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Tag: Tsum Tsum

  • FY-2015: Disney revenue up 7.5%; net income up 11.7%

    FY-2015: Disney revenue up 7.5%; net income up 11.7%

    BENGALURU: The Walt Disney Company Inc reported 7.5 per cent YoY increase in consolidated revenue at $52,465 million for the year ended 3 October, 2015 (FY-2015, current year) as compared to the $48.813 million reported for the year ended 27 September, 2014 (FY-2014, previous year). Net income in the current year increased 11.7 per cent YoY to $8.382 million from $7,501 million.

     

    “We had a strong quarter, with adjusted EPS up 35 per cent, completing our fifth consecutive year of record performance. In Fiscal 2015 we delivered the highest revenue, net income and adjusted EPS in the Company’s history, reflecting the power of our great brands and franchises, the quality of our creative content, and our relentless innovation to maximize value from emerging technologies,” said Disney chairman and CEO Robert A Iger.

     

    For the quarter ended 3 October, 2015 (Q4-2015, current quarter), consolidated revenue increased 9.1 per cent YoY to $13.512 million as compared to $12,389 million in the quarter ended 27 September, 2014 (Q4-2014). Net Income in Q4-2015 increased 7.3 per cent to $1,609 million as compared to $1,499 million.

     

    Segment Results

     

    Four of the five Disney’s segments – Media Works, Parks and Resorts, Studio Entertainment and Consumer Products reported growth in revenue in FY-2015 and Q4-2015 as compared to FY-2014 and Q4-2014 respectively, while the fifth segment – Interactive – reported decline in revenues. However, all the five segments reported growth in segment operating income in the current year and quarter as compared to the previous year and year ago quarter respectively.

     

    Media Networks

     

    Media Networks revenue in FY-2015 increased 10 per cent to $23,264 million from $21,152 million in the previous year. Segment Operating income increased 6.4 per cent in the current year to $7,793 million as compared to $7,321 million in FY-2014.

     

    The segments revenue in the current quarter increased 11.7 per cent YoY to $5,286 million from $5,217 million. Operating income for the segment increased 26.6 per cent YoY to $1,819 million from $1,437 million.

     

    Disney says that Operating income growth at Media Networks was driven by higher affiliate fees, increased advertising revenue at ESPN and the ABC Television Network and higher operating income from program sales. These increases were partially offset by an increase in programming and production costs at ESPN and, to a lesser extent, the Disney Channels and the ABC Television Network.

     

    Two sub-segments contribute to Disney’s Media Networks – Cable Networks and Broadcasting.

     

    Cable Networks

     

    Cable Networks revenue in FY-2015 increased 9.7 per cent to $16,581million from $15,110 million in the previous year. Segment Operating income increased 4.9 per cent in the current year to $6,787 million as compared to $6,467 million in FY-2014.

     

    The sub-segments revenue in the current quarter increased 12.4 per cent YoY to $4,245 million from $3,776 million. Operating income for the sub- segment increased 29.8 per cent YoY to $1,655 million from $1,275 million.

     

    For Q4-2014, Disney says that Operating income at Cable Networks increased due to an increase at ESPN and, to a lesser extent, A&E Television Networks (A&E) and the Disney Channels. The increase at ESPN reflected higher affiliate and advertising revenues, partially offset by an increase in programming costs. Affiliate revenue growth was driven by contractual rate increases and an increase in subscribers. The increase in subscribers was due to a full quarter of the SEC Network, which launched in August 2014, partially offset by a decline in subscribers at certain of Disney’s networks.

     

    Growth in advertising revenue reflected higher units sold, partially offset by lower ratings. Higher programming costs reflected a full quarter for the SEC Network, additional rights for the US Open Tennis tournament and contractual rate increases for Major League Baseball and NFL rights, partially offset by the absence of rights costs for NASCAR.

     

    Higher equity income from A&E was due to lower programming and marketing costs, partially offset by lower advertising and affiliate revenue. The increase at Disney Channels was driven by higher affiliate revenues, partially offset by higher programming costs. Affiliate revenue growth reflected contractual rate increases domestically and subscriber growth internationally. The programming cost increase was driven by higher costs for original programming, including more hours of new series in the current quarter.

