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Walt Disney Co · 10-K405 · For 9/30/96

Filed On12/19/96   ·   Accession Number 898430-96-5815   ·   SEC File1-11605

Annual Report — [X] Reg. S-K Item 405   —   Form 10-K
Filing Table of Contents

Document/ExhibitDescriptionPagesSize 2:EX-3.(B)    Amended Bylaws of the Company Dated 4/22/96           11     65K  3:EX-4.(C)    364 Day Credit Agreement Dated as of Oct. 30, 1996    51    229K  4:EX-4.(D)    Five-Year Credit Agreement Dated 10/30/96             53    240K  5:EX-21       Subsidiaries of the Company                            1      5K  6:EX-27       Financial Data Schedule                                2      9K

10-K405   —   Annual Report on Form 10-K for Period End 9/30/96
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 UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549FORM 10-KANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THESECURITIES EXCHANGE ACT OF 1934For the Fiscal Year EndedSeptember 30, 1996        Commission File Number 1-                                11605[LOGO OF THE WALT DISNEY COMPANY]Incorporated in Delaware                                   I.R.S. Employer      500 South Buena Vista Street,Burbank,California91521   Identification No.    (818) 560-1000                                              95-4545390          Securities Registered Pursuant to Section 12(b) of the Act:                                                                  Name of Each ExchangeTitle of Each Class                                  on Which Registered        -------------------                                 ---------------------       Common Stock, $.01 par value                        New York Stock Exchange                                                   Pacific Stock ExchangeSecurities Registered Pursuant to Section 12(g) of the Act: None.               Indicate by check mark whetherthe registrant (1) has filed all reports     required to be filed by Section 13 or 15(d) of the Securities Exchange Act of   1934 during the preceding 12 months, and (2) has been subject to such filing    requirements for the past 90 days. Yes   X    No                                             ----     ----Indicate by check mark if disclosure of delinquent filers pursuant to Rule  405 of Regulation S-K is not contained herein, and will not be contained, to    the best of registrant's knowledge, in definitive proxy or information          statementsincorporated by reference in Part III of this Form 10-K or any       amendment to this Form 10-K.   X                                                ----                As ofNovember 30, 1996, the aggregate market value of registrant's common  stock held by non-affiliates (based on the closing price on such date as        reported on the New York Stock Exchange-Composite Transactions) was $49.1       billion. All executive officers and directors of registrant and all persons     filing a Schedule 13D with the Securities and Exchange Commission in respect    to registrant's common stock have been deemed, solely for the purpose of the    foregoing calculation, to be"affiliates" ofthe registrant.                    There were 675,098,522 shares of common stock outstanding as ofDecember 12,1996.Documents Incorporated by Reference Certain information required for Part III of this report is incorporated    herein by reference to an amendment to this report on Form 10-K/A to be filed   within 120 days after the end of the fiscal year covered by this report.
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PART IITEM 1. BUSINESSThe Walt Disney Company, together with itssubsidiaries, is a diversified   international entertainment company with operations in three business           segments: Creative Content, Broadcasting and Theme Parks and Resorts.           Information on revenues, operating income, identifiable assets and              supplemental revenue ofthe Company's business segments appears in Note 11 of   the Notes to Consolidated Financial Statements included in Item 8 hereof. The   Company employs approximately 100,000 people.                                   OnFebruary 9, 1996,the Company completed its acquisition of Capital       Cities/ABC, Inc. ("ABC"). Information on the acquisition appears in Note 2 of   the Notes to Consolidated Financial Statements included in Item 8 hereof. As a  result of the acquisition, a new parent company, with the name"The WaltDisney Company," replaced the old parent company of the same name. For          convenience, the term"Company" is used in this report to refer to both the     old and the new parent company. Unless the context otherwise requires, the      term is also used to refer collectively to the parent company and thesubsidiaries through which its various businesses are actually conducted.BUSINESS SYNERGYThe Company's three different operating segments marketthe Company's       trademarks, characters, products and services as part of a cohesive effort to   generate stockholder value through synergy.                                     The Creative Content segment produces live-action and animated motion       pictures, television programs and musical recordings, licensesthe Company's    characters and other intellectual property for use in connection with           merchandise and publications, and publishes books and magazines. Within the     segment, films and characters are often promoted through the release of         audiocassettes and compact discs, children's books and magazines. In addition,  television programs have been created that contain characters originated in     animated films. Character merchandising and publications licensing promote the  Company's films and television programs, as well asthe Company's other         operations.The Company also operates the Disney Stores, which are direct       retail distribution outlets for products based onthe Company's characters and  films.The Company is also engaged directly in the home video and television    distribution of its film and television library.The Company's other operations benefit substantially from the Creative      Content segment, and those operations in turn promotethe Company's films,      television programs and merchandise. The products and services of the Creative  Content segment often contain elements highlightingthe Company's theme parks   and resorts, and the theme parks and resorts will often promote recent          releases of motion pictures through parades, stage shows and other              attractions.                                                                    In keeping with its pursuit of business synergy,the Company recently moved into the development of multimedia technologies, including interactive          software, interactive television and video ventures.The Company's interactive  software is primarily oriented toward children, and includes characters fromthe Company's animated films and television programs.The Company is also       expanding into the cruise line business, with two ships scheduled to be         launched in 1998.The Company anticipates promoting the cruise line business    by incorporatingthe Company's characters, themes from live-action and          animated motion pictures, film and stage entertainment into the cruise          experience, and by packaging cruises with visits to the Walt Disney World       Resort.                                                                         In addition to the value generated through synergy,the Company believes itsoperating segments benefit substantially fromthe Company's reputation in the   entertainment industry for commitment to excellent quality in all of its        products and services.                                                          -1-
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CREATIVE CONTENTThe Company is an industry leader in producing and acquiring live-action andanimated motion pictures for distribution to the theatrical, television and     home video markets, and producing original television programming for the       network and first-run syndication markets. In addition,the Company also        produces music recordings and live stage plays.The Company licenses the name"Walt Disney," as well asthe Company's characters, visual and literary         properties and songs and music, to various consumer manufacturers, retailers,   show promoters and publishers throughout the world. Companysubsidiaries also   engage in direct retail distribution through The Disney Stores; publish         domestic newspapers, technical and specialty publications; create books,        magazines and comics in the United States and Europe; and produce popular       music, children's audio products and computer software for all markets, as      well as film and video products for the educational marketplace.THEATRICAL FILMSWalt Disney Pictures and Television, a subsidiary ofthe Company, produces  and acquires live-action motion pictures that are distributed under the         banners Walt Disney Pictures, Touchstone Pictures, Hollywood Pictures and       Caravan Pictures. Another subsidiary, Miramax Film Corp., acquires and          produces motion pictures that are primarily distributed under the Miramax       banner.The Company also produces and distributes animated motion pictures      under the banner Walt Disney Pictures. In addition,the Company distributes     films produced or acquired by certain independent production companies.         Recently,the Company announced a new direction for its film slate, which   will be phased-in over the next several years.The Company intends on           producing fewer total films, but increasing its per film expenditures.          Accordingly, total film expenditures are expected to approximate current        levels. During 1997,the Company will seek to distribute approximately 25       feature films underthe Company's various banners and approximately 35          additional films under the Miramax banner, including several live-action        family feature films, one to two full-length animated films and between 45 and  55 films targeted to teenagers and adults. In addition,the Company             periodically reissues previously released animated films. As ofSeptember 30,1996,the Company had released 427 full-length live-action features (primarily  color), 34 full-length animated color features and approximately 554 cartoon    shorts.The Company distributes and markets its filmed products principally through its own distribution and marketing companies in the United States and major     foreign markets.HOME VIDEOThe Company directly distributes home video releases from each of its       banners in the domestic market. In the international market,the Company        distributes both directly and through foreign distribution companies. In        addition,the Company acquires and produces original programming for direct-    to-video release. As ofSeptember 30, 1996, approximately 834 produced and      acquired titles, including 437 feature films and 397 cartoon shorts and         animated features, were available to the domestic marketplace. Approximately    881 produced and acquired titles, including 462 feature films and 419 cartoon   shorts and animated features, were available to the international home          entertainment market.TELEVISION PRODUCTION AND DISTRIBUTIONThe Company develops, produces and distributes television programming for   broadcasters, cable and satellite operators, including the major television     networks, The Disney Channel, A&E Television Networks and Lifetime Television   under the Buena Vista Television, Touchstone Television and Walt Disney         Television labels. Program development is carried out in collaboration with a   number of independent writers, producers and creative teams under various       development arrangements.The Company focuses on the development, production    and distribution of half-hour comedies for network prime-time broadcast,        including such series as Home Improvement, Ellen and Boy Meets World. Fall      1996 releases included Dangerous Minds, Life's Work and Homeboys in Outer       Space.                                                                          -2-
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Walt Disney Television currently distributes two animated cartoon series forSaturday morning: Aladdin and Timon and Pumbaa.The Company also offers a       variety of prime-time specials for exhibition on network television.            Additionally,the Company produces first-run animated and live-action           syndicated programming. The Disney Afternoon is a two-hour block of cartoons    airing five days per week, including Aladdin, Gargoyles, Darkwing Duck, Mighty  Ducks, Quack Pack and Timon and Pumbaa. Live-action programming includes Live!  with Regis and Kathie Lee, a daily talk show on ABC; Siskel & Ebert, a weekly   motion picture review program; Disney Presents Bill Nye the Science Guy and     Sing Me a Story With Belle, weekly educational programs for children.The Company licenses the theatrical and television film library to the      domestic television syndication market. Television programs in off-network      syndication include Home Improvement, Blossom, Dinosaurs, The Golden Girls and  Empty Nest. Major packages ofthe Company's feature films and television        programming have been licensed for broadcast continuing over several years.The Company licenses television series developed for United States networks in a number of foreign markets, including Canada, France, Germany, Italy,       Spain and the United Kingdom. Certain ofthe Company's television programs are  also syndicated bythe Company abroad, including The Disney Club, a weekly      series thatthe Company produces for foreign markets.The Company's television  programs are telecast regularly in many countries, including Australia,         Brazil, Canada, China, France, Germany, Italy, Japan, Mexico, Spain and the     United Kingdom.The Company currently licenses its feature films for pay television on an   output basis in several geographic markets, including the United Kingdom and    Scandinavia, and has an arrangement with Showtime through 1997 for the United   States. In 1993,the Company entered into an agreement to license to the        Encore pay television service, over a multi-year period, exclusive domestic     pay television rights to Miramax films beginning in 1994 and Touchstone         Pictures and Hollywood Pictures films starting in 1997.AUDIO PRODUCTS AND MUSIC PUBLISHINGThe Company also produces and distributes compact discs, audiocassettes and records, consisting primarily of soundtracks for animated films and read-along  products, directed at the children's market in the United States, France and    the United Kingdom, and licenses the creation of similar products throughout    the rest of the world. In addition,the Company commissions new music for its   motion pictures, television programs and records and exploits the song          copyrights created forthe Company by licensing others to produce and           distribute printed music, records, audiovisual devices and public               performances.                                                                   Domestic retail sales of compact discs, audiocassettes and records are the  largest source of revenues, while direct marketing, which utilizes catalogs,    coupon packages and television, is a secondary means of distribution for the    Company.The Company's Hollywood Records subsidiary develops, produces and markets   recordings from new talent across the spectrum of popular music, as well as     soundtracks from certain ofthe Company's live-action motion pictures.WALT DISNEY THEATRICAL PRODUCTIONSIn 1994,the Company produced a Broadway-style stage musical based on the   animated feature film Beauty and the Beast. The stage adaptation is currently   playing in several cities in the United States and around the world. The        Company has also leased the New Amsterdam Theater in New York, and anticipates  producing additional live theatre including The Lion King, scheduled to open    in November 1997.CHARACTER MERCHANDISE AND PUBLICATIONS LICENSINGThe Company's worldwide licensing activities generate royalties which are   usually based on a fixed percentage of the wholesale or retail selling price    of the licensee's products.The Company                                         -3-
