Press Release: The Walt Disney Company
August 3, 2001
BURBANK, CA -- The Walt Disney Company yesterday reported earnings for the quarter and nine months ended June 30,
2001.
Pro forma revenues and segment operating income for the quarter decreased 1% and 7% to $6.0 billion and $1.1 billion,
respectively, from the prior-year quarter. Excluding the restructuring and impairment charges and gain on the sale
of businesses discussed below, net income for the quarter decreased 3% to $479 million, while diluted earnings
per share remained flat at $0.23.
For the nine months, pro forma revenues increased 1% to $19.4 billion and segment operating income increased 6%
to $3.4 billion. Excluding restructuring and impairment charges, gain on the sale of businesses and the cumulative
effect of accounting changes, net income and diluted earnings per share increased 17% to $1.4 billion and 18% to
$0.66, respectively.
``In a soft economy, Disney's overall performance continues to be solid,'' said Michael D. Eisner, Chairman and
CEO of The Walt Disney Company. ``Our studio has added yet another quarter to a year of strong growth. At our parks,
effective expense-management measures have largely compensated for the weaker attendance that we had anticipated.
``We also continue to take steps to build for the future, as evidenced by our acquisition of Fox Family Worldwide.
Once the economy begins to strengthen, we will be well positioned for accelerating growth.''
Fox Family Acquisition
On July 23, 2001, the Company announced that it had entered into an agreement to purchase Fox Family Worldwide
for $3 billion in cash, plus the assumption of $2.3 billion in debt. Among the businesses being acquired are the
Fox Family Channel, a programming service that currently reaches approximately 81 million cable and satellite television
subscribers throughout the U.S.; a 76% interest in Fox Kids Europe, which reaches more than 24 million subscribers
across Europe; Fox Kids channels in Latin America, and the Saban library and entertainment production businesses.
The Fox Family Channel is one of the few fully distributed stand-alone channels and gives Disney a platform for
launching ABC Family and strengthening its position as the leading provider of family television programming. The
acquisition of the Fox Kids international channels strengthens Disney's presence in important markets in Europe
and Latin America and enhances the Company's potential for growth domestically and internationally.
Basis of Presentation
The Company acquired Infoseek, created the Internet Group and disposed of Fairchild Publications in November 1999.
In January 2001, the Company announced the closure of the GO.com portal business and the conversion of Internet
Group common stock into Disney common stock.
To enhance comparability, the Company has presented operating results on a pro forma basis, which assumes these
transactions occurred at the beginning of fiscal 2000, eliminating the one-time impacts of those events. Additionally,
prior-year pro forma operating results for the Studio Entertainment segment have been restated to reflect the impact
of the Film Accounting change discussed below.
The Company believes that pro forma results provide additional information useful in analyzing underlying business
results. However, pro forma results are not necessarily indicative of the combined results that would have occurred
had these events actually occurred at the beginning of fiscal 2000, nor are they necessarily indicative of future
results.
On an as-reported basis, results for the quarter and nine months include restructuring and impairment charges totaling
$138 million and $1.3 billion, respectively. Included in the charges for the nine-month period is $862 million
associated with the closure of GO.com. On a pro forma basis, restructuring and impairment charges exclude the impact
of the GO.com closure and, as a result, amount to $138 million and $466 million, for the quarter and nine-month
periods, respectively. See Table C for details of these charges. In addition, as-reported results for the prior
year include a $243 million pre-tax gain on the sale of Fairchild Publications in the first quarter and a $93 million
pre-tax gain on the sale of the Company's stake in Eurosport in the third quarter.
On an as-reported basis, revenues for the quarter and nine months were $6.0 billion and $19.5 billion, respectively.
Including the restructuring and impairment charges and gain on the sale of businesses, as-reported net income attributed
to Disney common stock was $392 million (or $0.19 per share) for the quarter and as-reported net loss attributed
to Disney common stock was $94 million (or $0.04 per share) for the nine months including the cumulative effect
of the accounting changes ($0.13 per share).
See Table D for a reconciliation of as-reported income (loss) per share attributed to Disney common stock to pro
forma earnings per share.
