ESPN president Bodenheimer "bullish" on ad growth

By Gina Keating

LOS ANGELES (Reuters) - Walt Disney Co's sports chief, George Bodenheimer, said on Tuesday he is bullish on growth prospects for the cable sports network ESPN, whose solid performance in recent years has been the main engine for Disney's operating income and revenue.

"Ratings are up ... and I am bullish on our continued advertising (growth)," Bodenheimer, co-chairman of Disney's Media Networks and president of ESPN, said at a Deutsche Bank media conference in New York that was accessed via webcast.

"We're bullish on continued growth of the company ... we're peddling as fast as we can on every business that serves sports fans," he said.

Bodenheimer declined to give growth targets but said strong upfront advertising sales for Disney's ABC broadcast network last week "bodes success for us."

"The entire pie to sports consumption is growing ... and ESPN is continuing to ride that wave," he said. "Ratings on ESPN are up significantly this year."

Bodenheimer gave no indication of current advertising sales -- something investors would be keen to hear, said David Bank, managing director of equity research at RBC Capital Markets.

"What everybody really wants to know is what's going on with the advertising environment," Bank said. "People want to know what is going on with budgets and the tone of the advertising markets."

ESPN has all of its 96 million subscribers under contract through 2010, and 80 percent through 2012. Bodenheimer said the network has been "extremely successful in locking up sports rights ... long term," which helps maintain stable distribution rates.

The network's key growth driver, its television business, "continues to be very strong and continues to grow at the same time we are expanding rapidly in digital media," he said.

Disney said in its most recent earnings conference call that it expected ESPN to defer $120 million more in revenue from television affiliates in the fiscal third quarter than it did a year earlier.

But on Tuesday, Bodenheimer said this was no longer the case because ESPN had met its performance targets earlier than expected.

ESPN's international business also was "growing nicely" and actively looking for new broadcasting rights, including for the upcoming Olympics and English Premier League soccer, Bodenheimer said. "I am bullish on international growth."

The network was especially looking to expand offerings for its Spanish-speaking fans, he said.

The network is working to bring some of its TV franchises online through paying distributors, and Bodenheimer said he also sees growth online in fantasy sports and Web video.

Through the recent purchase of a high school sports publication dubbed ESPN Rise, the network hopes to capture a new generation of fans.