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Disney Posts Record Profits for Fiscal 2006

The Walt Disney Co. ended its fiscal year with a 33 percent increase in its net income, the company reported Thursday. The Burbank-based entertainment giant posted record net income and its fourth straight year of double digit growth. During a conference call with analysts, Disney Chief Executive Officer and President Robert Iger outlined the company’s high points during the year and plans for the coming year. “Our goal is to connect more directly with the consumer and to connect the consumer more directly with us by investing in new platforms and new opportunities,” Iger said. Disney reported net income of $3.4 billion, or $1.64 per diluted share, on revenues of $34.3 billion for its 2006 fiscal year ending Sept. 30. That is an increase over the $2.5 billion in net income, or $1.22 per diluted share, on revenues of $32 billion, for the 2005 fiscal year. For the fourth quarter ending Sept. 30, Disney reported net income of $782 million, or $0.36 per diluted share, on revenues of $8.8 billion. That is an increase of more than 100 percent over the same period in 2005 when the company posted net income of $379 million, or $0.19 per diluted share, on revenues of $7.8 billion. High points for the year included “Pirates of the Caribbean: Dead Man’s Chest” bringing in more than $1 billion in worldwide box office receipts; breakout cable hit “High School Musical;” and more than 85 million downloads of Disney television shows and films via iTunes, ABC.com, and DisneyChannel.com. For the new fiscal year, the company will relaunch its Disney.com website in early 2007 and increase investment by 30 percent in its video game business. Over the next five to seven years, the company plans to invest up to $350 million, said Chief Financial Officer Tom Staggs. Disney has huge assets in both new and existing content that can be exploited in games as the company builds the video game division through low-cost acquisitions, Iger said. “Our goal is to end up with a significant games business,” Iger said. The company announced this week it would launch its own video game studio, Fall Line, in Salt Lake City to develop Disney-branded games for Nintendo systems.

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