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The Walt Disney Company Reports Fourth Quarter And Full Year Earnings For Fiscal 2012

Higher segment operating income for both the year and quarter was primarily due to increases at Merchandise Licensing and our retail business as well as favorable foreign currency impacts. At Merchandise Licensing, the increase for the year and quarter was driven by earned royalty growth reflecting the strong performance of Spider-Man , Avengers, and Minnie and Mickey merchandise in the current year and an increase in Japan as a result of the impact of the earthquake and tsunami which occurred in the second quarter of the prior year. These increases were partially offset by lower sales of Cars and Toy Story merchandise. Licensing results for the current year also benefitted from lower revenue share with Studio Entertainment and higher guaranteed shortfall recognition. The revenue share impact was due to a lower mix of revenues from properties subject to revenue share in the current year reflecting the strong prior-year sales of Cars merchandise.

At our retail business, higher operating income for the year and quarter was driven by new stores in North America and Europe and higher online sales.


Interactive revenues for the year decreased 14% to $845 million and segment operating results improved $92 million to a loss of $216 million. For the quarter, revenues decreased 14% to $191 million and segment operating results improved $18 million to a loss of $76 million.

Improved segment operating results for the year reflected an increase at our social games business and higher allocations to other Company businesses, primarily related to website design and maintenance, partially offset by a decrease at our console game business.

Social game results reflected lower acquisition accounting impacts and improved title performance in the current year. Lower console game results were driven by a decline in sales volume from fewer significant releases which was partially offset by lower marketing costs, higher minimum guarantee recognition and decreased product development costs. The reduction in console games product development reflected an ongoing shift from console game releases to mobile and social game releases.

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