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42 Below are the segment financial data reported by Disney: 43 (1) Forecast Revenues for FY 2022E using the 2014-2018 CAGR. 44 Hint: Forecasting 2022E Revenues 4 years out may be calculated as Last Year X (1+CAGR)^4. 45 (2) Forecast the EBIT Margin for FY 2022E by applying the average expansion rate to the FY 2018 actual figures. 46 Hint: The expansion rate is the average increase or decrease in the percentage each year. 47 Hint: If the Margin is 10% for the last actual year and the expansion rate is +1%, the margin two years later would be (2 x 1%) +10% = 12%. 48 (3) Forecast EBIT for FY 2022E by multiplying the Revenue forecast by the EBIT Margin Forecast. 49 (4) Calculate the EBIT percentages (easy!). 50 Voila! You have created a forecast like a working financial analyst. 52 (On Wall Street, a Disney analyst might not simply apply the recent trend but would add a perspective that might accelerate, decelerate or reverse the trend.) 51 53 EXHIBIT: DISNEY CORP. BY SEGMENT 54 55 56 FY 2018 FY 2017 FY 2016 FY 2015 FY 2014 2014-2018 CAGR Revenues 57 FY 2022E Revenues 28,378 19,268 9,154 58 59 60 61 62 Media Networks Cable Networks Broadcasting Parks and Resorts Studio Entertainment Consumer Products Total 24,500 17,063 7,437 20,296 9,987 4,651 83,934 23,510 16,527 6,983 18,415 8,379 4,833 78,647 23,689 16,632 7,057 16,974 9,441 5,528 79,321 23,264 16,581 6,683 16,162 7,366 5,673 75,729 21,152 15,110 6,042 15,099 7,278 5,284 69,965 3.7% 3.1% 5.3% 7.7% 8.2% -3.1% 27,282 13,704 4,094 101,880 5.0% 63 64 65 EBIT EBIT 66 67 68 Media Networks Cable Networks Broadcasting Parks and Resorts Studio Entertainment Consumer Products Reconciliation Total 69 6,494 5,126 1,368 4,469 2,980 1,632 (738) 21,331 6,558 5,353 1,205 3,774 2,355 1,744 (558) 20,431 7,158 5,965 1,193 3,298 2,703 7,793 6,787 1,006 3,031 1,973 1,884 (1,457) 21,017 7,321 6,467 854 2,663 1,549 1,472 (1,636) 18,690 2014-2018 CAGR -3.0% -5.6% 12.5% 13.8% 17.8% 2.6% -18.0% 3.4% 70 1,965 (766) 21,516 (333) (333) 71 72 73 74 75 76 77 78 79 80 81 82 83 EBIT Percentage Mix Media Networks Cable Networks Broadcasting Parks and Resorts Studio Entertainment Consumer Products Reconciliation Total 30% 24% 6% 21% 14% % 8% -3% 100% 32% 26% 6% 18% 12% 9% -3% 100% 33% 28% 6% 15% 13% 9% -4% 100% 37% 32% 5% 14% 9% 9% -7% 100% 39% 35% 5% 14% 8% 8% -9% 100% Expansion Rate -2.2% -2.6% 0.5% 1.7% 1.4% -0.1% 1.3% EBIT Percent 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 100.0% 100.0% 84 85 EBIT Margin EBIT Margin 86 33% 27% 30% 87 28% 32% 17% 41% 35% 43% 14% 88 18% 22% 30% 36% 17% 19% 29% 36% 15% 19% Media Networks Cable Networks Broadcasting Parks and Resorts Studio Entertainment Consumer Products Reconciliation Total 89 90 20% 28% 36% 30% 35% Expansion Rate -2.0% -3.2% 1.1% 1.1% 2.1% 1.8% na -0.3% 18% 21% 28% 27% 33% na 91 92 93 94 na 25% na 26% na 28% na 27% na -0.3% 27% 42 Below are the segment financial data reported by Disney: 43 (1) Forecast Revenues for FY 2022E using the 2014-2018 CAGR. 44 Hint: Forecasting 2022E Revenues 4 years out may be calculated as Last Year X (1+CAGR)^4. 