Disney Profit Doubles

BURBANK, February 8: The Walt Disney Company, driven by DVD
sales, the performance of its cable networks and the sale of its stake in E!
Networks, has recorded a first-quarter profit of $1.7 billion, more than double
the $734 million posted this time last year.

The company reported revenues of $9.7 billion, a 10 percent
gain on the Q1 2005 revenues of $8.9 billion. Diluted earnings per share (EPS)
for the quarter increased to $0.79, compared to $0.37 in the prior-year
quarter. This quarter’s results included $1.1 billion derived from the sale of
the company’s interests in E! Entertainment and Us Weekly.

“I am very pleased to report such strong quarterly earnings
to kick off 2007,” said Bob Iger, the president and CEO of The Walt Disney
Company. “These results are particularly gratifying given the great year we had
in 2006 and are another clear sign our strategy is driving growth and creating
shareholder value.”

At the media networks division, revenues were up by 6
percent to 3.9 billion and segment operating income increased 24 percent to
$750 million. The cable networks saw revenues rise by 12 percent to $2.1
billion, with operating income up 22 percent to $453 million. These were driven
by increases at the international Disney Channels and domestic Disney/ABC cable
networks. At ESPN, there were increases in affiliate revenue and advertising
revenue, which were offset by higher programming costs. At ABC, meanwhile,
revenues were flat at $1.82 billion but operating income rose 27 percent to
$297 million. Highlights for the broadcasting segment included strong
international and DVD sales of Touchstone Television series led by the hit
dramas Grey’s Anatomy and Lost. These increases were partially offset by higher
programming and production costs, including increased costs associated with the
Disney branded mobile phone service.

Parks and Resorts revenues for the quarter increased 4
percent to $2.5 billion and segment operating income increased 8 percent to
$405 million.

Studio Entertainment revenues for the quarter increased 29
percent to $2.6 billion and segment operating income increased from $128
million to $604 million, driven by strong DVD sales of, among others, Pirates
of the Caribbean: Dead Man’s Chest,
Disney/Pixar’s Cars, and the Little
Mermaid Platinum Release.

Consumer Products revenues for the quarter decreased 6
percent to $692 million and segment operating income decreased 13 percent to
$235 million.