Disney hasn't forgotten "The Alamo" -- and neither has Wall Street.
While corporate directors and Chairman Michael Eisner deal with a building shareholder siege, Walt Disney Co.'s film unit -- a prime contributor to earnings lately -- is bracing for an uncertain spring because of some high-risk bets, including the once-delayed Texas epic.
In coming weeks, the Burbank company is set to release not only its $100-million production of "The Alamo" but also next Friday's $78-million adventure film, "Hidalgo." Both pictures were bumped out of last year's lineup because they weren't ready for audiences.
A week before the April 9 premiere of "The Alamo," moreover, Disney plans to open "Home on the Range," a traditionally-animated, 2-D comedy that cost about $110 million to produce -- a big roll of the dice, given today's strong audience preference for cutting-edge computer-generated cartoons.
Those and other spring pictures already are getting close scrutiny from investors, who are looking for any sign of weakness in a film operation that is coming off a record run at the box office.
"It was the studio that blew away everybody's first-quarter estimates," Sanford C. Bernstein & Co. media analyst Tom Wolzein said. "So now, what's next? Is it sustainable? That's basically what the market is asking."
An ill-timed stumble by the studio could undercut Eisner's argument that Disney has put its worst days behind and is poised for a period of steady growth.
On Monday, the Florida State Board of Administration, the fourth-largest U.S. pension fund, joined a dozen other large investors in promising to withhold their votes for Eisner's reelection to the Disney board at Wednesday's annual meeting in Philadelphia. At a meeting scheduled tonight in Philadelphia, the board is expected to plot its strategy for responding to the growing "no" vote.
In a pair of dueling letters, meanwhile, Disney's directors and dissident shareholders gave starkly different views of the company's future.
Former board members Roy Disney and Stanley Gold urged shareholders to use their vote to "send an unmistakable message that it is time for a change in the senior management and board of the Walt Disney Co. Tell the board you believe it is time to replace Michael Eisner."
The directors' letter, however, told shareholders their support "is important to keep the momentum of the Walt Disney Company going." By voting for the current board, it added, investors can ensure that Disney is not distracted from "realizing the full potential of our creative strength and enhancing shareholder value."
