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http:// --> Ashland, Oregon HOME Valley & State Sports Nation & World Opinion/Editorial Classifieds Business Columnists Obituaries Weather Archive Hot Topics Most Viewed Forum Photo Gallery Video Readers Polls Revels Etcetera Backpage O-Zone Special Sections Real Estate Guide Menu Guide Shakespeare Subscribe Contact Us Rate Card Place an Ad Online Games Movie Preview November 11, 2006 Walt Disney doubles profits thanks to films, networks By Joseph Menn The Associated Press HOLLYWOOD — Walt Disney Co. more than doubled its profit in the fiscal fourth quarter on a turnaround at the movie studios that released the two top-grossing domestic films of the year. The jump in net income to $782 million, or 36 cents a share, from $379 million, or 19 cents, ended the first full fiscal year under Chief Executive Robert Iger with an exclamation point. Yet Disney's shares, which have rocketed 40 percent this calendar year, slipped 58 cents to $33 in extended trading after the company would not predict a fifth consecutive year of at least 10 percent profit growth. The stock rose 48 cents to $33.58 in the regular session. Analysts said the pullback also reflected a number of cautionary notes on the company's conference call for investors and the realization that by drastically reducing the number of movies it makes, Disney is increasing the potential effects of one failure. "They seem to have a strategy of two 'tent-pole' releases next year," said Lehman Bros. analyst Vijay Jayant, referring to the third movie in the "Pirates of the Caribbean" series and an animated release from its Pixar Animation Studios, "Ratatouille." Disney reaped huge benefits from the top films of 2006 — the second "Pirates" movie and Pixar's "Cars." Without the expenses from Miramax Films' final Disney movies, the studios as a whole swung to operating profit of $214 million from a year-earlier loss of $313 million. In keeping with Iger's strategy of spreading successes through its divisions, Disney is creating more theme park attractions based on Pixar stories and licensing "Cars" merchandise that has brought in more than $1 billion to retailers. But Disney's consumer products division increased profit just 1 percent in the most recent quarter, to $139 million, as it spent more on video games. Iger said Disney would try to get more from its characters and movies by investing still more in games, some $130 million for development during fiscal 2007, compared with $100 million in the year just ended. On cable, the Disney Channel has spawned DVDs and top-selling albums from the movies "High School Musical" and "The Cheetah Girls" and the series "Hannah Montana." Disney's parks brought in 28 percent more profit than a year earlier, $396 million, as attendance edged up and visitors spent more. At ABC and cable networks including ESPN, profit rose 18 percent to $883 million. For the full year, Disney net income rose 33 percent to $3.37 billion, or $1.64 a share, from $2.53 billion, or $1.22. Revenue rose 7 percent to $34.3 billion. On the conference call, Iger said Disney might sign a long-term deal with top cable operator Comcast Corp. as soon as next week. Iger did not say whether Comcast would be paying more for Disney's current cable content, but he said the entertainment giant might be able to offer new packages as Comcast expands its video-on-demand, Internet and phone services. Disney's efforts to shed some of its ABC Radio properties, meanwhile, have been delayed until the first half of the new fiscal year, Chief Financial Officer Thomas Staggs said. He and Iger said they would increase their capital investment in theme parks and new-media initiatives by $400 million or more in 2007, from $1.3 billion this year, reversing a drop-off in park spending. Entertainment industry analyst Laura Martin of Soleil/Media Metrics said she was not concerned that Iger and Staggs declined to commit to the same pace of earnings growth in 2007. With the new "Cars" and forthcoming "Pirates" DVDs in the current quarter and more movies coming from proven franchises, she said, "this company is doing all the right things." Leave a Comment: Advertisement: Advertisement: Paid Advertising Inkjet Printers Student Loans Water Filter Helzberg Diamonds Mortgage Calculator Security Systems Advertisement: Copyright © 2006 Ashland Daily Tidings and Ottaway Newspapers. All Rights Reserved.