Pixar and Disney Break Down using estimates of Incredibles ($ million)

Worldwide Box Office

Domestic Box Office 250
International Box Office 300
Total Theatrical Gross 550
Theatrical Net 263
Marketing and Distribution Costs 105
Disney Distribution Fee 33 12.50% 0.313095 0.125
Net Revenue to Partners 125
Production Costs (Shared Equally) 24
Profit to Partners 101
Pixar Revenue 63
Pixar Total Theatrical Income 51
As % of Total Theatrical Revenue 40%
Disney Total Theatrical Income 83.4375
As% of Total Theatrical Revenue 67%

World Wide Home Entertainment

Home Video Sales
Sales 551
Less Costs 109
Gross Profits 442
Marketing and Distribution Costs 106
Disney Distribution Fee 69
Net Revenue to Partners 267
Production Costs (Shared Equally) 52
Partners Income 215
Pixar Revenue 134
Pixar Home Entertainment Income 108
Disney Home Entertainement Income 176

Worldwide PPV and Pay TV Sales

Sales 33
Disney Distribution Fee 4
Net Revenue To Partners 29
Production Costs (shared equally) 5
Partners Income 24
Pixar Revenue 14
Pixar Income 12
Disney Income 16

World Wide Free TV Sales

Sales 29
Disney Distibution fee 4
Net Revenue to Partners 25
Production costs (shared equally) 5
Partner Income 20
Pixar Revenue 13
Pixar Income 10
Disney Income 14

Worldwide Merchandising Royalties

Revenue 55
Disney Distribution Fee 7
Net Revenue to Partners 48
Production Costs Shared Equally 10
Partner Income 38
Pixar Revenue 24
Pixar Income 19
Disney Income 26

Total
Pixar Revenue 247
Pixar Total Income 199
As a % of total Income 39%
Disney Total Income 316
As a % of total Income 61%
million)
 Current alliance
Segment Particulars
Disney Pixar
Net Revenue to partners 125
Net Revenue 62.56 62.56
Worldwide box office Production cost 12.00 12.00
Other Income 32.88
Net Income 83.44 50.56
Net Revenue to partners 267
Net Revenue 133.56 133.56
Worldwide Home
Entertainment Production cost 26.00 26.00
Other Income 68.88
Net Income 176.44 107.56
Net Revenue to partners 29
Net Revenue 14.44 14.44
Worldwide PPV & Pay
TV Sales Production cost 2.50 2.50
Other Income 4.13
Net Income 16.06 11.94
Net Revenue to partners 25
Net Revenue 12.69 12.69
Worldwide free TV
sales Production cost 2.50 2.50
Other Income 3.63
Net Income 13.81 10.19
Net Revenue 48
Worldwide Net Revenue 24.00 24.00
merchandising Production cost 5.00 5.00
royalties Other Income 7.00
Net Income 26.00 19.00
Total Net Income 315.75 199.25
Alliance- Pixar's terms (8%) Alliance- Pixar's terms (10%)
Disney Pixar Disney Pixar
263.00 263.00
21.04 158.00 26.30 158.00
24.00 24.00
-21.04 -26.30
21.04 112.96 26.30 107.70
551.00 442.00
44.08 336.00 44.20 336.00
52.00 52.00
-44.08 -44.20
44.08 239.92 44.20 239.80
- 33.00 - 33.00
2.64 33.00 3.30 33.00
- 5.00 - 5.00
-2.64 -3.30
2.64 25.36 3.30 24.70
- 29.00 - 29.00
2.32 29.00 2.90 29.00
- 5.00 - 5.00
-2.32 -2.90
2.32 21.68 2.90 21.10
- 55.00 - 55.00
4.40 55.00 5.50 55.00
- 10.00 - 10.00
-4.40 -5.50
4.40 40.60 5.50 39.50
74.48 440.52 82.20 432.80
Acquisition
Disney

158.00
24.00

134.00
336.00

52.00

284.00
33.00

5.00

28.00
29.00

5.00

24.00
55.00

10.00

45.00
515.00
 Option 1: Acquisition of Pixar
Worst Base Best
Investment 7,500 7,500 7,500
Revenue per movie 515 515 515
Discount rate 12% 12% 12%
Growth Rate 5.5% 5.5% 5.5%
Movies produced per year 1 1.5 2
PV of revenue 7,923 11,885 15,846

NPV 423 4,385 8,346

 Option 2: As a distribution partner (8%) Option 3: As a distribution partner (10%)
Worst Base Best Worst Base Best
- - - - - -
74 74 74 82 82 82
9% 9% 9% 9% 9% 9%
5.5% 5.5% 5.5% 5.5% 5.5% 5.5%
1 1.5 2 1 1.5 2
2,128 3,192 4,256 2,349 3,523 4,697

2,128 3,192 4,256 2,349 3,523 4,697