Today at 1:00 pm EDT Chairman and CEO Robert A Iger hosted the 2014 Disney Shareholders’ Meeting in Portland, Oregon. Although I was not able to attend, I did listen to the broadcast which I think provided a lot of interesting information about the company as a whole, from the financial health to the plans for a creative and prosperous future. There are a lot of exciting things happening within the Walt Disney Company. I went to school for business and just recently graduated with an MBA so I do find the financials and business matters interesting, but I know not everyone feels the same way, so I’ll provide this information in a quick overview.
FYI the following is what I took from the meeting. Apologies for any inconsistencies with the official transcript and meeting minutes. For the Q&A section I did paraphrase both the questions and answers to reflect what I took from them. You may want to refer to any official transcripts or listen to the broadcast to hear any literal translations.
Opened with the introduction of Chairman and CEO Bob Iger.
Believes there are three keys to the Walt Disney Company’s success:
1. Exceptional creativity
2. Constant innovation
3. Unwavering commitment to excellence
Animation has been and always will be the heart and soul of Disney.
Frozen puts Disney back into the top position as a the leading animation studio, which meets one of the company’s business goals. The film is currently poised to pass Toy Story 3 as the number one animated film of all time.
This time last year the stock price was around $60 a share, and recently it has been selling at above $80 a share.
Fiscal 2013 – strong 2013 and third consecutive year of record results. Paid 58th consecutive dividend.
Also, the Walt Disney Company is constantly recognized as a reputable and admired company as well as socially responsible.
For first quarter 2014 all business units show double digit growth.
Disney Movies Anywhere – already 2.5 million people have downloaded it. Proud of the successful launch of the app.
Praise for the Cast Members.
Studio – upcoming films
Muppets Most Wanted March 2014
Captain America: The Winter Soldier April 2014
Maleficent May 2014
Guardians of the Galaxy August 2014
Planes: Fire and Rescue summer 2014
Big Hero Six
Into the Woods
2015
Cinderella live action
Avengers 2 May
Tomorrowland May
Pixar’s Inside Out June
Pixar’s The Good Dinosaur Thanksgiving
Pixar’s Finding Dory
Pixar’s Cars 3
Pixar’s The Incredibles 2 Brad Bird is already working on the script
Star Wars Episode 7 – December 18, 2015
Takes place 30 years after Return of the Jedi
Trio of new young leads
There will be familiar faces
Only confirmed actor is R2D2
Principle photography starts in May at Pinewood Studios in London
ESPN
New Sports Center starting May 26
Parks and Resorts
Finishing New Fantasyland
Continuing to roll out My Magic+
Broke ground on the new Avatar themed land at Animal Kingdom
Shanghai Disney is on track for end of year 2015 opening
Shanghai Disney will include an entire Pirates of the Caribbean themed land called Treasure Cove and will feature a new PoTC attraction called Battle of the Sunken Treasure which will be based on the films
With Disney, ABC, ESPN, Pixar, Marvel, and Lucas films we have an unprecedented and unparalleled collection of brands with many best loved characters and extremely creative minds to work with.
Disney will provide a collectible print featuring the family of Disney brands in place of paper stock certificates.
D23 Expo announced for 2015 – August 14-16 in Anaheim
Introduction of Disney’s Board of Directors:
(I’ve included the companies the individuals have,or do currently, work for. I think it’s important and interesting to see the variety of industries represented)
Lead Director: Orwin Smith – Starbucks
Susan Arnold – Carlyle Group, and Proctor and Gamble
John Chen – Blackberry
Fred Langhammer – Estée Lauder
Alywin Lewis – Pot Belly Sandwich Works
Monica Lozano – IntraMedia LLC
Bob Matschullat – Seagram Company
Sheryl Sandberg – Facebook
Thank you to Judy Estrin for 15 years serving on the board and who is now stepping down.
The announcement of Jack Dorsey (Twitter and Square) as her replacement.
Agenda:
1. Election of members of Board of Directors
2. Ratification of appointment of Price, Waterhouse, Coopers LLC as the Company’s independent registered accountant for 2014
3. Advisory vote on executive compensation
4. Approval of ammendment to certificate of incorporation
5. Limit accelerated executive pay – proposed by shareholder William Steiner
No questions on agenda items.
Inspector of election introduced: Melinda Massafra from Broadridge
As of January 17, 2014 there were 1,749,857,284 shares of common stock outstanding
At least 1,475,695,879 shares represented by proxy at the meeting.
Preliminary report of votes:
1. Arnold – 95% for appointment
Chen – 97% for
Dorsey – 99% for
Iger – 99% for
Langhammer – 98% for
Lewis – 97% for
Lozano – 99% for
Sandberg – 99% for
Smith – 92% for
2. 99% for ratification
3. 80% for advisory vote
4. 72% for approval of amendment
5. 24% for limited acceleration
End of business portion.