Unless otherwise noted, the following discussion reflects pro forma results.
Studio Entertainment
Studio Entertainment revenues for the quarter increased 8% to $1.3 billion, while segment operating income increased
to $65 million compared to a segment operating loss of $1 million in the prior-year quarter.
Studio Entertainment results for the quarter were primarily driven by growth in worldwide theatrical motion picture
distribution and stage plays.
Improvements in worldwide theatrical motion picture distribution were primarily due to the releases of ``Pearl
Harbor,'' ``Spy Kids'' and ``Atlantis.'' Growth in stage plays reflected performances of ``The Lion King'' in additional
cities.
The Company's live action and animated titles continued to perform well on DVD reflecting the overall strength
of the DVD market.
Media Networks
Media Networks revenues for the quarter decreased 6% to $2.1 billion and operating income decreased 29% to $470
million from the prior-year quarter.
Broadcasting results for the quarter reflected declines at the ABC television network and the Company's owned television
stations and radio operations driven by the soft advertising market, lower ratings and higher primetime programming
costs.
Disney's share of operating income from cable television activities, which consists of Disney's cable networks
and cable equity investments, was $293 million for the quarter.
Excluding the gain from the sale of Eurosport in the prior-year quarter, cable television results were up 2%, reflecting
higher cable network affiliate revenue and improved results from cable equity investments, including Lifetime Television,
The History Channel and E! Entertainment Television. These increases were partially offset by the soft advertising
market, higher programming costs and higher costs associated with the launch of international Disney Channels.
Higher affiliate revenues from the cable networks were driven by strong subscriber growth, annual contractual rate
adjustments and the conversion of the Disney Channel from a premium to a basic service. Additionally, certain European
Disney Channel operations showed improvements.
Parks & Resorts
Parks & Resorts revenues for the quarter remained flat at $1.9 billion and segment operating income decreased
1% to $560 million.
Parks & Resorts results reflected increased attendance, guest spending and occupied room nights at the Disneyland
Resort, due to the addition of Disney's California Adventure, Downtown Disney and the Grand Californian Hotel,
increased guest spending at Walt Disney World, continued growth at the Disney Cruise Line, due to the success of
the 7-day cruise package, and cost savings at Walt Disney World. These increases were offset by higher costs at
the Disneyland Resort and decreased theme park attendance and lower occupied room nights at Walt Disney World.
The decreased attendance and lower expenses at Walt Disney World reflected the prior-year impact of the Millennium
Celebration, which concluded in December 2000. Reduced costs at Walt Disney World also reflected productivity and
other cost reduction initiatives.
Consumer Products
Consumer Products revenues for the quarter decreased 3% to $518 million and segment operating income increased
32% to $58 million.
The decline in revenue for the quarter is primarily due to declines in comparative store sales at Disney Stores
North America. Operating income reflected cost reduction initiatives across all lines of business and favorable
comparable store sales at Disney Stores Europe, partially offset by the impact of declines in comparative store
sales at Disney Stores North America.
Over the last nine months, the Company has formed a number of alliances with companies such as Coca-Cola, Gillette
and Kimberly-Clark in children's food and personal care, in addition to retailers K-Mart, J.C. Penney and Wal-Mart
Canada in children's apparel. The Company believes that these arrangements will position Consumer Products for
future growth.
Internet Group
Internet Group revenues for the quarter decreased 17% to $38 million; however, segment operating loss improved
by 47% to $31 million.
Internet Group results for the quarter reflect improved operating performance at the Disney-branded and ESPN-branded
Web sites, the impact of cost reduction efforts and the elimination of operating losses at toysmart.com, due to
its closure in June 2000. The improved operating performance at the Disney-branded sites is primarily due to growth
in international licensing revenues and increased sales at DisneyVacations.com resulting from an increase in travel
bookings to Disney destinations.
Corporate and Unallocated Shared Expenses
Corporate and unallocated shared expense increased 15% to $94 million for the quarter, reflecting costs associated
with several strategic initiatives designed to improve overall company-wide efficiency and start-up costs for the
Disney Club, which was launched in the first quarter of 2001.
