Euro Disney S.C.A. Reports 2013 First Half Results

PARIS, May 7, 2013 /PRNewswire/ --

• Total revenues increased 3% to € 568 million 

•    Resort revenues increased 2% reflecting higher guest spending partially offset by anticipated moderate decrease in volumes

• EBITDA at € 3.1 million, up € 1.4 million

•    Net loss narrowed by 10% reflecting the positive impact of the 2012 refinancing and an improved operating margin

Euro Disney S.C.A. (the "Company"), parent company of Euro Disney Associés S.C.A. ("EDA"), operator of Disneyland® Paris, reported today the results of its consolidated group (the "Group") for the first six months of fiscal year 2013 which ended March 31, 2013 (the "First Half").


    Key Financial Highlights                 First Half          Fiscal
    (EUR in millions, unaudited)            2013       2012   Year 2012
    Revenues                               567.7      552.4     1,324.3
    Costs and expenses                   (650.2)    (637.1)   (1,320.9)
    Operating margin                      (82.5)     (84.7)         3.4
    Plus: Depreciation and amortization     85.6       86.4       173.8
    EBITDA [1]                               3.1        1.7       177.2
    EBITDA as a percentage of revenues      0.5%       0.3%       13.4%
    Net loss                             (108.4)    (120.9)     (100.2)
    Attributable to owners of the
    parent                                (89.1)    (100.8)      (85.6)
    Attributable to non-controlling
    interests                             (19.3)     (20.1)      (14.6)
    Cash flow (used in) / generated by
    operating activities                  (19.8)       12.3       142.7
    Cash flow used in investing
    activities                            (52.2)     (83.8)     (152.0)
    Free cash flow used [1]               (72.0)     (71.5)       (9.3)
    Cash and cash equivalents, end of
    period                                  68.7      230.4       114.3


Key Operating Statistics [1]

    Theme parks attendance (in millions)     6.7         6.8          16.0
    Average spending per guest (in EUR)    45.97       44.11         46.44
    Hotel occupancy rate                   78.0%       79.8%         84.0%
    Average spending per room (in EUR)    207.84      207.29        231.33


Commenting on the results, Philippe Gas, Chief Executive Officer of Euro Disney S.A.S, said:

"Delivering 3% revenue growth during our first semester is encouraging given the current economic environment and clearly demonstrates the resiliency of Disneyland Paris. Three years ago, we made the decision to increase our investments in the guest experience and the Resort in general and therefore focus on guest spending growth. Our results for the first semester are in line with this strategic choice with a 4% increase in guest spending and a slight decrease in visitation.

"We are seeing the first concrete benefits of the debt refinancing transaction, with substantial interest charge savings for the first semester. With the refinancing, we also benefit from greater flexibility to continue to invest in order to further strengthen the appeal of Disneyland Paris.

"In the second half of the year, we will continue to build on both the success of the 20th Anniversary celebration, which was extended for another 6 months, and the strong commitment of our Cast Members to keep delivering on our brand promise. At the same time, we remain cautious for the rest of the year in light of the continued challenging economy."

Seasonality

The Group's business is subject to the effects of seasonality and the annual results are significantly dependent on the second half of the fiscal year, or April 1 to September 30, which traditionally includes the high season at Disneyland® Paris. Consequently, the operating results for the First Half are not necessarily indicative of results to be expected for the full fiscal year.  

Revenues by Operating Segment  

                                                 First Half        Variance
    (EUR in millions, unaudited)                2013     2012  Amount          %
    Theme parks                                311.4    304.8     6.6       2.2%
    Hotels and Disney Village(R)               228.2    224.5     3.7       1.6%
    Other                                       21.5     21.8   (0.3)     (1.4)%
    Resort operating segment                   561.1    551.1    10.0       1.8%
    Real estate development operating segment    6.6      1.3     5.3        n/m
    Total revenues                             567.7    552.4    15.3       2.8%


n/m: not meaningful

Resort operating segment revenues increased 2% to € 561.1 million from € 551.1 million in the prior-year period.

Theme parks revenues increased 2% to € 311.4 million from € 304.8 million in the prior-year period, due to a 4% increase in average spending per guest to € 45.97, partly offset by a 2% decrease in attendance to 6.7 million. The increase in average spending per guest was due to higher spending on admissions, food and beverage and merchandise. The decrease in attendance was due to fewer guests visiting from France, Spain and Belgium.