45 (2) Forecast the EBIT Margin for FY 2022E by applying the average expansion rate to the FY 2018 actual figures. 46 Hint: The expansion rate is the average increase or decrease in the percentage each year. 47 Hint: If the Margin is 10% for the last actual year and the expansion rate is +1%, the margin two years later would be (2 x 1%) +10% = 12%. 48 (3) Forecast EBIT for FY 2022E by multiplying the Revenue forecast by the EBIT Margin Forecast. 49 (4) Calculate the EBIT percentages (easy!). 50 Voila! You have created a forecast like a working financial analyst. 52 (On Wall Street, a Disney analyst might not simply apply the recent trend but would add a perspective that might accelerate, decelerate or reverse the trend.) 51 53 EXHIBIT: DISNEY CORP. BY SEGMENT 54 55 56 FY 2018 FY 2017 FY 2016 FY 2015 FY 2014 2014-2018 CAGR Revenues 57 FY 2022E Revenues 28,378 19,268 9,154 58 59 60 61 62 Media Networks Cable Networks Broadcasting Parks and Resorts Studio Entertainment Consumer Products Total 24,500 17,063 7,437 20,296 9,987 4,651 83,934 23,510 16,527 6,983 18,415 8,379 4,833 78,647 23,689 16,632 7,057 16,974 9,441 5,528 79,321 23,264 16,581 6,683 16,162 7,366 5,673 75,729 21,152 15,110 6,042 15,099 7,278 5,284 69,965 3.7% 3.1% 5.3% 7.7% 8.2% -3.1% 27,282 13,704 4,094 101,880 5.0% 63 64 65 EBIT EBIT 66 67 68 Media Networks Cable Networks Broadcasting Parks and Resorts Studio Entertainment Consumer Products Reconciliation Total 69 6,494 5,126 1,368 4,469 2,980 1,632 (738) 21,331 6,558 5,353 1,205 3,774 2,355 1,744 (558) 20,431 7,158 5,965 1,193 3,298 2,703 7,793 6,787 1,006 3,031 1,973 1,884 (1,457) 21,017 7,321 6,467 854 2,663 1,549 1,472 (1,636) 18,690 2014-2018 CAGR -3.0% -5.6% 12.5% 13.8% 17.8% 2.6% -18.0% 3.4% 70 1,965 (766) 21,516 (333) (333) 71 72 73 74 75 76 77 78 79 80 81 82 83 EBIT Percentage Mix Media Networks Cable Networks Broadcasting Parks and Resorts Studio Entertainment Consumer Products Reconciliation Total 30% 24% 6% 21% 14% % 8% -3% 100% 32% 26% 6% 18% 12% 9% -3% 100% 33% 28% 6% 15% 13% 9% -4% 100% 37% 32% 5% 14% 9% 9% -7% 100% 39% 35% 5% 14% 8% 8% -9% 100% Expansion Rate -2.2% -2.6% 0.5% 1.7% 1.4% -0.1% 1.3% EBIT Percent 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 100.0% 100.0% 84 85 EBIT Margin EBIT Margin 86 33% 27% 30% 87 28% 32% 17% 41% 35% 43% 14% 88 18% 22% 30% 36% 17% 19% 29% 36% 15% 19% Media Networks Cable Networks Broadcasting Parks and Resorts Studio Entertainment Consumer Products Reconciliation Total 89 90 20% 28% 36% 30% 35% Expansion Rate -2.0% -3.2% 1.1% 1.1% 2.1% 1.8% na -0.3% 18% 21% 28% 27% 33% na 91 92 93 94 na 25% na 26% na 28% na 27% na -0.3% 27%