Disney Posts 4% Broadcasting Revenue Gain

The Walt Disney Co. on Thursday reported earnings for its fiscal fourth quarter ended Oct. 1.

Revenue at its broadcasting unit increased 4%, from $1.285 million in 4Q 2010 to $1.331 this year.

Broadcasting operating income increased $54 million to $201 million for the quarter, a 37% increase, driven by lower programming and production costs and higher network advertising revenues, partially offset by decreased political advertising at the owned television stations.

Lower programming costs were driven by decreased write-offs in the quarter. Higher network advertising revenues were due to higher rates, improved news ratings and higher sports units sold, partially offset by lower primetime ratings.

“Fiscal 2011 was a great year financially and strategically, demonstrating the strength of our brands and businesses with record revenue, net income and earnings per share,” said Disney President-CEO Robert A. Iger. “We are confident the company is well-positioned to deliver long-term value for our shareholders with our focus on quality content, compelling uses of technology and global asset growth.”

For the quarter, operating income at the company’s cable networks segment increased by $191 million to $1.3 billion due to growth at the worldwide Disney Channels, increased equity income and an improvement at ESPN.

The increase at the worldwide Disney Channels was driven by sales of Disney Channel programming, higher affiliate revenue due to contractual rate increases domestically and advertising revenue growth internationally.

The increase at ESPN reflected higher contractual rates for affiliate fees and, to a lesser extent, growth in advertising revenue, partially offset by an increase in programming and production, labor and marketing costs.

Advertising revenue growth was driven by higher rates, partially offset by fewer units sold and lower ratings, in part reflecting the absence of the FIFA World Cup. Programming and production cost increases were driven by higher contractual rates for college football and NFL programming, partially offset by the absence of programming costs for the FIFA World Cup. Increased equity income reflected the absence of programming write-offs at AETN.

Read the company’s report here.