
Net cash provided by operating activities was ¥22,780 million (US$205.1 million), a decrease of ¥1,028 million compared with the same period of the previous fiscal year. This was mainly due to decreased net income before income taxes, and decreased consumption taxes.
Net cash provided by investing activities was ¥6,297 million (US$ 56.7 million), an increase of ¥23,630 million compared with the same period of the previous fiscal year. Negative factors included additional investments into Tokyo Disney Resort facilities, while positive factors included an increase in revenues due to the sale and redemption of securities to repay interest-bearing debt.
Net cash used in financing activities was ¥14,603 million (US$131.5 million), an increase of ¥29,654 million compared with the same period of the previous fiscal year.
This was caused in spite of the steady progress made in redeeming bonds and repaying debt by the issuance of the sixth issue of unsecured bonds.