     

    Broadcasting

     

    Cable Networks revenue in FY-2015 increased 10.6 per cent to $6,683 million from $6,042 million in the previous year. Segment Operating income increased 17.8 per cent in the current year to $1,006 million as compared to $854 million in FY-2014.

     

    The sub-segments revenue in the current quarter increased 9.7 per cent YoY to $1,581 million from $1,441 million. Operating income for the sub-segment was flat YoY to $164 million from $163 million.

     

    For Q4-2014, Disney says that growth in advertising and affiliate revenue was offset by higher programming costs, lower operating income from program sales, an equity loss from Hulu and higher marketing costs for the fall season launch. The increase in advertising revenue reflected higher units sold, including the benefit of the extra week of operations, and higher rates. Affiliate revenue growth was due to contractual rate increases and new contractual provisions. Higher programming costs reflected the impact of an additional week of operations. Lower operating income from program sales was driven by an increase in cost amortisation and lower sales. Program sales reflected decreases for My Wife and Kids and America’s Funniest Home Videos, partially offset by the sale of How to Get Away with Murder in the current quarter. The equity loss from Hulu was due to higher content and marketing costs.

     

    Parks & Resorts

     

    Parks and Resorts segment revenue in the current year increased seven per cent to $16,162 million as compared to the $15,099 in FY-2014. Segment Operating income increased 13.8 per cent in the current year to $3,301 million as compared to $2,663 million in FY-2014.

     

    The segments revenue in the current quarter increased 10.1 per cent YoY to $4,361 million from $3,960 million. Operating income for the segment increased 7.4 per cent YoY to $738 million from $687 million.

     

    Growth at Parks and Resorts was driven by Disney’s domestic operations due to higher average guest spending, attendance and occupancy, partially offset by increased costs driven by inflation and volumes. Results at Disney’s international parks and resorts operations reflected lower attendance and occupancy at Hong Kong Disneyland Resort and higher pre-opening expenses at Shanghai Disney Resort.

     

    Studio Entertainment

     

    Studio Entertainment segment revenue in the current year increased 1.2 per cent to $7,366 million as compared to the $7,278 in FY-2014. Segment Operating income increased 27.4 per cent in the current year to $1,973 million as compared to $1,549 million in FY-2014.

     

    The segments revenue in the current quarter was flat (increased 0.3 per cent) YoY to $1,783 million from $1,778 million. Operating income for the segment more than doubled (2.09 times) YoY to $530 million from $254 million.

     

    At Studio Entertainment, operating income growth was due to a higher revenue share with the Consumer Products segment reflecting the success of Frozen merchandise, an increase in television distribution revenue and higher domestic theatrical results. This growth was partially offset by a decline in home entertainment units sold reflecting the success of Frozen in the prior year.

     

    For Q4-2015, Disney says that Operating income growth was due to increased TV/SVOD distribution results, lower film cost impairments, improved theatrical results and a higher revenue share with the Consumer Products segment. These increases were partially offset by lower home entertainment results.

     

    The increase in TV/SVOD distribution was driven by a lower average production cost amortisation rate, the timing of title availabilities in international pay and domestic free television markets as well as SVOD revenue growth internationally. Lower production cost amortisation reflected a higher sales mix of catalogue titles in the current quarter.

     

    Operating income growth in theatrical distribution was driven by the performance of Inside Out and Ant-Man in the current quarter compared to Guardians of the Galaxy, Maleficent and no Pixar title in the prior-year quarter. Theatrical distribution revenues were lower in the current quarter as the prior-year quarter also included Planes: Fire and Rescue and The Hundred-Foot Journey, whereas the current year included no Disney feature animation or DreamWorks titles in release. Increased revenue share was due to the performance of Frozen merchandise in the current quarter.

