DIS Walt Disney Co

By Erich Schwartzel 

California on Friday paved the way for Walt Disney Co.'s Disneyland and other attractions across the state to reopen as soon as next month, according to new guidelines on Covid-19 restrictions.

Under new guidelines announced by the California Department of Public Health, amusement parks, stadiums and ballparks in the state can reopen at 15% capacity starting on April 1 if certain test positivity rates are met. However, Disneyland won't resume operations under the most restrictive tier that still allows theme parks to reopen, since it limits capacity at 15%. The new guidelines could also drive activity in other industries, including live music and sports.

Opening the park at less than 25% capacity doesn't make economic sense, said a person familiar with the matter. If Covid-19 rates continue to fall as projected, though, Disney and other businesses could move into a zone that allows for 25% capacity by mid-April, this person said. Ken Potrock, the president of Disneyland Resort, said the company would be announcing an opening date soon.

Disneyland has been closed for nearly a year since the pandemic spread across the U.S., but unlike its counterpart in Orlando, has remained shut even as restrictions across the country have loosened.

"With case rates and hospitalizations significantly lower, the arrival of three highly effective vaccines and targeted efforts aimed at vaccinating the most vulnerable communities, California can begin gradually and safely bringing back more activities, especially those that occur outdoors and where consistent masking is possible," said Dr. Mark Ghaly, secretary of the California Health and Human Services Agency.

So far, California has administered about 10 million vaccine doses, according to the state. President Biden said earlier this week he expects the nation will have sufficient vaccine supplies for all adults in the U.S. by the end of May.

The updated guidance is welcome news to executives at Disney, who have publicly dueled with California officials over the right to reopen. The company's theme park in Orlando has been operating at reduced capacity since last July.

Reopening the California park will take several weeks. The company has tens of thousands of employees on furlough, and will need to negotiate with unions to bring those workers back and retrain them. A United Food and Commercial Workers local chapter that represents some Disney employees said Friday that its members "have been furloughed or out of a job for a year now and are excited to go back to work to provide Californians with a bit more magic in their lives."

Disney shares ticked upward more than 3% in after hours trading following the announcement. Yet for the past year, Wall Street has largely forgiven the company for months of theme-park and movie-theater closures, instead focusing on a booming streaming service that has lifted the company's share price to new highs.

Visiting Disney parks in Orlando and other parts of the world has been a theme-park experience unlike any other, full of employees who cheerily remind guests to socially distance and keep their masks on. While it has remained closed, Disneyland has operated as a Covid-19 vaccination site.

In the company's most recent earnings report, released last month, the Disney division that includes its theme-park business registered a $2.6 billion hit from Covid-19 during the quarter. Disney Chief Executive Bob Chapek said he expects social-distancing and mask-wearing to be required at parks at least through the end of the year.

Write to Erich Schwartzel at erich.schwartzel@wsj.com

(END) Dow Jones Newswires

March 05, 2021 19:17 ET (00:17 GMT)

Walt Disney (NYSE:DIS)
Historical Stock Chart
From Mar 2024 to Apr 2024

Walt Disney (NYSE:DIS)
Historical Stock Chart
From Apr 2023 to Apr 2024