Disney Quarterly Net Declines 42% - Multichannel

Disney Quarterly Net Declines 42%

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New York— The Walt Disney Co.'s earnings declined 42 percent for the fiscal first quarter (Dec. 31), fueled by declines at its broadcast and cable networks and a one-time charge for an investment in UAL Corp.

Revenue rose 6 percent, to $7.5 billion, while operating income rose 3 percent, to $778 million. Net income slid to $256 million (13 cents per share) from $438 million (21 cents) a year ago, mainly because of an $83 million write-off of an investment in aircraft leases.

Net income for the prior year also included a one-time gain of $216 million from the sale of shares in Knight-Ridder Inc.

Without the charge for the investment in UAL (parent of United Airlines) and the Knight-Ridder gain, net income for the recent quarter would have been 17 cents per share, versus 15 cents per share for the prior year.

Cable networks, including Disney Channel, ESPN and ABC Family — normally a top performer for the company — saw cash flow drop 39 percent, from $340 million to just $209 million in the recent quarter. Disney cited higher sports-programming costs for ESPN's National Football League, National Basketball Association and Major League Baseball games.

Revenue at the cable networks was up 11 percent year over year, to $1.7 billion.

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