Media and entertainment giant Walt Disney last night reported a 27% slump in quarterly earnings after accounting changes and heavy losses by its movie division.
Disney said net income in the July-September quarter was $379m, or 19 cents a share, down from $516m a year ago. Revenue was $7.73 billion, up a touch from last year's $7.54 billion.
Excluding various one-time gains and accountancy writedowns, the company would have reported earnings of 20 cents a share, ahead of the 18 cent estimate from analysts.
Disney said revenue for its studio entertainment division dived 20% to $1.5 billion, leading to an operating loss of $313m for the unit during the quarter. Much of the results were due to a decline at film production company Miramax, lower unit sales and higher movie cost writedowns.
DVD sales lagged with Disney-Pixar co-productions such as 'The Incredibles' and 'National Treasure' failing to match the success last year of 'Finding Nemo', 'Pirates of the Caribbean' and 'The Lion King' platinum re-release.
The theme parks business did better in a quarter that saw Disney open a new resort in Hong Kong. Disney hopes the park, which opened in September, will help it promote its brand in China's growing lucrative market. Parks and resorts revenues for the year increased 16% to $9 billion and the unit's operating income increased 9% to $1.2 billion.
Operating income at Disney's cable networks division jumped 19% to $2.29 billion for the year, helped by a strong performance by the ESPN sports network.
Disney chief executive Robert Iger, who took over the top job on September 30 after a shareholder revolt against his predecessor Michael Eisner, highlighted another period of double-digit growth in earnings per share.
He said the result was 'further evidence that our strategy to achieve growth through great creative content, global expansion and the application of new technology is working'.
Iger cited an agreement with Apple Computer to make Disney programming available on the iPod as a 'fitting example' of his company's embrace of the changing media landscape.