Workforce Reduction
In March 2001, the Company announced that it would eliminate 4,000 full-time jobs through a combination of voluntary
and involuntary reductions. The reduction affected employees in all business units and geographic regions. In connection
with the reduction and related restructuring initiatives, the Company incurred $95 million in severance and other
costs during the quarter. The Company expects that the reduction plan will be substantially complete in the fourth
quarter and, over time, will generate in excess of $350 million in annual savings.
Net Interest Expense and Other
Net interest expense and other decreased 35% to $80 million for the quarter, driven by lower interest rates and
gains from sales of certain investments.
Equity in the Income of Investees
Income from equity investees increased 6% to $86 million for the quarter, reflecting improved results from cable
equity investments including Lifetime Television, The History Channel and E! Entertainment Television, partially
offset by start-up losses incurred in connection with new investments.
Conversion of Internet Group Common Stock
On March 30, 2001, the Company converted all of its outstanding Internet Group common stock into Disney common
stock, resulting in the issuance of approximately 8.6 million shares of Disney common stock. For the quarter and
nine months ended June 30, 2001, Disney common stock as-reported earnings reflect approximately 72% of Internet
Group losses from October 1, 2000 through January 28, 2001 (the last date prior to the announcement of the conversion),
and 100% thereafter.
In addition, the Company has ceased operations of the GO.com portal business, which resulted in restructuring charges
in the current nine months.
Restructuring, Impairment and Workforce Reduction Related Charges
During the quarter and nine months, the Company recorded restructuring and impairment charges on an as-reported
basis, totaling $138 million and $1.3 billion, respectively. The charges relate to workforce reduction; the closure
of GO.com and approximately 70 Disney Stores; the closure of the Chicago DisneyQuest facility, including the write-down
of its fixed assets and leasehold improvements and lease termination costs, and impairment write-downs for certain
Internet investments. The second quarter $862 million charge for closure of the GO.com portal business includes
a non-cash write-off of intangible assets totaling $820 million and the Disney Store closure charge consists of
lease termination costs; write-downs of fixed assets, leasehold improvements and inventory, and other related closure
costs. Restructuring and impairment charges on a pro forma basis exclude the impact of the GO.com closure.
See Table C for details of the restructuring and impairment charges on both a pro forma and as-reported basis.
Accounting Changes
Effective October 1, 2000, the Company adopted AICPA Statement of Position No. 00-2, Accounting by Producers or
Distributors of Films (SOP 00-2), and FASB Statement No. 133, Accounting for Derivative Instruments and Hedging
Activities (SFAS 133), and recorded one-time after-tax charges for the adoption of the standards totaling $228
million (or $0.11 per share) and $50 million (or $0.02 per share), respectively.
FORWARD-LOOKING STATEMENTS
Management believes certain statements in this press release may constitute ``forward-looking statements'' within
the meaning of the Private Securities Litigation Reform Act of 1995. These statements are made on the basis of
management's views and assumptions regarding future events and business performance as of the time the statements
are made. Actual results may differ materially from those expressed or implied. Such differences may result from
actions taken by the Company prior to its fiscal 2001 year end, including further restructuring or strategic initiatives
and actions relating to the Company's strategic sourcing initiative, as well as from developments beyond the Company's
control, including changes in global economic conditions that may, among other things, affect the international
performance of the Company's theatrical and home video releases, television programming and consumer products and,
in addition, uncertainties associated with the Internet. Changes in domestic competitive and economic conditions
may also affect performance of all significant Company businesses.