Question and Answer session. Bob Iger accompanied by Jay Rasulo (Executive Vice President and CFO) and Allen Braverman (Senior Vice President, General Counsel and Secretary of the Company)
1. Q: the company stopped issuing paper annual reports with Disney artwork. Can the artwork be displayed with the online annual report?
A: it was done to cut down on costs as it appeared not many people were looking at the artwork. Iger agreed he liked the artwork as well.
2. Q: thanking Disney BoD and recognizing their work in diversification. Pitching Detroit as a possible future shareholder meeting location.
3. Q: address the media bias at ABC
A: Iger stands by ABCNews and overall the quality of news is something to be proud of.
4. Q: has there been any consideration of a stock split?
A: Iger: hasn’t been discussed and the return on capital is something to be proud of.
Rasulo: used to be popular a decade ago but doesn’t feel the need to take on the expense.
5. Q: has the Company ever considered getting into the summer camp business?
A: was discussed at one point but felt it wasn’t a business they wanted to get into
6. Q: are the Nemo submarines going away in favor for an attraction with higher profitability? Example: Marvel.
A: we don’t look at attractions in terms of profitability but in terms volume handled. Agrees that the volume handled by the Nemo submarines is lower due to slow loading and unloading time, however this was a ride Iger advocated for. Because it is an iconic attraction it is planned to remain open. They are looking at a Marvel and Star Wars presence in the parks though.
7. Q: wants My Magic+ in Disneyland. Pin trading – why are pin traders being pushed about in the parks? Is there some way to have access to someone who knows what’s going on that day with pin trading?
A: pin trading has been popular at all our parks. There is limited pin trading so as to not interfere the flow of traffic in the parks. Will pass along comments to Michael Colglazer. (Not sure if I got the name correct)
8. Q: concerned about changes to accommodating guests with disabilities. Believes the new process is not effective.
A: the new process was not designed to take away access from those who need it. The original program was being taken advantage of and offered to have him work with representatives from Parks and Resorts.
9. Q: questions about expanding into the German market. And pitching for a job in Shanghai Disney.
A: satisfied with recent expansion in Germany – launch of Disney Channel. Believe there is room for improvement and a market for further expansion. Will get him in contact with HR representatives. Shanghai is looking to hire thousands of people.
10. Q: Cruise line – any fleet or itinerary expansions?
A: thanks her for her business. No plans to add to the fleet but always looking at new itineraries. Alaska has been extremely successful and has itineraries to the Caribbean and Europe.
11. Q: asking if they would be willing to use the Montesouri primary program (an early childhood program) for their employees’ children.
A: no, the company already provides child care centers for their employees’ children.
12. Q: thanks for the stock holders certificates. Bob Iger is his favorite character. Wondering if he would dissolve in acetone. (Bob Iger: what?) believes The Lone Ranger received a bad rap. Will Mulan become a princess and will her castle be built in Shanghai? Will there be another PoTC?
A: there will be a Mulan presence in Shanghai but her castle will not be built there. Some development has gone on for another PoTC sequel but nothing has been greenlit.
13. Q: concerned about growing exclusivity in the parks.
Applause.
A: what is exclusive is very tiny. Suggested joining D23. Disney tries to be as inclusive as they can.
14. Q: ABCNews- sometimes it seems ABCNews is a training ground for CNN. What are you doing to retain talent?
A: ABCNews is a great group. Individuals have left for a variety of reasons.
15. Q: copyrights- at some point they will expire. What is Disney doing to protect the company? Are there concerns?
A: Allen: looking at this – we have extremely strong trademarks and have registered them around the world. Taken the right and prudent measures for when the copyrights expire.
Iger: Disney stands apart from the rest in terms of story and characters. Used Snow White and the Huntsman as an example.
16. Q: 2d animation is getting lost. Disney is the only studio that can do this. Is 2d continuing? Is unique to the Disney brand.
A: we are just trying to create great movies. People don’t think 2d or 3d. It’s about how good the story is. There aren’t any plans to make a 2d film. There have been 2d shorts created with Mickey Mouse.
17. Q: park CMs – are there any plans to raise financial compensation?
A: agreed CMs make the magic and create unbelievable experiences for their guests. Negotiations are always ongoing with unions in the form of salary and benefits. Disney has good relationships with the unions. Disney has added 10,000 jobs in the US parks alone. It is their intention to behave fairly and responsibly to their Cast Members.
18. Q: wants the stockholder meeting at the Disney Family Museum in San Francisco. Are Disney Dollars continuing?
A: have had a stockholders meeting in Oakland within the last four or five years. There aren’t any plans he is aware of to discontinue Disney Dollars.
19. Q: Any plans to tie in promotions on Shanghai Disney with “Shanghi’ed in Astori?”
A: no
End of Q&A.
End of 2014 Shareholders’ meeting,