Pixar Shines at Disney’s Shareholder Meeting

Chief Executive Robert Iger may have had top billing at Walt Disney Co.’s shareholder meeting Friday in Anaheim, but it was Pixar’s John Lasseter who stole the show.

Lasseter, who will become Disney’s chief creative officer with the Burbank entertainment company’s $7.4-billion acquisition of the computer-animation pioneer, regaled the Arrowhead Pond crowd with previously unscreened snippets of “Cars” and “Ratatouille,” the company’s next two theatrical releases.

The free-spirited Lasseter, who said he “wore black tennis shoes” because his wife told him to dress up for the meeting, also pledged to maintain Pixar’s unparalleled standard of quality on Disney’s future animated releases. Lasseter, who directed such groundbreaking films as “Toy Story,” is Pixar’s creative guru.

“I promise you we will make films that will entertain you from the time the lights go off in the theater,” he said, drawing applause from a crowd of about 4,000 that filled much of the arena’s lower levels.

Lasseter’s appearance provided the most excitement in an otherwise routine affair that marked the second sedate meeting in a row, in stark contrast to a shareholder revolt in 2004 that led to the departure of Iger’s predecessor, Michael Eisner.

On Friday, shareholders brushed aside a proxy advisory firm’s recommendation to withhold their votes from Chairman George J. Mitchell, instead reelecting all 13 board members with a 94% yes vote. Mitchell, who had said he would step down at the end of 2005, agreed to stay on the board through 2006, drawing the ire of some investors. The company is working on a plan to replace him.

Shareholders also rejected two proposals that would have altered policies on labor standards for Chinese workers making Disney products and on payments to those who would try to “greenmail” the company by demanding a premium for their stock in exchange for dropping a takeover attempt.

By making Pixar a centerpiece of the meeting, Iger underscored two of his oft-stated strategic priorities: refocusing the company on innovation and creativity and moving it forward through the application of new technologies.

He made it clear that reviving Disney’s vaunted animation business through the purchase of Emeryville, Calif.-based Pixar would be a key factor. Before slipping in recent years, Disney animation was a lucrative business that generated fat profits in such areas as video and merchandise sales.

“To truly live up to our legacy, animation must be great,” Iger said. “We must create animated films that raise the standard of the art and become true classics for countless generations.”

Disney Chief Financial Officer Tom Staggs said the Pixar deal could close as soon as late April or early May.

In their presentations to the shareholders, Iger and Staggs painted a mostly rosy picture of the company’s prospects, promising to continue to deliver double-digit earnings growth through at least 2008.

Disney’s media networks, including ABC and ESPN, were “the largest driver” of the company’s recent gains, Staggs said. For the quarter ended Dec. 31, the company posted a 7% increase in profit over the same period last year.

The company’s stock has risen by about 18% since Iger took over in October. It is trading at about the same level as a year earlier and is far off its all-time high of $43.63 in April 2000.

Disney shares closed Friday at $28.16, up 7 cents.

Iger said attendance was up at Disney’s theme parks, which have benefited from the continuing celebration of Disneyland’s 50th anniversary. He also noted the consumer products division’s strong showing, propelled by the success of its Princess franchise, which generated $3 billion in retail sales last year from dolls, video games and DVDs.

Disney’s studio operation saw its profit slip last year, but Iger and others predict that upcoming summer releases of “Cars” and “Pirates of the Caribbean: Dead Man’s Chest” will turn its fortunes around.

Among the many small shareholders on hand Friday were Sharon Bergh, her husband, her mother and her daughter Emily, 12, who is the reason the Highland Park family invested in Disney.

“She was born in December, and we bought the stock in January for her college education,” Bergh said, adding that they have held it through up times and down.

“We try not to look at the bottom line,” she said. “She’s still five years from college, so we’ll look at it then.”