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licenses characters based upon both traditional and newly created film          properties. Character merchandise categories which have been licensed include   apparel, watches, toys, gifts, housewares, stationery, sporting goods and       domestic items such as sheets and towels. Publication categories which have     been licensed include continuity-series books, book sets, art and picture       books and magazines.                                                            In addition to receiving licensing fees,the Company is actively involved inthe development and approval of licensed merchandise and in the                 conceptualization, development, writing and illustration of licensed            publications.The Company continually seeks to create new characters to be      used in licensed products.THE DISNEY STORESThe Company markets Disney-related products directly through its retail     facilities operated under"The Disney Store" name. These facilities are         generally located in leading shopping malls and similar retail complexes. The   stores carry a wide variety of Disney merchandise and promote other businesses  ofthe Company. During fiscal 1996,the Company opened 65 new stores in the     United States and Canada, 19 in Europe and 17 in the Asia-Pacific area,         bringing the total number to 530 as ofSeptember 30, 1996.The Company expects  to open additional stores in the future in selected markets throughout the      United States, as well as in Asia-Pacific, European and Latin American          countries.NEWSPAPER, TECHNICAL AND SPECIALTY PUBLISHINGPublishing operations include production of seven daily newspapers (five of which have Sunday editions); weekly community newspapers; shopping guides and   real estate magazines; specialized publications that involve news and ideas     for various industries; and consumer, special interest, trade and agricultural  publications. The publishing group also provides research and database          services.BOOKS AND MAGAZINESThe Company also has book imprints in the United States offering books for  children and adults.The Company also produces several magazines for the        children and family markets as well as Discover, a general science magazine.    In addition,the Company is a partner in a joint venture which produces         children's books and magazines and computer software magazines in France.DISNEY INTERACTIVEDisney Interactive is a fully-integrated software business focused on the   product development and marketing of entertainment and educational computer     software and video game titles for home and school. The division's initiatives  also involve the development, publication and distribution of content for       narrow-band on-line services, the interactive software market, interactive      television platforms, Internetweb sites and other emerging technology          ventures.OTHER ACTIVITIESThe Company produces audiovisual materials for the educational market,      including videocassettes and film strips. It also licenses the manufacture and  sale of posters and other teaching aids.The Company markets and distributes,   through various channels, animation cel art and other animation-related         artwork and collectibles.COMPETITIVE POSITIONThe success of the Creative Content operations is heavily dependent upon    public taste, which is unpredictable and subject to change. In addition,        filmed entertainment operating results fluctuate due to the timing of           theatrical and home video releases. Release dates are determined by several     factors, including timing of vacation and holiday periods and competition in    the market. Operating results for the licensing and retail distribution         business are influenced by seasonal consumer purchasing behavior and by the     timing of animated theatrical releases.                                         -4-
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The Company's Creative Content businesses compete with all forms of         entertainment. A significant number of companies produce and/or distribute      theatrical and television films, exploit products in the home video market,     provide pay television programming service, sponsor live theater, and/or        produce interactive software.The Company also competes to obtain creative      talents, story properties, advertiser support, broadcast rights and market      share, which are essential to the success of all ofthe Company's Creative      Content businesses.The Company competes in its character merchandising and other licensing,    publishing and retail activities with other licensers, publishers and           retailers of character, brand and celebrity names. Although public information  is limited,the Company believes it is the largest worldwide licenser of        character-based merchandise and producer/distributor of children's audio        products.The Company's newspaper publishing operations compete in their various localmarkets against other newspapers, and other media channels for audience and     advertising revenues. Technical and specialty publications usually cover small  markets, with limited competition.BROADCASTINGTELEVISION AND RADIO NETWORKSThe Company operates the ABC Television Network, which as ofSeptember 30,1996 had 223 primary affiliated stations operating under long-term agreements   reaching 99.9% of all U.S. television households. The ABC Television Network    broadcasts programs in"dayparts" and types as follows: Monday through Friday   Early Morning, Daytime and Late Night, Monday through Sunday Prime Time and     News, Children's and Sports.The Company also operates the ABC Radio Networks,  which serve more than 122 million people weekly over approximately 2,900        affiliates as ofSeptember 30, 1996 through seven different program services,   each with its own group of affiliated stations. The ABC Radio Networks also     produce and distribute a number of radio program series for radio stations      nationwide.                                                                     Generally, the networks pay the cost of producing their own programs or     acquiring broadcast rights from other producers for network programming and     pay varying amounts of compensation to affiliated stations for broadcasting     the programs and commercial announcements included therein. Substantially all   revenues from network operations are derived from the sale to advertisers of    time in network programs for commercial announcements. The ability to sell      time for commercial announcements and the rates received are dependent on many  factors, primarily the quantitative and qualitative audience that the network   can deliver to the advertiser, as well as overall advertiser demand for time    in the network marketplace.TELEVISION AND RADIO STATIONSThe Company owns nine very high frequency (VHF) television stations, five ofwhich are located in the top ten markets in the United States; one ultra high   frequency (UHF) television station; eleven standard (AM) radio stations; and    ten frequency modulation (FM) radio stations. All of the television stations    are affiliated with the ABC Television Network, and 17 of the 21 radio          stations are affiliated with the ABC Radio Networks.The Company's television   stations penetrate 24% of the nation's television households, calculated using  the multiple ownership rules of the Federal Communications Commission (FCC).The Company's radio stations reach more than 13 million people weekly in the    top twenty United States advertising markets.                                   During 1996,the Company also operated KCAL-TV, an independent station in   Los Angeles, California. In May 1996,the Company entered into an agreement to  sell KCAL to Young Broadcasting, Inc. The sale was consummated onNovember 22,1996.                                                                           -5-
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CABLE AND INTERNATIONAL BROADCASTThe Company's Cable and International Broadcast operations are principally  involved in the production and distribution of cable television programming,    the licensing of programming to domestic and international markets and          investment in joint ventures in foreign-based television operations and         television production and distribution entities.The Company owns The Disney    Channel, 80% of ESPN Inc., 37.5% of the A&E Television Networks, 50% of         Lifetime Entertainment Services, and has various other investments in Europe.   The Disney Channel, which has approximately 25 million domestic and 7       million international subscribers, is a cable television service. New shows     developed for original use by The Disney Channel include dramatic, adventure,   comedy and educational series, as well as documentaries and first-run           television movies. In addition, entertainment specials include shows            originating from both the Walt Disney World Resort(R) and Disneyland Park(R).   The balance of the programming consists of products acquired from third         parties and products fromthe Company's theatrical film and television          programming library. The Disney Channel Taiwan premiered in March 1995,         followed by the launch of The Disney Channel U.K. in October 1995.The Company  began broadcasting The Disney Channel Australia in 1996, expects to launch The  Disney Channel in France and the Middle East in 1997, and is exploring the      development of The Disney Channel in other countries around the world.          ESPN Inc. operates ESPN, a cable sports programming service reaching 70     million subscribers domestically and 105 million subscribers in 160 countries   internationally, and ESPN2, which reaches 38 million domestic subscribers.      ESPN also owns 33% of Eurosport, a pan-European satellite-delivered cable and   direct-to-home sports programming service, and 20% of Japan Sports Network, a   sports cable channel. ESPNews, a 24-hour sports news cable channel, was         launched in fall 1996, and ESPN Asia and Star Sports have formed a joint        venture for delivery of sports programming throughout most of Asia.             The A&E Television Network is a cable programming service devoted to        cultural and entertainment programming reaching 68 million subscribers. The     History Channel, which is owned by A&E, reaches 22 million subscribers.         Lifetime Entertainment Services owns Lifetime Television, which reaches 66  million cable subscribers and is devoted to women's lifestyle programming.The Company has affiliated European operations including (i) Tele-Munchen   Fernseh GmbH & Co., a 50%-owned television and theatrical                       production/distribution company based in Munich, Germany, which also has        interests in cinemas, (ii) RTL 2 Fernseh GmbH & Co., a 23%-owned general        entertainment commercial broadcasting company, also based in Munich, reaching   28 million households, (iii) TM3 Fernseh GmbH & Co. KG, a 37.5%-owned women-    oriented commercial broadcasting company reaching 17 million households, also   based in Munich, (iv) RTL Disney Fernseh GmbH & Co. KG ("Super RTL"), a 50%-    owned German family entertainment commercial broadcasting company reaching 18   million households and (v) Scandinavian Broadcasting System SA, a 23%-owned     company based in Luxembourg with interests in television and radio stations,    satellite-delivered cable and direct-to-home programming services and           television production, serving various European countries and reaching 13       million households.The Company's share of the financial results of the cable and international broadcast services, other than The Disney Channel and ESPN Inc., are reported   under the heading"Corporate Activities and Other" inthe Company's             consolidated statements of income.COMPETITIVE POSITIONThe ABC Television Network, The Disney Channel, ESPN and other broadcasting affiliates compete for viewers with the other television networks, independent  television stations, other video media such as cable television, multipoint     distribution services ("MDS," which employ non-broadcast frequencies to         transmit subscription television services to individual homes and businesses),  direct                                                                          -6-
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broadcast services, satellite television program services and videocassettes.   In the sale of advertising time, the broadcasting operations compete with       other television networks, independent television stations, suppliers of cable  television programs and other advertising media such as newspapers, magazines   and billboards. Substantial competition also exists for exclusive broadcasting  rights for television programs. The ABC Radio Networks likewise compete with    other radio networks and radio programming services, independent radio          stations and other advertising media.The Company's television and radio stations are in competition with other   television and radio stations, cable television systems, MDS, direct broadcast  services, satellite television program services, videocassettes and other       advertising media such as newspapers, magazines and billboards. Such            competition occurs primarily in individual market areas. Generally, a           television station in one market does not compete directly with other stations  in other market areas. Nor does a group of stations, such as those owned bythe Company, compete with any other group of stations as such. While the        pattern of competition in the radio station industry is basically the same, it  is not uncommon for radio stations outside of a market area to place a signal   of sufficient strength within that area (particularly during nighttime hours)   to gain a share of the audience. However, they generally do not realize         significantly increased advertising revenues as a result.The Company's television and radio broadcasting operations are under the    jurisdiction of the FCC. Under the Communications Act of 1934, as amended (the"Communications Act"), the FCC is empowered to issue, revoke or modify          broadcasting licenses, determine the location of stations, regulate the         equipment used by stations, adopt regulations to carry out the provisions of    the Communications Act and impose certain penalties for violation of its        regulations.                                                                    FCC regulations also restrict the ownership of stations and cable operationsin certain circumstances, and regulate the practices of network broadcasters,   cable providers and competing services. Such laws and regulations are subject   to change, andthe Company generally cannot predict whether new legislation or  regulations, or a change in the extent of application or enforcement of         current laws and regulations, would have an adverse impact onthe Company's     operations.THEME PARKS AND RESORTSThe Company operates the Walt Disney World Resort in Florida and the        Disneyland Park and two hotels in California.The Company also earns royalties  on revenues generated by the Tokyo Disneyland(R) theme park and has an equity   interest in Disneyland Paris.WALT DISNEY WORLD RESORTThe Walt Disney World Resort is located on approximately 30,500 acres of    land owned by Companysubsidiaries 15 miles southwest of Orlando, Florida. The  resort includes three theme parks (the Magic Kingdom, Epcot and the Disney-MGM  Studios), hotels and villas, an entertainment complex, a shopping village,      conference centers, campgrounds, golf courses, water parks and other            recreational facilities designed to attract visitors for an extended stay. A    fourth theme park, Disney's Animal Kingdom featuring live animals in natural    habitats, is currently under construction and scheduled to open in spring       1998.The Company markets the entire Walt Disney World Resort through a variety ofnational, international and local advertising and promotional activities. The   Walt Disney World Resort began celebrating its 25th Anniversary in October      1996 with a series of promotional and special events. A number of attractions   in each of the theme parks are sponsored by corporate participants through      long-term participation agreements.                                             MAGIC KINGDOM - The Magic Kingdom, which opened in 1971, consists of seven  principal areas: Main Street U.S.A., Liberty Square, Frontierland, New          Tomorrowland, Fantasyland, Adventureland and Toontown Fair. These areas         feature themed rides and attractions, restaurants, refreshment stands and       merchandise shops.                                                              -7-
