Big changes in the cast at Disney

The media giant swaps roles for two top executives, setting up more players as potential CEO candidates.

EMAIL  |   PRINT  |   SHARE  |   RSS
 
google my aol my msn my yahoo! netvibes
Paste this link into your favorite RSS desktop reader
See all CNNMoney.com RSS FEEDS (close)
By Richard Siklos, Editor at Large

(Fortune) -- If you work at Walt Disney, you are not just an employee, you are a "castmember"-- and Thursday, the company boldly swapped the roles of two of its most senior executives.

Jay Rasulo, who has run Disney's (DIS, Fortune 500) vast theme-park business for seven years, will become Disney's chief financial officer, while Thomas Staggs, who has held that post for the past 11 years, will take Rasulo's spot. It's kind of like asking the guys who play Pluto and Donald Duck to change costumes.

The unusual move by CEO Bob Iger comes after another one made last month: appointing Rich Ross, who had overseen the Disney Channel globally, as the new chief of Disney's movie business. Iger pointed out on a conference call that this was not the first time that Disney has made these sorts of changes, and that he himself had benefited from reassignments over the course of his career. However, he added, "This is a unique move in many respects given the importance of these jobs."

The moves came as Disney announced its fourth-quarter results, which underscored the challenges the company has faced in the economic downturn but also the broader operational issues that have hampered its film division. For the year ended Oct. 3, the company reported that operating income was down 21%, to $6.67 billion, on revenue of $36.1 billion, down 4%.

The fourth quarter showed signs of a turnaround and the effects of cost-cutting at the company, with operating income up 4%, to $1.85 billion, and revenue up 14%. Net income was up 18% in the fourth quarter, but down 25% on the year.

The hardest-hit group, studio entertainment, saw its operating income decline 84% for the year, to $175 million, and swung to a fourth-quarter operating loss of $13 million from a year-earlier operating profit of $111 million. Ross earlier this week made a series of executive changes within the studio group, which coincided with a weaker-than-expected debut for the Disney 3-D film A Christmas Carol, starring Jim Carrey.

Rasulo's group, theme parks, has had the extra-onerous task of responding to the economic downturn with a combination of cost-cutting and promotions to keep people coming to the parks and leaving satisfied, while being in the midst of a major expansion program in everything from its California Adventure theme park next to Disneyland to adding new cruise ships to announcing a new Disney park in China.

On the conference call, Staggs said bookings were running around 5% behind last year at the theme parks during the first quarter so far, but that it's difficult to predict trends because consumers are waiting longer to book holidays. For the year, the parks and resorts division saw operating income decrease 25%, to $1.4 billion, and revenues decrease 7%, to $10.4 billion.

Analyst Doug Mitchelson of Deutsche Bank noted that the new duties for Rasulo and Staggs positions both of them as potential candidates to someday succeed Iger. But the rotation philosophy is likely to bring other surprises as well. Iger noted that Anne Sweeney, who runs Disney's media networks division, was several years ago also given responsibility for the ABC broadcasting business, despite a background in cable. "It's not the first time that we've done this and it won't be the last time we do it," he said. To top of page

Company Price Change % Change
Bank of America Corp... 16.13 -0.26 -1.59%
Facebook Inc 59.72 0.63 1.07%
Yahoo! Inc 36.33 -0.02 -0.06%
Intel Corp 26.93 0.16 0.60%
Alcoa Inc 13.42 0.37 2.84%
Data as of Apr 16
Index Last Change % Change
Dow 16,424.85 162.29 1.00%
Nasdaq 4,086.23 52.06 1.29%
S&P 500 1,862.31 19.33 1.05%
Treasuries 2.64 0.01 0.34%
Data as of 1:42am ET
More Galleries
8 CEOs who took a pay cut in 2013 Median CEO pay inched up 9% in 2013 to $13.9 million. But not everyone got a bump last year. Here are eight CEOs who missed out. More
7 businesses Amazon wants to shake up From industrial supplies to educational software, Amazon is about more than just retail and books. More
Don't miss these Tax Day deals From massages and paper shredding to cookies and queso, celebrate the end of tax season with these Tax Day freebies and discounts. More
Sponsors
Worry about the hackers you don't know 
Crime syndicates and government organizations pose a much greater cyber threat than renegade hacker groups like Anonymous. Play
GE CEO: Bringing jobs back to the U.S. 
Jeff Immelt says the U.S. is a cost competitive market for advanced manufacturing and that GE is bringing jobs back from Mexico. Play
Hamster wheel and wedgie-powered transit 
Red Bull Creation challenges hackers and engineers to invent new modes of transportation. Play

Market indexes are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer LIBOR Warning: Neither BBA Enterprises Limited, nor the BBA LIBOR Contributor Banks, nor Reuters, can be held liable for any irregularity or inaccuracy of BBA LIBOR. Disclaimer. Morningstar: © 2014 Morningstar, Inc. All Rights Reserved. Disclaimer The Dow Jones IndexesSM are proprietary to and distributed by Dow Jones & Company, Inc. and have been licensed for use. All content of the Dow Jones IndexesSM © 2014 is proprietary to Dow Jones & Company, Inc. Chicago Mercantile Association. The market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. FactSet Research Systems Inc. 2014. All rights reserved. Most stock quote data provided by BATS.