Marvel Studios Analyst

Day Webcast
Thursday, August 10, 2006

1
Speaker: Peter Cuneo

2
Safe Harbor Disclosure
Except for any historical information that they contain, the statements in this
presentation regarding our plans are forward-looking statements that are
subject to various risks, including that we might be unable to attract and
retain creative talent; our films might be less successful economically than
we anticipate; our films might be more
expensive to make than we anticipate;
union activity might interrupt our film
production; we might be disadvantaged by
changes or disruptions in the way films are
distributed; we might lose potential sales
because of piracy of films and related products; we
will depend on our distributor for the implement-
ation of internal controls related to the accounting of film-production
activities; we might fail to meet the conditions set by the lenders for the
funding of films; we might fail to meet the tests imposed by the lenders for
the funding of films beyond the first four; and accounting related to the
production of our films may result in significant fluctuations in our reported
income or loss.
These and other risks are described in our filings with the Securities and
Exchange Commission, including our Annual Reports on Form 10-K and our
Quarterly Reports on Form 10-Q. We assume no obligation to publicly update
or revise any forward-looking statements. 3 3
Participants

Peter Cuneo - Vice Chairman, Marvel Entertainment

David Maisel - Vice Chairman, Marvel Studios;

EVP Corporate Development, Marvel
Entertainment

Michael Helfant - President/COO, Marvel Studios

Kevin Feige - President Production, Marvel Studios

Ken West - EVP & CFO, Marvel Entertainment

John Turitzin - EVP, CAO and General Counsel, Marvel

Entertainment

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Marvel Studios Analyst Day
Agenda and Goals
1. Provide analysts and investors with exposure to senior
executives running our entertainment business
2. Review Marvels strong track record in film production
3. Discuss launch of new Marvel film slate and its advantages
4. Provide illustrative financial models
5. Address accounting, transparency, cash disbursements,
recoupment and financial controls
6. Review Marvel Studios mission and operations
7. Describe the process Marvel uses to make its films
8. Discuss characters in development for film slate
9. Answer any remaining questions
5
David Maisel
Vice Chairman, Marvel Studios
Executive Vice President, Marvel Entertainment

Joined Marvel in January 2004

Conceived and executed direct to DVD animated feature deal
Conceived and executed film slate financing
Film and entertainment Executive 13 years
Endeavor Talent Agency, Head of Corporate Development
Chello Media (Europe), Managing Director
Livent, Inc., President
The Walt Disney Company, Director of Corporate Development
Creative Artists Agency, Corporate Agent
Entertainment industry consultant, The Boston Consulting Group 5 years
MBA, Harvard Business School

6
Michael Helfant
President and Chief Operating Officer, Marvel Studios
Joined Marvel in 2005
Film and entertainment executive 17 years
Beacon Pictures, Chief Operating Officer
Miramax / Dimension Films, Senior EVP
Interscope Communications/Polygram Filmed Entertainment, EVP
Involved in production and financing of over 75 films
The Hand that Rocks the Cradle, Jumanji, Mr. Hollands Opus,
Runaway Bride, Ladder 49
Spy Kids, Scream and Scary Movie franchises
Entertainment lawyer 5 years
JD/MBA - UCLA

7
Kevin Feige
President of Production, Marvel Studios
Joined Marvel in 2000
President of Production 1 year
Executive Vice President 3 years
Senior Vice President 2 years
Marvel Production Accomplishments:
Executive Producer - X-Men: The Last Stand, Spider-Man 2,
The Hulk, The Punisher and Fantastic Four
Co-Producer - X-Men 2: X-Men United and Daredevil
Production executive - Spider-Man
The Donners Company
Associate Producer (X-Men I ) 2 years
Production Team (Youve Got Mail and Volcano) 5 years
Selected as one of Top 35 Executives Under 35 by Hollywood Reporter
USC School of Cinema-Television

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Sid Ganis
Chairman of Marvel Film Slate Committee
Member Marvel Entertainment Board of Directors