     

    The decrease in home entertainment was due to lower net effective pricing and unit sales reflecting the prior-year quarter performance of Frozen internationally and Marvel’s Captain America: The Winter Soldier worldwide, partially offset by Marvel’s Avengers: Age of Ultron and Cinderella in the current quarter. These decreases were partially offset by lower per unit costs as well as decreased marketing spending in the current quarter.

     

    Consumer Products

     

    Consumer Products segment revenue in the current year increased 12.9 per cent to $4,499 million as compared to the $3,985 in FY-2014. Segment Operating income increased 29.2 per cent in the current year to $1,752 million as compared to $1,356 million in FY-2014.

     

    The segments revenue in the current quarter increased 11.5 per cent YoY to $1,195 million from $1,072 million. Operating income for the segment increased 9.8 per cent YoY to $416 million from $379 million.

     

    Consumer Products operating income growth was due to higher merchandise licensing revenue reflecting the strength of Frozen, Avengers and Star Wars Classic merchandise.

     

    Interactive

     

    Interactive segment revenue in the current year reduced 9.6 per cent to $1,174 million as compared to the $1,299 in FY-2014. Segment Operating income increased 13.8 per cent in the current year to $132 million as compared to $116 million in FY-2014.

     

    The segments revenue in the current quarter reduced 4.1 per cent YoY to $347 million from $362 million. Operating income for the segment increased 72.2 per cent YoY to $31 million from $18 million.

     

    Interactive growth was driven by the ongoing success of the Tsum Tsum mobile game and lower product development and marketing costs, primarily at Disney’s mobile businesses, partially offset by lower operating income from Disney Infinity console games.

  • Disney’s Q2-2015 revenue up 7%, income up 10%

    Disney’s Q2-2015 revenue up 7%, income up 10%

    BENGALURU: The Walt Disney Company Inc reported an increase of seven per cent in its revenue in Q2-2015 (quarter ended 28 March, 2015, current quarter) to $12461 million from $11649 million in the corresponding year ago quarter. Net income during the current quarter improved 10 per cent to $2108 million from $1917 million reported for the quarter ended 27 March, 2014 (Q2-2014).

     

    Of the five segments that add to Disney’s numbers, three – Media Networks, Parks & Resorts and Consumer Products showed improvement in revenue, while the other two – Studio Entertainment and Interactive segments showed decline in revenues. Segment Operating Income from three – Parks and Resorts, Consumer Products, and Interactive increased, while segment operating income from Media Networks and Studio Entertainment declined in Q2-2015 as compared to Q2-2014.

     

    “Our second quarter performance, marked by increased revenue, net income and EPS of US 1.23, demonstrates the incredible ability of our strong brands and quality content to drive results. The power of this winning combination is once again reflected in the phenomenal worldwide success of Marvel’s Avengers: Age of Ultron, which has opened at number one in every market so far,” said Disney chairman and chief executive officer Robert A Iger.

     

     

    Segment Results

     

    Media Networks

     

     

    Media Networks revenues for the current quarter improved 13 per cent to $5810 million from $5134 million reported for Q2-2014. Operating Income from this segment declined two per cent to $2101 million in Q2-2015 from $2133 million in Q2-2014.

     

    Two sub-segments – Cable Networks, and Broadcasting contribute to this segment.

     

    Cable Networks reported a growth of 11 per cent in revenue to $4030 million in Q2-2015 from $3633 million in Q2-2014, but reported a drop of nine per cent in Operating Income to $1799 million in Q2-2015 as compared to the $1974 million in Q2-2014. The drop in income was due to a decrease at ESPN, which was driven by higher programming and production costs, partially offset by growth in affiliate and advertising revenues. Programming and production cost increases were due to higher rights costs for college football programming and the addition of an NFL wild card playoff game and the SEC Network, which was launched in August 2014.

     

    Disney says further that the increase in affiliate revenues was due to contractual rate increases, an increase in subscribers, taking into account the new SEC Network, and a reduction in revenue deferrals as a result of changes in contractual provisions related to annual programming commitments. ESPN advertising revenue growth was due to higher rates and units sold.

