Disney Profit Climbs 60%

Despite ABC’s dismal prime-time ratings, a softer-than-expected reception of “The Hunchback of Notre Dame” at the domestic box office and reported tensions in the executive suite, Walt Disney Co. still knows how to make a lot of money.

The Burbank-based entertainment giant surprised Wall Street analysts with a better-than-expected performance in its fiscal fourth quarter. Earnings rose 60% to $354 million when the acquisition of ABC is factored in. Revenue climbed to $5.3 billion.

For the year, Disney’s net income climbed 16% to $1.5 billion with ABC factored in. Revenue climbed 12% to $21.2 billion.

Disney shares, which have risen about $20 since the summer, jumped again Tuesday, gaining $2.50 to close at a new high of $76 on the New York Stock Exchange.

“Disney is living up to and still exceeding expectations. People who were afraid of the stock now realize Disney is not going to fall apart because of the ABC acquisition,” said Arthur Rockwell, analyst with Yaeger Capital Markets in Los Angeles.

In Disney’s Creative Content group, which includes its film studio, revenue rose 18% to $2.7 billion and operating income rose 31% to $387 million. Results were boosted by the box-office performance of the John Travolta film “Phenomenon,” as well as the video sales of “Oliver & Co.” and “Aladdin and the King of Thieves.”

Results were also aided by the international performance of “The Rock” and “Hunchback.” Although “Hunchback” did not live up to the performances of previous Disney animated films such as “The Lion King” or “Aladdin,” the movie is expected to be highly profitable when home video sales and other revenue sources are eventually recorded.

Christopher Dixon, entertainment analyst with PaineWebber Inc., said Creative Content’s results should be even stronger when the current quarter’s earnings are reported, given the success of “Ransom,” the expected strong showing of the live-action film “101 Dalmatians” and video sales of “Toy Story.”

In broadcasting, poor ratings for ABC were offset by strong results from ESPN as well as accounting moves that reduced amortization and other costs stemming from Disney’s $19-billion acquisition of ABC earlier this year. ABC has been struggling this season and is mired in third place in overall homes in the ratings, behind NBC and CBS.

Disney also said its theme park results were especially strong, aided by such promotions as the Main Street Electrical Parade finale at Disneyland and the 25th anniversary of Walt Disney World in Florida.

Attendance records were set at the theme parks for the year. Quarterly revenue for the unit jumped 11% to $1.2 billion, with operating income up 16% to $242 million.

For the fiscal year, theme park revenues increased 13% to $4.5 billion and operating income rose 15% to $990 million.