Walt Disney Company (DIS)

Investing Activities

Investing activities from continuing operations consist principally of investments in parks, resorts, and other property and acquisition and divestiture activity. The Company’s investments in parks, resorts and other property from continuing operations for the last three years are as follows:

Capital expenditures for the Parks and Resorts segment are principally for theme park and resort expansion, new rides and attractions, cruise ships, recurring capital and capital improvements. The increase in capital expenditures at domestic parks and resorts in fiscal 2009 reflected spending on Disney’s California Adventure expansion and construction progress payments on two new cruise ships. The decrease in capital expenditures at international parks and resorts in fiscal 2008 reflected lower expenditures at Disneyland Paris as a result of completion of projects related to a multi-year investment program established with the 2005 Financial Restructuring (See Note 7 to the Consolidated Financial Statements).

Capital expenditures at Media Networks primarily reflect investments in facilities and equipment for expanding and upgrading broadcast centers, production facilities, and television station facilities. The increase in fiscal 2008 was driven by the construction of new production and television station facilities.

Other Investing Activities

During fiscal 2009, acquisitions totaled $517 million and included the purchase of additional interests in Jetix Europe N.V. and UTV (See Note 4 to the Consolidated Financial Statements), partially offset by proceeds totaling $185 million from the sale of our investment in two pay television services in Latin America.

During fiscal 2008, acquisitions totaled $660 million which included an additional interest in UTV.

During fiscal 2007, the Company received $1.5 billion in proceeds from the sales of our interests in E! Entertainment Television and Us Weekly. Acquisitions totaled $608 million driven by Club Penguin Entertainment, Inc. and NASN Limited (see Note 4 to the Consolidated Financial Statements).

Investing Activities

Cash used by investing activities during the six months ended March 28, 2009 of $1.1 billion included $749 million of investments in parks, resorts and other property and $487 million of acquisitions, partially offset by proceeds of $185 million from the sale of our investment in two pay television services in Latin America.

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS – (continued)

During the six months ended March 28, 2009 and March 29, 2008, investment in parks, resorts and other properties were as follows:

The increase in capital expenditures for the six months reflected a construction progress payment on the new cruise ships, the expansion at Disney’s California Adventure, new broadcast facilities, and new production facilities at Studio Entertainment.

Investing Activities

Cash used by investing activities during the quarter ended December 27, 2008 of $578 million included $291 million of investments in parks, resorts and other property and $475 million of acquisitions, partially offset by proceeds totaling $185 million from the sale of our investment in two pay television services in Latin America.

The increase in capital expenditures for the quarter was primarily due to the expansion at Disney’s California Adventure and new production facilities at Studio Entertainment.

Investing Activities

Investing activities from continuing operations consist principally of investments in parks, resorts, and other property and acquisition and divestiture activity. The Company’s investments in parks, resorts and other property from continuing operations for the last three years are as follows:

Capital expenditures for the Parks and Resorts segment are principally for theme park and resort expansion, new rides and attractions, cruise ships, recurring capital and capital improvements. The decrease in capital expenditures at Parks and Resorts reflected lower expenditures at Disneyland Resort Paris as a result of completion of projects related to a multi-year investment program established with the 2005 Financial Restructuring, which is discussed in more detail in Note 5 to the Consolidated Financial Statements. As of September 27, 2008, Disneyland Resort Paris had spent $333 million out of a total of $351 million for the program (based on September 27, 2008 exchange rates).

Capital expenditures at Media Networks primarily reflect investments in facilities and equipment for expanding and upgrading broadcast centers, production facilities, and television station facilities. The increase in fiscal 2008 was driven by the construction of new production and television station facilities.

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Capital expenditures at Corporate primarily reflect investments in information technology and other equipment and corporate facilities.

Other Investing Activities

During fiscal 2008, the Company invested $660 million in acquisitions which included the acquisition of UTV Software Communications Limited, an Indian media company (see Note 3 to the Consolidated Financial Statements).

During fiscal 2007, the Company received $1.5 billion in proceeds from the sales of our interests in E! Entertainment Television and Us Weekly. We also invested $608 million driven by the acquisitions of Club Penguin Entertainment, Inc. and NASN Limited.

During fiscal 2006 we received $1.1 billion from financial investments that were liquidated.