     

    Broadcasting reported 19 per cent hike in revenue in the current quarter to $1780 million from $1501 million and reported a massive 90 per cent increase in operating income to $302 million from $159 million in the corresponding quarter of last year due to growth in affiliate fees, higher program sales and an increase in advertising revenues. These increases were partially offset by higher marketing costs for the launch of new series.

     

    Parks and Resorts

     

    Parks and Resorts reported a growth of six per cent in revenue to $3760 million from $3562 million in the corresponding year ago quarter and a 24 per cent increase in Q2-2015 operating income to $566 million from $457 million in Q2-2014. Operating income growth for the quarter was due to an increase at Disney’s domestic operations, partially offset by a decrease at its international operations.

     

    Studio Entertainment

     

    Studio Entertainment reported decline in revenue to $1685 million in Q2-2015 as compared to the $1800 million in Q2-2014, and segment operating income decreased 10 per cent to $427 million from $475 million in Q2-2014.

     

    Lower operating income was driven by decreases in domestic home entertainment and international theatrical distribution, partially offset by a higher revenue share with the Consumer Products segment, reflecting performance of Frozen merchandise in the current quarter, and lower film cost impairments. The decreases in domestic home entertainment and international theatrical distribution both reflected the performance of ‘Big Hero 6’ in the current quarter compared to Frozen in the prior-year quarter

     

    Consumer Products

     

    Consumer Products Q2-2015 revenue increased 10 per cent to $971 million from $885 million in Q2-2014 and operating income improved 32 per cent to $362 million from $274 million in Q2-2014.

     

    Higher operating income was primarily due to an increase at Disney’s Merchandise Licensing business due to the performance of merchandise based on Frozen and, to a lesser extent, The Avengers.

     

    Interactive

     

    Revenue from this segment fell 12 per cent to $235 million in Q2-2015 from $268 million in Q2-2014, but segment operating income increased 86 per cent to $26 million from $14 million in Q2-2014.

     

    Improved operating results were due to lower marketing and product development costs and the success of its mobile game Tsum Tsum, partially offset by lower ‘Disney Infinity’ performance and decreased sales of mobile game catalogue titles due to fewer titles in release. Lower marketing and product development costs were driven by fewer mobile game titles in development and the benefit of previous restructuring activities.

  • Consumer products segment leads Disney’s record profits for Q1-2015

    Consumer products segment leads Disney’s record profits for Q1-2015

    BENGALURU: The Walt Disney Company Inc (Disney) reported 17.4 per cent higher operating income (op inc) of $3545 million (27.7 per cent of all segment operating revenue or TIO) for Q1-2015 (quarter ended 27 December, 2014, current quarter) versus $3020 million (24.5 per cent of TIO) in quarter ended 28 December, 2013 – Q1-2014.Op Inc in Q1-2015 was 27.7 per cent more than the Op Inc reported for the immediate trailing quarter (Q4-2014, previous quarter, quarter ended 27 September, 2014) at $2775 million (22.4 per cent of TIO).

     

    Leading the growth with a 45.6 per cent y-o-y increase in Q1-2015 at $626 million from the $430 million was its Consumer Products segment (CP).CP’s Op Inc in Q1-2015 grew 65.2 per cent from the $379 million in Q4-2014.Though a couple of Disney’s segments reported drops in revenues, Op Inc of all of Disney’s other segments – Media Networks (MN), Parks & Resorts (P&R), Studio Entertainment (SE) and Interactive, also showed positive y-o-y and q-o-q growth.

     

    Disney’s TIO for Q1-2015 grew 8.8 per cent y-o-y to $13391 million from $12309 million and was 8.1 per cent higher q-o-q than the $12389 million in Q4-2015.

     

    “This was yet another incredibly strong quarter for our Company, with diluted EPS up 23 per cent driven by record revenue as well as significant growth in segment operating income, ” said Disney chairman and CEO Robert A Iger.”Our results once again reflect the strength of our brands and high quality content and demonstrate that our proven franchise strategy creates long-term value across all of our businesses”

     

    Disney Segment results

     

    Media Networks

     

    MN is Disney’s largest segment, both in terms of revenue and Op Inc.MN reported 2.7 per cent growth in Op Inc to $1495 million (41.2 per cent of all Op Inc) in the current quarter from the $1455 million (48.2 per cent of all Op Inc) in Q1-2014 and a growth of 4 per cent from $1437 million (51.8 per cent of all Op Inc) in Q4-2014.

