Disney earnings up for the second quarter

Leah Zanolla | Posted: May 11, 2012 | Updated: Oct 19, 2014 - 9:25:27 AM

The Walt Disney Co. has released their earnings report for the second quarter of the fiscal year. They are reporting a 21 percent gain from last year, due largely in part to their television advertising and theme parks. The quarter saw earnings of $1.1 billion, compared to $942 million at the same time last year. Sales were up 6 percent to $9.6 billion.

Advertising profits were up 13 percent to $1.7 billion, due to cable giants ESPN and the Disney Channels, as well as ABC.

In a huge boost to the earnings numbers were reports from Walt Disney Parks and Resorts. Operating income from the division jumped an astounding 53 percent to $222 million; revenue was up 10 percent to $2.9 billion. Lending to that jump was a 7 percent increase in attendance at the U.S. theme parks from last year. Not only were guests flocking to the parks, they were spending while they were there - ticket prices were up this year, as well as spending on food and souvenirs, leading to a per-capita spending that is up 5 percent.

Hotel room occupancy increased by 2 percent, up to 82 percent and per-room spending has gone up 7 percent. So far in the third quarter, hotel reservations are already up 1 percent.

In the theme parks division, a lot was said about international attendance, which now makes up 22 percent of the park's guests. Disneyland's second quarter financials broke records and are expected to keep rising as Cars Land opens June 15 at Disney California Adventure.

Especially encouraging were the reports from Disney Cruise Line, who just launched their fourth ship in March. In the third quarter, bookings are already up 30 percent and ship occupancy rates are above 90 percent.

Disney's film studios lost $84 million this quarter, mainly due to the poor performance of film "John Carter," which didn't live up to all of the advertising hype. Disney chose instead to focus on how well their newest film, "The Avengers," is doing, even though it opened after the second quarter had already ended. "The Avengers" is a superhero movie full of the Marvel characters that Disney now owns. Its record-breaking opening weekend sold $207.1 million in tickets and is already up to $700 million worldwide.

Disney will attempt to capitalize on the film's success, and has already announced sequels for the film's stars, including "Thor 2," "Iron Man 3," "Captain America 2" and "The Avengers 2." Disney Co. President and Chief Executive Officer Bob Iger said, "I think what you're essentially seeing here is a true franchise, not necessarily in the making, but having been made and launched. There are multiple opportunities to continue to mine this great set of characters." Avengers merchandise is flooding stores' shelves and Iger says design has been started on Marvel-based attractions for Disneyland and the international parks. Universal Orlando has rights to the Marvel properties for the East Coast, so Walt Disney World won't be getting any Marvel attractions in the near future.

Disney's profits should only continue to get better with the Art of Animation Resort opening in Florida and Cars Land opening in California.