Investing Activities

Investing activities from continuing operations consist principally of investments in parks, resorts, and other property and acquisition and divestiture activity. The Company’s investments in parks, resorts and other property from continuing operations for the last three years are as follows:

Capital expenditures for the Parks and Resorts segment are principally for theme park and resort expansion, new rides and attractions, cruise ships, recurring capital and capital improvements. The decrease in capital expenditures at Parks and Resorts reflected lower expenditures at Disneyland Resort Paris as a result of completion of projects related to a multi-year investment program established with the 2005 Financial Restructuring, which is discussed in more detail in Note 5 to the Consolidated Financial Statements. As of September 27, 2008, Disneyland Resort Paris had spent $333 million out of a total of $351 million for the program (based on September 27, 2008 exchange rates).

Capital expenditures at Media Networks primarily reflect investments in facilities and equipment for expanding and upgrading broadcast centers, production facilities, and television station facilities. The increase in fiscal 2008 was driven by the construction of new production and television station facilities.

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Table of Contents

Capital expenditures at Corporate primarily reflect investments in information technology and other equipment and corporate facilities.

Other Investing Activities

During fiscal 2008, the Company invested $660 million in acquisitions which included the acquisition of UTV Software Communications Limited, an Indian media company (see Note 3 to the Consolidated Financial Statements).

During fiscal 2007, the Company received $1.5 billion in proceeds from the sales of our interests in E! Entertainment Television and Us Weekly. We also invested $608 million driven by the acquisitions of Club Penguin Entertainment, Inc. and NASN Limited.

During fiscal 2006 we received $1.1 billion from financial investments that were liquidated.

Investing Activities

FACE="Times New Roman" SIZE="2">Investing activities from continuing operations consist principally of investments in parks, resorts, and other property and acquisition and divestiture activity. The Company’s investments in parks, resorts and
other property from continuing operations for the last three years are as follows:

Capital expenditures for the Parks and Resorts segment are principally for theme park and resort
expansion, new rides and attractions, cruise ships, recurring capital and capital improvements. The decrease in capital expenditures at Parks and Resorts reflected lower expenditures at Disneyland Resort Paris as a result of completion of projects
related to a multi-year investment program established with the 2005 Financial Restructuring, which is discussed in more detail in Note 5 to the Consolidated Financial Statements. As of September 27, 2008, Disneyland Resort Paris had spent $333
million out of a total of $351 million for the program (based on September 27, 2008 exchange rates).

Capital expenditures at Media
Networks primarily reflect investments in facilities and equipment for expanding and upgrading broadcast centers, production facilities, and television station facilities. The increase in fiscal 2008 was driven by the construction of new production
and television station facilities.

41

Table of Contents

Capital expenditures at Corporate primarily reflect investments in information technology and other
equipment and corporate facilities.

Other Investing Activities

FACE="Times New Roman" SIZE="2">During fiscal 2008, the Company invested $660 million in acquisitions which included the acquisition of UTV Software Communications Limited, an Indian media company (see Note 3 to the Consolidated Financial
Statements).

During fiscal 2007, the Company received $1.5 billion in proceeds from the sales of our interests in E! Entertainment
Television and Us Weekly. We also invested $608 million driven by the acquisitions of Club Penguin Entertainment, Inc. and NASN Limited.

SIZE="2">During fiscal 2006 we received $1.1 billion from financial investments that were liquidated.

Investing Activities

Cash used by continuing investing activities during the nine months ended June 28, 2008 of $1.4 billion included $949 million of investments in parks, resorts and other property and $488 million of acquisitions. During the nine months ended June 28, 2008 and June 30, 2007, investments in parks, resorts and other properties were as follows:

Capital expenditures for the Parks and Resorts segment are principally for new rides and attractions and recurring capital improvements. Capital expenditures at Media Networks primarily reflect investments in facilities and equipment for expanding and upgrading broadcast centers, production facilities, and television station facilities.

Investing Activities

Cash used by continuing investing activities during the six months ended March 29, 2008 of $807 million was primarily due to $596 million of investments in parks, resorts and other property. During the six months ended March 29, 2008 and March 31, 2007, investments in parks, resorts and other properties were as follows:

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS -- (continued)

Capital expenditures for the Parks and Resorts segment are principally for new rides and attractions and recurring capital improvements.

Investing Activities

Cash used by continuing investing activities during the quarter ended December 29, 2007 of $324 million was primarily due to $249 million of investments in parks, resorts and other property. During the quarters ended December 29, 2007 and December 30, 2006, investments in parks, resorts and other properties were as follows:

Capital expenditures for the Parks and Resorts segment are principally for new rides and attractions and recurring capital improvements.

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS—(continued)