Editor's Note: The Company makes available its quarterly earnings releases, annual report to shareholders, fact
book and SEC filings on its Investor Relations Web site located at http://www.disney.com/investors
The Walt Disney Company
PRO FORMA CONSOLIDATED STATEMENTS OF INCOME
(unaudited; in millions, except per share data)
Three Months Ended Nine Months Ended
June 30 June 30
2001 2000 2001 2000
Revenues $ 5,975 $ 6,034 $ 19,444 $ 19,249
Costs and expenses (4,947) (4,904) (16,317) (16,270)
Amortization of intangible
assets (145) (162) (441) (491)
Gain on sale of businesses - 93 22 93
Net interest expense and
other (80) (124) (287) (413)
Equity in the income of
investees 86 81 234 196
Restructuring and
impairment charges (138) - (466) (61)
Income before income taxes,
minority interests and the
cumulative effect of
accounting changes 751 1,018 2,189 2,303
Income taxes (339) (446) (1,012) (1,025)
Minority interests (20) (42) (83) (86)
Income before cumulative
effect of accounting
changes 392 530 1,094 1,192
Cumulative effect of
accounting changes:
Film accounting - - (228) -
Derivative accounting - - (50) -
Net income $ 392 $ 530 $ 816 $ 1,192
Earnings per share before
cumulative effect of
accounting changes
(basic and diluted) $ 0.19 $ 0.25 $ 0.52 $ 0.57
Earnings per share including
cumulative effect of
accounting changes
(basic and diluted) (1) $ 0.19 $ 0.25 $ 0.39 $ 0.57
Earnings before cumulative
effect of accounting
changes, excluding
restructuring and
impairment charges and
gain on the sale of
businesses $ 479 $ 495 $ 1,393 $ 1,190
Earnings per share before
cumulative effect of
accounting changes,
excluding restructuring
and impairment charges
and gain on the sale
of businesses:
Diluted $ 0.23 $ 0.23 $ 0.66 $ 0.56
Basic $ 0.23 $ 0.24 $ 0.67 $ 0.57
Average number of common
and common equivalent
shares outstanding:
Diluted 2,107 2,123 2,108 2,108
Basic 2,091 2,086 2,090 2,078
(1) The per share impacts of the film and derivative accounting
changes for the nine-month period were ($0.11) and ($0.02),
respectively.
The Walt Disney Company
AS-REPORTED CONSOLIDATED STATEMENTS OF INCOME
(unaudited; in millions, except per share data)
Three Months Ended Nine Months Ended
June 30 June 30
2001 2000 2001 2000
Revenues $ 5,975 $ 6,053 $ 19,457 $19,300
Costs and expenses (4,947) (4,935) (16,363) 16,326)
Amortization of intangible
assets (145) (340) (622) (910)
Gain on sale of businesses - 93 22 336
Net interest expense and
other (80) (124) (287) (417)
Equity in the income of
investees 86 81 234 155
Restructuring and
impairment charges (138) - (1,328) (61)
Income before income taxes,
minority interests and
the cumulative effect of
accounting changes 751 828 1,113 2,077
Income taxes (339) (425) (963) (1,238)
Minority interests (20) (42) (83) (86)
Income before cumulative
effect of accounting
changes 392 361 67 753
Cumulative effect of
accounting changes:
Film accounting - - (228) -
Derivative accounting - - (50) -
Net income (loss) $ 392 $ 361 $ (211) $ 753
Earnings (loss) attributed
to:
Disney Common Stock (1)$ 392 $ 440 $ (94) $ 957
Internet Group Common
Stock - (79) (117) (204)
$ 392 $ 361 $ (211) $ 753
Earnings (loss) per share
before cumulative effect
of accounting changes
attributed to:
Disney Common Stock
(basic and diluted) (1)$ 0.19 $ 0.21 $ 0.09 $ 0.46
Internet Group Common
Stock (basic and
diluted) n/a $ (1.75) $ (2.72) $ (4.58)
Earnings (loss) per share
including cumulative
effect of accounting
changes attributed to:
Disney Common
Stock (1) (2) (3)
Diluted $ 0.19 $ 0.21 $ (0.04) $ 0.46
Basic $ 0.19 $ 0.21 $ (0.05) $ 0.46
Internet Group
Common Stock
(basic and diluted) n/a $ (1.75) $ (2.72) $ (4.58)
Earnings attributed to
Disney common stock before
cumulative effect of
accounting changes,
excluding restructuring
and impairment charges and
gain on the sale of
businesses $ 479 $ 405 $ 1,198 $ 934
Earnings per share
attributed to Disney
common stock before
cumulative effect of
accounting changes,
excluding restructuring
and impairment charges
and gain on the sale of
businesses (1)
Diluted $ 0.23 $ 0.19 $ 0.57 $ 0.44
Basic $ 0.23 $ 0.19 $ 0.57 $ 0.45
Average number of common
and common equivalent
shares outstanding:
Disney
Diluted 2,107 2,115 2,103 2,100
Basic 2,091 2,078 2,085 2,070
Internet Group
(basic and diluted) - 45 43 44
(1) Including Disney's retained interest in the Internet Group.