     

    During Q1-2015, MN revenue grew 10.8 per cent to $5860 million (43.8 per cent of TIO) from $5290 million (43 per cent of TIO) in Q1-2014 and was 12.3 per cent more than the $5217 million (42.1 per cent of TIO) in the previous quarter.

     

    Two sub-segments contribute to MN – Cable Networks and Broadcasting

     

    Cable Networks

     

    Cable Networks reported 11 per cent growth in revenue in Q1-2015 to $4166 million from $3759 million in Q1-2014.Cable Network’s Op Inc fell two per cent to $1255 million from $1277 million in Q1-2014.

     

    Disney says that Operating income at Cable Networks decreased two per cent due to a decrease at ESPN, which was partially offset by increases at the worldwide Disney Channels and ABC Family.

     

    The decrease at ESPN was due to higher programming and production costs and, to a lesser extent, higher marketing, general and administrative and technical costs and lower advertising revenue.These decreases were partially offset by affiliate fee contractual rate increases, a reduction in revenue deferrals as a result of changes in contractual provisions related to annual programming commitments and an increase in subscribers, taking into account the new SEC Network.

     

    Programming and production cost increases were due to a contractual rate increase for NFL programming and rights costs for the SEC Network.ESPN advertising revenue decreased due to lower ratings for certain of our programs, partially offset by higher rates.

     

    The increase at the worldwide Disney Channels was due to higher affiliate rates for the domestic channels and higher international advertising revenues, partially offset by higher programming costs.

     

    International advertising revenues were driven by the company’s new channel in Germany, which was launched in January 2014.Increased programming costs were driven by higher pilot write-offs and costs for the new channel in Germany.The increase at ABC Family was due to higher affiliate revenue due to higher rates and increased advertising revenue reflecting higher units sold.

     

    Broadcasting

     

    Revenue from Broadcasting grew 11 per cent to $1694 million in Q1-2015 from $1531 million in Q1-2014.Op Inc for this sub-segment grew 35 per cent to $240 million from $178 million in Q1-2014.

     

    The company says that Operating income at Broadcasting increased due to an increase in affiliate fees and higher program sales.These increases were partially offset by lower advertising revenue.

     

    The increase in affiliate revenues was due to contractual rate increases and new contractual provisions.Program sales growth included higher sales of Criminal Minds, Scandal and Once Upon A Time.Lower advertising revenue was due to fewer units sold at the ABC Television Network, partially offset by an increase at the owned television stations due to higher political advertising and an increase from higher primetime rates.

     

    Parks & Resorts

     

    P&R revenue in the current quarter at $3910 million (29.2 per cent of all revenue) was 8.7 per cent more than the $3597 million (29.2 per cent of TIO) in Q1-2014 but was 1.3 per cent lower than the $3960 million (32 per cent of TIO) in the previous quarter.

     

    P&R reported 20 per cent growth in Op Inc to $805 million (22.7 per cent of all Op Inc) in Q1-2015 from $671 million (22.2 per cent of all Op Inc) and a growth of 17.2 per cent from the $687 million (24.8 per cent of all Op Inc) in the previous quarter.

     

    Disney says that Operating income growth for the quarter was driven by an increase at domestic operations, partially offset by a decrease at its international operations.

     

    Higher operating income at Disney’s domestic operations reflected both higher volumes and guest spending growth at its parks and resorts and, to a lesser extent, at its cruise business, partially offset by higher costs.Guest spending growth at Disney’s parks and resorts reflected higher average ticket prices and increased merchandise, food and beverage spending.The volume increase at its cruise business reflected higher passenger cruise ship days due to the impact of the Disney Magic being in dry-dock for a portion of the prior-year quarter.Increased costs were driven by labour and other cost inflation, higher pension and post-retirement medical costs and increased depreciation driven by new attractions.

