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Euro Disney posts ‘substantial’ loss

Euro Disney S.C.A., operators of the theme park and resort near Paris, announced losses Tuesday for their second six months of operation.

Terming the loss “substantial,” park officials revealed a net loss of 1.081 billion francs ($ 200 million).

Losses occurred on reported revenues of 1.794 billion francs ($ 301 million) earned Oct. 1, 1992, through March 31, 1993.

Disappointing results

The half-yearly loss follows a previously announced loss for fiscal year 1992 (which ended in September) of $ 35 million.

The disappointing results for the park’s second six months of public operation were blamed on continuing seasonal losses, fixed costs and the high level of financial charges.

France’s changing economic climate was also to blame for the resort’s dismal results, according to company spokesmen.

Lower-than-expected hotel occupancy levels have already caused partial season closing on one of Disney’s six on-site flagship hotels.

Overall, first 11/2 year operating losses and ongoing capital program investments — including park expansion — will have an adverse effect on the operation’s immediate cash flow and financial programs, according to Euro Disney officials.

Earlier this month, officials announced a delay of “up to two years” on the resort complex’s next major planned expansion — a second theme park.

The MGM-Disney Studio addition is now targeted for a 1996 opening, officials say.

Profit in ’94

Park officials said during the first year’s anniversary that the theme park is not expected to turn profitable until 1994.

To address continuing losses, both Euro Disney and The Walt Disney Co., the park’s largest equity shareholder (49%), are exploring potential sources of new financing, officials said Tuesday.

“These new sources of financing mainly involve internal arrangements between Euro Disney and the Walt Disney Co. involving adjustment of the Disney company’s fees,” said one company source.

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