Disney's as-reported retained interest in the Internet Group reflects
100% of Internet Group losses through November 17, 1999, approximately
72% for the period from November 18, 1999 through January 28, 2001
(the last date prior to the announcement of the conversion of the
Internet Group common stock) and 100% thereafter.
(2) Amounts for the current year nine-month period represent basic
earnings per share.
(3) The per share impacts of the film and derivative accounting
changes for the nine month period were ($0.11) and ($0.02),
respectively.
THE WALT DISNEY COMPANY SEGMENT RESULTS
For the Quarter Ended June 30
(unaudited, in millions)
Pro Forma % As Reported
2001 2000 Change 2001 2000
Revenues: (3)
Media Networks $2,135 $2,270 (6)% $2,135 $2,270
Parks & Resorts 1,942 1,940 n/m 1,942 1,940
Studio
Entertainment 1,342 1,246 8 % 1,342 1,246
Consumer Products 518 532 (3)% 518 532
Internet Group 38 46 (17)% 38 65
$5,975 $6,034 (1)% $5,975 $6,053
Segment operating
income
(loss): (1) (3)
Media Networks $ 470 $ 662 (29)% $ 470 $ 662
Parks & Resorts 560 565 (1)% 560 565
Studio
Entertainment (2) 65 (1) n/m 65 (1)
Consumer Products 58 44 32 % 58 44
Internet Group (31) (58) 47 % (31) (70)
$1,122 $1,212 (7)% $1,122 $1,200
The Company evaluates the performance of its operating segments based
on segment operating income. A reconciliation of segment operating
income to income before income taxes and minority interests is as
follows:
Pro Forma As Reported
2001 2000 2001 2000
Segment operating income 1,122 1,212 1,122 1,200
Corporate and unallocated
shared expenses (94) (82) (94) (82)
Amortization of intangible
assets (145) (162) (145) (340)
Gain on sale of businesses - 93 - 93
Net interest expense and
other (80) (124) (80) (124)
Equity in the income of
investees 86 81 86 81
Restructuring and impairment
charges (138) - (138) -
Income before income taxes and
minority interests 751 1,018 751 828
(1) Segment earnings before interest, income taxes, depreciation and
amortization (EBITDA) is as follows:
Pro Forma As Reported
2001 2000 2001 2000
Media Networks $ 509 $ 697 $ 509 $ 697
Parks & Resorts 731 731 731 731
Studio Entertainment 76 11 76 11
Consumer Products 77 75 77 75
Internet Group (26) (55) (26) (62)
$1,367 $1,459 $1,367 $1,452
(2) Pro forma segment operating income has been adjusted to reflect
the impact of SOP 00-2. The respective adjustments for the year will
(decrease) increase segment operating income as follows:
Quarter ended
December 31, 1999 $ (73)
March 31, 2000 37
June 30, 2000 -
September 30, 2000 (14)
$ (50)
(3) The Company made certain changes to its business segment
classifications. The Disney Store Catalog and the Disney Store Online,
which were previously reported in the Internet Group, are now reported
in the Consumer Products segment. Prior-year amounts have been
reclassified to reflect the current-year presentation.
