Cable Drives Disney Earnings

Cable Networks Post $577 Million in Operating Income in Fiscal 2007

By Steve Donohue -- Multichannel News, 11/8/2007 2:15:00 PM

Operating income at Walt Disney Co.’s cable networks jumped $255 million to $1.1 billion during the company’s fiscal fourth quarter.

Disney said Thursday that its cable networks saw operating income increase $577 million to $3.6 billion for fiscal year 2007.

Growth during the fourth quarter at ESPN, the most expensive basic-cable network on the dial, was led by higher affiliate and advertising revenues, which were partially offset by higher programming and production costs, Disney said.

For the year, operating income at ESPN also benefited from lower costs associated with mobile phone operations, which were transitioned to a licensing model, Disney said. The increases at ESPN were partially offset by higher programming and production costs driven by the addition of NASCAR programming.

Revenue at ESPN’s media networks division, which includes its ABC broadcast channel, increased 7% to $15 billion in fiscal 2007 Disney said. For the quarter, revenues increased 14% to $4.0 billion and segment operating income increased 25% to $1.1 billion.