Euro Disney Reports Weaker First-Half Financials

[crazy4wdw]

From The Hollywood Reporter:

Euro Disney Reports Weaker First-Half Financials
3:03 AM PDT 5/6/2014 by Georg Szalai

The operator of the Disneyland Paris theme park, in which Walt Disney owns a 39.8 percent stake, posted lower revenue and a widened loss, citing "continued economic softness."


Euro Disney on Tuesday reported weaker financials for the first half of its fiscal year.

The operator of the Disneyland Paris theme park, in which the Walt Disney Co., owns a 39.8 percent stake, posted lower revenue and a widened loss for the six months period ended March 31, citing "continued economic softness."

The company reported a loss of $176 million (126.2 million euros) compared with a year-ago loss of $151 million (108.4 million euros). Revenue of $743 million (533.3 million) was down 6 percent.

Average spending per guest rose 2 percent to $65.23 (46.83 euros), but attendance declined from 6.7 million to 6.3 million.

The results "were again marked by the continued economic softness in Europe, as well as a shift of the Easter vacation period into the third quarter," said Euro Disney CEO Philippe Gas. "These elements drove lower resort volumes, which impacted our results."

However, he touted the increase in average guest spending and satisfaction: "This demonstrates the relevancy and consistency of our strategy of investing in the guest experience."

In July, the company will open a new attraction inspired by Pixar movie Ratatouille.

Saudi billionaire Prince Alwaleed owns a 10 percent stake in Euro Disney

 

[Michael623]

There are a couple of threads going on the DLP boards about all of the new attractions (Soarin, Toy story mania etc) they are supposedly getting. I really think it's fanboy, bluesky stuff because based on financials none of these things will ever happen. Based on my trips there, I'm surprised the Remy dark ride got the green light. I really don't think this place will ever be truly profitable.

 

[Girox]

The perfect place for an European park was South of Italy or Spain...
Too bad French weather!

 

[lockedoutlogic]

The perfect place for an European park was South of Italy or Spain...
Too bad French weather!

Eisner was insistent on France...drew the line on that one

 

[Grimbold]

I can understand why it was France as well however the weather isn't going to help it.

It is only a short journey from the UK. You can get there by train from London direct to DLP in 2 hours(ish).

It is right near Paris which is a major tourist centre so the premise would have been people taking day trips there whilst staying in Paris as well as people extending stays there to stay at the resort.

Paris is also a major travel hub. You have the airports, but you can also get to a lot of Europe by trian from Paris and therefore you are not reliant on people flying in.

However, it is expensive there.

I have booked for 2 weeks at BCR and is costign me £4k. That is with Deluxe dinning plan included as well.

To book a similar holiday to DLP would cost £3k for 2 weeks and £1.6k for 1 week. As there are only 2 parks there then the most you would stay any way is a few nights.
A 4 night stay is still just over £1k

So even though it is cheaper, it is a lot better value for us Brits and probably the rest of Europe to go to WDW for a long holiday.

 

[SWofDisorder]

My idea of fun is not running around a disney park in the cold and rain. Paris is lovely but the weather is not. Spain would have been a much better choice.

I bought shares to get into Salon Mickey which is a very nice room with a special feel but other than access to the club, the stock has lost over the years.

 

[luisov]

I think France was a good choice. Yeah, Spain and Italy have better weather, but perhaps they weren't economically and politically stable enough at the time, and it seems like that is quite an important feature for Disney to consider placing a park somewhere. Plus, the park is very accesible by other countries (Especifically the UK) and Paris receives tons of visitors every year.

I guess many tourists don't associate a Disney experience with Paris, and as a result many people don't even consider the park for their vacation. Many Americans probably think ''I can always go to Disney back home. On the other hand, I don't come to Europe all the time''

 

[anthony2k7]

"This demonstrates the relevancy and consistency of our strategy of investing in the guest experience."

Guest experience!? If he's being serious then that explains all thats wrong with Disney right now.

Before the new Remi ride, the last real e-ticket was I think tower of terror in 2008? Since then yes there is toy story play land, but none of those are good enough to draw in additional visitors. Other than dreams there has been no real investment. Meanwhile they've cut the fantillusion and the remaining shows.

