Disney Plans More Cutbacks As Chief Forecasts Rebound

The chairman of the Walt Disney Company, Michael D. Eisner, acknowledged today that he, like many shareholders, was disappointed with Disney's stock price, but said it was poised for growth when the economy turned around.

In his annual letter to shareholders, Mr. Eisner vowed to shave costs further. He forecast that when Disney's fiscal year ends in September, its money-losing Internet operations will show a profit.

''We are now officially in a recession, and people have less disposable income for travel,'' Mr. Eisner wrote. ''However, when the economy does come back, and as confidence in America's safety continues to grow, there is every reason to believe that the performance at our parks will be stronger than ever.''

Mr. Eisner said Disney would close 50 more Disney Stores as it continues to revamp its retail unit. Disney aims to drop the number of stores to 300 to 400 in North America from more than 600 in fiscal 1997.

But analysts said the big questions for Disney in 2002 were whether and when Walt Disney World in Florida and Disneyland and California Adventure in Southern California would bounce back from the tourism slump after the Sept. 11 attacks and the recession.

Second to theme park attendance is the timing of a rebound at Disney's ABC television network, which has suffered from a severe advertising slump and a steep ratings decline because it currently lacks the kind of hit it had in 2000 with the game show ''Who Wants to Be a Millionaire.'' This year, the popularity of ''Millionaire'' faded.

A Prudential analyst, Kathy Styponias, said Disney ''is doing as much as it can on the cost side'' of the theme park business, and it should be poised for a rebound ''as consumers feel more comfortable with flying and traveling.''

She added, ''With ABC, the company is facing different issues. The ability to turn that around is a long process.''

She said Disney needed to use Hollywood's TV development talent outside ABC's own programming executives, if necessary, to find a winning program.

Disney's major cost-cutting efforts in 2001 included reductions of some 4,000 positions -- many at the theme parks -- primarily through voluntary resignations.

The cutbacks, however, failed to overcome the triple blow of a recession, an ad slump and the Sept. 11 attacks. Disney earnings in fiscal 2001, ended Sept. 30, plummeted to $120 million, before accounting changes, versus $920 million in 2000.

After accounting adjustments, Disney reported a net loss of $158 million in fiscal 2001, and its stock sank, too.

Disney rose 67 cents today, to $22.12.