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EPCOT - Epcot, which opened in 1982, consists of two major themed areas:    Future World and World Showcase. Future World dramatizes certain historical     developments and addresses the challenges facing the world today through major  pavilions devoted to high-tech products of the future ("Innoventions"),         communication and technological exhibitions ("Spaceship Earth"), and energy,    transportation, imagination, life and health, the land and seas. World          Showcase presents a community of nations focusing on the culture, traditions    and accomplishments of people around the world. World Showcase includes as a    central showpiece the American Adventure pavilion, which highlights the         history of the American people. Other nations represented are Canada, China,    France, Germany, Italy, Japan, Mexico, Morocco, Norway and the United Kingdom.  Both areas feature themed rides and attractions, restaurants and merchandise    shops.                                                                          DISNEY-MGM STUDIOS - The Disney-MGM Studios, which opened in 1989, consists of a theme park, an animation studio and a film and television production       facility. The complex park centers around Hollywood as it was during the        1930's and 1940's and features Disney animators at work and a backstage tour    of the film and television production facilities in addition to themed food     service and merchandise facilities and other attractions. The production        facility consists of three sound stages, merchandise shops and a back lot area  and currently hosts both feature film and television productions.               RESORT FACILITIES - As ofSeptember 30, 1996,the Company owned and operated12 resort hotels and a complex of villas and suites at the Walt Disney World    Resort, with a total of approximately 14,700 rooms. The Disney Institute, a     resort offering participatory programs and life-enriching experiences, opened   in 1996, as did Disney's BoardWalk Hotel with 378 luxury rooms. In addition,    Disney's Fort Wilderness camping and recreational area offers approximately     1,200 campsites and wilderness homes. Several of the resort hotels also         contain conference centers and related facilities.                              Recreational activities available at the resort facilities include five     championship golf courses, miniature golf courses, an animal sanctuary,         tennis, sailing, water skiing, swimming, horseback riding and a number of       noncompetitive sports and leisure time activities.The Company also operates    three water parks: Blizzard Beach, River Country and Typhoon Lagoon.The Company has also developed a shopping facility and entertainment complexto be known as Downtown Disney, which consists of the Disney Village            Marketplace and Pleasure Island. The Disney Village Marketplace is home to the  50,000-square-foot World of Disney, which opened in October 1996 and is the     largest Disney retail store in the world. Pleasure Island, an entertainment     center adjacent to the Disney Village Marketplace, includes restaurants, night  clubs and shopping facilities. These shopping and entertainment facilities are  currently under significant expansion. The newly expanded property will be      situated on 66 acres on the west side of Pleasure Island and will include       multiple third party arrangements such as the House of Blues, a New Orleans-    style restaurant and live entertainment facility; Wolfgang Puck's Cafe, a       California cuisine restaurant; Virgin Records Megastore, a state-of-the-art     music, video and book showplace; Cirque du Soleil, a high energy acrobatics     and modern dance show; Bongos Cuban Cafe, a cafe/night club; and an AMC         theater complex, which will become the largest theater complex in Florida.      Currently under development are Celebration, a 4,900-acre town; Disney      Cruise Line, a cruise vacation line that will include two 85,000 ton ships;     Disney's Coronado Springs Resort, a facility designed to serve the moderately   priced hotel/convention market; and Disney's Wide World of Sports, a sports     complex featuring professional and amateur sporting events.                     At the Disney Village Marketplace Hotel Plaza, seven independently operated hotels are situated on property leased fromthe Company. These hotels have a    capacity of approximately 3,700 rooms. Additionally, two hotels--the Walt       Disney World Swan and the Walt Disney World Dolphin, with an aggregate          capacity of approximately 2,300 rooms--are independently operated on property   leased fromthe Company near Epcot. Another hotel, the 288-room Shades of       Green on Walt Disney World Resort, is leased fromthe Company and operated by   a non-profit organization as an armed forces recreation center.                 -8-
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DISNEYLANDThe Company owns 330 acres and has under long-term lease an additional 39   acres of land in Anaheim, California. Disneyland, which opened in 1955,         consists of eight principal areas: Toontown, Fantasyland, Adventureland,        Frontierland, Tomorrowland, New Orleans Square, Main Street and Critter         Country. These areas feature themed rides and attractions, restaurants,         refreshment stands and merchandise shops. A number of the Disneyland            attractions are sponsored by corporate participants.The Company markets        Disneyland through national and local advertising and promotional activities.The Company also owns and operates the 1,100-room Disneyland Hotel and the      500-room Disneyland Pacific Hotel.The Company has received approval from the city of Anaheim to construct a   new theme park, Disney's California Adventure. The new theme park will be       constructed on the existing Disneyland parking lot and property adjacent to     the park. Disney's California Adventure will celebrate the many attributes of   the state of California and will feature Disneyland Center, a themed complex    of shopping, dining, and entertainment venues; the Grand Californian, a deluxe  750-room hotel located inside the park; and an assortment of"California"       themed areas with associated rides and attractions.DISNEY VACATION CLUBIn 1995,the Company completed the 497-unit Disney Old Key West Resort at   the Walt Disney World Resort. In addition, 175 units in Vero Beach, Florida     opened in October 1995, and 102 units on Hilton Head Island, South Carolina,    and 383 villas located at Disney's BoardWalk Resort opened in 1996. Available   units at each facility are intended to be sold under a vacation ownership plan  and operated partially as rental property until the units are sold.DISNEY REGIONAL ENTERTAINMENTThe Company is developing a variety of entertainment-based initiatives to   open in various parts of the United States and abroad. These businesses will    include sports concepts, interactive entertainment centers, children's play     centers and other operations that use Disney's creative entertainment talents   and the popularity of the Disney brand.                                         Beginning in February 1997,the Company will be opening Club Disney, the    first regional entertainment operation, in select suburban markets. Club        Disney is a play environment oriented toward children under 10 and their        parents. The first store in Thousand Oaks, California, will include a three-    story Jungle Climber, a game area, the Pooh N You Hundred Acre Wood-themed      play area, Curiosity Castle, the Starring You Studio and other attractions.     Entrance to the property will be priced comparably with the cost of admission   to a movie theater. The property will also have a cafe, a unique retail store   and party rooms with different themes for birthdays and other special           occasions.TOKYO DISNEYLANDThe Company earns royalties on revenues generated by the Tokyo Disneyland   theme park, which is owned and operated by Oriental Land Co., Ltd. (OLC), an    unrelated Japanese corporation. The park, which opened in 1983, is similar in   size and concept to Disneyland and is located approximately six miles from      downtown Tokyo, Japan.The Company and OLC have concluded a joint study of the basic design conceptfor a theme park and associated hotel adjacent to Tokyo Disneyland. The         schematic design and design development stages for Tokyo DisneySea are          expected to continue until late 1997, at which time OLC will make a final       decision whether to commence construction.                                      In addition,the Company and OLC have reached agreement on the construction of a 500 room Disney-branded hotel to be built near Tokyo Disneyland.DISNEYLAND PARISDisneyland Paris is located on a 4,800-acre site at Marne-la-Valle,         approximately 20 miles east of Paris, France. The theme park, which opened in   April 1992, features 42 attractions in its five themed                          -9-
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lands. Seven themed hotels, with a total of approximately 5,800 rooms, are part of the resort complex, together with an entertainment center offering a variety of retail, dining and show facilities. The project has been developed pursuant  to a 1987 master agreement with French governmental authorities by Euro Disney  S.C.A., a publicly held French company in whichthe Company holds a 39% equity  interest and which is managed by a subsidiary ofthe Company. The financial     results ofthe Company's investment in Euro Disney are reported under the       heading"Corporate Activities and Other" inthe Company's consolidated          statements of income.WALT DISNEY IMAGINEERINGWalt Disney Imagineering provides master planning, real estate development, attraction and show design, engineering support, production support, project    management and other development services forthe Company's operations.ANAHEIM SPORTS, INC.The Company owns and operates a National Hockey League franchise, the MightyDucks of Anaheim. In addition, a subsidiary ofthe Company serves as general    partner of the Anaheim Angels (formerly the California Angels), a Major League  Baseball team.COMPETITIVE POSITIONAll of the theme parks and most of the associated resort facilities are     operated on a year-round basis. Historically, the theme parks and resorts       business experiences fluctuations in park attendance and resort occupancy       resulting from the nature of vacation travel. Peak attendance and resort        occupancy generally occur during the summer months when school vacations occur  and during early-winter and spring holiday periods.The Company's theme parks and resorts compete with all other forms of       entertainment, lodging, tourism and recreational activities. The profitability  of the leisure-time industry is influenced by various factors which are not     directly controllable, such as economic conditions, amount of available leisure time, oil and transportation prices and weather patterns.ITEM 2. PROPERTIESThe Walt Disney World Resort, Disneyland Park and other properties of the   Company and itssubsidiaries are described in Item 1 under the caption Theme    Parks and Resorts. Film library properties are described in Item 1 under the    caption Creative Content.                                                       A subsidiary ofthe Company owns approximately 51 acres of land in Burbank, California on whichthe Company's studios and executive offices are located.    The studio facilities are used for the production of both live-action and       animated motion pictures and television products. In addition, Companysubsidiaries lease office and warehouse space for certain studio and corporate  activities.The Company's Broadcasting segment corporate offices are located in a       Company-owned building at 77 West 66th Street in New York City.The Company     also owns the ABC Television Center adjacent to the building and ABC Radio      Networks' studios at 125 West End Avenue in New York City.Subsidiaries ofthe Company own the ABC Television Center and lease the ABC Television Network offices in Los Angeles, the ABC News Bureau facility in      Washington, DC and a computer facility in Hackensack, New Jersey, under leases  expiring on various dates through 2034.The Company's broadcast operations and  engineering facility and local television studios and offices in New York City  are leased, butthe Company has the right to acquire such properties for a      nominal sum in 1997.The Company's 80%-owned subsidiary ESPN owns ESPN Plaza in Bristol, Connecticut, from which it conducts its technical operations. The      Company owns the majority of its other broadcast studios and offices and        broadcast transmitter sites elsewhere, and those which it does not own are      occupied under leases expiring on various dates through 2039.                   -10-
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A U.K. subsidiary ofthe Company owns buildings on a four-acre parcel under long-term lease in London, England. The mixed-use development consists of       143,000 square feet of office space occupied by subsidiary operations, a27,000 square foot building leased to a third party and 65,000 square feet of   retail space.                                                                   Various Companysubsidiaries own and lease executive, editorial and other   offices and facilities used by the publishing operation in various cities. For  leased properties, the leases expire on various dates through 2006. All of the  significant premises occupied by the newspapers are owned by Companysubsidiaries.The Company's Disney Store unit also leases retail space for the Disney     Stores in shopping malls and similar retail complexes worldwide.                It isthe Company's practice to obtain United States and foreign legal      protection for its theatrical and television product and its other original     works, including the various names and designs of the animated characters and   the publications and music which have been created in connection with the       Company's filmed products.The Company owns all rights to the name, likeness    and portrait of Walt Disney.ITEM 3. LEGAL PROCEEDINGSThe Company, together with, in some instances, certain of its directors and officers, is a defendant or co-defendant in various legal actions involving     copyright, breach ofcontract and various other claims incident to the conduct  of its businesses. Management does not expectthe Company to suffer any         material liability by reason of such actions.                                   -11-
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ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERSNo matters were submitted to a vote of stockholders during the fourth       quarter of the fiscal year covered by this report.EXECUTIVE OFFICERS OFTHE COMPANYThe executive officers ofthe Company are elected each year at the          organizational meeting of the Board of Directors which follows the annual       meeting of the stockholders and at other meetings as appropriate. Each of the   executive officers has been employed bythe Company in the position or          positions indicated in the list and pertinent notes below. Messrs. Eisner,      Disney and Murphy have been employed bythe Company as executive officers for   more than five years.                                                           AtSeptember 30, 1996, the executive officers were as follows:                                                                              [Download Table]--------                                                                        /1/ OnOctober 2, 1995, Mr. Michael Ovitz joinedthe Company and assumed the    position of President. Mr. Ovitz co-founded and served as chairman of   Creative Artists Agency from 1975 until 1995. OnDecember 12, 1996, the  Company announced that Mr. Ovitz will leavethe Company effectiveJanuary31, 1997.                                                               /2/ Mr. Nanula joinedthe Company's strategic planning operation in 1986 and was   named Vice President-Treasurer ofthe Company in January 1990. He was named   Senior Vice President and Chief Financial Officer in August 1991, Executive   Vice President in February 1994 and President of The Disney Stores, Inc. inNovember 1994, where he served until assuming his present position in   February 1996.                                                          /3/ Mr. Cooke served as President of the The Disney Channel from 1985 until     assuming his present position in February 1995.                               -12-
