DIS Walt Disney Co

By Micah Maidenberg and Andrew Dowell 

Walt Disney Co. said it would again close the Hong Kong Disneyland theme park, less than a month after it reopened, amid an increase of new coronavirus cases in the city, in a new setback for the entertainment company.

The reversal highlights the challenge a multinational company such as Disney faces in navigating strategies in disparate jurisdictions as governments around the world adopt different approaches to combating the spread of Covid-19. Disney has reopened some of its theme parks at reduced capacities while implementing heightened safety measures.

The closure comes as Hong Kong officials said activities such as large social gatherings, dining in at restaurants and going to the gym would be temporarily suspended. For three weeks Hong Kong had no local infections, but after an outbreak that began July 5, the city has racked up more than 180 locally contracted cases.

Carrie Lam, Hong Kong's chief executive, said at a press conference that the theme park would have to shut under the city's new regulations.

"As required by the government and health authorities in line with prevention efforts taking place across Hong Kong, Hong Kong Disneyland park will temporarily close from July 15," a Disney spokeswoman said Monday. Hotels at the property will remain open with adjusted service levels, she added.

Over the weekend, Disney reopened two main parts of Disney World in Orlando -- Magic Kingdom and Animal Kingdom -- at reduced capacities as Florida hit a record on Sunday of more than 15,000 new coronavirus cases.

Many U.S. businesses had hoped for a smooth transition to more normal levels of business activity this summer after lockdowns only to see those plans complicated by rising new coronavirus cases in some markets.

Macy's Inc. said earlier this month it had reopened most locations, but Chief Executive Jeff Gennette said many of the malls where it had stores were still shut or could be if virus cases increased. Apple Inc. temporarily closed dozens of stores, including in Texas and Florida.

Executives at Nike Inc. said last month the company didn't expect a linear recovery. Meanwhile, bars and restaurants in New York City weren't allowed to start offering indoor dining due to rising infection rates in other states and a lack of compliance with social-distancing rules and enforcement of such measures.

In January, Disney closed the Hong Kong park as the coronavirus was spreading in China and elsewhere, describing the shutdown as a precautionary measure meant to protect the health and safety of customers and staff.

The park reopened last month, with enhanced health and safety measures. The company said then it would increase the frequency of cleaning and limit the number of people allowed in to help visitors comply with social-distancing rules. Guests also had to book trips to the facility ahead of time.

Disney owns a 47% stake in the Hong Kong property, with a government entity for the region holding the remaining portion, the company said in its annual report covering its fiscal year that ended in late September of last year.

The park sits on 310 acres on an island near the Hong Kong International Airport and offers seven themed areas, including Main Street USA and Toy Story Land, the report said.

The company's main two parks at Walt Disney World Resort in Orlando, Magic Kingdom and Animal Kingdom, reopened last week with significantly reduced capacity.

Disney is looking to resume operations at the attraction as the coronavirus spreads in Florida, with a record of more than 15,000 new cases reported in the state on Sunday.

Disney had pulled back on plans to reopen its Disneyland property in Southern California around the same time as Disney World. Employees at the California park protested the plan, worried about safety, and the state government there said guidelines for reopening theme parks wouldn't be ready for the property to be reopened as planned.

The Shanghai Disneyland property, meanwhile, is only open to guests who make advanced reservations, with a limited number of tickets available each day, according to a July 13 statement on the website for that park.

The theme-park business is a key driver of revenue for Disney, one that has been especially hit hard by the pandemic. In May, Disney said revenue for its quarter ended March 28 for its unit that includes parks fell 10% from the year earlier to $5.54 billion and operating income dropped 58% to $639 million.

RT Watson contributed to this article.

Write to Micah Maidenberg at micah.maidenberg@wsj.com and Andrew Dowell at andrew.dowell@wsj.com

(END) Dow Jones Newswires

July 13, 2020 15:42 ET (19:42 GMT)

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