     

    The decrease at Disney’s international operations was driven by higher Shanghai Disney Resort pre-opening expenses, the impact of a weaker Japanese yen on Tokyo Disney Resort royalties and higher costs at Hong Kong Disneyland Resort, partially offset by an increase at Disneyland Paris.The increase at Disneyland Paris was due to higher guest spending, attendance and occupied room nights, partially offset by higher costs driven by higher volumes, new guest offerings and marketing costs.The increase in guest spending was driven by higher average ticket prices.

     

    Studio Entertainment

     

    SE reported a 1.8 per cent drop in revenue to $1858 million (13.9 per cent of TIO) in the current quarter from $1893 million (15.4 per cent of TIO) reported for the year ago quarter and a 4.5 per cent growth from the $1178 million (14.4 per cent of TIO) in the previous quarter.

     

    SE Op Inc in Q1-2015 grew 30 per cent to $544 million (15.3 per cent of all Op Inc) in the current quarter from $409 million (13.5 per cent of all Op Inc) in Q1-2014 and more than doubled (up 2.14 times) from $254 million (9.2 per cent of all Op Inc) in the previous quarter.

     

    The company says that higher operating income was due to an increase in home entertainment results, higher revenue share with the Consumer Products segment due to the performance of Frozen merchandise and higher TV/SVOD distribution results driven by more titles available internationally.These increases were partially offset by lower theatrical distribution results.

     

    The increase in home entertainment results was driven by higher unit sales and lower per unit costs.

     

    Unit sales growth was driven by Marvel’s Guardians of the Galaxy, Frozen and Maleficent in the current quarter compared to Monsters University and The Lone Ranger in the prior-year quarter, which did not include the release of a Marvel title.The decrease in unit costs reflected distribution cost savings and lower production cost amortization reflecting a higher amortization rate on The Lone Ranger in the prior year quarter.

     

    Lower theatrical distribution results reflected the performance of Big Hero 6 in the current quarter compared to Frozen in the prior-year quarter.In addition, the current quarter included the continuing performance of Marvel’s Guardians of the Galaxy, which was released in the fourth quarter of fiscal 2014 whereas the prior-year quarter included the release of Marvel’s Thor: The Dark World.

     

    Consumer Products

     

    CP Op Inc has been mentioned above.CP revenue in Q1-2015 grew 22.5 per cent to $1379 million (10.3 per cent of TIO) from $1126 million (9.1 per cent of TIO) in Q1-2014 and was 28.6 per cent more than the $1072 million (8.7 per cent of TIO) in the immediate trailing quarter.

     

    Disney says that higher operating income was due to increases at its Merchandise Licensing and Retail businesses.The increase in operating income at Merchandise Licensing was due to the performance of merchandise based on Frozen and, to a lesser extent, Disney Channel properties, Mickey and Minnie, Spider-Man and Avengers.

     

    At Disney’s Retail business, higher operating income for the quarter was due to comparable store sales growth and higher online sales in all regions driven by sales of Frozen merchandise.

     

    Interactive

     

    Interactive is Disney’s smallest in terms of revenue and Op Inc.Interactive reported revenue of $384 million (3.1 per cent of TIO) in Q1-2015, $403 million (3.3 per cent of TIO) in Q1-2014 and $362 million (2.9 per cent of TIO) in Q4-2014.

     

    Op Inc for the Interactive segment grew to US 73 million in Q1-2015 versus the $55 million in Q1-2014 and $18 million in Q4-2014.

     

    The company says that improved operating results were due to an increase at its mobile games business driven by the success of Tsum Tsum and Frozen Free Fall as well as lower product development costs due to fewer titles in development.This increase was partially offset by lower results at our console games business reflecting higher per unit costs driven by the mix of Disney Infinity products sold, lower unit sales and higher marketing costs.The decrease in unit sales was driven by lower sales of Infinity accessories and catalogue titles, partially offset by higher sales of Infinity starter packs.

     

    Click here to read first quarter earnings for fiscal 2015