Euro Disney S.C.A.: Reports Fiscal Year 2010 Results
By Euro Disney S.c.a., PRNETuesday, November 9, 2010
Resort Revenues Were Stable at EUR 1.2 billion, With Higher Guest Spending in the Parks and Hotels Offsetting Lower Attendance and Hotel Occupancy
MARNE-LA-VALLEE, France, November 10, 2010 - Euro Disney S.C.A. (the "Company"), parent company of Euro
Disney Associes S.C.A. ("EDA"), operator of Disneyland(R) Paris, reported
today the results for its consolidated group (the "Group") for the fiscal
year 2010 which ended September 30, 2010 (the "Fiscal Year").[1]
Key Financial Highlights Fiscal Year
(EUR in millions, unaudited) 2010 2009 2008
Revenues 1,275.9 1,230.6 1,324.5
Costs and expenses (1,241.8) (1,204.2) (1,234.0)
Operating margin 34.1 26.4 90.5
Plus: Depreciation and amortization 167.4 160.8 159.0
EBITDA 1 201.5 187.2 249.5
EBITDA as a percentage of revenues 15.8% 15.2% 18.8%
Net (loss) / profit (45.2) (63.0) 1.7
Attributable to equity holders of
the parent (39.9) (55.5) (2.8)
Attributable to minority interests (5.3) (7.5) 4.5
Cash flow generated by operating
activities 236.7 124.1 178.3
Cash flow used in investing
activities (86.8) (72.1) (72.4)
Free cash flow generated 1 149.9 52.0 105.9
Cash and cash equivalents, end of
period 400.3 340.3 374.3
Key Operating Statistics (1) Fiscal Year
2010 2009 2008
Theme parks attendance (in millions) 15.0 15.4 15.3
Average spending per guest (in EUR) 45.30 44.22 46.32
Hotel occupancy rate 85.4% 87.3% 90.9%
Average spending per room (in EUR) 209.78 201.24 211.39
Commenting on the results, Philippe Gas, Chief Executive
Officer of Euro Disney S.A.S, said:
"In a year marked by the difficult economic context and
challenging travel conditions, we achieved 15 million in attendance at our
parks and 85% occupancy in our hotels, remaining Europe's number one tourist
destination. Resort revenues were stable versus the prior-year, as an
increase in guest spending offset lower attendance and occupancy. Total
revenues ended the year up 4%, reflecting increased real estate revenues from
a property sale in Val d'Europe.
During our second semester, we launched Disney's New
Generation Festival and saw a marked improvement in both attendance and hotel
occupancy, while growing guest spending. In August, we opened Toy Story
Playland, with three new attractions in the Walt Disney Studios Park,
bringing the magic of these popular Toy Story films to life. Iconic
Disney-themed attractions and entertainment, together with great guest
service delivered by our Cast Members, continue to create magical moments for
our guests.
On September 14, we signed an important amendment to our
existing partnership agreement with the State and other public parties, which
outlines the future development of Disneyland Paris and the town of Val
d'Europe. This amendment marks a significant milestone in the history of our
company, and enhances our ability to further develop the Resort and
surrounding area over the next twenty years."
Revenues by Operating Segment
Fiscal Year Variance
(EUR in millions, unaudited) 2010 2009 Amount %
Theme parks 685.3 688.2 (2.9) (0.4)%
Hotels and Disney(R) Village 480.2 474.7 5.5 1.2%
Other 50.6 49.8 0.8 1.6%
Resort operating segment 1,216.1 1,212.7 3.4 0.3%
Real estate development
operating segment 59.8 17.9 41.9 >100%
Total revenues 1,275.9 1,230.6 45.3 3.7%
Resort operating segment revenues of EUR 1,216.1 million were
slightly up compared to the prior-year period.
Theme parks revenues declined by EUR 2.9 million to EUR 685.3
million from EUR 688.2 million in the prior-year period, primarily resulting
from a 3% decrease in attendance. The decrease in attendance reflected fewer
guests visiting from the United Kingdom, Belgium and the Netherlands,
partially offset by more guests visiting from France. This decline in
attendance was partially compensated by a 2% increase in average spending per
guest, due to higher spending on admissions and food and beverage.
Hotels and Disney(R) Village revenues increased by EUR 5.5
million to EUR 480.2 million from EUR 474.7 million in the prior-year period,
primarily due to a 4% increase in average spending per room. The increase in
average spending per room reflected higher daily room rates and spending on
food and beverage. This increase in average spending per room was partially
compensated by a 1.9 percentage point decrease in hotel occupancy, resulting
from 40,000 fewer room nights compared to the prior-year period. This
decrease was driven by fewer guests visiting from the United Kingdom and
lower group activity, partially neutralized by more French and Spanish guests
staying overnight.
