Disney beats Wall Street; movies, parks strong

By Gina Keating

LOS ANGELES (Reuters) - Walt Disney Co posted a better-than-expected 22 percent rise in profit as its movie studio scored hits with "National Treasure: Book of Secrets" and "Enchanted" and a weak U.S. economy failed to dampen theme park attendance.

Disney's media networks also saw a double-digit rise in second-quarter operating income due mainly to affiliate and ad rate increases and subscriber growth at sports channel ESPN.

Broadcasting shook off a Hollywood writers' strike that ended halfway through the quarter to post a 17 percent rise in operating income, propelled by international sales of ABC Studios scripted shows like "Lost" and "Gray's Anatomy."

Disney joined other major U.S. media companies in outperforming expectations in the quarter, and investors rewarded the outsized results on Tuesday by boosting Disney shares by 1.6 percent in after-hours trade.

"If you didn't know that the consumer was under tremendous pressure you would think we were in a boom if you looked at their results," said Larry Haverty, associate portfolio manager at Gabelli Global Multimedia Trust.

"All of the big media companies are doing fundamentally very well and the market just refuses to acknowledge it," Haverty added.

'FANTASTIC QUARTER'

Net income in the fiscal second quarter ended March 29 was $1.1 billion, or 58 cents per share, compared with $931 million, or 44 cents per share, in the same quarter last year.