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PART IIITEM 5. MARKET FORTHE COMPANY'S COMMON STOCK AND RELATED STOCKHOLDER MATTERSThe Company's common stock is listed on the New York and Pacific stock      exchanges (NYSE symbol DIS). The following sets forth the high and low          composite sale prices for the fiscal periods indicated.                                                                                         [Download Table]The Company declared a first quarter dividend of $.09 per share and three   subsequent quarterly dividends of $.11 per share in 1996, and in 1995,          declared a first quarter dividend of $.075 per share and three subsequent       quarterly dividends of $.09 per share.                                          As ofSeptember 30, 1996, the approximate number of record holders of the   Company's common stock was 564,000.                                             -13-
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ITEM 6. SELECTED FINANCIAL DATA(In millions, except per share data)                                                                                                            [Download Table]--------                                                                        (1) These amounts reflect the impact of the acquisition of ABC. See Note 2 to   the Consolidated Financial Statements.                                  (2) 1996 results include a $300 million non-cash charge pertaining to the       implementation of SFAS 121 Accounting for the Impairment of Long-Lived  Assets and for Long-Lived Assets to be Disposed Of, and a $225 million    charge for costs related to the acquisition of ABC. The earnings per share  impacts of these charges were $.30 and $.22, respectively. See Notes 2 and11 to the Consolidated Financial Statements.                            (3) In 1993,the Company changed its accounting policy for project-related      pre-opening costs, adopted SFAS 106"Employers' Accounting for          Postretirement Benefits Other Than Pensions" and adopted SFAS 109"Accounting for Income Taxes." The cumulative effect of these accountingchanges on the 1993 results follows.                                                                                                    [Download Table]Operating and net income for 1993 also reflect a $350 million charge to fully   reservethe Company's outstanding receivables from Euro Disney and the          Company's commitment to help fund Euro Disney for a limited period. The         earnings per share impact of the charge, net of income tax benefit, was $.64.   -14-
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ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION ANDRESULTS OF OPERATIONSRESULTS OF OPERATIONSOnFebruary 9, 1996,the Company acquired Capital Cities/ABC, Inc. ("ABC").The Company's results of operations have incorporated ABC's activity since      that date. To enhance comparability, certain information below is presented on  a"pro forma" basis and reflects the acquisition of ABC as though it had        occurred at the beginning of the respective periods presented. The pro forma    results are not necessarily indicative of the combined results that would have  occurred had the acquisition actually occurred at the beginning of those        periods.CONSOLIDATED RESULTS(in millions, except per share data)                                                                  [Download Table]-15-
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(2) During the second quarter of 1996,the Company recorded two non-recurring   charges.The Company adopted Statement of Financial Accounting Standards  No. 121,"Accounting for the Impairment of Long-Lived Assets and for Long-  Lived Assets to be Disposed Of," which resulted inthe Company recognizing  a $300 million non-cash charge. In addition,the Company recognized a $225million charge for costs related to the acquisition of ABC. See Notes 2 and 11 to the Consolidated Financial Statements.                        As a result of the acquisition,the Company has reconfigured its financial  reporting segments into Creative Content, Broadcasting, and Theme Parks and     Resorts. Consumer products operations, ABC's publishing operations and filmed   entertainment activities not related to broadcasting have been classified as    Creative Content. Operations previously reported as Filmed Entertainment that   pertain to broadcasting, as well as ABC's broadcasting operations, have been    classified as the Broadcasting segment. The Theme Parks and Resorts segment     contains the same operations as in prior years.                                 The following discussion of 1996 versus 1995 performance is primarily based on pro forma results.The Company believes pro forma results represent the      best comparative standard for assessing net income, changes in net income and   earnings trends, as the pro forma presentation combines a full year of the      results ofthe Company and its acquired ABC operations. The discussion of       consolidated results also includes"as reported" comparisons to the extent      there have been material changes in reported amounts.                           The discussion of Theme Parks and Resorts segment results is on an as       reported basis since the pro forma adjustments did not impact this segment.CONSOLIDATED RESULTS1996 VS. 1995 (PRO FORMA AND AS REPORTED)Pro forma results for all periods and as reported results since the         acquisition date reflect the impact of the acquisition of ABC, including the    use of purchase accounting. Comparisons of as reported results reflect          significant increases in amortization of intangible assets, interest expense,   the effective income tax rate and shares outstanding arising from the           acquisition.                                                                    Pro forma revenues increased 12% to $21.2 billion, reflecting growth in all business segments. Net income, excluding non-recurring charges, increased 16%   to $1.5 billion, and earnings per share increased 15% to $2.23. These results   were driven by increased operating income at the Theme Parks and Resorts and    Broadcasting segments.                                                          Pro forma net interest expense decreased 10% to $698 million reflecting     lower interest rates and a reduction in net borrowings (the Company's           borrowings less cash and liquid investments).                                   As reported revenues increased 54% to $18.7 billion, reflecting increases inall business segments and the impact of the acquisition of ABC. Net income,     excluding the non-recurring charges, increased 11% to $1.5 billion driven by    increased operating income for each business segment. Earnings per share,       excluding the non-recurring charges, decreased 5% to $2.48, reflecting the      impact of additional shares issued in connection with the acquisition.          As reported corporate activities and other increased 29% to $309 million,   reflecting higher corporate general and administrative costs and a $55 million  gain in the prior year related to the sale of a portion ofthe Company's        investment in Euro Disney.1995 VS. 1994 (AS REPORTED)Revenues increased 20% or $2.1 billion to $12.2 billion in 1995, reflecting growth in Creative Content, Broadcasting and Theme Parks and Resorts revenues   of $1.5 billion, $55 million, and $502 million, respectively.                   -16-
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Operating income rose 25% or $494 million to $2.5 billion in 1995, driven byincreases in Creative Content and Theme Parks and Resorts operating income of   $326 million and $169 million, respectively. Net income increased 24% to $1.4   billion and earnings per share increased 27% to $2.60 from $1.1 billion and     $2.04, respectively.                                                            Corporate activities and other expenses decreased 14% or $40 million to $239million. The results for 1995 included a gain of $55 million from the sale of   approximately 75 million shares, or 20% ofthe Company's investment in Euro     Disney, partially offset by higher corporate general and administrative         expenses.                                                                       Net interest income decreased $120 million to an expense of $110 million in 1995. The decrease reflected both a decline in interest income driven by lower  average investment balances and yields and an increase in interest expense      primarily reflecting the impact of higher borrowings. The higher borrowings     were due in part to prior-year common stock repurchases and Euro Disney         funding, which were initiated in the latter part of 1994.BUSINESS SEGMENT RESULTSCREATIVE CONTENT1996 VS. 1995 (PRO FORMA)Revenues increased 17% or $1.5 billion to $10.5 billion, driven by growth of$500 million in home video, $274 million in theatrical, $197 million in the     Disney Stores and $151 million in character merchandise licensing. Home video   revenues reflect Pocahontas, Cinderella and The Aristocats animated titles and  The Santa Clause, While You Were Sleeping and Crimson Tide live-action titles   domestically, as well as The Lion King and 101 Dalmatians internationally.      Theatrical revenues reflect the worldwide box office performance of Toy Story,  The Rock and The Hunchback of Notre Dame, the international performance of      Pocahontas and the domestic performance of Phenomenon. Revenue growth at the    Disney Stores was driven by the opening of 101 new stores in 1996, bringing     the total number of stores to 530. Comparable store sales declined 2%,          primarily due to the strength of The Lion King merchandise in the prior year,   and new stores contributed $103 million of sales growth. Merchandise licensing  revenues increased due to the strength of standard characters worldwide and     the success of targeted marketing programs. Television revenues from program    distribution were comparable to the prior year, reflecting the success of       live-action titles in pay television, offset by the syndication sale of Home    Improvement in the prior year.                                                  Operating income remained flat at $1.6 billion, reflecting improved results in home video and worldwide merchandise licensing offset by lower theatrical    results. Costs and expenses increased 21% or $1.5 billion. The increase is      primarily due to higher theatrical distribution and home video selling costs,   higher production cost amortization, expansion of the Disney Stores and the     write-off of certain theatrical development projects.1995 VS. 1994 (AS REPORTED)Revenues increased 24% or $1.5 billion to $7.7 billion in 1995, driven by   growth of $605 million in worldwide home video revenues, $340 million in        television revenues, $237 million from the Disney Stores, $106 million in       worldwide theatrical revenues and $67 million from worldwide character          merchandise licensing. Home video revenues reflected the domestic and initial   international release of The Lion King and the worldwide release of Snow White  and the Seven Dwarfs. Television revenues grew primarily due to the release of  Home Improvement in syndication and increased availability and success of       titles in pay television. Growth at the Disney Stores was driven by the         opening of 105 new stores in 1995, bringing the total number of stores to 429.  Comparable store sales grew 4% and sales at new stores contributed $94 million  of sales growth. Theatrical revenues reflected the domestic rerelease and       expanded international release of The Lion King, the domestic release of        Pocahontas and the domestic release of the live-action titles The Santa         Clause, While You Were Sleeping and Pulp Fiction. Worldwide merchandise         licensing growth was generated by increased demand for traditional Disney       characters and recent animated film properties, principally The Lion King and   Pocahontas.                                                                     -17-
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Operating income increased 27% or $326 million to $1.5 billion in 1995,     primarily due to growth in worldwide home video, television, worldwide          character merchandise licensing and the Disney Stores. Costs and expenses       increased 23% or $1.2 billion, principally due to higher home video marketing   and distribution costs reflecting the worldwide release of Snow White and the   Seven Dwarfs and the domestic release of The Lion King, the ongoing expansion   and revenue growth of the Disney Stores, higher distribution costs related to   theatrical releases and costs associated with the syndication of Home           Improvement.BROADCASTING1996 VS. 1995 (PRO FORMA)Revenues increased 4% or $267 million to $6.2 billion, reflecting a $309    million increase in revenues at ESPN and The Disney Channel, resulting from     higher advertising revenues and affiliate fees due primarily to expansion,      subscriber growth and improved advertising rates. Revenue increases were        partially offset by a $61 million decrease at the television network and        stations due to the impact of ratings deterioration and the absence of the      Super Bowl in the current period.                                               Operating income increased 12% or $114 million to $1.1 billion, reflecting  decreased costs and expenses at the television network, revenue increases at    ESPN and The Disney Channel and lower program write-offs at KCAL. Costs and     expenses increased 3% or $153 million, reflecting increased program rights and  production costs driven by growth at ESPN and The Disney Channel                internationally, partially offset by significantly decreased program            amortization at the television network, primarily attributable to the           acquisition, and lower program write-offs at KCAL.1995 VS. 1994 (AS REPORTED)The results reported in each year were not material, and reflected the      Company's broadcasting operations prior to the acquisition of ABC.THEME PARKS AND RESORTS1996 VS. 1995Revenues increased 13% or $501 million to $4.5 billion, reflecting growth of$191 million due to record theme park attendance, $148 million from greater     guest spending, and $52 million due to increased occupied rooms, primarily at   Florida resorts. Record theme park attendance at both the Walt Disney World     Resort and Disneyland Park in 1996 reflected growth in domestic and             international tourist visitation. Increased guest spending resulted from        higher admission prices, increased sales of food and beverages due to pricing   and expanded locations, and higher room rates at hotel and resort properties.   The increase in occupied rooms in Florida resulted from higher occupancy and a  complete year of operations at Disney's All-Star Music Resort, which opened in  phases during 1995. Occupied rooms also increased due to the opening of         Disney's BoardWalk Resort in June 1996.                                         Fiscal 1996 operating income increased 15% or $131 million to $990 million, resulting primarily from higher theme park attendance, increased guest          spending and increased occupied rooms at Florida resorts. Costs and expenses,   which consist principally of labor, costs of merchandise, food and beverages    sold, depreciation, repairs and maintenance, entertainment and marketing and    sales expenses, increased 12% or $370 million, primarily due to increased       operating hours in response to higher attendance, expansion of theme park       attractions and resorts, increased marketing and sales expenses and increased   costs associated with higher guest spending and increased occupied rooms.1995 VS. 1994Revenues increased 14% or $502 million to $4.0 billion, driven by growth of $288 million from higher theme park attendance in Florida and California and    $127 million from an increase in occupied rooms at Florida resorts. Higher      theme park attendance reflected increased domestic and international tourist    visitation. The increase in occupied rooms reflected the openings of Disney's   Wilderness Lodge                                                                -18-