Joined Marvel Board of Directors in 1999

Currently President of Academy of Motion Picture Arts & Sciences
(OSCARS)
Currently Chairman Out of the Blue Entertainment
Akeelah and the Bee, Big Daddy, Mr. Deeds, Deuce Bigalow
Vice Chairman of Columbia Pictures
A League of Their Own, A Few Good Men, Groundhog Day
President of Paramount Motion Picture Group
Ghost, Fatal Attraction, Top Gun
Senior Vice President, Lucasfilm
The Empire Strikes Back, Raiders of the Lost Ark

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Speaker: David Maisel

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 Historical Box Office
Performance of Marvel PG-13 Films
US Box Int'l Box
Release Office Office Total
Date Distributor $mm's $mm's $mm's
PG-13-rated films:
X-Men 7/14/00 Fox $ 157.3 $ 138.7 $ 296.0
Spider-Man 5/3/02 Sony 403.7 418.0 821.7
Daredevil 2/14/03 Fox 102.5 76.6 179.2
X2: X-Men United 5/2/03 Fox 214.9 191.5 406.4
Hulk 6/20/03 Universal 132.2 113.1 245.3
Spider-Man 2 6/30/04 Sony 373.6 410.4 784.0
Elektra 1/14/05 Fox 24.4 32.1 56.6
Fantastic Four 7/8/05 Fox 154.7 175.4 330.1
(1 )
X-Men: The Last Stand 5/26/06 Fox 233.1 206.8 439.9
Total $ 1,796.4 $ 1,762.7 $ 3,559.1
Average $ 199.6 $ 195.9 $ 395.5

(1)
Still in release

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Marvels Unique Film
Advantages
Large, established and loyal Marvel comic fan base worldwide
60-year history of the Marvel brand
Marvel brand stands for high quality, family-friendly
entertainment, action and excitement, reaches across all
demographics
One of the few studio brands meaningful to film consumers
Depth and breadth of the stories, characters and artwork in
Marvels IP library
Rich storylines and characters transcending comic book
stereotypes
Potential to create film franchises from each Marvel property
Opportunity for multiple sequels and spin-offs
Proven, experienced production team with a strong familiarity with
the characters histories and storylines
Enviable track record
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Key Film Slate Benefits:
Financial
With minimal cash risk:
Receive significant producer
fee
5% of all film related
revenues
Receive profit upside from
films
Eliminates studio sharing of
merchandising and toy
revenues
Build film library
Strategic
Give Marvel greater control of its
future:
Greenlight and schedule release of
films
Film development and production
process
Film marketing
Sequels and spin-offs
Enable ripple-effect deals
Regaining rights to previously
licensed characters like Hulk and
Iron Man
Recapture merchandising
opportunities 13
 Key Film Slate Elements
Financial
100% debt/no equity
$465 million revolving senior bank debt insured by AMBAC
(LIBOR + 1.635%)
$60 million of junior debt (LIBOR + 7.0%)
LIBOR capped at 6.0% for ~2/3 of expected borrowings
Marvel paid gross participation fee
5% of all film-related revenues including DVD
Marvel receives film profits
Profits are crossed among films with various financial tests
to determine cash dispositions from facility to Marvel
Non-film revenues are not shared with the distributor or lenders
All interest, fees and closing costs paid from facility or film
proceeds
Marvel development costs fully paid back at film greenlight
Marvel receives reimbursement for actual incremental overhead
Up to 2% of film budgets
Film budgets from $65-165 million
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Key Film Slate Elements
Legal
Debt is non-recourse to Marvel Entertainment
No cash collateral other than film profits - collateral is
theatrical film rights to the pledged characters
Duration through 2012/2013
Key greenlight requirements
$65-$165 million bonded budget
PG or PG-13 rated
Five foreign territories pre-sold: Germany, France, Spain,
Japan, Australia/New Zealand
Completion bond in place
Post the fourth film, passage of various interim asset and
pre-sale tests

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Key Distribution Deal
Elements
Financial
Extremely competitive
distribution fee
Hard dollar financial minimums
set for spending on marketing
With built in escalations as
industry marketing costs
increase
Excludes charges for
distributors internal
charges/overhead and interest
Protection on DVD margins
Distributor marketing spend
recoupment not crossed
Other
Paramount obligation to distribute
10 films from facility
Marvel flexibility to go elsewhere
in certain situations
No distributor creative controls
Key release date windows set
Early Spring/Summer
Fall Holiday
Distribution in Germany, France,
Spain, Japan and Australia/New
Zealand reserved to Marvel
U.S. free TV distribution reserved
to Marvel
Mutual approvals on marketing
plan and creative material
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Caution Regarding Illustrative
Models