Hotels and Disney Village® revenues increased 2% to € 228.2 million from € 224.5 million in the prior-year period, reflecting a 17% increase in Disney Village revenues, partly offset by a 1.8 percentage point decrease in hotel occupancy to 78%. The increase in Disney Village revenues mainly reflected the opening of a new boutique, World of Disney, in July 2012.  The decrease in hotel occupancy resulted from 24,000 fewer room nights sold compared to the prior-year period, primarily due to fewer guests visiting from Spain, as well as lower business group activity, partly offset by more guests visiting from the United Kingdom.

Other revenues, which primarily include participant sponsorships, transportation and other travel services sold to guests, decreased 1% to € 21.5 million from € 21.8 million in the prior-year period.  

Real estate development operating segment revenues increased by € 5.3 million to € 6.6 million, from € 1.3 million in the prior-year period. This increase was due to one land sale closed during the First Half while no land sale closed in the prior-year period.

Costs and Expenses  

                                    First Half        Variance
    (EUR in millions, unaudited)   2013     2012  Amount          %
    Direct operating costs (1)    527.4    513.4    14.0       2.7%
    Marketing and sales expenses   68.0     69.5   (1.5)     (2.2)%
    General and administrative
    expenses                       54.8     54.2     0.6       1.1%
    Costs and expenses            650.2    637.1    13.1       2.1%


Direct operating costs primarily include wages and benefits for employees in operational roles, depreciation and amortization related to operations, cost of sales, royalties and management fees. For the First Half and the corresponding prior-year period, royalties and management fees were € 32.7 million and € 31.6 million, respectively.

Direct operating costs increased 3% compared to the prior-year period due to expenses related to new guest offerings, labor rate inflation and increased costs associated with higher real estate development activity.

Marketing and sales expenses decreased 2% compared to the prior-year period due to lower sales activities and media initiatives.

Net Financial Charges  

                                      First Half               Variance
    (EUR in millions, unaudited)     2013         2012     Amount            %
    Financial income                  0.5          2.9      (2.4)      (82.8)%
    Financial expense              (26.3)       (38.9)       12.6      (32.4)%
    Net financial charges          (25.8)       (36.0)       10.2      (28.3)%


Financial income decreased by € 2.4 million compared to the prior-year period due to a lower average level of cash and cash equivalents and lower short-term interest rates.  

Financial expense decreased by € 12.6 million due to a lower average interest rate on debt following the 2012 refinancing.  

Net Loss

For the First Half, the net loss of the Group amounted to € 108.4 million compared to € 120.9 million for the prior-year period.

Cash flows

Cash and cash equivalents as of March 31, 2013 were € 68.7 million, down € 45.6 million compared with September 30, 2012, and down € 161.7 million compared with March 31, 2012. These variances resulted from:

                                                                First Half      Variance
    (EUR in millions, unaudited)                               2013       2012
    Cash flow (used in) / generated by operating activities  (19.8)       12.3    (32.1)
    Cash flow used in investing activities                   (52.2)     (83.8)      31.6
    Free cash flow used                                      (72.0)     (71.5)     (0.5)
    Cash flow generated by / (used in) financing activities    26.4     (64.2)      90.6
    Change in cash and cash equivalents                      (45.6)    (135.7)      90.1

    Cash and cash equivalents, beginning of period            114.3      366.1   (251.8)
    Cash and cash equivalents, end of period                   68.7      230.4   (161.7)


Free cash flow used for the First Half was € 72.0 million compared to € 71.5 million used in the prior-year period.

Cash flow used in operating activities for the First Half totaled € 19.8 million compared to € 12.3 million generated in the prior-year period. This decrease resulted from higher working capital requirements. Changes in working capital during the prior-year period benefited from the deferral into long-term debt of € 33.9 million of royalties and management fees, as permitted by the 2005 restructuring debt agreements. No such benefit occurred in the First Half following the removal of this deferral mechanism after the 2012 refinancing.  

Cash flow used in investing activities for the First Half totaled € 52.2 million compared to € 83.8 million used in the prior-year period. This decrease was driven by the level of investments made in the prior-year period in the World of Disney boutique, which opened in July 2012, as well as the timing of capital expenditures related to a new attraction based on the Disney.Pixar movie Ratatouille, scheduled to open in the Walt Disney Studios® Park in 2014.

Cash flow generated by financing activities totaled € 26.4 million for the First Half compared to € 64.2 million used in the prior-year period. During the First Half, the Group drew an amount of € 30.0 million from the € 250.0 million standby revolving credit facility granted by The Walt Disney Company ("TWDC")[2]. In the prior-year period, the Group repaid € 64.3 million of its bank borrowings, consistent with the scheduled maturities before the 2012 refinancing.

