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MUMBAI:
US media conglomerate Disney has reported results for its
first fiscal quarter ended 29 December 2007.
Revenue
rose by 9 per cent to $10.45 billion.
Disney
president and CEO Robert Iger says, “We’ve started
off 2008 with another outstanding quarter, marked by strong
creative and operational performances. These results once
again highlight the quality of our content and our unique
ability to leverage it across our many businesses and territories.”
Media
Networks revenues for the quarter increased 10 per cent to
$4.2 billion and segment operating income increased 28 per
cent to $908 million. Operating income at cable networks increased
by $125 million to $586 million for the quarter driven by
increases at ABC Family Channel and the domestic Disney Channels.
Growth at ABC Family Channel was due to the absence of programming
costs for Major League Baseball and higher affiliate and ad
revenue, both of which were driven by higher rates. The growth
at the Disney Channels in the US was primarily due to strong
DVD sales of High School Musical 2 and higher affiliate
revenue due to contractual rate increases and subscriber growth.
At
ESPN, both advertising and affiliate revenues grew, offset
by higher programming and production costs. Increased advertising
revenue and programming and production costs reflected the
addition of Nascar programming. The increase in affiliate
revenue was due to higher contractual rates
and subscriber growth, partially offset by $53 million of
incremental programming covenant revenue deferrals.
Total
revenue deferrals for the quarter were $234 million, which
are expected to be recognised in the second half of the fiscal
year.
Operating
income at the broadcasting division increased $75 million
to $322 million for the quarter primarily due to higher prime
time ad revenue at ABC. This was partially offset by higher
prime time programming costs.
Increased
primetime ad revenues were due to higher ad rates and sold
inventory, partially offset by the impact of lower ratings.
The
film segment operating income for the quarter decreased by
15 per cent to $514 million while revenues were essentially
flat at $2.6 billion. Lower segment operating income was primarily
due to a decrease in domestic home entertainment, partially
offset by increases in worldwide theatrical distribution and
music distribution.
In
terms of home entertainment, despite the strong performance
of Pirates of the Caribbean: At World’s End, Ratatouille
and Jungle Book Platinum Release, the results were
down due to lower unit sales compared to the prior year quarter,
which included Cars, Pirates of the Caribbean: Dead
Man’s Chest and Little Mermaid Platinum Release.
The
improvement in worldwide theatrical distribution was primarily
due to the strong domestic performance of current quarter
titles, including Game Plan, National
Treasure: Book of Secrets
and Enchanted, and the performance internationally
of Ratatouille in the current quarter as well as lower
film cost write-downs. The growth in music distribution was
driven by the Hannah Montana concert tour and High
School Musical CDs.
Consumer
products revenues for the quarter increased by 29 per cent
to $870 million and segment operating income increased 38
per cent to $322 million.
Growth
at merchandise licencing was driven by higher earned royalties
across multiple product categories, led by the strong performance
of Hannah Montana and High School Musical merchandise.
The growth at Disney Interactive Studios was primarily due
to the success of new self-published titles based on High
School Musical and Hannah Montana in the current
quarter, partially offset by higher video game development
costs.
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