The following models are not projections of the expected

performance of any individual film or of Marvels film
slate as a whole. They are presented only to illustrate the
possible performance of those films and to assist in an
understanding of Marvels self-produced filmmaking
operations. These models are based on the following
assumptions. The assumptions are mere estimates. If
the assumptions turn out to be incorrect, the actual film
performance will be different from the model. As with
any model, actual performance will be different, perhaps
significantly different, from the performance illustrated in
these models.

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Key Film Model Assumptions

Revenue Assumptions
International box office 98% of domestic box office (1)
Theatrical rentals revenue (includes
traditional non-theatrical)
Domestic 55% of domestic box office (1)
International 43% of international box office (1)
Reserved territories
Minimum guarantees from reserved
territories and tax incentives 33% of direct negative cost (2)
Percent of international Ultimate
allocated to reserved territories 40% (1)

(1) Based on historical actuals of Marvel PG-13 films

(2) Based on industry estimates

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Key Film Model Assumptions
(continued)

Revenue Assumptions
Home video/DVD revenue
Domestic 78% of domestic theatrical box office (1)
International 60% of domestic home video (1)

Television Revenue
Domestic
Pay-per-view 12.5% of dom. theatrical rentals, cap of $7.5mm (2)
Pay 45% of dom. theatrical rentals, cap of $17.5mm (2)
Free 18% of dom. theatrical rentals, cap of $40.0mm (2)
International
Pay 33% of intl theatrical rentals, cap of $30.0mm (2)
Free 50% of intl theatrical rentals, cap of $30.0mm (2)

(1) Based on historical actuals of Marvel PG-13 films

(2) Based on industry estimates
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Key Film Model Assumptions
(continued)
Costs Assumptions
Prints and advertising Tied to distribution partner minimums
with escalation assumptions (3)
Home video costs Tied to distribution partner cap (3)
Television costs 5% of television revenue (2)
Residuals
Home video 11% of first $1 million of home video royalty,
13% thereafter (3)
Television 9% of television revenue (3)
Participations
Marvel producer fee 5% of 100% of gross receipts (3)
Third parties 3.75% of 100% of gross receipts (2)
Distribution fee 10%, maximum allowed by loan agreement (3)
Production budget $130 million

(2) Based on industry estimates

(3) Derived from contractual commitments
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Illustrative Single Film P&L
Revenue
Domestic Box Office
(in millions) $ 100 $ 150 $ 200 $ 250 $ 300
Domestic
Theatrical Rentals/Non-theatrical $ 55 $ 82 $ 109 $ 137 $ 164
Home Video 78 117 156 195 234
Pay-Per-View 7 8 8 8 8
Pay Television 18 18 18 18 18
Free Television 10 15 20 25 30
International, Net of Reserved
Territories
Theatrical Rentals 25 38 51 63 76
Home Video 35 42 56 70 84
Pay Television 8 13 17 18 18
Free Television 13 18 18 18 18
Minimum Guarantees from
Reserved Territories and Tax
Incentives 43 43 43 43 43
Total Gross Film Revenue $ 292 $ 393 $ 495 $ 594 $ 692
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Illustrative Single Film P&L
(continued)
Domestic Box Office
(in millions) $ 100 $ 150 $ 200 $ 250 $ 300
Total Gross Film Revenue (prior slide) $ 292 $ 393 $ 495 $ 594 $ 692

Distribution Fee 24 33 43 53 62
Domestic
Prints and Advertising 53 56 64 72 80
Home Video Costs 29 44 59 73 88
International
Prints and Advertising 21 22 26 29 32
Home Video Costs 13 16 21 26 31
Television Costs 2 2 2 3 3
Residuals 8 10 13 15 16
Participations 24 33 41 50 58
Total Distribution Expenses $ 174 $ 216 $ 269 $ 320 $ 371
Direct Negative Cost - including
capitalized interest 134 134 134 134 134
Total Film Operating Expenses $ 308 $ 350 $ 403 $ 454 $ 505
Total Film Profit $ (16) $ 42 $ 92 $ 140 $ 187
Marvel Producer Fee 15 20 25 30 35
Operating Income Contribution $ (1) $ 62 $ 117 $ 170 $ 222