In accordance with the scheduled maturities agreed as part of the 2012 refinancing, the Group is only required to repay € 1.4 million of its borrowings with TWDC in the last six months of fiscal year 2013.

UPDATE ON RECENT AND UPCOMING EVENTS

Disneyland® Paris' 20th Anniversary Celebration

On February 28, 2013, the Group announced the extension of Disneyland® Paris' 20th Anniversary celebration until September 30, 2013. Guests now have a second chance to enjoy the festivities that include a new twist on the Disney Dreams®! nighttime spectacular. The show is enriched with scenes from two animated films, The Lion King and Brave, and becomes an interactive experience with Disney Light'Ears[3]. These Mickey ears change color in time with the show, making Disney Dreams! an even more spectacular experience for the whole family. For more information, please refer to the press release available on the Group's website.

New Ratatouille-themed attraction announced for Disneyland Paris in 2014

On February 28, 2013, the Group also announced a new attraction based on the Disney.Pixar movie Ratatouille, scheduled to open in the Walt Disney Studios® Park in 2014. This unique attraction will take guests into the world of Remy - a talented young rat who dreams of becoming a renowned French chef. Disney storytelling and state-of-the-art technology will come together in this romantic, larger-than-life, Parisian experience. For more information, please refer to the press release available on the Group's website.


An Analyst Meeting will be held on May 7, 2013 at 14:30 (CET)

at Le Royal Monceau, 37 avenue Hoche - 75008 Paris

The presentation of the Analyst Meeting will be available at 14:30 on Euro Disney S.C.A. corporate website:

http://corporate.disneylandparis.com/investor-relations/publications/index.html

Additional Financial Information can be found on the Internet at http://corporate.disneylandparis.com

Code ISIN:        FR0010540740            

Code Reuters:     EDLP.PA

Code Bloomberg:   EDL:FP


The Group operates Disneyland® Paris, which includes: Disneyland® Park, Walt Disney Studios® Park, seven themed hotels with approximately 5,800 rooms (excluding approximately 2,400 additional third-party rooms located on the site), two convention centers, Disney Village®, a dining, shopping and entertainment center, and a 27-hole golf course. The Group's operating activities also include the development of the 2,230-hectare site, half of which is yet to be developed. Euro Disney S.C.A.'s shares are listed and traded on NYSE Euronext Paris.

Attachments:  Exhibit 1 - Consolidated Statement of Income

              Exhibit 2 - Consolidated Segment Statement of Income

              Exhibit 3 - Consolidated Statement of Financial Position

              Exhibit 4 - Consolidated Statement of Cash Flows

              Exhibit 5 - Consolidated Statement of Changes in Equity

              Exhibit 6 - Statement of Changes in Borrowings

              Exhibit 7 - Definitions


EXHIBIT 1

EURO DISNEY S.C.A.

Fiscal Year 2013

First Half Results

Six Months Ended March 31, 2013

CONSOLIDATED STATEMENT OF INCOME

                                          First Half           Variance
    (EUR in millions, unaudited)         2013       2012  Amount           %

    Revenues                            567.7      552.4    15.3        2.8%
    Costs and expenses                (650.2)    (637.1)  (13.1)        2.1%
    Operating margin                   (82.5)     (84.7)     2.2      (2.6)%
    Net financial charges              (25.8)     (36.0)    10.2     (28.3)%
    Loss from equity investments        (0.1)      (0.2)     0.1         n/m
    Loss before taxes                 (108.4)    (120.9)    12.5     (10.3)%
    Income taxes                            -          -       -         n/a
    Net loss                          (108.4)    (120.9)    12.5     (10.3)%
    Net loss attributable to:
    Owners of the parent               (89.1)    (100.8)    11.7     (11.6)%
    Non-controlling interests          (19.3)     (20.1)     0.8      (4.0)%


n/m: not meaningful

n/a: not applicable


EXHIBIT 2

EURO DISNEY S.C.A.

Fiscal Year 2013

First Half Results

Six Months Ended March 31, 2013

CONSOLIDATED SEGMENT STATEMENT OF INCOME

Resort operating segment

                                          First Half           Variance
    (EUR in millions, unaudited)         2013       2012  Amount           %

    Revenues                            561.1      551.1    10.0        1.8%
    Costs and expenses                (644.1)    (635.9)   (8.2)        1.3%
    Operating margin                   (83.0)     (84.8)     1.8      (2.1)%
    Net financial charges              (25.8)     (36.0)    10.2     (28.3)%
    Loss from equity investments        (0.1)      (0.2)     0.1         n/m
    Loss before taxes                 (108.9)    (121.0)    12.1     (10.0)%
    Income taxes                            -          -       -         n/a
    Net loss                          (108.9)    (121.0)    12.1     (10.0)%


n/m: not meaningful.

n/a: not applicable.

