Disney’s movie business playing a starring role after some misfires

The Magic Kingdom finally seems to be getting the hang of Hollywood magic.

Once upon a time, Disney just couldn’t get a handle on the movie business. For every few Iron Man-style blockbusters, the studio had to dig itself out of the crater left by at least one Lone Ranger bomb.

But it brought in new studio management in 2012, pared its misfires — it hasn’t declared a film writedown in three years — and revved up its multibillion-dollar acquisitions Pixar, Marvel and Lucasfilm. Just eight years ago, it was dead last in box office receipts among the six major Hollywood studios; this year, it’s on pace for a recordbreaking No. 1 spot. It’s expected to get big assists from movies like Captain America: Civil War, which kicked off the summer season last weekend, and Rogue One, a second instalment in its reinvigorated Star Wars series due this winter.

Disney’s studio profits neared US$2 billion last year. Some expect the studio to post nearly $3 billion in profit this year.

The momentum was evident Tuesday, when The Walt Disney Co. reported $2.1 billion in net profit, boosted by a 27 per cent gain in studio profits to $542 million. Although the results fell short of analyst expectations, partly on poor performance of its soon-tobe-shuttered Infinity video game line, CEO Bob Iger touted “our studio’s unprecedented winning streak at the box office.”

The movie business has long gotten the cold shoulder on Wall Street because its frequent ups and downs make it tough to value. The pay TV business has been a much bigger and steadier source of profits, underpinning the stock price of entertainment companies from Time Warner Inc. to 21st Century Fox.

But while Disney’s studio may be on a roll — even somewhat doubtful movies like The Jungle Book and Zootopia have made a killing — the creative cycle can be cruel.

But its slate looks good. Even before the next Star Wars instalment, summer moviegoers can see Johnny Depp reprise the Mad Hatter in Alice Through the Looking Glass, watch the Pixar sequel Finding Dory and catch the Steven Spielberg-directed adolescent tale The BFG. Yet another Marvel hero, Doctor Strange, hits theatres this fall.