Debt-ridden Euro Disney's losses shrink

16th November 2005, Comments 0 comments

PARIS, Nov 16 (AFP) - Theme park operator Euro Disney, owner of the troubled attraction east of Paris, announced on Wednesday a 35-percent cut in nine-month net loss and said investors would have a better ride next year.

PARIS, Nov 16 (AFP) - Theme park operator Euro Disney, owner of the troubled attraction east of Paris, announced on Wednesday a 35-percent cut in nine-month net loss and said investors would have a better ride next year.

In mid-day trading on the Paris stock exchange, shares in Euro Disney were unchanged at EUR 0.12 after falling to EUR 0.11 earlier in the day. The CAC 40 index of leading shares fell 0.91 percent.

The company said that the loss during the first nine months of the year was EUR 94.9 million (US $111.0 million) compared with a loss of EUR 145.2 million in the same period of 2004.

Company chief executive Karl Holz said that 2005 would have been "a transitional year" and added that "fundamental indicators allow us to remain confident in the future".

The reduction in net loss this year was mainly because of reduced financial costs after a debt restructuring in February and a fall in exceptional charges, the company explained.

The debt-ridden group has had to restructure its finances twice since being launched in the early 1990s and completed a 253.3-million-euro capital increase in February to avert a risk of insolvency.

A total of 12.3 million people entered Euro Disney's Disneyland Resort in Marne-la-Vallée, near Paris, during the period and the average hotel occupancy rate was 80.7 percent.

The company also pointed to a 3.0-percent increase in sales to EUR 1.076bn.

The rise was because of increased spending by visitors and a rise in revenues from property development, which offset a slight fall in average spending on hotel rooms.

Holz pledged that the company was "determined to honour our commitment to progressively bring the group back to profitability" and identified labour costs as an area that management needed to tackle.

Negotiations between management and labour unions began on October 12 and the company is hoping for a new labour agreement in the first half of next year to bring down costs "which have risen twice as fast as the growth rates of our 2005 revenues", Holz said.

During the nine months to September, the group experienced a fall in its underlying earnings, or earnings before interest, tax, depreciation and amortisation (EBITDA), as overall costs increased by 3.0 percent.

In a conference call after the results, deputy finance director Jeffrey Speed said that the company hoped to reverse this trend and post growth in underlying earnings next year.

Holz also gave details on new investments planned for the theme park, saying a new Buzz Lightyear Lazer Blast attraction would open in April next year followed by a new Toon Studios park in 2007.

A Tower of Terror attraction is planned for 2008.

Copyright AFP

Subject: French news

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