Walt Disney Co, the second-largest US media and entertainment company, earned US$259 million in the latest quarter as the company's theme parks started to recover from last year's slump in tourism.
Net income was US$0.13 a share in the fiscal second quarter ended March 31, compared with a loss of US$567 million, or US$0.26, a year earlier, the company said in a statement. Sales slipped 2.4 percent to US$5.9 billion from US$6.05 billion.
Disney's theme parks generated a higher profit than analysts had predicted. The company cut operating expenses at Walt Disney World in Florida in Disneyland in California after last year's US economic recession and the Sept. 11 attacks reduced travel.
Now domestic tourism is recovering, Disney executives said.
"They handily beat people's expectations on the parks," said Paul Kim, an analyst at Kaufman Bros. "Most people thought after Sept. 11 that the theme-park business would just go away." Kim rates Disney shares a "buy" and doesn't own them personally.
Burbank, California-based Disney's profit exceeded the average estimate of US$0.10 a share from analysts surveyed by Thomson Financial/First Call.
The year-earlier loss included US$996 million in costs to shut down the Go.com Web site and some retail stores.
Disney shares today rose US$0.48 to US$25 in New York Stock Exchange trading, with the entire increase coming in the final 15 minutes of regular trading. The stock was unchanged in after-hours trading following the earnings announcement. The shares have fallen 19 percent over the past year.
Operating income, or profit before interest, taxes and some corporate expenses, declined 35 percent to US$702 million. Year-earlier operating income includes results from the ABC Family cable-TV network, which Disney acquired in October.
The company expects operating income to decline again in the current quarter, Chief Financial Officer Thomas Staggs said on a conference call with analysts. He forecast a "substantial improvement" in fourth-quarter operating income.
At the theme parks, operating income fell 15 percent from a year earlier to US$280 million, while revenue dropped 7.6 percent to US$1.53 billion. Compared with the quarter ended Dec. 31, operating income rose 50 percent and revenue rose 6.4 percent.
"We're seeing improvement in domestic travel as the year progresses," Disney President Robert Iger said in an interview.
Operating income at Disney's media-networks division declined 31 percent from a year earlier to US$309 million. The unit includes the ABC television network, TV stations and cable networks such as ESPN and the Disney Channel. Revenue fell 2.7 percent to US$2.2 billion.
Results at the consumer-products division, including the Disney Stores, were little changed from a year earlier. Operating income rose 2 percent to US$261 million, while revenue fell 3.2 percent to US$1.41 billion.
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