The Walt Disney Co. (DIS) was able to increase profits by 12 percent for their fiscal fourth quarter, led by strong theme park visitor growth and cable television shows.
For Disney theme parks operating income grew by 9 percent, reaching $430 million for the quarter, reflecting huge numbers of visitors to the parks.
The cable channels also performed very well for Disney, with ESPN performing very strongly. Operating income for the unit that has Disney cable-TV channels with it, grew by 25 percent to $1.1 billion. The success of "High School Musical 2," which broke basic-cable ratings, helped the division to it solid results.
ESPN also produced strong revenue from its affiliates, along with an increase in advertising sales.
The broadcast network was much weaker this year, with nowhere near as many TV shows going into syndication. The one-time shutdown of their mobile-phone service also hit the division.
The film business was way down from last year with its operating profit, as it dropped by 21 percent to $170 million. The success of "Pirates of the Caribbean" was tough to compete against for this quarter.
For the consumer products division, they had a decent quarter, with operating income increasing by 10 percent to finish at $153 million.
The overall quarter had the company increasing net income to $877 million. That equated to 44 cents a share. The same quarter last year ended with $782 million, or 36 cents a share.
Revenue for the quarter increased by a smaller 3.2 percent to reach $8.93 billion. That was lower than anylysts expected.
After their fiscal year has ended, the company has again reached double-digit growth for the fifth straight year.
Commenting on the writers' strike, executives at the company said there won't be any impact on their TV operations until the end of the year, assuming it goes that long. CEO Bob Iger said if the strike lasts longer than four weeks it will it would lead to a negative impact on the company.
Their film portfolio looks good, as there should be no problems in relationship to the strike until 2009.
Iger said, "We're fine through the November sweeps. We are definitely going to have to implement contingency plans if the strike persists."
Those contingency plans include what all the studios are looking at, like reality shows, sports and news. They also have scripted shows already finished in the pipeline which they could bring out if they had to. They would have to alter their schedule if they do that; something they pefer not to do unless they have to.
Over the next half year or so, what will be of interest to watch, is the visitors to their theme parks. While the falling dollar could definitely cause American consumers to cut back on their visits, it could also unleash a huge number of international visitors; both from Europe and Canada.
This is the one are I think is hard to project, because if Americans keep visiting in large numbers, and foreign visitors increase, they could have very strong numbers over the next couple quarters, and possibly even beyond.
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