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EARNINGS

Disney Profit Jumps 25% in 2nd Quarter

April 27, 1993|JAMES BATES | TIMES STAFF WRITER

Walt Disney Co., helped by the animated hit "Aladdin" and videocassette sales of "Pinocchio," said Monday that its profit jumped 25%, to $204.9 million in its fiscal second quarter, despite a $44-million loss from its problem-plagued Euro Disney theme park.

Separately, the company said it will release "Aladdin"--Disney's biggest box office hit ever--for sale on videocassette beginning Oct. 1. Analysts estimate that Disney could easily reap more than $200 million in profit from "Aladdin" videocassette sales.

Disney's revenue in the quarter rose 24% to $2 billion. Chairman Michael D. Eisner and President Frank G. Wells said Disney's filmed entertainment, theme park and consumer products areas were all strong.

The company's film unit was the clear standout, with revenue rising 45% to $929.8 million in the quarter, and operating income soaring 84% to $156.7 million. Much of that is due to "Aladdin," which last week passed $200 million at the domestic box office.

Euro Disney, the theme park near Paris that Disney operates, continues to struggle. Disney's loss from its investment was $87 million in the first six months of the fiscal year. The company said Euro Disney "will sustain a substantial loss for the fiscal year," in part because of high fixed costs such as interest. Because the continued losses and ongoing capital expenses will continue to strain Euro Disney's finances, Disney said, it has started looking at various sources of financing for the theme park.

The "Aladdin" announcement from Disney's Buena Vista Home Video unit ended months of speculation that Disney will try to duplicate its success in releasing the animated "Beauty and the Beast" on videocassette last fall, shortly after the film completed its theatrical run. Disney has sold more than 20 million cassettes domestically, an industry record.

"Aladdin" is considered a good bet to outperform "Beauty and the Beast" in the video market because it did better at the box office and because the frenetic performance of Robin Williams as the genie's voice made the film appealing to more age groups.

"I think it would be a fairly conservative prediction to assume it will do as well as 'Beauty and the Beast,' or even better," S.G. Warburg entertainment analyst Lisbeth R. Barron said.

Although Disney's video executives did not specifically forecast a sales number, Disney home video chief Bill Mechanic suggested that "Aladdin" stands a good chance of becoming the first videocassette to sell 30 million copies.

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