Here's a transcript of today's CNBC report on Disney:
WE MAY HAVE HAD A MONDAY
SELL-OFF BUT THAT WASN'T THE
CASE FOR DISNEY, IT BUCKED THE
DOWNWARD TREND FINISHING UP
3/8 AT 31 1/4.
A BIG REASON IT WAS SUCCESSFUL
WEEKEND AT THE BOX OFFICE.
AND FOR DISNEY IT WAS HUGE.
THE FILM GIANT TOOK IN A
RECORD $46 MILLION FOR THE
FIVE-DAY WEEKEND, WITH THE
ANIMATED FEATURE "A BUG'S
LIFE" LEADING THE WAY.
JIM PAYMAR HAS THE STORY.
>> THE CREEPY CROWLEY THINGS
MADE A LOT OF MONEY THIS
WEEKEND.
SUE: I KNOW.
JIM: SUE, IT WAS A GREAT
WEEKEND FOR DISNEY; NOT
ONLY WITH "A BUG'S LIFE,"
BUT THE ENTERTAINMENT
CONGLOMERATE HAD THREE OF
THE TOP FIVE MOVIES FOR THE
HOLIDAY WEEKEND KICK-OFF.
SOME ANALYSTS BELIEVE THE
STRONG PERFORMANCE BY THE
FILM DIVISION IS HELPING TO
MOVE DISNEY STOCK, WHICH
HAS SEEN A NICE RISE AS OF
LATE.
>> THESE NUMBERS ARE SOMETHING
THAT MAKES THE DAY FOR DISNEY
CEO MICHAELIZENER LOOKING OVER
THE TOP FILMS FOR -- MICHAEL
EISNER, AND SEEING A BUG'S
LIFE RAKING IN 46 MILLION,
ENEMY OF THE STATE CASHING IN
THE 25 MILLION, AND LOW BUDGET
COMEDY THE WATER BOY BRINGING
IN CLOSE TO 20 MILLION
DOLLARS.
TOGETHER, THE FILMS GROSSED
MORE THAN 90 MILLION.
FOR DISNEY, THE CASH FLOW IS
SIGNIFICANTLY HELPED STEM THE
TIDE OF UNDERPERFORMING
BUSINESS SEGMENTS WHICH HAVE
BEEN FALTERING OVER THE PAST
YEAR.
>> IF THERE'S AN UPSIDE
SURPRISE TO OUR RECENTLY
REDUCED ESTIMATES, THEN IT
MUST KPROM THE FILM DIVISION
AND GIVEN THEIR LAST FEW
RELEASES, THEY WILL BE VERY
PROFITABLE.
>> TO EARNINGS FRONT, DISNEY
HAS SEEN A FAIRLY STEADY
EARNINGS DROP FROM THE FOURTH
QUARTER OF LAST YEAR, WHEN IT
EARNED 37 CENTS, DROPPING TO
JUST 14 CENTS IN THE THIRD
QUARTER OF THIS YEAR.
AND DISNEY SHARES HAVE HAD A
ROCKY RIDE THIS PAST YEAR,
RISING TO A SPLIT ADJUSTED
HIGH OF 42, THEN SENGING LIKE
A STONE TO A LOW OF 22 BEFORE
REBOUNDING NICELY FROM OCTOBER
LOWS, FINDING ITS WAY BACK TO
THE LOW 30s.
WHILE FILMS WILL DEFINITELY
HELP THE BOTTOM LINE, DISNEY
HAS SOME MAJOR OBSTACLES TO
OVERCOME TOGETHER FORWARD.
>> THEIR BUSINESS IS NOT VERY
STRONG RIGHT NOW.
SOME OF THEIR BUSINESSES ARE
ACTUALLY DOING VERY POORLY,
SPECIFICALLY THEIR BROADCAST
DIVISION, WHICH INCLUDE IT IS
ABC NETWORK WHICH IS NOT DOING
WELL AT ALL.
ABC'S RATINGS, RADIO DIVISION
WHICH IS UNDERPERFORMING THE
INDUSTRY AND EPPSP WHICH WAS A
GROWTH ENGINE HAS SEEN A
SIGNIFICANT SLOWDOWN IN ITS
GROWTH RATE.
>> DISNEY, LONG KNOWN AS A
GROWTH COMPANY HAS SEEN SALES
GROWTH SLOW TO 2.2% AND GOING
FORWARD A. SHARP SNAP-BACK
DOESN'T APPEAR TO HORIZON.
>> THE FIRST QUARTER OF FISCAL
YEAR '99 WILL LOOK VERY SOFT
FOR DISNEY AND HOPEFULLY IT
SHOULD START TO CLIMB OUT THAT
HOLE AS THE YEAR PROGRESSES.
THEY WILL FACE SOME
COMPETITIVE PRESSURES IN THE
THEME PARK AREA IN THE SECOND
HALF AS UNIVERSAL BRINGS ON
THEIR MAJOR THEME PARK IN
FLORIDA.
BUT OVERALL, WE'RE LOOKING FOR
A FLAT EARNINGS PICTURE AND
ESSENTIALLY AT THIS ON IN WE
BELIEVE IT WILL BE A MARKET
PERFORMER.
>> MERRILL LYNCH CONTINUES
TO HAVE A HOLD ON DISNEY,
AS DO 10 OTHER ANALYSTS
THAT FOLLOW THE STOCK.
HOWEVER, 11 OTHERS HAVE A
MODERATE BUY OR BUY RATING
ON THE STOCK.
AND COULD IT SALS PROFITS
SURGE WITH INFOSEEK.
SUE: SOMETHING TO WATCH FOR,
THANKS, JIM PAYMAR.
Chip
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