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and Disney's All-Star Sports Resort in the third quarter of 1994 and the        phased opening of Disney's All-Star Music Resort during 1995.                   Operating income increased 24% or $169 million to $859 million in 1995,     driven by higher theme park attendance and increased occupied rooms at Florida  resorts. Costs and expenses increased 12% or $333 million, primarily due to     increased attendance and occupied rooms, expansion of theme park attractions    and Florida resorts and increased marketing and sales expenses, partially       offset by the impact of ongoing cost reduction initiatives.LIQUIDITY AND CAPITAL RESOURCESThe Company generates significant cash from operations and has substantial  borrowing capacity to meet its operating and discretionary spending             requirements. Cash provided by operations increased 32% or $1.1 billion to      $4.6 billion in 1996, which includes the impact of the acquistion of ABC        discussed below.                                                                Net borrowings increased $10.6 billion to $12.0 billion during fiscal 1996. The increase was primarily due to an increase in debt in connection with the    acquisition of ABC.                                                             In 1996,the Company invested $3.7 billion to develop, produce and acquire  rights to film and television properties and $1.7 billion to design and         develop new theme park attractions, resort properties, real estate              developments and other properties. 1995 investments totaled $1.9 billion and    $896 million, respectively.                                                     The $1.8 billion increased investment in film and television properties was primarily driven by ABC's television spending subsequent to the acquisition.    Television expenditures in 1997 will be higher as they will reflect a full      year of ABC's operations.                                                       The $849 million increased investment in theme parks, resorts and other     properties resulted from initiatives including Disney's Animal Kingdom, Disney  Cruise Line, Disney's BoardWalk Resort, Disney's Coronado Springs Resort,       Disney's Wide World of Sports, and the town of Celebration. Continued spending  increases related to these projects and from development of additional          initiatives, including Disney's California Adventure and Downtown Disney, are   anticipated through 1997.The Company repurchased 8 million shares of its common stock for            approximately $462 million in 1996. Under its share repurchase program, the     Company is authorized to purchase up to an additional 96 million shares. The    Company evaluates share repurchase decisions on an ongoing basis, taking into   account borrowing capacity, management's target capital structure, and other    investment opportunities.The Company also used $271 million to fund dividend   payments during the year.                                                       During the second quarter of 1996,the Company completed its acquisition of ABC. Aggregate consideration paid to ABC shareholders in March 1996 consisted   of $10.1 billion in cash and 155 million shares of Company common stock. The    Company initially funded the cash portion through the issuance of               approximately $8.8 billion of commercial paper and the use of existing cash     and investments. At acquisition,the Company assumed $627 million of ABC's      long-term debt.                                                                 Since the acquisition of ABC,the Company has replaced a portion of its     commercial paper with longer-term financing, and expects to continue this       process in the future. In the United States,the Company has issued $275        million of medium-term notes maturing in two to fifteen years, and in the       global bond market,the Company has issued $1.3 billion of five year notes and  $1.3 billion of ten year notes. In Europe,the Company has issued 300 billion   Italian lira (approximately $190 million) of four year notes, and borrowed      (Pounds)335 million (approximately $520 million) through a private offering.    In the Japanese market,the Company issued (Yen)150 billion (approximately      $1.4 billion) of three-year bonds through two public offerings.The Company     has swapped the interest payable on the foreign denominated borrowings into     United States dollar LIBOR.                                                     -19-
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The Company employs a variety of on-and off-balance-sheet financial         instruments to manage its exposure to changes in interest rates and             fluctuations in the value of foreign currencies.The Company does not expect    interest rate movements or fluctuations in the value of foreign currencies to   significantly affect its liquidity in the foreseeable future. For 1996 and      1995, a 1% increase or decrease in interest rates would not have had a          material impact onthe Company's liquidity or operating results.The Company currently maintains significant borrowing capacity to take      advantage of growth and investment opportunities.The Company focuses on net    borrowings, which take into account its cash and investment balances, when      monitoring borrowing capacity.The Company's borrowing capacity includes a $5   billion line of credit which is available for general corporate purposes and    to support commercial paper issuance.The Company has the capacity to issue up  to $2.1 billion in additional debt under a U.S. shelf registration filed in     March 1996, and $1.2 billion under a Euro Medium-Term Note Program established  in June 1996.The Company sold its Los Angeles television station KCAL in November 1996   for $387 million in cash.The Company's financial condition remains strong.The Company believes that its cash, other liquid assets, operating cash flows and access to capital       markets taken together provide adequate resources to fund ongoing operating     requirements and future capital expenditures related to the expansion of        existing businesses and development of new projects.ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATASee Index to Financial Statements and Supplemental Data on page 27.ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING ANDFINANCIAL DISCLOSURENone.                                                                       -20-
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PART IIIITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OFTHE COMPANYDIRECTORSInformation regarding directors appearing under the caption ELECTION OF     DIRECTORS inthe Company's Proxy Statement for the 1997 Annual Meeting of       Stockholders (the"1997 Proxy Statement") is herebyincorporated by reference.  Information regarding executive officers is included in Part I of this Form 10-K as permitted by General Instruction G(3).ITEM 11. EXECUTIVE COMPENSATIONInformation appearing under the captions DIRECTORS' REMUNERATION; ATTENDANCEand EXECUTIVE COMPENSATION in the 1997 Proxy Statement is hereby incorporated   by reference.ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENTInformation setting forth the security ownership of certain beneficial      owners and management appearing under the caption STOCK OWNERSHIP OF CERTAIN    BENEFICIAL OWNERS and STOCK OWNERSHIP OF DIRECTORS AND EXECUTIVE OFFICERS in    the 1997 Proxy Statement is herebyincorporated by reference.ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONSInformation regarding certain related transactions appearing under the      caption RELATED TRANSACTIONS in the 1997 Proxy Statement is herebyincorporated by reference.                                                      -21-
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PART IVITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K(a) Exhibits and Financial Statements and Schedules                             (1) Financial Statements and Schedules                                      See Index to Financial Statements and Supplemental Data at page 27.     (2) Exhibits                                                                3(a)   RestatedCertificate of Incorporation ofthe Company, filed as          Exhibit 3(a) to the Form 8-B/A, datedJanuary 23, 1996, is herebyincorporated by reference.3(b)   AmendedBylaws ofthe Company, datedApril 22, 1996, is filed  herewith.                                               4(a)   Form of RegistrationRights Agreement entered into or to be           entered into with certain stockholders ofthe Company, filed as         Exhibit B to Exhibit 2.1 to the Current Report on Form 8-K, datedJuly 31, 1995, of Disney Enterprises, Inc., is hereby incorporatedby reference.                                             4(b)Rights Agreement dated as ofNovember 8, 1995 betweenthe Company          and The Bank of New York, as rights agent, filed as Exhibit 4.2 to        the Registration Statement on Form S-4, datedNovember 13, 1995,(No.33-64141), is herebyincorporated by reference.4(c)   364-Day Credit Agreement, dated as ofOctober 30, 1996, among the          Company, as Borrower, Citicorp USA, Inc., as Administrative Agent,    Credit Suisse and Bank of America National Trust and Savings  Association, as Co-Administrative Agents and the FinancialInstitutions named therein, isfiled herewith.4(d)   Five-Year Credit Agreement, datedOctober 30, 1996, among the            Company, as Borrower, Citicorp USA, Inc., as Administrative Agent,    Credit Suisse and Bank of America National Trust and Savings  Association, as Co-Administrative Agents and the FinancialInstitutions named therein, isfiled herewith.          4(e)Indenture, dated as of November 30, 1990, between Disney            Enterprises, Inc. and Bankers Trust Company, as Trustee, with          respect to certain senior debt securities ofthe Company, filed as    Exhibit 2 tothe Company's Current Report on Form 8-K, datedJanuary 14, 1991, is herebyincorporated by reference.  4(f)Indenture, dated as ofMarch 7, 1996, betweenthe Company and         Citibank, N.A., as Trustee, with respect to certain senior debt securities ofthe Company, filed as Exhibit 4.1(a) to the     Company's Current Report on Form 8-K, datedMarch 7, 1996, isherebyincorporated by reference.                       4(g)   Other long-term borrowing instruments issued bythe Company are        omitted pursuant to Item 601(b) (4) (iii) of Regulation S-K. The       Company undertakes to furnish copies of such instruments to theCommission upon request.                                  10(a)   (i) Agreement on the Creation and the Operation of Euro Disneyland         en France, dated March 25, 1987, and (ii) Letter relating thereto      ofMichael D. Eisner, Chairman Disney Enterprises, Inc., dated        March 24, 1987, filed as Exhibits 10(b) and 10(a), respectively,      to Disney Enterprises, Inc.'s Current Report on Form 8-K datedApril 24, 1987, are herebyincorporated by reference.   10(b)   Limited Recourse Financing Facility Agreement, dated as of April27, 1988, among Disney Enterprises, Inc., Citibank Channel Island     Limited and Citicorp International, filed as Exhibit 10(a) to         Disney Enterprises, Inc.'s Current Report on Form 8-K dated April29, 1988, is herebyincorporated by reference.          10(c)   (i) Employment Agreement, dated as of January 10, 1989, between         Disney Enterprises, Inc. andMichael D. Eisner, filed as Exhibit         10(a) to Disney Enterprises, Inc.'s Quarterly Report on Form 10-Q        for the period ended March 31, 1989; (ii) Agreement, dated March        1, 1985, between Disney Enterprises, Inc. andMichael D. Eisner,filed as                                                -22-
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        Exhibit 2 to Disney Enterprises, Inc.'s Quarterly Report on Form         10-Q for the period ended June 30, 1985; and (iii) description of        action by the Compensation Committee taken on November 30, 1990,          filed as Exhibit 10(c) to Disney Enterprises, Inc.'s Annual Report      on Form 10-K for the year ended September 30, 1990, are herebyincorporated by reference.                              10(e)   Employment Agreement, datedOctober 1, 1995, between Disney             Enterprises, Inc. and Michael S. Ovitz filed as Exhibit 10(e) to          Disney Enterprises, Inc.'s Annual Report on Form 10-K for the year      endedSeptember 30, 1995, is herebyincorporated by reference.10(f)   (i)Contract, dated December 14, 1979, with E. Cardon Walker, to        purchase a 2% interest in certain motion pictures to be produced          by Disney Enterprises, Inc. and to acquire an additional 2% profit        participation; and (ii) Amendment thereto, dated August 8, 1980,       filed as Exhibits 1 and 3, respectively, to Disney Enterprises,          Inc.'s Annual Report on Form 10-K for the year ended September 30,1980, are herebyincorporated by reference.             10(g)   Form of Indemnification Agreement entered into or to be entered           into by certain officers and directors of Disney Enterprises, Inc.  as determined from time to time by the Board of Directors,          included as Annex C to the Proxy Statement for Disney Enterprises,          Inc.'s 1988 Annual Meeting of Stockholders, is hereby incorporatedby reference.                                           10(h)   1995 Stock Option Plan for Non-Employee Directors, filed as            Exhibit A to the Proxy Statement for Disney Enterprises, Inc.'s      1995 Annual Meeting of Stockholders, is hereby incorporated byreference.                                              10(i)   (i) 1990 Stock Incentive Plan and Rules, filed as Exhibits 28(a)and 28(b), respectively, to Disney Enterprises, Inc.'s           Registration Statement on Form S-8 (No. 33-39770), dated April 5,         1991, and (ii) Amended and Restated 1990 Stock Incentive Plan and     Rules, attached as Appendix B-2 to Disney Enterprises, Inc.'s      Joint Proxy Statement/ Prospectus included in the Registration         Statement on Form S-4, datedNovember 13, 1995 (No.33-64141), isherebyincorporated by reference.                       10(j)   1995 Stock Incentive Plan and Rules, attached as Appendix B-1 to   Disney Enterprises, Inc.'s Joint Proxy Statement/Prospectus          included in the Registration Statement on Form S-4, datedNovember13, 1995 (File No.33-64141), is herebyincorporated by reference.  10(k)   (i) 1987 Stock Incentive Plan and Rules, (ii) 1984 Stock Incentive         Plan and Rules, (iii) 1981 Incentive Plan and Rules and (iv) 1980         Stock Option Plan, all as set forth as Exhibits 1(a), 1(b), 2(a),         2(b), 3(a), 3(b) and 4, respectively, to the Prospectus contained         in Part I of Disney Enterprises, Inc.'s Registration Statement on    Form S-8 (No. 33-26106), dated December 20, 1988, are herebyincorporated by reference.                                10(l)   Contingent Stock Award Rules under Disney Enterprises, Inc.'s 1984Stock Incentive Plan, filed as Exhibit 10(t) to Disney           Enterprises, Inc.'s Annual Report on Form 10-K for the year endedSeptember 30, 1986, is herebyincorporated by reference.  10(m)   1996 Cash Bonus Performance Plan, filed as Exhibit 10(m) to Disney         Enterprises, Inc.'s Annual Report on Form 10-K for the year endedSeptember 30, 1995, is herebyincorporated by reference.  10(n)   Disney Salaried Retirement Plan, as amended throughMarch 1, 1994,          filed as Exhibit 10(l) to Disney Enterprises, Inc.'s Annual Report     on Form 10-K for the year endedSeptember 30, 1994, is herebyincorporated by reference.                              10(o)   The Walt Disney Company and Associated Companies Key Employees           Deferred Compensation and Retirement Plan, filed as Exhibit 10(u)        to Disney Enterprises, Inc.'s Annual Report on Form 10-K for theyear ended September 30, 1985, is hereby incorporated byreference.                                              10(p)   Group Term Life Insurance Plan (summary plan description), filed       as Exhibit 10(x) to Disney Enterprises, Inc.'s Annual Report on  Form 10-K for the year ended September 30, 1985, is herebyincorporated by reference.                              -23-
