This document is being provided for the exclusive use of ELSPETH CHEUNG at MILLWARD BROWN UK LIMITED North America Equity Research 01 September 2015 Disney A Force to Be Reckoned With; A Deep Dive into the Consumer Products Division As Disney continues to enhance and grow its franchise-focused, company-wide Media strategy, we believe the Consumer Products division has and will continue to benefit AC Alexia S. Quadrani from success across all of Disney’s divisions. Most notably, we believe the global (1-212) 622-1896 launch of new Star Wars merchandise this Friday at midnight, branded “Force
[email protected] Friday,” ahead of the first Star Wars film in a decade on December 18th has the Julia Yue potential to meaningfully accelerate the division’s revenue and profit growth. In our (1-212) 622-9896 analysis within, we estimate a ~200% increase in Star Wars global licensing and retail
[email protected] store sales could lead to ~$500m of incremental revenues and ~$200m of incremental James Kopelman operating profit in F2016 (see pages 28-30 for full analysis). In this report, we (1-212) 270-5899 examine licensing and toy industry trends; analyze the Consumer Products strategy,
[email protected] growth opportunities, and risks; and profile the competitors. In our opinion, Disney not David Karnovsky, CFA (1-212) 622-1206 only has the best portfolio of intellectual properties but also is in the best position to
[email protected] monetize its IP – which is most notable in the Consumer Products division – with J.P.