Walt Disney Sees 9 Percent Growth in Parks & Resorts 3Q Revenue
The Walt Disney Company reported a rise in its earnings for its third fiscal quarter, and nine months ended June 30, 2012. Diluted earnings per share (EPS) for the third quarter increased 31 percent to $1.01 from 77 cents in the prior-year quarter. Diluted EPS for the nine months ended June 30, 2012, was $2.44 compared to $1.93 in the prior-year period. EPS for the current quarter includes restructuring and impairment charges totaling $7 million, which had no net impact on EPS, while the prior-year quarter included restructuring and impairment charges totaling $34 million, which had a negative impact of 1 cent on EPS. Excluding these charges, EPS for the quarter increased 29 percent to $1.01 from 78 cents in the prior-year quarter.
“We had a phenomenal third quarter, delivering the largest quarterly earnings in the history of our company,” said Robert A. Iger, chairman and CEO of The Walt Disney Company. “Earnings per share were up 31 percent over last year, driven by growth in every one of our businesses. We also delivered record earnings per share for the first nine months of our fiscal year, and we believe our results clearly demonstrate Disney’s unique value proposition and great potential to deliver long-term growth.”
In the key Parks and Resorts segment, revenues for the quarter increased 9 percent to $3.4 billion, and segment operating income increased 21 percent to $630 million. Results for the quarter were driven by increases at Tokyo Disney Resort, Disney Cruise Line and the domestic parks and resorts. The increase at Tokyo Disney Resort reflected the loss of income from the March 2011 earthquake and tsunami in Japan, which resulted in a temporary suspension of operations and a reduction in volume after reopening in the prior-year quarter, and the collection of related business interruption insurance proceeds in the current-year quarter.
Operating income growth at Disney Cruise Line was due to the first full quarter of operations of the Disney Fantasy. Higher operating income at the domestic parks and resorts was primarily due to increased guest spending at both Walt Disney World Resort and Disneyland Resort and attendance growth at Disneyland Resort, partially offset by higher costs. Increased guest spending reflected higher average ticket prices, food, beverage and merchandise spending, and daily hotel room rates. Higher costs were driven by labor cost inflation, resort expansion and new guest offerings, and increased investments in systems infrastructure at Walt Disney World Resort.
Capital expenditures company-wide increased from $2.6 billion to $2.9 billion driven by an increase at Parks and Resorts due to resort expansion and new guest offerings at Walt Disney World Resort and Disneyland Paris and construction costs at Shanghai Disney Resort, and an increase at Corporate driven by investments in facilities and information technology infrastructure.