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10(q)   Group Personal Excess Liability Insurance Plan (summary plan              description), filed as Exhibit 10(z) to Disney Enterprises, Inc.'s         Annual Report on Form 10-K for the year ended September 30, 1986,is herebyincorporated by reference.                     10(r)   Family Income Assurance Plan (summary plan description), filed as     Exhibit 10(aa) to the Annual Report on Form 10-K for the year      ended September 30, 1986, is herebyincorporated by reference.10(s)   Disney Salaried Savings and Investment Plan, as amended and           restated, filed as Exhibit 10(s) to Disney Enterprises, Inc.'s         Annual Report on Form 10-K for the year endedSeptember 30, 1995,is herebyincorporated by reference.                      10(t)   Disney Salaried Savings and Investment Trust Agreement, datedJune30, 1992, filed as Exhibit 10 to Disney Enterprises, Inc.'s         Quarterly Report on Form 10-Q for the period endedJune 30, 1992,is herebyincorporated by reference.                      10(u)   Master Trust Agreement for Employees Savings and Retirement Plans,    as amended and restated through June 1, 1990, between Disney         Enterprises, Inc. and Bankers Trust Company, as Trustee, filed as          Exhibit 28(b) to Disney Enterprises, Inc.'s Registration Statement  on Form S-8 (No. 33-35405), dated June 14, 1990, is herebyincorporated by reference.                                10(v)   Employee Stock Option Plan of Capital Cities/ABC, Inc., as amended    through December 15, 1987, filed as Exhibit 10(f) to Capital        Cities/ABC, Inc.'s Annual Report on Form 10-K for the year endedDecember 31, 1992, is herebyincorporated by reference.   10(w)   Amended and Restated 1991 Stock Option Plan of Capital Cities/ABC,        Inc., filed as Exhibit 6(a)(i) tothe Company's Quarterly Report   on Form 10-Q for the period endedMarch 31, 1996, is herebyincorporated by reference.                              10(x)   Amended and Restated Agreement andPlan of Reorganization, dated         as ofJuly 31, 1995, between Disney Enterprises, Inc. and Capital     Cities/ABC, Inc., filed as Exhibit 2.1 to Disney Enterprises,    Inc.'s Current Report on Form 8-K, datedOctober 6, 1995, isherebyincorporated by reference.                        10(y)   First Amendment to the Disney Salaried Retirement Plan as amended        and restated effective January 1, 1988, filed as Exhibit (10) to        Disney Enterprises, Inc.'s Quarterly Report on Form 10-Q for the period endedDecember 31, 1995, is hereby incorporated byreference.21Subsidiaries ofthe Company isfiled herewith.                  23      Consent of Price Waterhouse LLP,the Company's independent      accountants, is included herein at page 28.27Financial Data Schedule (filed electronically only).            28(a)   Financial statements with respect to the Disney Salaried Savings          and Investment Plan for the year endedDecember 31, 1995, filed as          Exhibit 28 to Disney Enterprises, Inc.'s Annual Report on Form 10-        K for the year endedSeptember 30, 1995, as amended by Amendment         No. 1 on Form 10-K/A datedJune 30, 1996, are hereby incorporatedby reference.                                           (b) Reports on Form 8-K                                                         -24-
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SIGNATURESPursuant to the requirements of Section 13 or 15(d) of the Securities       Exchange Act of 1934,the registrant has duly caused this report to be signed   on its behalf by the undersigned, thereunto duly authorized.THE WALT DISNEY COMPANY                         -----------------------------------------------------                        (Registrant)Date:December 19, 1996   By:MICHAEL D. EISNER                                            -----------------------------------------------------                         (Michael D. Eisner, Chairman of the Board and Chief                        Executive Officer)Pursuant to the requirements of the Securities Exchange Act of 1934, this   report has been signed below by the following persons on behalf of the          registrant and in the capacities and on the dates indicated.                                                                                    [Download Table]-25-
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THE WALT DISNEY COMPANY ANDSUBSIDIARIESINDEX TO FINANCIAL STATEMENTS AND SUPPLEMENTAL DATA                                                                [Download Table]Schedules other than those listed above are omitted for the reason that they    are not applicable or the required information is included in the financial     statements or related notes.                                                    -27-
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REPORT OF INDEPENDENT ACCOUNTANTSTo the Board of Directors and Stockholders of The Walt Disney Company           In our opinion, the consolidated financial statements listed in the         accompanying index present fairly, in all material respects, the financial      position of The Walt Disney Company and itssubsidiaries (the"Company") atSeptember 30, 1996 and1995, and the results of their operations and their      cash flows for each of the three years in the period endedSeptember 30, 1996,  in conformity with generally accepted accounting principles. These financial    statements are the responsibility ofthe Company's management; our              responsibility is to express an opinion on these financial statements based on  our audits. We conducted our audits of these statements in accordance with      generally accepted auditing standards which require that we plan and perform    the audits to obtain reasonable assurance about whether the financial           statements are free of material misstatement. An audit includes examining, on   a test basis, evidence supporting the amounts and disclosures in the financial  statements, assessing the accounting principles used and significant estimates  made by management, and evaluating the overall financial statement              presentation. We believe that our audits provide a reasonable basis for the     opinion expressed above.                                                        As discussed in Note 1 to the consolidated financial statements,the Companyadopted the provisions of the Financial Accounting Standard Board's Statement   of Financial Accounting Standards 121,"Accounting for the Impairment of Long-  Lived Assets and for Long-Lived Assets to be Disposed Of," in fiscal 1996.PRICE WATERHOUSE LLPLos Angeles, CaliforniaNovember 25, 1996CONSENT OF INDEPENDENT ACCOUNTANTSWe hereby consent to the incorporation by reference in the prospectuses     constituting part of the Registration Statements on Form S-8 (Nos. 33-26106,    33-35405 and 33-39770) and Form S-3 (Nos.33-49891 and33-62777) of The Walt    Disney Company of our report datedNovember 25, 1996 which appears above.PRICE WATERHOUSE LLPLos Angeles, CaliforniaDecember 19, 1996                                                               -28-
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CONSOLIDATED STATEMENTS OF INCOME(In millions, except per share data)                                                                [Download Table]See Notes to Consolidated Financial Statements-29-
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CONSOLIDATED BALANCE SHEETS(In millions)                                                                 [Download Table]See Notes to Consolidated Financial Statements-30-
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CONSOLIDATED STATEMENTS OF CASH FLOWS(In millions)                                                                 [Download Table]See Notes to Consolidated Financial Statements-31-
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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Tabular dollars in millions, except per share amounts) 1  Description of the Business and Summary of Significant Accounting Policies   The Walt Disney Company, together with itssubsidiaries (the"Company"), is a diversified international entertainment organization. As discussed in Note    2,the Company acquired Capital Cities/ABC, Inc. ("ABC") onFebruary 9, 1996.   As a result of the acquisition,the Company has reconfigured its financial      reporting segments into Creative Content, Broadcasting and Theme Parks and      Resorts. Consumer products operations, ABC's publishing operations and filmed   entertainment activities not related to broadcasting have been classified as    Creative Content. Operations previously reported as Filmed Entertainment that   pertain to broadcasting, as well as ABC's broadcasting operations, have been    classified as the Broadcasting segment. The Theme Parks and Resorts segment     contains the same operations as in prior years.The Company's business          segments are described below.CREATIVE CONTENTThe Company produces and acquires live-action and animated motion pictures  for distribution to the theatrical, home video and television markets. The      Company also produces original television programming for the network and       first-run syndication markets.The Company distributes its filmed product       through its own distribution and marketing companies in the United States and   most foreign markets.The Company licenses the name"Walt Disney," as well asthe Company's       characters, visual and literary properties and songs and music, to various      consumer manufacturers, retailers, show promoters and publishers throughout     the world.The Company also engages in direct retail distribution principally   through the Disney Stores, and produces books and magazines for the general     public in the United States and Europe. In addition,the Company produces       audio products for all markets, as well as film, video and computer software    products for the educational marketplace.The Company also publishes newspapers, technical and specialty publications and provides research and database services, primarily for markets in the       United States.BROADCASTINGThe Company operates the ABC Television Network which has primary and       secondary affiliated stations providing coverage to U.S. television             households.The Company also owns television and radio stations affiliated      with the ABC Television Network and the ABC Radio Networks.The Company's       Cable and International Broadcast operations include domestic, European,        Taiwanese, Japanese and Australian operations, and are principally involved in  the production and distribution of cable television programming, the licensing  of programming to domestic and international markets and investing in joint     ventures in foreign-based television operations and television production and   distribution entities. The primary domestic cable programming services, which   operate through joint ventures, are ESPN, the A&E Television Networks and       Lifetime Television.The Company provides programming for and operates The      Disney Channel, a television programming service.THEME PARKS AND RESORTSThe Company operates the Walt Disney World Resort(R) in Florida, and        Disneyland Park(R), the Disneyland Hotel and the Disneyland Pacific Hotel in    California. The Walt Disney World Resort includes the Magic Kingdom, Epcot and  the Disney-MGM Studios Theme Park, twelve resort hotels and a complex of        villas and suites, a nighttime entertainment complex, a shopping village,       conference centers, campgrounds, golf courses, water parks and other            recreational facilities.The Company earns royalties on revenues generated by   the Tokyo Disneyland(R) theme park near Tokyo, Japan, which is owned and        operated by an unrelated Japanese corporation.The Company also has an          investment in                                                                   -32-
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Euro Disney S.C.A. ("Euro Disney"), a publicly held French corporation that     operates Disneyland Paris.The Company's Walt Disney Imagineering unit designs  and develops new theme park concepts and attractions, as well as resort         properties.The Company also manages and markets vacation ownership interests   in the Disney Vacation Club. Included in Theme Parks and Resorts are the        Company's National Hockey League franchise, the Mighty Ducks of Anaheim, and    its ownership interest in the Anaheim Angels, a Major League Baseball team.SIGNIFICANT ACCOUNTING POLICIESPrinciples of Consolidation                                                     The consolidated financial statements ofthe Company include the accounts ofThe Walt Disney Company and itssubsidiaries after elimination of intercompany  accounts and transactions. Investments in unconsolidated affiliated companies   are accounted for using the equity method, and are classified in the            consolidated balance sheets as"Other assets."The Company's share of earnings  or losses in its equity investments is shown under"Corporate activities and    other" in the consolidated statements of income.                                Accounting Changes                                                              During the second quarter of 1996,the Company adopted SFAS 121 Accounting  for the Impairment of Long-Lived Assets and for Long-Lived Assets to be         Disposed Of ("SFAS 121") (see Note 11). Long-lived assets to be held and used   are recorded at cost. Management reviews long-lived assets and the related      intangible assets for impairment whenever events or changes in circumstances    indicate the carrying amount of such assets may not be recoverable.             Recoverability of these assets is determined by comparing the forecasted        undiscounted net cash flows of the operation to which the assets relate, to     the carrying amount including associated intangible assets of such operation.   If the operation is determined to be unable to recover the carrying amount of   its assets, then intangible assets are written down first, followed by the      other long-lived assets of the operation, to fair value. Fair value is          determined based on discounted cash flows or appraised values, depending upon   the nature of the assets.                                                       Use of Estimates                                                                The preparation of financial statements in conformity with generally        accepted accounting principles requires management to make estimates and        assumptions that affect the amounts reported in the financial statements and    footnotes thereto. Actual results could differ from those estimates.            Revenue Recognition                                                             Revenues from the theatrical distribution of motion pictures are recognized when motion pictures are exhibited. Revenues from video sales are recognized    on the date that video units are made widely available for sale by retailers.   Revenues from the licensing of feature films and television programming are     recorded when the material is available for telecasting by the licensee and     when certain other conditions are met.                                          Broadcast advertising revenues are recognized when commercials are aired.   Revenues from television subscription services related tothe Company's         primary cable programming services are recognized as services are provided.     Revenues from participants and sponsors at the theme parks are generally    recorded over the period of the applicable agreements commencing with the       opening of the related attraction.                                              Cash, Cash Equivalents and Investments                                          Cash and cash equivalents consist of cash on hand and marketable securities with original maturities of three months or less.                               -33-