Other revenues, which include participant sponsorships,
transportation and other travel services sold to guests, slightly increased
to EUR 50.6 million.
Real estate development operating segment revenues increased
by EUR 41.9 million from the prior-year period, as the Group recognized EUR
47 million for the sale of a property on which the Val d'Europe mall is
located. This property had been subject to a long-term ground lease. The
positive impact of this transaction was partially offset by lower revenues
from the remaining transactions, as the other projects this year were less
significant than those of the prior-year.
Costs and Expenses
Fiscal Year Variance
(EUR in millions,
unaudited) 2010 2009 Amount %
Direct operating costs
(1) 1,008.8 976.0 32.8 3.4%
Marketing and sales
expenses 129.5 127.8 1.7 1.3%
General and
administrative expenses 103.5 100.4 3.1 3.1%
Costs and expenses 1,241.8 1,204.2 37.6 3.1%
(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
Fiscal Year and the corresponding prior-year period, royalties and management
fees were EUR 71.7 million and EUR 71.3 million, respectively.
Direct Operating Costs increasedEUR 32.8 million compared to
the prior-year period primarily due to higher cost of sales, notably related
to the property sale in Val d'Europe, and labor rate inflation. Partially
offsetting this increase were lower business taxes and volume related costs.
In fiscal years 2010 and 2009, the Group's Direct Operating Costs also
benefited from refunds of certain tax payments made in previous years, for
EUR 6.2 million and EUR 6.6 million net of legal fees, respectively.
Marketing and sales expenses increased EUR 1.7 million
compared to the prior-year period primarily due to costs related to new
system developments.
General and administrative expenses increased EUR 3.1 million
compared to the prior-year period mainly due to labor rate inflation.
Net Financial Charges
Fiscal Year Variance
(EUR in millions,
unaudited) 2010 2009 Amount %
Financial income 3.2 9.7 (6.5) (67.0)%
Financial expense (82.3) (98.9) 16.6 (16.8)%
Net financial charges (79.1) (89.2) 10.1 (11.3)%
Financial income decreased EUR 6.5 million due to lower
average short term interest rates.
Financial expense decreased EUR 16.6 million primarily due to
lower interest rates and average borrowings.
Net Loss
For the Fiscal Year, the Group's net loss amounted to EUR 45.2
million, compared to a net loss of EUR 63.0 million for the prior-year
period. Net losses attributable to equity holders of the parent and minority
interests amounted to EUR 39.9 million and EUR 5.3 million, respectively. The
decrease of the Group's net loss compared to the prior-year period primarily
reflects the property sale, while labor rate inflation was offset by lower
net financial charges and business tax expenses.
Cash flows
Cash and cash equivalents as of September 30, 2010 were EUR
400.3 million, up EUR 60.0 million compared to September 30, 2009.
Fiscal Year Variance
(EUR in millions, unaudited) 2010 2009
Cash flow generated by operating activities 236.7 124.1 112.6
Cash flow used in investing activities (86.8) (72.1) (14.7)
Free cash flow generated 149.9 52.0 97.9
Cash flow used in financing activities (89.9) (86.0) (3.9)
Change in cash and cash equivalents 60.0 (34.0) 94.0
Cash and cash equivalents, beginning of
period 340.3 374.3 (34.0)
Cash and cash equivalents, end of period 400.3 340.3 60.0
Free cash flow generated for the Fiscal Year was EUR 149.9
million compared to EUR 52.0 million in the prior-year period.
Cash generated by operating activities for the Fiscal Year
totaled EUR 236.7 million compared to EUR 124.1 million generated in the
prior-year period. This improvement resulted from lower working capital
requirements and cash proceeds from the property sale. Changes in working
capital were driven by the deferrals into long-term debt of EUR 70.2 million
of royalties, management fees and interest with respect to fiscal year 2009.
Only EUR 25 million of royalties and management fees were deferred with
respect to fiscal year 2008, as the remaining amounts incurred were paid in
fiscal year 2009.
Cash used in investing activities for the Fiscal Year totaled
EUR 86.8 million compared to EUR 72.1 million used in the prior-year period.
This increase was driven by the investment in Toy Story Playland, which
opened in August 2010.
Cash used in financing activities for the Fiscal Year totaled
EUR 89.9 million compared to EUR 86.0 million used in the prior-year period.
This increase reflects the scheduled repayment of bank borrowings made by the
Group during the Fiscal Year.
The Group must respect certain financial covenant requirements
under its debt agreements[2] and believes it has complied with these
requirements for the Fiscal Year.
The Group also has defined annual performance objectives. In
the Fiscal Year, the Group did not meet its performance objectives and must
defer the following amounts incurred in the Fiscal Year into long-term
subordinated debt:
- EUR 25.0 million of the Fiscal Year royalties and management
fees due to The Walt Disney Company ("TWDC"), and
- EUR 15.1 million of interest due to the Caisse des depots et
consignations ("CDC").
