Disney quarterly results beat expectations

News Corp and Time Warner Inc also reported better-than-expected results this month. For all three,the strength of cable TV can be credited.

8220;There was strength across the board,8221; said James Marsh,an analyst with Piper Jaffray. 8220;I would point to the resiliency of their media networks business. You get consistent revenue growth out of there,consistent operating income growth,and I think that8217;s something people forget about.8221;

Disney benefited from the calendar shift of the New Year8217;s holiday into the first quarter this year from the second quarter a year earlier,which analysts said added an estimated 2 cents to results. But even with the calendar shift,the quarter was much better than most had expected.

Still,some Disney divisions remain under pressure.

For example,room reservations at its parks for the second quarter are currently down 10 per cent from last year.

8220;Consumers remain tentative,8221; said Jay Rasulo,chief financial officer for Disney,which more than most media companies remains tethered to consumer psychology as it reaches across so many sectors in entertainment and leisure.

But while Rasulo said reservations were down,guests continue to book their rooms closer to their travel date,so the 10 per cent was not fully indicative of where it could end up. 8220;But the number speaks for itself,8221; he added.

Overall,Disney8217;s fiscal first quarter net income fell to 844 million,or 44 cents per share,from 845 million,or 45 cents a share,in the year-ago first quarter.

Excluding items,the company earned 47 cents a share. That beat the 38 cents expected on average,according to Thomson Reuters I/B/E/S. Revenue rose 1 per cent to 9.74 billion.

The strongest performance came from Disney8217;s media network division,the largest in terms of revenue and profit and home to lucrative cable networks. The division8217;s sales rose 7 per cent to 4.2 billion,driven by increases at Disney Channels and ESPN.

But analysts said the biggest surprise came from its studio,which is currently being overhauled. Sales were essentially flat at 1.9 billion and segment operating income rose 30 per cent to 243 million.

One key factor was cost-cutting. That helped take the sting out of quarter that failed to produce a blockbuster from titles like 8220;Old Dogs,8221; 8220;Princess and the Frog8221; and 8220;A Christmas Carol.8221;

8220;It was a stronger than expected quarter,primarily driven by cost initiatives at the studio,8221; Jason Helfstein,an analyst with Oppenheimer amp; Co.

On the conference call,Disney Chief Executive Officer Bob Iger told analysts they will not see the 8220;real8221; results of the studio8217;s restructuring until 2011.

Iger also called Apple Inc8217;s new iPad tablet a really compelling device that could be a game changer in terms of 8220;enabling us to create essentially new forms of content.8221;

When asked about a potential sale of Disney8217;s Miramax unit,he said it was prudent to explore all options regarding the art-house studio,which sources have said has already attracted several interested buyers like Lions Gate Entertainment Corp and Weinstein Co.

Analysts expect Disney to start this year reaping benefits from its acquisition of Marvel Entertainment and a distribution deal with Steven Spielberg8217;s DreamWorks studio.

In the parks division,which encompasses Disney8217;s theme parks,resorts,cruise lines and vacation and time share operations,operating income fell 2 per cent in the first quarter.

Attendance was higher at its domestic parks,but guest spending was down alongside lower average ticket prices and a drop in spending on food and drink.

Prior to Disney8217;s earnings release,its shares closed up 36 cents,or 1.22 per cent,at 29.84 on the New York Stock Exchange.