Disney profits plunge; recession hurts theme parks
LOS ANGELES -- The family entertainment giant's profit in the quarter through March 28 was $613 million, or 33 cents a share. That was down from $1.13 billion, or 58 cents a share, a year earlier.
Revenue fell 7% to $8.09 billion.
Excluding restructuring charges and other items, the earnings fell to 43 cents a share, just above analyst expectations for 40 cents a share, according to Thomson Reuters. Analysts expected slightly higher revenue, $8.15 billion.
"Our second-quarter performance reflected the weak global economy, as well as disappointing results at our movie studio," Chief Executive Bob Iger told analysts on a conference call.
Disney shares closed at $23.15, up 1.3%, before the earnings report, and rose another 99 cents, or 4.3%, to $24.14 in after-hours trading.
Disney booked about $305 million in charges, including $102 million in restructuring costs, about half of which came from cutting about 1,900 positions at its parks division.
Studio operating profits fell 97% to $13 million as theatrical releases such as Bedtime Stories and Race to Witch Mountain did not fare as well as movies that came out in the same period a year ago, such as National Treasure 2: Book of Secrets, and Hannah Montana/Miley Cyrus: Best of Both Worlds.
Revenue at the studio fell 21% to $1.44 billion.
Disney said the recession led visitors to spend less money in its theme parks, though U.S. attendance was even with last year because of heavy discounting. Parks and resorts operating profits fell 50% to $171 million, while revenue dipped 12% to $2.41 billion.
Cable network profit from ESPN, ABC Family and the Disney Channel grew 5% to $1.14 billion as higher fees from cable and satellite affiliates rose despite a decline in ad revenue.
Broadcast profit at the ABC television network and its ABC stations fell 38% to $162 million amid the advertising downturn.
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