Disney Consumer Products Continues Strong Growth at Retail

Retail sales by Disney and its licensees are on track to reach the $26 billion level in fiscal 2007 (FY07), which would double the $13 billion in retail sales of just five years ago in fiscal 2002; it was announced today by Disney Consumer Products (DCP) Chairman Andy Mooney at the International Licensing Expo in New York City. DCP expects 13% growth in retail sales over fiscal 2006 as it continues to expand its licensing business with a rich and diverse array of entertainment properties for all ages.

“Given the rich breadth of entertainment and content generating from across the company, there is no better time for licensees and retailers to be aligned with The Walt Disney Company than now,” said Mr. Mooney. “The breakout success of tween and preschool programming on Disney Channel and the slate of powerful films have enabled us to balance out our licensing portfolio across age segments and make an impact at retail 365 days a year.”

Driving this growth are global retail sales of licensed merchandise for classic franchises such as Disney Princess, Mickey Mouse and Winnie the Pooh; new franchises such as Disney/Pixar’s Cars, Pirates of the Caribbean and Disney Fairies; and the promise of new tween franchise opportunities with smash hit programming from Disney Channel including High School Musical and Hannah Montana:

High School Musical & Hannah Montana

Disney has become the authority among kids and tweens ages 9-14 with smash hits from Disney Channel original programming including High School Musical, Hannah Montana and That’s So Raven. Emphasizing its commitment to the tween market, DCP opened Licensing Show with an appearance by Miley Cyrus, star of Hannah Montana, and announced that retail sales figures for its tween business are on track to reach $400 million globally in FY07.

(Editors please note: high resolution images of Disney’s Licensing Show events are available online at DCP’s press room www.disneyconsumerproducts.com)

Rich Ross, president, Disney Channel Worldwide, said, “We’re thrilled that kids, tweens and parents respond so positively to our programming and that they want a deeper connection with our characters, stories and brands via consumer products extensions of our series and movies.”

With High School Musical 2 premiering this August on Disney Channel and a third film releasing theatrically in 2008, there is no stopping this tween phenomenon. At retail, a special line of High School Musical merchandise will launch at Wal-Mart for back-to-school this fall supported by a significant, 52-week sponsorship on Disney Channel. The sponsorship package boasts dedicated marketing support through in-store promotions, circulars and Wal-Mart’s PRN programming.

Meanwhile, the reach of Hannah Montana will extend beyond TV this summer as star Miley Cyrus releases a brand new 2-CD set, Hannah Montana 2 / Meet Miley Cyrus, a new DVD, Hannah Montana Pop Star, and embarks on a 50+ city tour kicking off this October. At retail, the franchise will expand this fall from apparel, stationery and home décor into a line of footwear from Payless Shoes and an expanded line of youth electronics including an LCD TV and a fun line of professional electric and acoustic guitars.

Additionally, both franchises boast comprehensive publishing programs. Worldwide sales of High School Musical books are well over 4.5 million copies, including the High School Musical junior novel which ranked No. 1 on the New York Times best-selling list. A total of 10 titles will be in stores in time for the August premiere of High School Musical 2 and 20 more titles are in development through Spring 2008, including original fiction, novelty and High School Musical 2 tie-ins. Hannah Montana books launched in the US in September 2006 with almost 2.5 million copies sold to date. Six junior novels are currently out with three new books releasing this fall –Nightmare on Hannah Street; Seeing Green; and Face the Music; six more titles will publish in Spring 2008 as well as an original fiction series.

New videogame titles are also set to release this fall, combining interactive game play with music and dance elements, these include: High School Musical: Makin’ the Cut on Nintendo DS, Hannah Montana: Music Jam on Nintendo DS™ and Hannah Montana: Spotlight World Tour on Wii™ from Nintendo.

Disney Princess

The Disney Princess franchise is on track for a 14% increase over prior year, with an expected $4 billion in global retail sales companywide in FY07 – compared to just $300 million in 2001. Disney Princess introduces a new Disney Video Premiere DVD release this fall – Enchanted Tales: Follow Your Dreams – celebrating the golden heart of a true Disney Princess and the power of believing in yourself. An assortment of more than 1,500 glimmering pink and gold products with a “Season of Enchantment” theme will accompany the DVD release set to make a striking impression at retail. Disney will also re-brand its multi-million selling line of Disney Princess books as part of this theme with an “all that glitters is gold” overlay. To date over 2,000 Disney Princess book titles are published worldwide while Disney Princess magazines are enjoyed in 72 countries and 27 languages. Disney will also release its first console video game created specifically for young girls, Disney Princess: Worlds of Enchantment for Wii™ from Nintendo and the Sony PlayStation® 2 computer entertainment system and Disney Princess: Magical Jewels for Nintendo DS™.

