A solid performance at ESPN -- primarily thanks to higher affiliate fees -- and improvements at the theme parks and resorts and consumer-products segments drove The Walt Disney Co. to a 38% operating-profit gain to $1.1 billion in the company’s second fiscal quarter (ended March 31) on an 11% revenue increase to $7.2 billion.
Noticeably absent from those revenue drivers was the TV network.
Disney CEO Michael Eisner said the improved economy was the key factor in the company’s improved results for the quarter. He made a point of noting that ABC is still a laggard but said he was “very enthusiastic about the new management team” at the network.
Disney’s entire media networks division, which includes the company’s cable and broadcast assets, posted a 7% revenue gain for the quarter to $2.8 billion, with a 76% increase in operating profits to $704 million. The majoritiy of that revenue came from cable.
The broadcasting unit, however, posted a 5% drop in revenue, to $1.34 billion, due to ABC’s continuing poor performance, although cost cuts helped the unit post a $28 million operating profit versus a $105 million loss for the same period a year ago.
The cable networks, led by ESPN, posted a 21% gain in revenue to $1.5 billion, with a 34% gain in operating profit to $676 million. The gain in cable profits was primarily due to higher affiliate fees for the sports network, Disney said.