I'm sure Remi will boost figures, but they really need continued investment after this.

 

[diamondpixienc]

Maybe they should offer some great deals to us here in the United States that we extend to our European and Canadian brothers. I would loooove to take my kids to DLP or any other Disney park outside of the US I've even priced it out a few times online and Free Dining alone would shave a significant amount off. Atleast off set the air fare some.

 

[anthony2k7]

Maybe they should offer some great deals to us here in the United States that we extend to our European and Canadian brothers. I would loooove to take my kids to DLP or any other Disney park outside of the US I've even priced it out a few times online and Free Dining alone would shave a significant amount off. Atleast off set the air fare some.

But why would you ever actually want to anyway? DLRP has very little to offer thats not at WDW (Crush's coaster and Dreams are all I can think of). If you want a change from WDW, then surely your first choice would be DLR?

 

[OnSpaceshipEarth]

I really don't think this place will ever be truly profitable.

What do *you* or anyone else that wants posit a theory think will eventually happen to DLPR? Do they have any kind of "out" in this mess. Does anyone think that it could eventually close?

 

[anthony2k7]

What do *you* or anyone else that wants posit a theory think will eventually happen to DLPR? Do they have any kind of "out" in this mess. Does anyone think that it could eventually close?

I think its unimaginable for it to ever close. The bad publicity it would give Disney, the actual operation aspect of just how you wind down something that big and also the political aspect of how negative that would be for the French government.

I wonder if its actually such a bad thing for Disney to be running DLRP at a loss? Financially it must be a mess, but with a significant amount of that debt being owned by Disney now anyway - well thats complicated. Plus I wonder if there is a tax benefit to this?

If Disney did see an urgent need to turn this around then they definitely have several options before the final option of closure. They currently have 7 of their own hotels servicing one and a half theme parks. I've no idea what the occupancy rates are but 7 hotels for 1.5 parks seems a little crazy. I think I recall previously they did shut one of the hotels for a while when their results were particularly bad. So maybe they should consider that again. The other fairly significant move they've got to do sooner or later is a major california adventure size project on WDS. Its only half a park currently. Build the other half!

 

[BudgieMama]

However, it is expensive there.

I have booked for 2 weeks at BCR and is costign me £4k. That is with Deluxe dinning plan included as well.

To book a similar holiday to DLP would cost £3k for 2 weeks and £1.6k for 1 week. As there are only 2 parks there then the most you would stay any way is a few nights.
A 4 night stay is still just over £1k

So even though it is cheaper, it is a lot better value for us Brits and probably the rest of Europe to go to WDW for a long holiday.

Bingo. Better value for us to do WDW for a week than DLRP. DH and I looked at doing a couple of nights there before we visit Florida this summer and couldn't believe the price. We could justify it for somewhere with 4 theme parks, 2 water parks and Disney Quest, but two parks? Nope. The prices are nasty for DLRP, at least for UK guests. Compared to the free dining and 40% discount that we got for our booking for WDW, DLRP don't seem to be trying to get guests.

 

[anthony2k7]

Bingo. Better value for us to do WDW for a week than DLRP. DH and I looked at doing a couple of nights there before we visit Florida this summer and couldn't believe the price. We could justify it for somewhere with 4 theme parks, 2 water parks and Disney Quest, but two parks? Nope. The prices are nasty for DLRP, at least for UK guests. Compared to the free dinging and 40% discount that we got for our booking for WDW, DLRP don't seem to be trying to get guests.

I think the costs are what they are because of the French labour laws and socialist way of life. Their minimum wage is one of the highest in europe and they have a maximum working week of 35 hours.

That hurts disney because of the amount they have to pay their unskilled workers, and because they have to have extra employees of its higher paid skilled workers because of the maximum working hours.

Plus remember that Disney is lucky to get through 6 months without some of the DLRP workers going on strike over something.

 

[Donut23]

People! People! Please!

You would fly all the way to the magnificant "City of Light" and go to a Disney Park?

Europe's......Paris specifically......distractions are far to wonderful to spend a second at a park we can visit back home.