THE WALT DISNEY COMPANY SEGMENT RESULTS
For the Nine Months Ended June 30
(unaudited, in millions)
Pro Forma % As Reported
2001 2000 Change 2001 2000
Revenues: (3)
Media Networks $ 7,252 $ 7,420 (2)% $ 7,252 $ 7,420
Parks & Resorts 5,312 5,088 4 % 5,312 5,088
Studio Entertainment 4,765 4,511 6 % 4,765 4,511
Consumer Products 1,978 2,094 (6)% 1,978 2,108
Internet Group 137 136 1 % 150 173
$19,444 $19,249 1 % $ 19,457 $ 19,300
Segment operating
income
(loss): (1) (3)
Media Networks $ 1,549 $ 1,838 (16)% $ 1,549 $ 1,838
Parks & Resorts 1,276 1,258 1 % 1,276 1,258
Studio
Entertainment (2) 381 - n/m 381 36
Consumer Products 314 303 4 % 314 304
Internet Group (109) (190) 43 % (142) (230)
$ 3,411 $ 3,209 6 % $ 3,378 $ 3,206
The Company evaluates the performance of its operating segments based
on segment operating income. A reconciliation of segment operating
income to income before income taxes, minority interests, and
cumulative effect of accounting changes is as follows:
Pro Forma As Reported
2001 2000 2001 2000
Segment operating income $3,411 $3,209 $3,378 $3,206
Corporate and unallocated
shared expenses (284) (230) (284) (232)
Amortization of intangible assets (441) (491) (622) (910)
Gain on sale of businesses 22 93 22 336
Net interest expense and other (287) (413) (287) (417)
Equity in the income of investees 234 196 234 155
Restructuring and impairment
charges (466) (61) (1,328) (61)
Income before income taxes,
minority interests, and the
cumulative effect of accounting
changes $2,189 $2,303 $1,113 $2,077
(1) Segment EBITDA is as follows:
Pro Forma As Reported
2001 2000 2001 2000
Media Networks $1,664 $1,942 $1,664 $1,942
Parks & Resorts 1,729 1,696 1,729 1,696
Studio Entertainment 416 40 416 76
Consumer Products 379 386 379 387
Internet Group (91) (183) (121) (209)
$4,097 $3,881 $4,067 $3,892
(2) Pro forma segment operating income has been adjusted to reflect
the impact of SOP 00-2. The respective adjustments for the year will
(decrease) increase segment operating income as follows:
Quarter ended
December 31, 1999 $ (73)
March 31, 2000 37
June 30, 2000 -
September 30, 2000 (14)
$ (50)
(3) The Company made certain changes to its business segment
classifications. The Disney Store Catalog and the Disney Store Online,
which were previously reported in the Internet Group, are now reported
in the Consumer Products segment. Prior-year amounts have been
reclassified to reflect the current-year presentation.
Table A
MEDIA NETWORKS
(unaudited, in millions)
Quarter Ended June 30
2001 2000 % Change
Revenues:
Broadcasting $ 1,321 $ 1,509 (12) %
Cable Networks 814 761 7 %
$ 2,135 $ 2,270 (6) %
Segment operating income: (1)
Broadcasting $ 244 $ 421 (42) %
Cable Networks 226 241 (6) %
$ 470 $ 662 (29) %
Nine Months Ended June 30
2001 2000 % Change
Revenues:
Broadcasting $ 4,454 $ 4,876 (9) %
Cable Networks 2,798 2,544 10 %
$ 7,252 $ 7,420 (2) %
Segment operating income: (1)
Broadcasting $ 723 $ 1,010 (28) %
Cable Networks 826 828 n/m
$ 1,549 $ 1,838 (16) %
(1) Amounts exclude intangible asset amortization
Table B
CABLE TELEVISION ACTIVITIES
(unaudited, in millions)
Quarter Ended June 30
2001 2000 % Change
Operating income:
Cable Networks $ 226 $ 241 (6) %
Equity investments:
A&E, Lifetime and
E! Entertainment
Television 206 183 13 %
Other (1) 52 124 (58) %
484 548 (12) %
Partner share of operating
income (191) (186) (3) %
Disney share of operating
income $ 293 $ 362 (19) %
Nine Months Ended June 30
2001 2000 % Change
Operating income:
Cable Networks $ 826 $ 828 n/m
Equity investments:
A&E, Lifetime and
E! Entertainment
Television 560 501 12 %
Other (1) 166 175 (5) %
1,552 1,504 3 %
Partner share of operating
income (582) (504) (15) %
Disney share of operating
income $ 970 $ 1,000 (3) %
Note: Amounts presented in this table represent 100% of the operating
income for all of the Company's cable businesses. The Disney share of
operating income represents the Company's ownership interest in cable
television operating income. Cable networks are reported in "Segment
operating income" in the statements of income. Equity investments are
accounted for under the equity method and the Company's proportionate
share of the net income of its cable equity investments is reported in
"Equity in the income of investees" in the statements of income.
