The Walt Disney Company (NYSE: DIS) is out with earnings and the report is a solid one compared to what we have seen elsewhere, yet it too saw mostly erosion in its business segments. For the quarter, the Mouse House posted $0.47 EPS compared to $0.40 in the prior-year quarter, but that figure had gains from the Lifetime/A&E transaction and restructuring and impairment charges, which together resulted in a net benefit of $0.01.  If you back out all items, the company is showing a 5% earnings gain to $0.46 EPS.  Revenues were down 4% year over year to $9.867 billion.  Thomson Reuters had estimates at $0.41 EPS and $9.27 billion in revenues.  The units are where the story sounds worse than the raw figures.

While there were not any new deals announced, CEO Bob Iger noted:

• “… We also have adapted our organization to respond to and take advantage of the changes taking place in our businesses and will continue to do so as we position Disney to thrive for years to come.”

Media Networks, i.e. cable and broadcasting, revenues for the year increased 2% to $16.2 billion and segment operating income decreased 4% to $4.8 billion. For the quarter the revenue was up 14% to $4.725 billion.

Parks and Resorts revenues for the year fell 7% to $10.7 billion and segment operating income fell 25% to $1.4 billion. For the quarter, revenues fell 4% to $2.8 billion and segment operating income fell 17% to $344 million (year and quarter reflected cuts at our domestic operations and at Disneyland Paris).

Studio Entertainment revenues for the year fell 16% to $6.1 billion and segment operating income fell 84% to $175 million. For the quarter, revenues rose 3% to $1.5 billion and segment operating income rose $111 million to a loss of $13 million.

Consumer Products revenues for the year were essentially flat at $2.4 billion, and segment operating income fell 22% to $609 million. For the quarter, revenues fell 12% to $646 million, and segment operating income fell 28% to $151 million.

Interactive Media revenues for the year fell 1% to $712 million and segment operating results fell 14% to a loss of $295 million. For the quarter, revenues rose by 8% to $157 million and segment operating results improved 5% to a loss of $114 million.

Disney shares closed down 0.8% at $29.05 today, yet shares are up 3.4% at $30.05 in the after-hours reaction.

JON C. OGG

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