Disney results strong but no happy ending at box office

ENTERTAINMENT giant Walt Disney had a strong performance from its theme parks and cable TV channels to thank for a 20% surge in profits in the three months to June.

Net income for the quarter rose to $604 million (€495m) from total revenues of $7.5 billion, as visitor numbers at Walt Disney World in Florida and Disneyland in California picked up in response to new attractions and economic recovery in America.

Total theme park revenue was up 32% at $2.29bn.

Combined revenues from the Disneyland parks in Paris and Hong Kong accounted for $332m during the quarter.

The division recorded operating income of $421m, an increase of 20% on the same period last year.

The cable TV division, which includes American coast-to-coast network ABC and sports channel ESPN, saw revenues increase by 8% to $2.93bn.

Studio entertainment revenue was 19% higher at $1.7bn, driven by higher DVD sales of box office smashes such as Quentin Tarantino’s Kill Bill: Volume 1 and strong fees from cable TV channels for the rights to show older successes like children’s cartoon Finding Nemo.

But there was bad news from the company’s most recent film releases.

Big-budget films Around the World in 80 Days, Raising Helen and The Alamo failed to impress at cinemas and lagged significantly behind equivalent revenues generated by Finding Nemo last year.

Major shareholder Roy Disney, a nephew of the company’s founder who stepped down as a director last year after falling out with chief executive Michael Eisner, described the box office results as “miserable”.

Mr Disney said “the party may be over” and is expected to launch a shareholder heave to oust Mr Eisner later this year.

But Mr Eisner said the results were strong and that the company would deliver full year earnings 50% ahead of last year.

Analysts, however, feared the studio unit would continue to struggle as poor performances at the box office would result in lower demand for this summer’s films when they are released on DVD and to cable TV stations.

The unit may also suffer from the unhappy ending next year of Disney’s highly successful partnership with animation company Pixar, which developed the award-winning children’s cartoon Toy Story, the first-ever feature film made entirely by computer.

Disney is keen to extend the deal but relations between the companies are believed to be poor.