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DISNEY INDICATES STRIKE CUT COSTS, SPURRED PROFITS
Wednesday, May 7 2008
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The Walt Disney Co. is the latest media conglomerate to report stronger-than-expected quarterly results in the wake of the recent writers' strike. In fact, it said in its SEC filing Tuesday, net profit soared 22 percent from a year ago, coming in at $1.13 billion on revenue of $8.71 billion. Its ABC Studios contributed to a 14 percent growth in income for its media networks unit, largely because of lower production costs during the strike. Profits at its movie studios also shot up as a result of such hits as National Treasure: Book of Secrets, Enchanted, and Hannah Montana/Miley Cyrus: Best of Both Worlds. But it was Disney's theme parks that surprised the most, delivering an amazing 33 percent jump in revenue. Analysts had forecast only a slight bump or even a downturn in attendance given the current recession. They attributed much of the boost to the fact that the Easter holiday arrived in the second quarter this year -- it usually occurs in the third quarter -- and the surge in overseas visitors seeking to take advantage of the depressed American dollar.
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