Possible Wholesale Toy Sales Per Film $35-150mm

Possible Merchandising Revenue Per Film $10-50mm
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Illustrative Film Window
Assumptions*
Domestic
Theatrical 0
Home Video/DVD 4-6 months
Pay-per-view 7-9 months
Pay TV 12 months
Network TV/Cable TV 24-30 months
TV Syndication 48 months

International
Theatrical 0
Home Video/DVD 4-6 months
Pay-per-view & Pay TV 12 months
Free TV 48 months

* Timing of initial revenues post theatrical release

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 Illustrative Timing of
Film P&L
Single Film

(in millions) Year 1 Year 2 Year 3 Years 4-7 Total

Marvel Producer Fee $ 12 $ 10 $ 1 $ 1 $ 25
Film Receipts 46 125 36 19 226
Amortization of Film Costs (31) (73) (19) (11) (134)
Operating Income $ 27 $ 63 $ 18 $ 10 $ 117

Assumptions: Note: illustration excludes

$130 million budget merchandising and licensing
Films released in May and July of each year contributions
$200 million domestic box office
Note: years 1-7 are calendar years

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Illustrative Timing of Film P&L
Full 10 Film Slate Contribution
Operating Income Impact
(millions)
Film Released Year 1 Year 2 Year 3 Years 4-7
Film 1 Year 1 $ 27 $ 63 $ 18 $ 10
Film 2 Year 1 $ 19 $ 70 $ 19 $ 10
Film 3 Year 2 $ 27 $ 63 $ 27
Film 4 Year 2 $ 19 $ 70 $ 29
Film 5 Year 3 $ 27 $ 90
Film 6 Year 3 $ 19 $ 97
Film 7 Year 4 $ 111
Film 8 Year 4 $ 111
Film 9 Year 5 $ 108
Film 10 Year 5 $ 108
Total Operating Income $ 46 $ 179 $ 215 $ 700
Assumptions:
$130 million budget Note: illustration excludes
Films released in May and July of each year merchandising and licensing
$200 million domestic box office contributions
Note: years 1-7 are calendar years 25
Speaker: Ken West

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Marvel Studios Financial
Concepts
Reporting transparency
Accounting fundamentals
Net inventories
Income recognition timing and method
Individual film forecast method
Ultimates - All forecasted revenues and costs of a
film for the first 7-10 years
Funding Sources
Scripts and other pre-production costs
Production and post-production costs
Interest
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Interest on Outstanding Film
Facility Debt
Debt characteristics

$525 million credit facility consists of $60 million mezzanine (interest @ LIBOR
+ 7%) and $465 million senior debt (interest @ LIBOR + 0.7% plus 0.935%
Ambac insurance premium)
Unused commitment fee on mezzanine (0.5%) and senior (0.2% plus 0.4%
Ambac insurance premium)
Mezzanine is drawn down first (to date, approximately $30 million has been
drawn down to pay closing costs and interest)
Once mezzanine is fully drawn, senior is drawn down
Senior debt revolves; mezzanine remains outstanding for the term of the debt

Interest presentation on Marvel financial statements

Interest on funds borrowed to finance film production is capitalized through
delivery of the completed film. Capitalized interest is amortized as a cost of
production
Interest on funds borrowed to pay closing costs and interest as well as
interest on funds borrowed to finance film production after delivery are
expensed during the period
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Illustrative Example of Marvel
P&L Impact Domestic Box Office
(millions) $ 100 $ 150 $ 200 $ 250 $ 300
Total Gross Film Revenue (prior slide) (A) $ 292 $ 393 $ 495 $ 594 $ 692

Distribution Fee 24 33 43 53 62
Domestic
Prints and Advertising 53 55 64 72 80
Home Video Costs 29 44 59 73 88
International
Prints and Advertising 21 22 26 29 32
Home Video Costs 13 16 21 26 31
Television Costs 2 2 2 3 3
Residuals 8 10 13 15 16
Participations 24 33 41 50 58
Total Distribution Expenses (B) $ 174 $ 216 $ 269 $ 320 $ 371
Direct Negative Cost (Includes
Capitalized Interest) 134 134 134 134 134
Total Film Operating Expenses $ 308 $ 350 $ 403 $ 454 $ 505
Total Film Profit $ (16) $ 42 $ 98 $ 140 $ 187
Marvel Producer Fee (C) 15 20 25 30 35
Operating Income Contribution $ (1) $ 62 $ 117 $ 170 $ 222

