Disney ended its fiscal year in blockbuster style on Thursday, reporting solid growth in fourth-quarter profit, unveiling a substantial Netflix deal and savouring a stock price that has climbed 35 per cent in 12 months.
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.