TV hit gives Disney boost

With the success of Walt Disney Co's first High School Musical television movie, Chief Executive Officer Robert Iger saw an opportunity to extend the hit across theme parks, merchandising and the cable-TV division.

High School Musical 2 in August drew a record number of basic cable viewers for its premiere, and live shows helped draw visitors to its parks, building on the original TV movie that attracted 170 million viewers worldwide.

As Iger focused on the ESPN sports network and family TV programming on the Disney Channel, he also raised prices at parks and expanded the resort business to increase visitors, driving a 12 percent increase in theme-park profit to $1.28 billion in the first three quarters. Disney's earnings have risen in each of the seven quarters since Iger took over the top job at the second-biggest US media company two years ago.

"Iger is doing a great job focusing the company's resources in the right direction," said Imran Khan, a JPMorgan Securities analyst in New York.

Gains in cable TV and tourism probably overcame lower film- studio profit and an operating loss at ABC to help boost fourth-quarter net income to $844 million, or 42 cents a share, from $782 million, or 36 cents, a year earlier, the average of 20 analysts' estimates compiled by Bloomberg. Sales for the period ended September 29 may have climbed 2.3 percent to $9 billion.

Disney's film studio probably posted a 14 percent drop in operating profit and a 30 percent decline in sales to $1.4 billion, Goldman Sachs Group Inc analyst Anthony Noto in New York wrote in an October 22 report.

Jonathan Friedland, a company spokesman, said Disney wouldn't discuss the results before they are released.

While Disney shares have fallen 5.6 percent in the past month on investor concerns that the economy will slow, and are little changed for the year, they have climbed about 41 percent since Iger took over in October 2005.

Bloomberg News

(China Daily 11/09/2007 page16)