Disney profit up 12% on consumer products, studio, theme park gains
Walt Disney Co. reported a 12% increase in net income for its fiscal fourth quarter, lifted by the performance of its consumer products, studio, and parks and resorts divisions.
The Burbank company posted net income of $1.394 billion for the quarter that ended Sept. 28, up from $1.244 billion a year earlier. Revenue rose 7% to $11.568 billion.
Disney, the world’s largest entertainment and media company, posted adjusted earnings per share of 77 cents, up from 68 cents a year earlier.
That was slightly ahead of the expectations of analysts, who predicted earnings per share of 76 cents, according to investment research firm Zacks.
Shares of Disney fell $1.85 on Thursday to $67.15 in regular trading. The stock was down to $66.48 in after-hours trading. The shares are up 35% on the year.
Disney’s earnings release came just hours after the company made a splash with video delivery service Netflix Inc., announcing a long-term agreement for several new live-action series based on Marvel Entertainment comic book characters.
The shows from Disney-owned Marvel will begin their rollout on Netflix in 2015. Characters Daredevil, Jessica Jones, Iron Fist and Luke Cage will get their own shows. Each will receive a 13-episode story arc, to be followed by a miniseries based on Marvel’s “The Defenders” franchise.
Disney’s movie studio fared better than it did in the third quarter, when it posted a 36% decline in operating income from a year earlier -- partly because of marketing costs associated with “The Lone Ranger,” the company’s costly summer disappointment.
The studio posted operating income of $108 million in its fourth quarter, up 35% from a year earlier. Revenue was up 7% to $1.506 billion. Disney attributed the improvement to growth in video-on-demand distribution and better theatrical results.
The company had a hit in “Monsters University,” which was released June 21 and has grossed $743 million worldwide, according to Box Office Mojo. The film offset the poor performance of “Lone Ranger.”
The Johnny Depp-starring film, released July 3, grossed $261 million worldwide but had a production budget of at least $225 million and cost tens of millions of dollars more to market.
Upon release of the company’s third-quarter earnings in August, Chief Financial Officer Jay Rasulo said on a conference call with analysts that Disney expected to lose $160 million to $190 million on “The Lone Ranger” -- results that are reflected in its fourth-quarter earnings.
Disney’s media networks group, which includes ABC and ESPN, posted operating income of $1.442 billion, down 8%. That decline was partly due to a decrease in operating income at the company’s cable networks division, which was driven by a reduction of $172 million due to revenue deferrals at ESPN. (Absent that impact, the cable division’s operating income would have been $77 million higher.) Overall, revenue rose 1% to $4.946 billion for the media networks.
Disney’s parks and resorts posted operating income of $571 million -- a gain of 15% from a year earlier. Disney said the strong performance was partly because of an increase in guest spending and attendance at the company’s domestic properties.
The company’s consumer products division posted operating income of $347 million, compared with $267 million a year earlier. Revenue was up 14% to $1.004 billion.
Disney also reported its full fiscal year results. The company achieved record revenue, net income and earnings per share for fiscal 2013. Net income for the year reached $6.1 billion on revenue of $45 billion.
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