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Disney Profit Rises 32% as Theme-Park Guests Splurge

Image: Disney Profit Rises 32% as Theme-Park Guests Splurge

Tuesday, 07 May 2013 04:28 PM

Walt Disney Co., the world's largest entertainment company, said fiscal second-quarter profit rose 32 percent, beating analysts' estimates, as guests splurged at theme parks in California and Florida.

Net income grew to $1.51 billion, or 83 cents a share, from $1.14 billion, or 63 cents, a year earlier, Burbank, California-based Disney said Tuesday in a statement. Excluding items, profit of 79 cents beat the 77-cent average of 27 analysts' estimates compiled by Bloomberg.

Additions at Disney parks, such as the Cars Land attraction based on Pixar movies, delivered 73 percent higher profit for the division and the fastest revenue growth for the company at 14 percent. Higher attendance and guest spending, along with the addition of the Disney Fantasy cruise ship, spurred the gains, the company said.

"The Disney machine is churning out the benefits which come from courageous capital investments in the difficult stretch from 2008 to 2011," William W. Smead, chief executive officer of Smead Capital Management Inc., a shareholder in Seattle, said in an e-mail.

Operating profit at the namesake theme parks soared to $383 million from $222 million a year earlier, Disney said. Sales totaled $3.3 billion.

Film Division

Disney's film studio posted a profit of $118 million, compared with an $84 million loss a year ago after writing down the theatrical flop "John Carter."

Chief Executive Officer Robert Iger's film unit led the industry with the top-grossing movie for the three months ended March 31, "Oz the Great and Powerful," and is building momentum now with Marvel's "Iron Man 3," already at the top of the worldwide box office after just days in theaters.

"Iron Man 3" kicked off the summer movie season on May 3, registering $174.1 million in domestic weekend ticket sales, according to Hollywood.com Box-Office, a haul bested only by last year's "Marvel's The Avengers," also from Disney.

Disney’s media networks, ABC, ESPN and the Disney channel, registered a 7.7 percent gain in profit to $1.86 billion as revenue increased 5.6 percent. Profit at ABC fell 40 percent while earnings from cable networks grew 15 percent.

In consumer products, operating profit rose 35 percent to $200 million on growth in sales of Disney and Marvel branded merchandise.

Disney shares were little changed in extended trading. The stock rose 1.6 percent to $66.07 in New York, an all-time closing high, and has advanced 33 percent this year, the second-best performer in the Dow Jones Industrial Average, which has gained 15 percent.

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