The major media companies continue to surprise in their earnings, as the latest to exceed expectations is the Walt Disney Co. (NYSE:DIS), which enjoyed an increase in net income for the 2nd quarter of 22 percent.
Much of that increase is attributed to their parks and resorts divisions, media-networks and studio entertainment.
Net income for the quarter grew to a reported $1.13 billion, or 58 cents a share, a huge surge from the $931 million, or 44 cents a share last year in the same period. Analysts were looking for 51 cent a share for the quarter.
Sales for the quarter came in at $8.71 billion, a decent 9.5 percent increase as well. Analysts' estimates were for $8.51 billion. Last year's revenue came in at $7.95 billion for the same quarter.
Theme Parks
One of the strongest performers for the company in the quarter was their theme park business. Some sounded surprised by this, but the weakened U.S. dollar almost guaranteed this was going to happen, as foreigners came to town to take advantage of the great prices.
The only question out there was whether domestic visitors would diminish to the point foreign visitors would be negated. That didn't happen; the reason for such a strong showing.
Profits at the parks and resorts division grew by 33 percent to $339 million. Revenue increased by 11 percent to finish at $2.73 billion.
"Given the economic environment, we're pleased with the performance last quarter of our parks and resorts," Chief Executive Officer Robert Iger said on a conference call. "Our parks have been resilient to-date."
Media-Networks
The media networks division of Disney, which include the cable channels and the ABC broadcast network, grew earnings by 14 percent, based on revenue growth of 5 percent. Sales ended the quarter at $3.6 billion, while earnings increased to $1.3 billion.
Broadcast revenue dropped overall by 1.5 percent to end at $1.5 billion. Broadcast profits on the other hand grew by 17 percent to $223 million.
Earnings growth was primarily driven by ESPN, along with increased revenue at cable equity investments. Profits were also helped by the writers strike, which limited investment and costs in new programming.
Cable operating profits were up by 14 percent to $1.09 billion, as an increase in carriage fees helped in that area. Sales in the division grew by 9.3 percent to $2.11 billion.
Studio Entertainment
Studio sales for the quarter rose by 18 percent to $1.82 billion, with operating income growing by 61 percent to $377 million.
"National Treasure 2" helped lead the way there, as well as "Hannah Montana/Miley Cyrus: Best of Both Worlds." DVD sales that helped bolster the quarter were "Game Plan," "Enchanted," and "No Country for Old Men,"
Consumer Products
The consumer product divison continues to hamper Disney, as it did enjoy an increase in overall sales of 10 percent to $551 million, but earnings were down a significant 14 percent to $107 million.
Guidance
The company said re-acquiring the 200 Disney Stores from Children's Place Retail Stores will probably decrease profits for the rest of the year.
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