Key Internal Factors Weighted

Strength
1 cost and expenses declined, and the ROE has increased to 15.24%.
Gross Profit Margin, Operating Profit Margin, and Net Profit Margin, have all increased in 2007 compared with the number of 2006, while the

Weight Rating

Weighted Score

0.09 0.08 0.08 0.09 0.05 0.04 0.05

4 3 3 4 3 3 3

0.36 0.24 0.24 0.36 0.15 0.12 0.15

2 Operating income of Consumer Products segment increased 14% to $618 million in 2006. 3 The revenues at its Parks and Resorts increased 10 percent in 2006. 4 According to the Liquidity Ratios and Leverage Ratios, Disney has a good ability to meet its both short-term and long-term obligations. 5 Disneys 50th anniversary celebration at its park and resorts increased attendance and hotel occupancy. 6 Two major TV networks of Disney now offer hit shows and football games on demand. 7 Disney produces varieties of studio entertainment in different aspects.

Weakness
1 Disney revenues from Studio Entertainment and Consumer product segment decreased by 1%. 2 The increased product development spendng resulted in a decrease at Buena Vista Games. 3 2007.
High operating cost. The company recorded an operating expense of USD 28729 million which constitute 80.9% of the total revenue earned in

0.09 0.08 0.11 0.08 0.06 0.04 0.06 1.00

1 2 1 1 2 2 1

0.09 0.16 0.11 0.08 0.12 0.08 0.06 2.32

4 P/E ratios below the industry average. 5 Limited range of target audience mainly children. 6 Consistently declining performance of its Studio Entertainment segment are the causes for concern to the company. 7 Disney has smaller industry segment in the broadcasting industry as News corp.operates in eight industry segments. Total

number

Key external factors opportunities

Weight

Rating

Weighted score 0.32 0.14 0.24 0.15 0.12 0.28 0.27 0.32 0.14 0.15 0.1 0.21 0.04 0.32 0.12 2.92

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15

By capturing the attention world-wide, family entertainment market is expected to increase. Disney is reducing the risks as well as reward due to minority-owned business transaction. The growing e-commerce market could strongly promote the companys retail growth. The attendance in amusement parks has continued to increase and is projected to in a steady growth Company tries to match creativity and innovation with international expansion and leveraging of new technologies. To adapt to demographic changes to deliver products and services that match consumer preference. Favorable growth expectations from advertising can boost revenues. threats Consumers of all ages, especially the young and men,use he internet more and more for entertainment and share opinions. Competitors are consolidating and spending aggressively to promote new hit movies and TV shows. Many uncontrollable factors impact Disneys parks and resorts segment, including business cycle, exchange rate fluctuations, travel industry trends, amount of available leisure time, oil and transportation price and weather patterns. Seasonality is another concern for all the theme parks Due to demographic changes and increase in aging population, the consumers preferences are diversified. A significant number of companies compete with Disney in entertainment industry. Increases in unemployment, interest rates and fuel costs limit consumers disposable income for entertainment expenses. The success of studio entertainment operations is influenced by the timing and performance of releases. Total

0.08 0.07 0.08 0.05 0.06 0.07 0.09 0.08 0.07 0.05 0.05 0.07 0.04 0.08 0.06 1

4 2 3 3 2 4 3 4 2 3 2 3 1 4 2