Disney's fiscal dreams come true
Its challenge now is to keep the momentum going.
For the fiscal quarter that ended September 28, the Walt Disney Co. reported a profit of $US1.39 billion, or US77¢ a share, a 12 per cent increase from $US1.24 billion, or US68¢ a share, a year earlier. Revenue climbed 7 per cent, to $US11.57 billion. The results beat analyst expectations.
Disney's theme parks provided the biggest boost, although one resort - Disneyland Paris - continued to slump. Operating profit for the company's parks division, which includes Disney Cruise Line, increased 15 per cent, to $US571 million. Disney noted that higher ticket prices at Walt Disney World in Florida and Disneyland in California had contributed to a 9 per cent increase in per-capita guest spending at those parks. Tokyo Disney Resort also had a strong quarter.
At Disney Consumer Products, operating income surged 30 per cent, to $US347 million. Merchandise tied to the animated movie Planes sold particularly well - "an incredible juggernaut", Disney's chief financial officer, Jay Rasulo, told analysts in a conference call.
Despite losses tied to The Lone Ranger, Walt Disney Studios managed a 35 per cent jump in operating income, to $US108 million. The improved results were powered by ticket sales for Monsters University, which took in $US743.1 million at the global box office, and growth from subscription video-on-demand.
"We are well-positioned for continued growth in 2014," Robert A. Iger, Disney's chairman and chief executive, told analysts.
Even so, Disney must pull off several high-wire acts over the coming year. For the first time in nine years, for instance, the company's highly successful Pixar division will not supply an annual movie; The Good Dinosaur was pushed back because of production problems. That puts more box-office pressure on expensive live-action films like Maleficent, which is scheduled for release in the spring.
Walt Disney World in the coming months is expected to introduce its long-planned My Magic Plus technology, a complex advance reservation and crowd management system that cost roughly $US1 billion to install; Wall Street is eager for results. Construction spending at Shanghai Disneyland will speed up as the company hurtles towards an opening in late 2015.
And holiday sales will be crucial for Infinity, a make-or-break video game and merchandising initiative designed to stabilise Disney's digital media unit.
Initial sales of Infinity were strong enough for Disney Interactive to swing to a fourth-quarter profit from a loss in the year-ago period of $US76 million. While recognising the importance of the holiday season for the game, Disney said more than a million starter kits had been sold worldwide since August.
Disney also said on Thursday that its Marvel Entertainment unit would produce four dramas and one miniseries for Netflix.
Frequently Asked Questions about this Article…
Disney ended its fiscal year with strong financial performance, reporting a 12% increase in profit to $US1.39 billion and a 7% rise in revenue to $US11.57 billion, surpassing analyst expectations.
Disney ended its fiscal year with strong financial performance, reporting a 12% increase in profit to $US1.39 billion and a 7% rise in revenue to $US11.57 billion, surpassing analyst expectations.
Disney's growth in the fourth quarter was driven by increased profits from its theme parks, particularly due to higher ticket prices at Walt Disney World and Disneyland, as well as strong merchandise sales tied to the animated movie Planes.
Disney's growth in the fourth quarter was driven by increased profits from its theme parks, particularly due to higher ticket prices and increased guest spending, as well as strong merchandise sales tied to the animated movie Planes.
Disney faces challenges such as the absence of a new Pixar movie for the first time in nine years, putting pressure on live-action films like Maleficent, and the need for successful holiday sales of its Infinity video game.
Disney's theme parks division saw a 15% increase in operating profit, reaching $US571 million, thanks to higher ticket prices and increased guest spending at Walt Disney World and Disneyland.
Disney's theme parks saw a 15% increase in operating profit, with higher guest spending at Walt Disney World and Disneyland contributing significantly, although Disneyland Paris continued to underperform.
Disney faces challenges such as the absence of a new Pixar movie for the first time in nine years and the pressure on live-action films like Maleficent to perform well at the box office.
Disney aims to stabilize its digital media unit through initiatives like the Infinity video game, which has already shown strong initial sales, helping Disney Interactive turn a profit in the fourth quarter.
My Magic Plus is a complex advance reservation and crowd management system that Disney plans to introduce at Walt Disney World, costing roughly $US1 billion to install.
Disney's Marvel Entertainment unit is set to produce four dramas and one miniseries for Netflix, expanding its content offerings on the streaming platform.
Disney's digital media unit, particularly through the Infinity video game, has shown improvement, swinging to a fourth-quarter profit from a previous loss, with strong initial sales of over a million starter kits worldwide.
Disney plans to introduce the My Magic Plus technology at Walt Disney World, a $US1 billion investment in advance reservation and crowd management, and accelerate construction at Shanghai Disneyland for a 2015 opening.
Marvel Entertainment, a unit of Disney, announced it will produce four dramas and one miniseries for Netflix, expanding its content offerings on the streaming platform.
Despite losses from The Lone Ranger, Disney's movie division saw a 35% increase in operating income, driven by the success of Monsters University and growth in subscription video-on-demand.
Disney plans to accelerate construction spending at Shanghai Disneyland as it prepares for an opening in late 2015, marking a significant expansion in the Asian market.
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