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Debt and equity securities are classified into one of three categories. Debtsecurities thatthe Company has the positive intent and ability to hold to      maturity are classified as"held-to-maturity" and reported at amortized cost.   Debt securities not classified as held-to-maturity and marketable equity        securities are classified as either"trading" or"available-for-sale," and are  recorded at fair value with unrealized gains and losses included in earnings    or stockholders' equity, respectively.                                          Inventories                                                                     Carrying amounts of merchandise, materials and supplies inventories are     generally determined on a moving average cost basis and are stated at the       lower of cost or market.                                                        Film and Television Costs                                                       Film and television production and participation costs are expensed based onthe ratio of the current period's gross revenues to estimated total gross       revenues from all sources on an individual production basis. Estimates of       total gross revenues can change significantly due to the level of market        acceptance of film and television products. Accordingly, revenue estimates are  reviewed periodically and amortization is adjusted. Such adjustments could      have a material effect on results of operations in future periods.              Television broadcast program licenses and rights and related liabilities arerecorded when the license period begins and the program is available for use.   Television network and station rights for theatrical movies and other long-     form programming are charged to expense primarily on accelerated bases related  to the usage of the program. Television network series costs and multi-year     sports rights are charged to expense based on the flow of anticipated revenue.  Theme Parks, Resorts and Other Property                                         Theme parks, resorts and other property are carried at cost. Depreciation iscomputed on the straight-line method based upon estimated useful lives ranging  from three to fifty years.                                                      Intangible/Other Assets                                                         Rights to the name, likeness and portrait of Walt Disney and other          intangible assets are amortized over periods ranging from two to forty years.The Company continually reviews the recoverability of the carrying value of     these assets using the methodology prescribed in SFAS 121.                      Risk ManagementContracts                                                       In the normal course of business,the Company employs a variety of off-     balance-sheet financial instruments to manage its exposure to fluctuations in   interest and foreign currency exchange rates, including interest rate and       cross-currency swap agreements, forward and optioncontracts, and interest      rate exchange-traded futures.The Company designates interest rate and cross-   currency swaps as hedges of investments and debt, and accrues the differential  to be paid or received under the agreements as interest rates change over the   lives of thecontracts. Differences paid or received on swap agreements are     recognized as adjustments to interest income or expense over the life of the    swaps, thereby adjusting the effective interest rate on the underlying          investment or obligation. Gains and losses on the termination of swap           agreements, prior to their original maturity, are deferred and amortized to     interest income or expense over the remaining term of the underlying hedged     transactions. Gains and losses arising from interest rate futures, forward and  optioncontracts, and foreign currency forward and optioncontracts are         recognized in income or expense as offsets of gains and losses resulting from   the underlying hedged transactions.                                             Cash flows from interest rate and foreign exchange risk management          activities are classified in the same category as the cash flows from the       related investment, borrowing or foreign exchange activity.The Company classifies its derivative financial instruments as held or      issued for purposes other than trading.                                         -34-
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Earnings Per Share                                                              Earnings per share amounts are based upon the weighted average number of    common and common equivalent shares outstanding during the year. Common         equivalent shares are excluded from the computation in periods in which they    have an anti-dilutive effect.                                                   Reclassifications                                                               Certain reclassifications have been made in the 1995 and 1994 financial     statements to conform to the 1996 presentation.                                 2  Acquisition                                                                  OnFebruary 9, 1996,the Company completed its acquisition of ABC. Pursuant to the acquisition, aggregate consideration paid to ABC shareholders consisted  of $10.1 billion in cash and 155 million shares of Company common stock valued  at $8.8 billion based on the stock price as of the date the transaction was     announced.                                                                      The acquisition has been accounted for as a purchase and the acquisition    cost of $18.9 billion has been allocated to the assets acquired and             liabilities assumed based on estimates of their respective fair values. Assets  acquired totaled $4.8 billion (of which $1.5 billion was cash) and liabilities  assumed were $4.4 billion. A total of $18.3 billion, representing the excess    of acquisition cost over the fair value of ABC's net tangible assets, has been  allocated to intangible assets and is being amortized over forty years.         In connection with the acquisition, all common shares ofthe Company        outstanding immediately prior to the effective date of the acquisition were     canceled and replaced with new common shares and all treasury shares were       canceled and retired.The Company's consolidated results of operations have incorporated ABC's    activity from the effective date of the acquisition. The unaudited pro forma    information below presents combined results of operations as if the             acquisition had occurred at the beginning of the respective periods presented.  The unaudited pro forma information is not necessarily indicative of the        results of operations of the combined company had the acquisition occurred at   the beginning of the periods presented, nor is it necessarily indicative of     future results.                                                                                                                                 [Download Table]--------                                                                        (1) The 1996 period includes the impact of a $300 million non-cash charge       related to the initial adoption of a new accounting standard (see Note  11). The charge reduced earnings per share by $0.27 for the period.     In addition, during the second quarter,the Company recognized a $225       million charge for costs related to the acquisition, which are not included in  the above pro forma amounts. Acquisition-related costs consist principally of   interest costs related to imputed interest for the period from the effective    date of the acquisition untilMarch 14, 1996, the date that cash and stock      consideration was issued to ABC shareholders.The Company entered into an agreement to sell its independent Los Angeles   television station as a result of the ABC acquisition. The sale of KCAL-TV for  $387 million was completed onNovember 22, 1996, resulting in a gain of         approximately $135 million which will be recognized in 1997's income            statement.                                                                      -35-
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3  Investment in Euro Disney                                                    Euro Disney operates the Disneyland Paris theme park and resort complex on a4,800-acre site near Paris, France.The Company accounts for its 39% ownership  interest in Euro Disney using the equity method of accounting. As ofSeptember30, 1996,the Company's recorded investment in Euro Disney was $430 million.    The quoted market value ofthe Company's Euro Disney shares atSeptember 30,1996 was approximately $634 million.                                            During fiscal year 1994,the Company entered into restructuring agreements  with Euro Disney and the lenders participating in a financial restructuring     for Euro Disney (the"Lenders") to provide certain debt, equity and lease       financing to Euro Disney. In addition,the Company agreed to cancel certain     fully-reserved receivables and waive royalties and base management fees for a   period of five years and reduce such amounts for a specified period             thereafter.                                                                     As part of the overall restructuring, the Lenders served as underwriters for51% of the Euro Disney rights offering, agreed to forgive certain interest      charges of Euro Disney, having a present value of approximately $300 million,   and deferred all principal payments until three years later than originally     scheduled. Pursuant to the terms of the restructuring, interest charges will    continue to progressively increase through fiscal year 2003, although           substantially all of the interest will have been reinstated by the end of       fiscal year 1998. Additionally, Euro Disney will begin paying royalties and     management fees commencing in fiscal year 1999.                                 Also as part of the restructuring,the Company agreed to arrange for the    provision of a 10-year unsecured standby credit facility of approximately $210  million, upon request, bearing interest at PIBOR. As ofSeptember 30, 1996,     Euro Disney had not requestedthe Company to establish this facility. The       Company also agreed, as long as any obligations to the Lenders are              outstanding, to maintain ownership of at least 34% of the outstanding common    stock of Euro Disney until June 1999, at least 25% for the subsequent five      years and at least 16.67% for an additional term thereafter.                    In connection with the restructuring, Euro Disney Associes S.N.C. ("Disney  SNC"), a wholly-owned affiliate ofthe Company, entered into a lease            arrangement with a noncancelable term of 12 years (the"Lease") related to      substantially all of the Disneyland Paris theme park assets, and then entered   into a 12-year sublease agreement (the"Sublease") with Euro Disney. Remaining  lease rentals atSeptember 30, 1996 of FF 9.8 billion ($1.9 billion)            receivable from Euro Disney under the Sublease approximate the amounts payable  by Disney SNC under the Lease. At the conclusion of the Sublease term, Euro     Disney will have the option to assume Disney SNC's rights and obligations       under the Lease. If Euro Disney does not exercise its option, Disney SNC may    purchase the assets, continue to lease the assets or elect to terminate the     Lease, in which case Disney SNC would make a termination payment to the lessor  equal to 75% of the lessor's then outstanding debt related to the theme park    assets, estimated to be $1.5 billion; Disney SNC could then sell or lease the   assets on behalf of the lessor to satisfy the remaining debt, with any excess   proceeds payable to Disney SNC.                                                 Euro Disney's consolidated financial statements are prepared in accordance  with accounting principles generally accepted in France ("French GAAP"). U.S.   generally accepted accounting principles ("U.S. GAAP") differ in certain        significant respects from French GAAP applied by Euro Disney, principally as    they relate to accounting for leases and the calculation of interest expense    relating to debt affected by Euro Disney's financial restructuring. The         Company records its pro rata equity share of Euro Disney's operating results    calculated in accordance with U.S. GAAP.                                        -36-
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4  Film and Television Costs                                                                                                                    [Download Table]Based on management's total gross revenue estimates as ofSeptember 30, 1996,   approximately 89% of unamortized film and television costs (except in-process)  are expected to be amortized during the next three years.                       5  Borrowings                                                                                                                                   [Download Table]--------                                                                        (a) In support of the issuance of commercial paper to fund the cash portion of  the ABC purchase price (see Note 2),the Company established bank       facilities in October 1995 totaling $12 billion. A portion of the       commercial paper issued was subsequently refinanced into longer-term    borrowings, and the bank facilities were refinanced to $7 billion. In   October 1996, these facilities were further refinanced to $5 billion andexpire in one to five years. Under the bank facilities,the Company has the option to borrow at various interest rates.                         (b) Includes approximately $600 million of borrowings previously issued by      ABC, Inc. and $300 million of borrowings due in 2093. The effective       interest rate reflects the effect of interest rate swaps entered into withrespect to certain of these borrowings.                                 (c) Denominated principally in U.S. dollars, Japanese yen, Australian dollars,  and Italian lira. The effective interest rate reflects the effect of    interest rate and cross-currency swaps entered into with respect to     certain of these borrowings.                                            (d) The average coupon rate is 2.7% on $1.3 billion face value of notes.        Additional interest may be paid based on the performance of designated  portfolios of films.                                                    Borrowings, excluding commercial paper, have the following scheduled        maturities:                                                                                                                                     [Download Table]-37-
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The Company capitalizes interest on assets constructed for its theme parks, resorts and other property, and on theatrical and television productions in     process. In 1996, 1995 and 1994, respectively, total interest costs incurred    were $545, $236 and $172 million, of which $66, $58 and $52 million were        capitalized.                                                                    6  Income Taxes                                                                                                                                 [Download Table]                                                                [Download Table]                                                                [Download Table]In 1996 and 1995, income tax benefits of $44 and $90 million, respectively, were allocated to stockholders' equity. Such benefits were attributable to      employee stock option transactions.                                             -38-
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7  Pension and Other Benefit ProgramsThe Company maintains pension plans and postretirement medical benefit planscovering most of its domestic employees not covered by union or industry-wide   plans. Employees hired afterJanuary 1, 1994 are not eligible for the           postretirement medical benefit plans. Pension benefits are generally based on   years of service and/or compensation. The following summarizes the balance      sheet impact, as well as the benefit obligations, assets, funded status and     rate assumptions associated with the pension and postretirement medical         benefit plans.                                                                                                                                  [Download Table]The annual increase in cost of postretirement benefits of 7% is assumed to  decrease .3ppts per year until stabilizing at 5.5%. An increase in the assumed  benefits cost trend of 1ppt for each year would increase the postretirement     benefit obligation atSeptember 30, 1996 by $55 million.The Company's accumulated pension benefit obligation atSeptember 30, 1996  was $1.2 billion, of which 98% was vested. The projected benefit obligation     for the postretirement benefit plans atSeptember 30, 1996 comprised 47%        retirees, 18% fully eligible active participants and 35% other active           participants.                                                                   The income statement cost of the pension plans for 1996, 1995 and 1994      totaled $58, $33 and $37 million, respectively. The income statement cost       (credit) for the postretirement benefit plans for the same years was $(16),     $(43) and $14 million, respectively. The discount rates and the salary          increase rate were 8.5% and 6.3%, respectively, in 1994.                        -39-
