Profit Up 39 Percent at Disney

BURBANK, August 9: Boosted
in part by a $30 million net benefit associated with the completion of the
Pixar acquisition, The Walt Disney Company today reported a third quarter net
profit of $1.1 billion, a 39 percent gain on the year-ago period, on revenues
of $8.6 billion, a 12 percent increase on Q3 2005.

For the nine months ended
July 1, meanwhile, profit was up 20 percent to $2.6 billion, on revenues of
$25.5 billion.

Announcing the results,
president and CEO Robert A. Iger noted, "Disney's strong third quarter
financial results demonstrate the company's unique ability to leverage great
content across our many businesses. In recent months, we have released such
highly successful creative product as Cars, High School Musical
and Pirates of the Caribbean: Dead Man's Chest, all of which are having a positive impact
throughout our company, from merchandise sales to the Internet to home video to
our theme parks. By investing in our pre-eminent core brands and adopting new
platforms to enhance the entertainment experience, we intend to deliver our
content to more people, more often, in more places, and thereby also deliver
long-term growth to our shareholders."

Media Networks revenues
for the quarter increased 10 percent to $3.7 billion and segment operating
income increased 5 percent to $1.2 billion. Cable network revenues were up 12
percent to $2.2 billion, with an operating income of $969 million, a 15 percent
gain, led by ESPN. At the broadcasting division, however, operating income
dropped 28 percent to $183 million despite an 8-percent revenue increase to
$1.6 billion. Disney attributed the weaker segment profit to higher programming
expenses at ABC, the increased number and costs of pilot productions and costs
associated with the launch of the Disney branded mobile phone service. These
were partially offset by increased revenue due to higher advertising rates at
ABC.

Studio Entertainment
revenues for the quarter increased 17 percent to $1.7 billion and segment
operating income increased $284 million to $240 million. Higher segment
operating income was due to improvements in worldwide home entertainment and
domestic theatrical motion picture distribution, partially offset by a decrease
in international theatrical motion picture distribution.

Parks and Resorts revenues
for the quarter increased 11 percent to $2.7 billion and segment operating
income grew 26 percent to $549 million. Consumer Products revenues for the
quarter increased 6 percent to $445 million and segment operating income
increased 69 percent to $105 million.