Patricia
05-07-2014, 11:35 AM
From New York Times:
LOS ANGELES — The stunning success of “Frozen,” surging theme park spending, strong merchandise sales and higher fees for ESPN combined to deliver quarterly results for the Walt Disney Company that were nothing short of spectacular.
Even the ratings-challenged ABC and Disney’s turbulent video game division delivered solid growth.
Disney on Tuesday reported net income for its second fiscal quarter of $1.92 billion, or $1.08 a share, an increase of 27 percent from $1.51 billion, or 83 cents a share, in the same period a year earlier. Excluding one-time items, Disney had earnings in the current quarter of $1.11 a share — billed by Robert A. Iger, Disney’s chief executive, as “the highest in the history of the company.”
Analysts expected 96 cents a share.
No single business or entertainment offering was responsible for Disney’s overall spike in profit, although the runaway success of “Frozen” may have been the largest contributor. An animated princess musical, “Frozen” has taken in $1.18 billion worldwide since opening in November; the film opened in important foreign markets like Japan, China and South Korea in the first three months of the year.
The “Frozen” soundtrack, released by Disney and distributed by Universal Music, has become the biggest hit of the season, selling nearly 2.5 million copies in the United States alone and ranking No. 1 on Billboard’s album chart 12 times.
Mr. Iger, speaking during a conference call with analysts, said “Frozen” now ranked as one of the top five franchises in terms of revenue, putting it up there with the likes of “Toy Story” and Winnie the Pooh in terms of importance.
“Passion for these characters and for the film is so extraordinary,” Mr. Iger said, noting that “Frozen” was coming to Broadway and that Disney was working to increase the presence of the film’s Nordic characters in its theme parks.
As a result of “Frozen,” Walt Disney Studios had operating income of $475 million, more than double the $118 million a year ago. The studio also got a boost from strong DVD and digital sales of “Thor: The Dark World.”
Disney’s largest division, Media Networks, which includes ESPN, the Disney Channel and ABC, delivered operating income of $2.13 billion, a 15 percent increase. The company cited higher affiliate fees for carriage of the Disney Channel in North America; higher affiliate fees and lower costs at ESPN, partly offset by lower ad revenue; and a higher contribution from holdings in A&E Television Networks.
ABC benefited from lower marketing costs and higher affiliate revenue, offset by weakness in prime-time ad sales.
Operating income at Walt Disney Parks and Resorts totaled $457 million, a 19 percent improvement from the year-earlier period. The results were hurt by the timing of Easter, which moved related family vacations into Disney’s third quarter. (The most recent quarter ended on March 29.)
Attendance increased at Disneyland in California, and guest spending on merchandise and food climbed at Walt Disney World in Florida. Hotels at both resorts had higher occupancy. Growth at Hong Kong Disneyland also contributed, offset by continued weakness at Disneyland Paris, where losses have climbed because of what Disney executives called “continued economic softness in Europe.”
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The phenomenon of “Frozen” did not do much to help Disney Consumer Products in the quarter, where the operating profit of $274 million — up 37 percent compared with a year earlier — was driven by higher Mickey Mouse, “Planes” and Disney Junior licensing revenue. Under Disney’s accounting procedures, a cut of “Frozen” merchandise sales goes to Walt Disney Studios; retailers like Walmart and Target also kept preorders light and ran out of merchandise as a result.
Disney Interactive had operating profit of $14 million, providing three back-to-back quarters of profitability for the division, which includes Disney.com and a gaming business. The improvement — the unit had a loss of $54 million in the same quarter a year ago — was primarily caused by Infinity, a video game and toy initiative that has generated $500 million in global sales since its August introduction.
Last week, Disney Interactive unveiled a version of Infinity that for the first time will bring Marvel superheroes to the game, which will also include more sophisticated offerings meant to attract a hard-core gaming audience. (The average age of Infinity players now is 13, Disney said.) A “Star Wars” version of Infinity is in the planning phase.
In a separate announcement, Maker Studios, a YouTube-based video supplier that sold itself to Disney last month for $500 million, on Tuesday completed an eight-figure advertising deal with the Omnicom Media Group.