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8  Stockholders' Equity                                                                                                                         [Download Table]In November 1995,the Company adopted a stockholders' rights plan on        substantially the same terms originally adopted bythe Company in 1989. The     plan becomes operative in certain events involving the acquisition of 25% or    more ofthe Company's common stock by any person or group in a transaction not  approved bythe Company's Board of Directors. Upon the occurrence of such an    event, each right, unless redeemed by the Board, entitles its holder to         purchase for $350 an amount of common stock ofthe Company, or in certain       circumstances the acquirer, having a market value of twice the purchase price.  In connection with the rights plan, 7 million shares of preferred stock were    reserved. In connection with the acquisition of ABC,the Company's former       stockholders' rights plan was canceled.                                         AtSeptember 30, 1996 and1995,the Company's cumulative foreign currency   translation adjustments and other amounts recorded directly to equity were $39  and $38 million, net of deferred taxes of $16 and $18 million, respectively.The Company attempts to increase the long-term value of its shares by       periodically acquiring its stock when it perceives that the market value is     below an appropriate ratio of share price to historical earnings, projected     earnings, or other relevant measures. Treasury stock activity for the three     years endedSeptember 30, 1996 was as follows:                                                                                                  [Download Table]OnApril 22, 1996,the Company adopted a new share repurchase program. The  program will allowthe Company to purchase up to 105 million shares of its      common stock from time to time in the open market or in privately negotiated    transactions. In December 1996,the Company established a fund pursuant to the  repurchase program to acquire shares ofthe Company for the purpose of funding  certain stock-based compensation. Any shares acquired by the fund that are not  utilized must be disposed of byDecember 31, 1999. Concurrent with the          acquisition of ABC,the Company canceled its former share repurchase program.   -40-
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9  Stock Incentive Plans                                                        Under various plans,the Company may grant stock option and other awards to key executive, management and creative personnel. Transactions under the        various stock option and incentive plans for the periods indicated were as      follows:                                                                                                                                        [Download Table]Stock option awards are granted at prices equal to at least market price on the date of grant. Options outstanding atSeptember 30, 1996 and1995 ranged    in price from $13.28 to $65.75 and $5.56 to $57.44 per share, respectively.     Options exercised ranged in price from $5.56 to $57.44 per share in 1996, from  $3.61 to $57.44 per share in 1995, and from $3.23 to $41.00 per share in 1994.  Shares available for future option grants atSeptember 30, 1996 were 60         million.                                                                        In October 1995, the Financial Accounting Standards Board issued SFAS 123,  Accounting for Stock-Based Compensation ("SFAS 123") which is effective forthe Company in fiscal 1997. As permitted under SFAS 123,the Company has        elected not to adopt the fair value based method of accounting for its stock-   based compensation plans, but will continue to account for such compensation    under the provisions of APB Opinion No. 25 and, accordingly, the impact of      SFAS 123 onthe Company's financial statements is not expected to be material.The Company will comply with the disclosure requirements of SFAS 123 in 1997.   10 Detail of Certain Balance Sheet Accounts                                                                                                     [Download Table]-41-
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11 Segments                                                                                                                                     [Download Table]-42-
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                                                                [Download Table]During the second quarter of the current year,the Company implemented SFAS 121. This new accounting standard changes the method that companies use to      evaluate the carrying value of such assets by, among other things, requiring    companies to evaluate assets at the lowest level at which identifiable cash     flows can be determined. The implementation of SFAS 121 resulted in the         Company recognizing a $300 million non-cash charge related principally to       certain assets included in the Theme Parks and Resorts segment.                 12 Financial Instruments                                                        Investments                                                                     As ofSeptember 30, 1996,the Company held $41 million of securities        classified as available-for-sale. As ofSeptember 30, 1995,the Company held    $96 million of securities classified as trading and $403 and $307 million of    securities and cash equivalents, respectively, classified as available-for-     sale. In 1996 and 1995, realized gains and losses on available-for-sale         securities, determined principally on an average cost basis, and unrealized     gains and losses on available-for-sale securities were not material. In 1995,   the change in the net unrealized gain on trading securities was not material.   Financial Risk ManagementThe Company is exposed to the impact of interest rate changes.The Company'sobjective is to manage the impact of interest rate changes on earnings and      cash flows and on the market value of its investments and borrowings. The       Company maintains fixed rate debt as a percentage of its net debt between a     minimum and maximum percentage, which is set by policy.The Company transacts business in virtually every part of the world and is  subject to risks associated with changing foreign exchange rates. The           Company's objective is to reduce earnings and cash flow volatility associated   with foreign exchange rate changes to allow management to focus its attention   on its core business issues and challenges. Accordingly,the Company enters     into variouscontracts which change in value as foreign exchange rates change   to protect the value of its existing foreign currency assets and liabilities,   commitments and anticipated foreign currency revenues. By                       -43-
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policy,the Company maintains hedge coverage between minimum and maximum        percentages of its anticipated foreign exchange exposures for each of the next  five years. The gains and losses on thesecontracts offset changes in the       value of the related exposures.                                                 It isthe Company's policy to enter into foreign currency and interest rate transactions only to the extent considered necessary to meet its objectives as  stated above.The Company does not enter into foreign currency or interest      rate transactions for speculative purposes.                                     Interest Rate Risk ManagementThe Company uses interest rate swaps and other instruments to manage net    exposure to interest rate changes related to its portfolio of borrowings and    investments and to lower its overall borrowing costs. Significant interest      rate risk management instruments held bythe Company atSeptember 30, 1996 and1995 are described below.                                                       Interest Rate Risk Management--Borrowings                                       AtSeptember 30, 1996,the Company had outstanding interest rate swaps on   its borrowings with notional amounts totaling $900 million, which effectively   converted floating rate commercial paper to fixed rate instruments. AtSeptember 30, 1996 and1995,the Company had outstanding interest rate swaps    on its borrowings with notional amounts totaling $1,520 and $685 million,       respectively, which effectively converted medium-term notes to commercial       paper or LIBOR-based variable rate instruments. These swap agreements expire    in two to 15 years.                                                             Interest Rate Risk Management--Investment Transactions                          AtSeptember 30, 1995,the Company had outstanding $154 million notional    amount of interest rate swaps designated as hedges of investments, and $225     million of options, futures and forwardcontracts. These swaps andcontracts    were terminated during 1996 and the realized gains and losses are included in   earnings.                                                                       Interest Rate Risk Management--Summary of Transactions                          The following table reflects incremental changes in the notional or         contractual amounts ofthe Company's interest ratecontracts during 1996 and    1995. Activity representing renewal of existing positions is excluded.                                                                          [Download Table]-44-
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The impact of interest rate risk management activities on income in 1996 and1995 and the amount of deferred gains and losses from interest rate risk        management transactions atSeptember 30, 1996 and1995 were not material.       Foreign Exchange Risk ManagementThe Company primarily uses option strategies which provide for the sale of  foreign currencies to hedge probable, but not firmly committed, revenues.       While these hedging instruments are subject to fluctuations in value, such      fluctuations are offset by changes in the value of the underlying exposures     being hedged. The principal currencies hedged are the Japanese yen, French      franc, German mark, British pound, Canadian dollar, Italian lira and Spanish    peseta.                                                                         Foreign Exchange Risk Management TransactionsThe Company uses optioncontracts to hedge anticipated foreign currency     revenues.The Company also uses forwardcontracts to hedge foreign currency     assets, liabilities and foreign currency paymentsthe Company is committed to   make in connection with the construction of two cruise ships (see Note 13).     Cross-currency swaps are used to hedge foreign currency-denominated             borrowings.                                                                     AtSeptember 30, 1996 and1995, the notional amounts ofthe Company's       foreign exchange risk managementcontracts, net of notional amounts ofcontracts with counterparties against whichthe Company has a legal right of    offset, the related exposures hedged and thecontract maturities are as         follows:                                                                                                                                        [Download Table]Gains and losses oncontracts hedging anticipated foreign currency revenues and foreign currency commitments are deferred until such revenues are           recognized or such commitments are met, and offset changes in the value of the  foreign currency revenues and commitments. AtSeptember 30, 1996 and1995, the  Company had net deferred gains of $28 million and net deferred losses of $189   million, respectively, related to foreign currency hedge transactions, which    will be recognized in income over the next three years. Amounts recognizable    in any one year are not material and will be substantially offset by gains and  losses in the value of the related hedged transactions.                         The impact of foreign exchange risk management activities on income in 1996 and 1995 was not material.                                                      Fair Value of Financial Instruments                                             AtSeptember 30, 1996 and1995,the Company's financial instruments includedcash, cash equivalents, investments, receivables, accounts payable, borrowings  and interest rate and foreign exchange risk managementcontracts.               -45-
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AtSeptember 30, 1996 and1995, the fair values of cash and cash            equivalents, receivables, accounts payable, commercial paper and securities     sold under agreements to repurchase approximated carrying values because of     the short-term nature of these instruments. The estimated fair values of other  financial instruments subject to fair value disclosures, determined based on    broker quotes or quoted market prices or rates for the same or similar          instruments, and the related carrying amounts are as follows:                                                                                   [Download Table]Credit ConcentrationsThe Company continually monitors its positions with, and the credit quality of, the financial institutions which are counterparties to its financial        instruments and does not anticipate nonperformance by the counterparties. The   Company would not realize a material loss as ofSeptember 30, 1996 in the       event of nonperformance by any one counterparty.The Company enters into        transactions only with financial institution counterparties which have a        credit rating of A- or better.The Company's current policy in agreements with  financial institution counterparties is generally to require collateral in the  event credit ratings fall below A- or in the event aggregate exposures exceed   limits as defined bycontract. In addition,the Company limits the amount of    credit exposure with any one institution. AtSeptember 30, 1996, financial      institution counterparties posted collateral of $201 million tothe Company,    andthe Company was not required to collateralize its financial instrument      obligations.The Company's trade receivables and investments do not represent significantconcentrations of credit risk atSeptember 30, 1996, due to the wide variety    of customers and markets into whichthe Company's products are sold, their      dispersion across many geographic areas, and the diversification of the         Company's portfolio among instruments and issuers.                              13 Commitments and ContingenciesThe Company, together with, in some instances, certain of its directors and officers, is a defendant or co-defendant in various legal actions involving     copyright, breach ofcontract and various other claims incident to the conduct  of its businesses. Management does not expectthe Company to suffer any         material liability by reason of such actions, nor does it expect that such      actions will have a material effect onthe Company's liquidity or operating     results.                                                                        During 1995,the Company entered into agreements with a shipyard to build   two cruise ships for its Disney Cruise Line. Under the agreements,the Company  is committed to make payments totaling approximately $700 million through       1999.                                                                           AtSeptember 30, 1996,the Company is committed to the purchase of broadcastrights for various feature films, sports and other programming aggregating      approximately $4.5 billion. This amount is substantially payable over the next  five years.                                                                     -46-
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QUARTERLY FINANCIAL SUMMARY(In millions, except per share data)  (Unaudited)                                                                 [Download Table]--------                                                                        (1) Results afterFebruary 9, 1996 reflect the impact of the acquisition of     ABC. See Note 2 to the Consolidated Financial Statements.               (2) Reflects a $300 million non-cash charge in the second quarter pertaining    to the implementation of SFAS 121, and a $225 million charge for costs    related to the acquisition of ABC. The earnings per share impacts of thesecharges were $.30 and $.22, respectively. See Notes 2 and 11 to the     Consolidated Financial Statements.                                      -47-
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Dates Referenced Herein  and   Documents Incorporated By Reference

				Referenced-On Page
This 10-K405 Filing		Date		First		Last			Other Filings
		6/30/92		25
		12/31/92		25
		1/1/94		40
		3/1/94		24
		9/30/94		24		45
		7/31/95		23		25
		9/30/95		24		47			10-K/A
		10/1/95		24
		10/2/95		13
		10/6/95		25
		11/8/95		23
		11/13/95		23		24			S-4
		12/31/95		25					10-Q
		1/23/96		23					8-B12G/A
		2/9/96		2		48			8-K
		3/7/96		23					8-K
		3/14/96		36
		3/31/96		25					10-Q
		4/22/96		23		41
		6/30/96		25					10-Q
For The Period Ended		9/30/96		1		47			10-K/A
		10/30/96		23
		11/22/96		6		36
		11/25/96		29
		11/30/96		1
		12/12/96		1		13
Filed On / Filed As Of		12/19/96		26		29
		1/31/97		13
		12/31/99		41					10-K/A, 10-Q
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