Restore The Magic at Disney | View Trian's Case for Change

Restore
The Magic

at The Walt Disney Company

Trian’s Case for Change at Disney

Despite being one of the most advantaged global consumer entertainment companies, Disney’s Total Shareholder Return has materially underperformed the S&P 5001:

Source: FactSet as of 1/10/23. (1) Total Shareholder Return (“TSR”) defined as the total return an investor would receive if they purchased one share of stock on the first day of the measured period, inclusive of share price appreciation and dividends paid. We highlight the S&P 500 here only as a widely recognized index, however, for various reasons the performance of the index and that of the securities mentioned above may not be comparable. One cannot invest directly in an index.

Disney’s financial performance has been disappointing post-21st Century Fox deal.

Source: SEC filings. Note: (1) EPS Defined as Earnings Per Share.

Despite Disney’s share price peaking in 2021, it trades near its 8-Year low.

Source: FactSet as of 1/10/23.

Trian believes that Disney is a company in crisis and faces many challenges that weigh on the Company’s investment prospects. We believe that these challenges are primarily self-inflicted and need to be addressed:

Poor

Corporate Governance

Failed succession planning
“Over-the-top” compensation
Minimal shareholder engagement

Poor

Strategy & Operations

Flawed DTC strategy
Lack of cost discipline
Using Parks to subsidize streaming losses

Poor

Capital Allocation

Deteriorating returns on incremental investments
Questionable M&A judgement (Fox, Sky)
Increased leverage, eliminating 50+ yr dividend

Trian’s Strategic & Operating Initiatives

Fix

Corporate Governance

Develop effective succession plan
Align compensation with performance

Fix

Strategy & Operations

Improve DTC operating margins
Eliminate redundant/excessive costs
Refocus creative engine to drive growth

Fix

Capital Allocation

Enhance accountability
Reinstate dividend by FY 2025

Trian’s Objective

To create sustainable, long-term value at Disney by working WITH Bob Iger & the Board. Trian recognizes that Disney is undergoing a lot of change quickly and is NOT trying to create additional instability. Trian is:

NOT looking to replace Bob Iger

FOR ensuring successful CEO succession within 2 years

NOT advocating for a break-up of Disney

FOR reinvigorating the Disney “flywheel”

NOT advocating to increase financial leverage

FOR orderly deleveraging

NOT seeking to cut costs that impact product quality or customer experience

FOR driving efficiencies and additional profits

NOT advocating for aggressive price increases at the expense of customers

FOR ensuring customers can get real value across all business lines

NOT advocating for a permanent dividend cut

FOR reinstating the dividend by FY 2025

Materials

Read the latest news, letters, press releases, presentations and SEC filings.

Board Candidate

Nelson Peltz brings an ownership mentality and track record of long-term value creation.