As Presented on Marvel Income Statement

Revenue [(A) - (B) + (C)] $ 133 $ 196 $ 251 $ 304 $ 356
Amortization of Film Costs 134 134 134 134 134
Operating Income Contribution $ (1) $ 62 $ 117 $ 170 $ 222
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 Five-Minute Intermission

Questions for Marvel Studios management may be

submitted via e-mail at: mvlq&a@jcir.com.

We will address as many

questions as time permits
following the end of
the presentations.

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Speaker: Michael Helfant

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MARVEL STUDIOS

Primary goals and objectives

Build entertainment franchises based on Marvel characters
Create content that drives, supports and enhances all of
Marvels business activities

New Strategic Plan

Self-finance feature films in order to retain creative and
strategic control of franchise properties
Capture full upside of self-financed films
Retain long term ownership of film and television library assets

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Current Business Segments

Live Action
Licensed Third Party Studio Films
New Self-Financed Film Slate
Television Series

Animation
Direct to DVD Features
Television Series

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Animation
Direct-to-DVD Features Status
Ultimate Avengers 2 Released 8/8/06
Iron Man In production
Doctor Strange In production
Teen Avengers Development

TV Series
Fantastic Four In production
Wolverine and the X-Men Pre-production
Iron Man Development
Spider-Man Development

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Animation

Marvel Studios responsible for all

creative development and design

Actual animation executed by third

party animation houses

Direct to DVD and series productions

will become Marvel library assets
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Studio Financed Films
Production
Ghost Rider Sony Feb. 07
Spider-Man 3 Sony May 07
Fantastic Four 2 Fox June 07

Development
Deathlok Paramount
Gargoyle Sony
Magneto Fox
Namor Universal
The Punisher 2 Lions Gate
Wolverine Fox
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Studio Financed Films

Business as usual

Marvel Studios will have a

balance of studio financed and
self-financed films

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Self-Financed Film Slate

Plan to release 2 self-financed films per year

beginning in 2008

Development
7 projects in development

First film: Iron Man May 2, 2008

Incredible Hulk likely to be second film

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Film Slate - Production

Fully controlled by Marvel

Additional staffing/infrastructure as needed

Physical Production, Production Finance and
Business/Legal Affairs

Pre-production activities

Production financing with new revolving film facility after

greenlight

Same quality as studio-financed films

Competitive advantages

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Film Slate:
Production Risk Management
Extensive pre-production

Experienced crews

Complete production insurance package

Strict budget and financial controls

Completion bond
Independent review/approval of budgets
Guaranty of completion and delivery
Guaranty of over-budget financing if needed

40
Film Slate - Distribution
Principal distribution arrangements
Paramount
Universal for Incredible Hulk

Major studio distribution partners in US and various international

territories

Marvels reserved distribution rights

Australia/New Zealand, Germany, France, Spain and Japan
Domestic free television
All ancillary rights, including merchandising, music publishing
and soundtrack rights

Additional staffing to manage and oversee all activities of Marvel

Studios distribution partners
Marketing and distribution executives

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Speaker: Kevin Feige

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 MARVEL STUDIOS:

How We Make Marvel Movies

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INTRODUCTION

How does a Marvel superhero

go from comic books pages to a
global box office phenomenon?

The answer is a team of experts

working in concert to make sure
that every detail is imagined
and executed during the
painstaking film process.

Heres a look at how Marvel Studios has made some of the biggest
movies of all time

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 1 DEVELOPMENT

2 PRE-PRODUCTION

3 PRODUCTION

4 POST-PRODUCTION

5 MARKETING / RELEASE

45
DEVELOPMENT

46
MINING MARVELS VAST
IP LIBRARY
Marvel Studios draws upon its rich library of comic
books and characters to create hit films.

