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Disney Posts Plummeting Profits for Fiscal Q1

News, 01 February 2002

Hit by falling tourist numbers and the woeful performance of broadcast TV network ABC, the Walt Disney Company has reported a plunge in profits for its fiscal first quarter.

On a 7% year-on-year drop in revenue to $7.1 billion, net income came in at $297 million, down 55% on twelve months before. However, after stringent cost-cutting at the group’s theme parks, earnings and operating income bettered analysts’ expectations – a sign, says Disney, that it has weathered the worst of the downturn.

Due to the ad slump, revenues at the group’s media networks fell 3% to $3bn, with operating income tumbling almost 60% to $246m. Of particular concern is ABC, which has suffered more than broadcast rivals NBC and CBS due to weak prime-time ratings [WAMN: 14-Jan-02].

At Disney’s theme parks, there were falls in sales (down 17% to $1.4bn) and operating income (dropping 51% to $187m), while revenue at its movie studios slid 2% to $1.8bn.

News source: Financial Times