DISNEY BRACES FOR THE WORST

The Walt Disney Co. reported a 78% drop in fiscal Q4 net profits, blaming weak television advertising, slumping park attendance and Mickey Mouse, whose contract is up in 2002, being courted by Microsoft. They also warned the slump would continue through the next year. Hey, forget Disneyland, we're now forced to hit up Uncle Scrooge for a short-term loan.

The company reported a net profit of $53 million, 3 cents a common share or half of Minnie's alimony settlement from Mickey. The total was down $240 million or 11 cents a share from the same period a year ago. Revenues fell to $5.8 billion from $6.1 billion.

The Burbank-based company has a movie studio, ABC and ESPN television networks and theme parks, projected that operating income for the current quarter would be less than half of year-earlier levels because of contraction in its broadcasting operations and resorts. And you thought contraction only took place in baseball. They also projected the following three quarters would see income down by as much as 10-15% below year-earlier levels as business conditions start to improve. We can't wait.

Disney shares ended trading up 35 cents at $18.84, though they dropped to $18.50 in after-hours trade. The company's put its hopes in the recent Pixar/Walt Disney animated feature "Monsters, Inc," which opened to first-week grosses of $65 million.

Said company Chairman/CEO Michael Eisner: "Recent events make this a particularly challenging and somewhat anomalous time for our company. We will continue to manage our company in a way that carefully balances the need for near-term cost reduction with the equally compelling need to invest for future growth." He pledged that the company would allow one free child with every paid adult admission to the California Adventure theme park.