Real estate development operating segment

                                        First Half        Variance
    (EUR in millions, unaudited)       2013     2012  Amount          %

    Revenues                            6.6      1.3     5.3        n/m
    Costs and expenses                (6.1)    (1.2)   (4.9)        n/m
    Operating margin                    0.5      0.1     0.4        n/m
    Net financial charges                 -        -       -        n/a
    Loss from equity investments          -        -       -        n/a
    Income before taxes                 0.5      0.1     0.4        n/m
    Income taxes                          -        -       -        n/a
    Net profit                          0.5      0.1     0.4        n/m


n/m: not meaningful.

n/a: not applicable.


EXHIBIT 3

EURO DISNEY S.C.A.

Fiscal Year 2013

First Half Results

Six Months Ended March 31, 2013

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

                                                           September 30,
    (EUR in millions)                     March 31, 2013            2012
                                             (unaudited)
    Non-current assets
    Property, plant and equipment, net           1,824.4         1,860.8
    Investment property                             14.2            14.2
    Intangible assets                               33.9            36.1
    Restricted cash                                 14.9            21.3
    Other                                           17.0             8.9
                                                 1,904.4         1,941.3
    Current assets
    Inventories                                     43.2            38.7
    Trade and other receivables                    107.8           116.8
    Cash and cash equivalents                       68.7           114.3
    Other                                           21.4            24.8
                                                   241.1           294.6
    Total assets                                 2,145.5         2,235.9

    Equity attributable to owners of the
    parent
    Share capital                                   39.0            39.0
    Share premium                                1,627.3         1,627.3
    Accumulated deficit                        (1,748.5)       (1,659.4)
    Other                                          (8.1)          (15.7)
    Total equity attributable to owners
    of the parent                                 (90.3)           (8.8)

    Non-controlling interests                     (14.9)             2.7
    Total equity                                 (105.2)           (6.1)
    Non-current liabilities


    Borrowings                                 1,709.2       1,709.3
    Deferred income                               15.4          15.6
    Provisions                                    11.4          12.3
    Other                                         49.6          51.8
                                               1,785.6       1,789.0
    Current liabilities
    Trade and other payables                     281.9         331.7
    Borrowings                                    31.7           1.7
    Deferred income                              150.5         112.3
    Other                                          1.0           7.3
                                                 465.1         453.0
    Total liabilities                          2,250.7       2,242.0
    Total equity and liabilities               2,145.5       2,235.9



EXHIBIT 4

EURO DISNEY S.C.A.

Fiscal Year 2013

First Half Results

Six Months Ended March 31, 2013

CONSOLIDATED STATEMENT OF CASH FLOWS

                                                                First Half
    (EUR in millions, unaudited)                               2013       2012

    Net loss                                                (108.4)    (120.9)
    Items not requiring cash outlays or with no impact on
    working capital:
    - Depreciation and amortization                            85.6       86.4
    - Net increase in valuation and reserve allowances          2.9        3.0
    - Other                                                   (0.3)        1.3

    Net change in working capital account balances:
    - Change in receivables, deferred income and other
    assets                                                     52.9       37.1
    - Change in inventories                                   (5.2)      (1.7)
    - Change in payables, prepaid expenses and other
    liabilities                                              (47.3)        7.1
    Cash flow (used in) / generated by operating
    activities                                               (19.8)       12.3

    Capital expenditures for tangible and intangible
    assets                                                   (50.3)     (81.9)
    Increase in equity investments                            (1.9)      (1.9)
    Cash flow used in investing activities                   (52.2)     (83.8)

    Net (purchases) / sales of treasury shares                (0.2)        0.1
    Cash proceeds from TWDC standby revolving credit
    facility                                                   30.0          -
    Repayment of borrowings                                   (0.1)     (64.3)
    Payment of costs incurred during the 2012 refinancing     (3.3)          -
    Cash flow generated by / (used in) financing
    activities                                                 26.4     (64.2)

    Change in cash and cash equivalents                      (45.6)    (135.7)
    Cash and cash equivalents, beginning of period            114.3      366.1
    Cash and cash equivalents, end of period                   68.7      230.4


SUPPLEMENTAL CASH FLOW INFORMATION

                                                                 First Half
    (EUR in millions, unaudited)                                2013     2012
    Supplemental cash flow information:
    Interest paid                                               33.5     21.2



EXHIBIT 5

EURO DISNEY S.C.A.