Coming to theaters this fall, Disney will release Enchanted, a classic princess fairytale with a modern day twist, starring Amy Adams, Patrick Dempsey and Susan Sarandon. The entertainment will continue as Sleeping Beauty is planned for re-release on DVD in 2008 and will be available on Blue Ray for the first time. In 2009, the highly anticipated release of The Princess and the Frog will introduce Disney’s newest princess.

Disney Fairies

Launched as a Disney franchise at the International Licensing Expo only a year ago, retail sales of Disney Fairies merchandise are on track to surpass $800 million in FY07. The franchise is supported by an engaging website, www.disneyfairies.com which attracts more than one million daily unique visitors, and has generated over 1.7 million customized, fan-created Fairies since the “Create-A-Fairy” feature launched on the site in January 2007. A massive global publishing program is also in place. Disney Fairies books are now published in 51 countries and in 33 languages and have sold over 5 million copies around the world. Disney will launch Fairy Haven and the Quest for the Wand by Gail Carson Levine, illustrations by David Christiana, in the US this summer and worldwide this fall. The book is the global sequel to the worldwide best seller Fairy Dust and the Quest for the Egg, which served as the cornerstone of the Disney Fairies franchise launch. Additionally, Disney Fairies magazine is currently available in 24 countries with plans to launch in 11 more by 2008; over 2.6 million copies of the magazine have sold globally.

Later this summer, a broad global marketing program will launch, extending through the Buena Vista Worldwide Home Entertainment release of Tinker Bell, the movie, in fall 2008 which will be supported by a broad assortment of lifestyle products for six-to-nine year old girls.

Disney·Pixar’s Cars & Pirates of the Caribbean

Disney has grown its presence in the boys segment with powerful franchises behind Cars and Pirates of the Caribbean. Cars has quickly accelerated to the top, generating an impressive $2 billion in global retail sales with a mix of toys, electronics, home furnishings, apparel, video games and publishing. Crossing the $1 billion retail sales mark, the Pirates of the Caribbean franchise has also generated a year-round opportunity for DCP beyond toys with a breadth of fashion and lifestyle products and new adventures through original content from Disney Publishing Worldwide and Disney Interactive Studios. Disney Publishing will continue to create and develop new content and adventures as part of both the Cars and Pirates of the Caribbean franchises in the US and worldwide over the next few years, as titles are seeing continued growth and success in markets including the US, the UK, Italy, and more.

Mickey Mouse & Winnie the Pooh

Disney has also become the gold standard in preschool programming with Disney Channel’s Playhouse Disney, delivering four of Saturday’s top five shows on TV and Sunday’s top six including Mickey Mouse Clubhouse, Little Einsteins and My Friends Tigger & Pooh which launched in May and was the No. 1 TV series in the kids 2-5 preschool demo during its premiere weekend. Merchandise based on all three shows will be rolling out globally in 2007 and 2008; books have just released in the US and are selling out at all levels of retail.

ABOUT DISNEY CONSUMER PRODUCTS:

Disney Consumer Products (DCP) is the business segment of The Walt Disney Company (NYSE:DIS) that extends the Disney brand to merchandise ranging from apparel, toys, home décor and books to interactive games, food and beverages, stationery, electronics and animation art. This is accomplished through the work of DCP’s various lines of business: Disney Toys, Disney Apparel, Disney Food, Health & Beauty, Disney Home, Disney Stationery, Disney Publishing, Disney Interactive Studios, Baby Einstein, and www.disneyshopping.com. The Disney Store, which debuted in 1987, also falls under DCP, through stores currently owned and operated by unaffiliated third parties under licensing agreements in North America and Japan, and wholly-owned stores in Europe. For more information, please visit www.disneyconsumerproducts.com.

FORWARD-LOOKING STATEMENTS

Certain statements in this press release may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are made on the basis of our views and assumptions regarding future events and business performance as of the time the statements are made and we do not undertake any obligation to update these statements. Actual results may differ materially from those expressed or implied. Such differences may result from actions taken by the Company, as well as from developments beyond the Company’s control, including international, political, health concern and military developments and changes in domestic and global economic conditions that may affect retail businesses generally. Additional factors are set forth in the Company’s Annual Report on Form 10-K for the year ended September 30, 2006 and in subsequent reports on Form 10-Q under Item 1A “Risk Factors.”