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SCRIPT DEVELOPMENT
We condense decades of comic books into one
screenplay. This is the most crucial - and longest - stage
of the development process.

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PRE-PRODUCTION

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STORYBOARDS
Every major sequence is carefully drawn out by storyboard artists.
The filmmakers then use these boards to plan every detail of the
sequence. Comic books are a valuable resource during this
process since they are basically storyboards themselves.

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PRE-VISUALIZATION
ANIMATICS
Complex action sequences are fully animated to give the
filmmakers a better idea of how the sequence will look and feel

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CASTING
Marvel Studios works with an impressive array of talented actors to
bring our characters to life. Very often, after appearing in a Marvel
Studios production, these actors go on to enjoy superstar status.

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PRODUCTION
When all the details are in place the production is
ready to go before the cameras. This process can
last many months.

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POST-PRODUCTION

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POST PRODUCTION
EDITING

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POST PRODUCTION
VISUAL EFFECTS

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POST PRODUCTION
VISUAL EFFECTS

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POST PRODUCTION
VISUAL EFFECTS

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POST PRODUCTION
VISUAL EFFECTS

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POST PRODUCTION
VISUAL EFFECTS

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POST PRODUCTION
VISUAL EFFECTS

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POST PRODUCTION SOUND
EFFECTS, SCORING & FINAL MIX

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MARKETING / RELEASE

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THE MARVEL FILM SLATE
IRON MAN
Billionaire industrialist Tony
Stark builds a high-tech suit of
armor to fight injustice on a
global scale.

Director - JON FAVREAU

(Made, Elf, Zathura)

Production Designer
J. MICHAEL RIVA (Spider-Man 3,
Zathura)

VFX Supervisor JOHN NELSON

(I Robot, The Matrix 2, 3, Academy
Award winner for Gladiator)

Director of Photography
MATTHEW LIBATIQUE (Inside Man,
Requiem for A Dream)

Release date - May 2nd, 2008

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THE MARVEL FILM SLATE
THE INCREDIBLE HULK
Caught in the heart of a gamma
explosion, Dr. Bruce Banner now
finds himself transformed in times
of stress into seven feet, one
thousand pounds of unfettered
fury the most powerful creature
to ever walk the earth
The Incredible Hulk!

Director: Louis Leterrier

(Unleashed, The
Transporter 2)

Writer: Zak Penn (X-Men: The

Last Stand, X2: X-Men
United, Last Action Hero) 65
THE MARVEL FILM SLATE
ANT MAN

Small time crook Scott Lang

stumbles upon an old uniform
once worn by the reclusive Dr.
Hank Pym a.k.a. Ant-Man.
Now, the torch is passed and
an unlikely new hero is born.

Director: Edgar Wright

(Shaun of The Dead)

66
THE MARVEL FILM SLATE
CAPTAIN AMERICA
In 1942 Steve Rogers is
picked to participate in a
super-soldier experiment
which transforms him
into Captain
America. Thought lost in
battle towards the end
of WW2, Captain
America awakens in the
present day to a world
he doesn't recognize.

Writer: David Self

(Road to Perdition,
Thirteen Days)
67
THE MARVEL FILM SLATE
NICK FURY
Super-spy Nick Fury uses
high-tech equipment and a
team of agents from the
most powerful spy
organization in the world to
fight an evil group
determined to send the
world into chaos.

Writer: Andrew Marlowe

(Air Force One,
Hollow Man,
End of Days)

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THE MARVEL FILM SLATE
THOR

An epic tale of Norse

mythology, this is the
story of Thor, the god of
thunder, being banished
to live as a human among
mortal men.

Writer: Mark Protosevich

(I Am Legend, The Cell)

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THE MARVEL FILM SLATE
THE AVENGERS
The Avengers are Earth's
mightiest heroes, formed to
fight the foes no single hero
could withstand. The
Avengers are the most
prestigious and powerful
super-hero team in the world.

Writer: Zak Penn (The Incredible

Hulk, X-Men: The Last Stand,
X2: X-Men United, Last Action
Hero)

70
Question and Answer Period

Moderated by: Peter Cuneo

e-mail questions now to

mvlq&a@jcir.com

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Thank You For Joining Us Today!

Marvel Entertainment, Inc.

(NYSE: MVL)
www.marvel.com

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