-By BROOKS BARNES
LOS ANGELES — The stunning success of “Frozen,” surging theme park spending, strong merchandise sales and higher fees for ESPN combined to deliver quarterly results for the Walt Disney Company that were nothing short of spectacular.
Even the ratings-challenged ABC and Disney’s turbulent video game division delivered solid growth.
Disney on Tuesday reported net income for its second fiscal quarter of $1.92 billion, or $1.08 a share, an increase of 27 percent from $1.51 billion, or 83 cents a share, in the same period a year earlier. Excluding one-time items, Disney had earnings in the current quarter of $1.11 a share — billed by Robert A. Iger, Disney’s chief executive, as “the highest in the history of the company.”
Analysts expected 96 cents a share.
No single business or entertainment offering was responsible for Disney’s overall spike in profit, although the runaway success of “Frozen” may have been the largest contributor. An animated princess musical, “Frozen” has taken in $1.18 billion worldwide since opening in November; the film opened in important foreign markets like Japan, China and South Korea in the first three months of the year.
The “Frozen” soundtrack, released by Disney and distributed by Universal Music, has become the biggest hit of the season, selling nearly 2.5 million copies in the United States alone and ranking No. 1 on Billboard’s album chart 12 times.
Mr. Iger, speaking during a conference call with analysts, said “Frozen” now ranked as one of the top five franchises in terms of revenue, putting it up there with the likes of “Toy Story” and Winnie the Pooh in terms of importance.
“Passion for these characters and for the film is so extraordinary,” Mr. Iger said, noting that “Frozen” was coming to Broadway and that Disney was working to increase the presence of the film’s Nordic characters in its theme parks.
As a result of “Frozen,” Walt Disney Studios had operating income of $475 million, more than double the $118 million a year ago. The studio also got a boost from strong DVD and digital sales of “Thor: The Dark World.”
Disney’s largest division, Media Networks, which includes ESPN, the Disney Channel and ABC, delivered operating income of $2.13 billion, a 15 percent increase. The company cited higher affiliate fees for carriage of the Disney Channel in North America; higher affiliate fees and lower costs at ESPN, partly offset by lower ad revenue; and a higher contribution from holdings in A&E Television Networks.
ABC benefited from lower marketing costs and higher affiliate revenue, offset by weakness in prime-time ad sales.
Operating income at Walt Disney Parks and Resorts totaled $457 million, a 19 percent improvement from the year-earlier period. The results were hurt by the timing of Easter, which moved related family vacations into Disney’s third quarter. (The most recent quarter ended on March 29.)
Attendance increased at Disneyland in California, and guest spending on merchandise and food climbed at Walt Disney World in Florida. Hotels at both resorts had higher occupancy. Growth at Hong Kong Disneyland also contributed, offset by continued weakness at Disneyland Paris, where losses have climbed because of what Disney executives called “continued economic softness in Europe.”
Continue reading the main storyContinue reading the main story
Advertisement
The phenomenon of “Frozen” did not do much to help Disney Consumer Products in the quarter, where the operating profit of $274 million — up 37 percent compared with a year earlier — was driven by higher Mickey Mouse, “Planes” and Disney Junior licensing revenue. Under Disney’s accounting procedures, a cut of “Frozen” merchandise sales goes to Walt Disney Studios; retailers like Walmart and Target also kept preorders light and ran out of merchandise as a result.
Disney Interactive had operating profit of $14 million, providing three back-to-back quarters of profitability for the division, which includes Disney.com and a gaming business. The improvement — the unit had a loss of $54 million in the same quarter a year ago — was primarily caused by Infinity, a video game and toy initiative that has generated $500 million in global sales since its August introduction.
Last week, Disney Interactive unveiled a version of Infinity that for the first time will bring Marvel superheroes to the game, which will also include more sophisticated offerings meant to attract a hard-core gaming audience. (The average age of Infinity players now is 13, Disney said.) A “Star Wars” version of Infinity is in the planning phase.
In a separate announcement, Maker Studios, a YouTube-based video supplier that sold itself to Disney last month for $500 million, on Tuesday completed an eight-figure advertising deal with the Omnicom Media Group.
-By BROOKS BARNES