Fiscal Year 2013

First Half Results

Six Months Ended March 31, 2013

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

                                          Net loss
                                             for
                              September   the First                  March 31,
    (EUR in millions)          30, 2012     Half         Other            2013
                                         (unaudited)  (unaudited)  (unaudited)
    Equity attributable to
    owners of the parent
    Share capital                  39.0            -            -         39.0
    Share premium               1,627.3            -            -      1,627.3
    Accumulated deficit       (1,659.4)       (89.1)            -    (1,748.5)
    Other                        (15.7)            -          7.6        (8.1)
    Total equity
    attributable to owners
    of the parent                 (8.8)       (89.1)          7.6       (90.3)

    Non-controlling
    interests                       2.7       (19.3)          1.7       (14.9)

    Total equity                  (6.1)      (108.4)          9.3      (105.2)


EXHIBIT 6

STATEMENT OF CHANGES IN BORROWINGS

                                           First Half 2013 (unaudited)
                            September                                         March 31,
    (EUR in millions)        30, 2012  Increase    Decrease     Transfers         2013
                                                                            (unaudited)
    TWDC Loans                1,231.8         -           -             -      1,231.8
    Promissory Note with DEI    268.7         -           -             -        268.7
    Promissory Note with Euro
    Disney S.A.S.                92.7         -           -             -         92.7
    TWDC - Centre de congrès     15.9         -           -             -         15.9
    TWDC EUR 100 million
    revolving credit facility   100.0         -           -             -        100.0
    TWDC loans                1,709.1         -           -             -      1,709.1
    Financial lease               0.2         -           -         (0.1)          0.1
    Non-current borrowings    1,709.3         -           -         (0.1)      1,709.2
    TWDC - Centre de congrès      1.4         -           -             -          1.4
    TWDC EUR 250 million
    revolving credit facility       -      30.0 (1)       -             -         30.0
    TWDC Loans                    1.4      30.0           -             -         31.4
    Financial Lease               0.3         -       (0.1)           0.1          0.3
    Current borrowings            1.7      30.0       (0.1)           0.1         31.7
    Total borrowings          1,711.0      30.0       (0.1)             -      1,740.9


Amount drawn in the First Half from the € 250 million standby revolving credit facility granted by TWDC to the Group.

EXHIBIT 7

EURO DISNEY S.C.A.

Fiscal Year 2013

First Half Results

Six Months Ended March 31, 2013

DEFINITIONS

EBITDA corresponds to earnings before interest, taxes, depreciation and amortization. EBITDA is not a measure of financial performance defined under IFRS, and should not be viewed as a substitute for operating margin, net profit / (loss) or operating cash flows in evaluating the Group's financial results. However, management believes that EBITDA is a useful tool for evaluating the Group's performance.

Free cash flow is cash generated by operating activities less cash used in investing activities. Free cash flow is not a measure of financial performance defined under IFRS, and should not be viewed as a substitute for operating margin, net profit / (loss) or operating cash flows in evaluating the Group's financial results. However, management believes that Free cash flow is a useful tool for evaluating the Group's performance.

Theme parks attendance corresponds to the attendance recorded on a "first click" basis, meaning that a person visiting both parks in a single day is counted as only one visitor.

Average spending per guest is the average daily admission price and spending on food, beverage and merchandise and other services sold in the theme parks, excluding value added tax.

Hotel occupancy rate is the average daily rooms occupied as a percentage of total room inventory (total room inventory is approximately 5,800 rooms).

Average spending per room is the average daily room price and spending on food, beverage and merchandise and other services sold in hotels, excluding value added tax.

--------------------------------------------------

1. Please refer to Exhibit 7 for the definition of EBITDA, Free cash flow and key operating statistics.

2. Please refer to note 12.1. "TWDC Debt" of the Group's 2012 consolidated financial statements, included in the Group's 2012 Reference Document.

3. Disney Light'Ears will be sold beginning in summer 2013 at select locations throughout Disneyland Paris and online.

Press Contact
Laurent Manologlou
Tel: +331-64-74-59-50
Fax: +331-64-74-59-69
e-mail: laurent.manologlou@disney.com
   
Corporate Communication
François Banon
Tel: +331-64-74-59-50
Fax: +331-64-74-59-69
e-mail: francois.banon@disney.com

Investor Relations
Olivier Lambert
Tel: +331-64-74-58-55
Fax: +331-64-74-56-36
e-mail: olivier.lambert@disney.com

SOURCE Euro Disney S.C.A.



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