(1) Amounts include the gain on the sale of Eurosport in fiscal 2000.
Excluding Disney's share of the gain, cable television operating
income for the quarter and nine months ended June 30, 2000 was $287
million and $925 million, respectively. Reflecting the adjustment for
Eurosport in the prior year, Disney's share of operating income from
cable television activities increased 2% and 5% for the quarter and
nine months, respectively.
Table C
RESTRUCTURING AND IMPAIRMENT CHARGES
(unaudited, in millions)
Pro Forma As Reported
Quarter Ended June 30 2001 2000 2001 2000
Workforce reductions and other $ 95 $ - $ 95 $ -
Chicago DisneyQuest closure (1) 33 - 33 -
Disney Store closures - - - -
Investment impairment 10 - 10 -
$ 138 $ - $ 138 $ -
Pro Forma As Reported
Nine Months Ended June 30 2001 2000 2001 2000
GO.com intangible assets
impairment $ - $ - $ 820 $ -
GO.com severance, fixed asset
write-offs and other - - 42 -
Workforce reductions and other 95 - 95 -
Chicago DisneyQuest closure (1) 94 - 94 -
Disney Store closures 51 - 51 -
Investment impairment 226 61 226 61
$ 466 $ 61 $ 1,328 $ 61
(1) The charge for the quarter ended June 30, 2001 reflects lease
termination costs for the closure of the Chicago DisneyQuest facility.
The charge for the nine months includes a write-down to the estimated
salvage value of the property and equipment at the facility.
Table D
The following table provides a reconciliation of as-reported income
(loss) per share attributed to Disney common stock to pro forma
earnings per share before the cumulative effect of accounting changes,
excluding restructuring and impairment charges and gains on the sale
of businesses.
Three Months Nine Months
Ended June 30, Ended June 30,
(unaudited) 2001 2000 2001 2000
As-reported income (loss)
per share attributed to
Disney common stock $ 0.19 $ 0.21 $ (0.04) $ 0.46
Adjustment to exclude
restructuring and
impairment charges
attributed to Disney
common stock 0.04 -- 0.48 --
Adjustment to exclude
gain on the sale of
businesses -- (0.02) -- (0.02)
Adjustment to exclude the
cumulative effect of
accounting changes -- -- 0.13 --
As-reported earnings per
share before the
cumulative effect of
accounting changes,
excluding restructuring
and impairment charges
and gain on the sale of
businesses 0.23 0.19 0.57 0.44
Adjustment to attribute
100% of Internet Group
operating results to
Disney common stock (72%
included in as-reported
amounts) -- (0.04) (0.06) (0.10)
Adjustment to exclude
pre-closure GO.com portal
operating results and
amortization of
intangible assets -- 0.09 0.09 0.26
Adjustment to exclude
restructuring and
impairment charges
attributed to the
Internet Group -- -- 0.06 0.01
Adjustment to include
pre-acquisition Infoseek
operating results -- (0.01) -- (0.04)
Adjustment to reflect the
impact of the new Film
Accounting rules -- -- -- (0.01)
Pro forma earnings per
share before the
cumulative effect of
accounting changes,
excluding restructuring
and impairment charges
and gain on the sale of
businesses $ 0.23 $ 0.23 $ 0.66 $ 0.56
-------------------------------------------------
Contact:
The Walt Disney Company, Burbank
John Dreyer, (818) 560-5300