DISNEY PROFITS FALL SHORT EISNER, OTHER TOP OFFICIALS TO FORGO BONUSES THIS YEAR.Byline: Jason Z. Cohen cohen or kohen (Hebrew: “priest”) Jewish priest descended from Zadok (a descendant of Aaron), priest at the First Temple of Jerusalem. The biblical priesthood was hereditary and male. Staff Writer BURBANK - Mickey Mouse Mickey Mouse Famous character of Walt Disney's animated cartoons. He was introduced in Steamboat Willie (1928), the first animated cartoon with sound. Mickey was created by Disney, who also provided his high-pitched voice, and was usually drawn by the studio's head animator, is being stingy stin·gy adj. stin·gi·er, stin·gi·est 1. Giving or spending reluctantly. 2. Scanty or meager: a stingy meal; stingy with details about the past. with the bonus checks this year. Disney Chairman and Chief Executive Michael Eisner Michael Dammann Eisner (born March 7, 1942) was CEO of The Walt Disney Company from September 22, 1984 to September 30, 2005. Early life Michael Eisner was born to a wealthy family in Mt. Kisco, New York, and raised on Park Avenue in Manhattan. will get no bonus in 2000, nor will most of the company's senior executives, because the company failed to meet performance targets that trigger bonus payouts, the company disclosed Wednesday in government filings. Eisner, for example, received no bonus because the company's earnings per share were less than a 7.5 percent increase over the average of the 1997 and 1998 figure. In fact, the company's per-share earnings declined 33 percent from the average of the previous two years. In 1999, under a different bonus formula, Eisner received a bonus of $5 million over his $750,000 annual salary. His yearly salary has not changed since 1984. The canceled bonuses are just the latest bad news for Eisner and his top assistants. In its past fiscal year, Disney's revenues decreased by 29.7 percent and its stock price slowly drifted from more than $36 per share to a year-ending $29. Even Wednesday's closing price of $32.625 per share is well off the stock's all-time high of $41. On Wednesday, in addition to its annual proxy statement Proxy Statement A document containing the information that a company is required by the SEC to provide to shareholders so they can make informed decisions about matters that will be brought up at an annual stockholder meeting. , Disney released its annual report and a letter to shareholders from Eisner. In the letter, he outlined a four-pronged strategy to bring Disney's performance back up to standards. ``Your company is really in excellent health despite the short-term earnings hiccup hiccup or hiccough, involuntary spasmodic contraction of the diaphragm followed by a sharp intake of air, which is abruptly stopped by a sudden, involuntary closing of the glottis (opening between the vocal cords); the consequent blocking of air ,'' Eisner wrote in his letter. His plans include shoring up Noun 1. shoring up - the act of propping up with shores propping up, shoring supporting, support - the act of bearing the weight of or strengthening; "he leaned against the wall for support" the sagging sag v. sagged, sag·ging, sags v.intr. 1. To sink, droop, or settle from pressure or weight. 2. home video and consumer products divisions, cutting costs, using capital more efficiently and continued creative development. ``Last year's performance was pretty bad. The stock languished for most of the year,'' said Doug Christopher, an analyst with Los Angeles-based Crowell Weedon. But the bonus situation appears to be acting as an incentive to Disney's management, he said. The company is embarking on a substantial program to cut costs and use its capital more efficiently, Christopher said. ``The bonus side of it is showing, Hey, we're serious. We did not perform well last year,'' Christopher said. ``They're looking at every area of the organization for potential either expense reduction, productivity improvements or reducing the amount of capital they've got tied up.'' The company's stated goal is to save $500 million annually by 2001. Christopher said that is a conservative goal, and estimated the company could save as much as $1 billion annually through capital expense reductions and cost-cutting. Most of the programs already are under way, including a plan to improve home video revenues by releasing animated titles for year-round availability. Disney also plans to restructure its purchasing practices in a cost-cutting move. ``By bringing this common-sense approach to all of our purchases - from tacks to trucks to toilet paper - in five years, we should be saving more than $300 million annually,'' Eisner told shareholders. Eisner's strategy for turning around Disney's home video business includes rolling out all but 10 of its major library titles for year-round availability. Previously, titles such as ``Pinocchio,'' ``Hercules'' and ``Tarzan'' were only available for a few months at a time. Eisner said in his letter that Disney plans to maintain a collection of ``classics'' such as ``Snow White,'' ``Jungle jungle [Hindustani jangal=desert, forest; from Skt. jangala=wasteland, uncultivated land], densest form of tropical forest (usually second growth or later) found throughout tropical lowland regions. Book'' and ``The Lion King,'' that will continue to be held for limited release. Eisner said Disney's 4,000 licensees are simply too many, as are the total number of products in its Disney Stores. He plans to reduce both. ``During the '90s, as we were focused on expansion, and as enormous profits continued to flow into the company, inefficiencies crept crept v. Past tense and past participle of creep. crept Verb the past of creep crept creep into our operations,'' Eisner wrote. Eisner's cost-cutting plan also includes getting Disney out of underperforming businesses. ``If an asset is noncore, or doesn't generate an adequate return on capital, we will discontinue dis·con·tin·ue v. dis·con·tin·ued, dis·con·tin·u·ing, dis·con·tin·ues v.tr. 1. To stop doing or providing (something); end or abandon: it, sell it or finance it differently,'' Eisner wrote. By expanding its theme parks, consolidating most of its ABC Television ABC Television may refer to:
``The franchise, I think, is very strong. They've fixed ABC ABC in full American Broadcasting Co. Major U.S. television network. It began when the expanding national radio network NBC split into the separate Red and Blue networks in 1928. and are continuing to fix it,'' Christopher said. ``I think they're doing the right things.'' CAPTION(S): 2 photos Photo: (1 -- color) There may be fewer products for sale in Disney stores, if Chief Executive Michael Eisner has his way. Vincent Yu/Associated Press (2) EISNER |
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