The Group is also required to defer an additional EUR 5.1
million of interest that will be incurred, and otherwise payable to the CDC,
during the first quarter of fiscal year 2011.
As a result of utilizing the entire EUR 45.2 million of
deferrals available to the Group with respect to the Fiscal Year, the Group
must agree with the agent banks of the Group's lenders on the method to
calculate the recurring annual investment budget for fiscal year 2011 and
thereafter. If no agreement is reached, the recurring annual investment
budget will be reduced, principally from 5% to 3% of the prior fiscal year's
adjusted consolidated revenues[3]. For fiscal year 2011, the impact of using
this different method would lower the Group's recurring investment budget by
approximately EUR 25 million.
For fiscal year 2011, if compliance with financial performance
covenants cannot be achieved, the Group will have to appropriately reduce
operating costs, curtail a portion of planned capital expenditures, sell
assets and/or seek assistance from TWDC or other parties as permitted under
the debt agreements. Although no assurances can be given, management believes
the Group has adequate cash and liquidity for the foreseeable future based on
existing cash position, liquidity from the EUR 100.0 million line of credit
available from TWDC and the benefit of additional conditional deferrals.
Update on recent and upcoming events
Amendment to the Main Agreement
On September 14, 2010, the Group signed an amendment to the
main agreement entered into between TWDC, the French State and certain other
French public authorities on March 24, 1987, for the creation and the
operation of Disneyland(R) Paris (the "Main Agreement"). This amendment
extends the duration of the Main Agreement from 2017 to 2030, and reflects
the Group's significant and growing contributions to the Ile-de-France region
and the overall French tourism industry. In addition to the development of
the tourist destination, the amendment provides for updated land entitlements
from those included in the Main Agreement and will allow for a more relevant
urban development of Val d'Europe.
The amendment to the Main Agreement also allows the Group to
develop, in partnership with Groupe Pierre & Vacances Center Parcs, Les
Villages Nature de Val d'Europe, an innovative eco-tourism project which will
constitute, in its design as well as in its operating mode, a unique model of
sustainable development for tourism. This project is expected to be developed
in phases over the duration of the Main Agreement.
For more information on this amendment, please refer to the
press release issued on September 14, 2010 and available on the Company's
website.
Scheduled Debt Repayments
The Group plans to repay EUR 123.4 million of its borrowings
in fiscal year 2011, consistent with the scheduled maturities.
Results Webcast: November 10, 2010 at 11:00 CET
To connect to the webcast:
corporate.disneylandparis.com/investor-relations/publications/index.xh
tml
(Due to the length of this URL, it may be necessary to copy and paste
this hyperlink into your Internet browser's URL address field. Remove the
space if one exists.)
Additional Financial Information can be found on the Internet
at corporate.disneylandparis.com
Code ISIN: FR0010540740
Code Reuters: EDL.PA
Code Bloomberg: EDL FP
The Group operates Disneyland(R) Paris which includes:
Disneyland(R) Park, Walt Disney Studios(R) Park, seven themed hotels with
approximately 5,800 rooms (excluding approximately 2,400 additional
third-party rooms located on the site), two convention centers, the Disney(R)
Village, a dining, shopping and entertainment centre, and a 27-hole golf
course. The Group's operating activities also include the development of the
approximately 2,200 hectare site, half of which is yet developed. Euro Disney
S.C.A.'s shares are listed and traded on Euronext Paris.
Attachments: Exhibit 1 - Consolidated Statements of Income
Exhibit 2 - Consolidated Segment Statements of Income
Exhibit 3 - Consolidated Statements of Financial Position
Exhibit 4 - Consolidated Statements 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 2010 Results Announcement
CONSOLIDATED STATEMENTS OF INCOME
Fiscal Year Variance
(EUR in millions, unaudited) 2010 2009 Amount %
Revenues 1,275.9 1,230.6 45.3 3.7%
Costs and expenses (1,241.8) (1,204.2) (37.6) 3.1%
Operating margin 34.1 26.4 7.7 29.2%
Net financial charges (79.1) (89.2) 10.1 (11.3)%
Loss from equity investments (0.2) (0.2) - -
Loss before taxes (45.2) (63.0) 17.8 (28.3)%
Income taxes - - - n/a
Net loss (45.2) (63.0) 17.8 (28.3)%
Net loss attributable to:
Equity holders of the parent (39.9) (55.5) 15.6 (28.1)%
Minority interests (5.3) (7.5) 2.2 (29.3)%
n/a: not applicable.
EXHIBIT 2
EURO DISNEY S.C.A.
Fiscal Year 2010 Results Announcement
CONSOLIDATED SEGMENT STATEMENTS OF INCOME
Resort operating segment
Fiscal Year Variance
(EUR in millions, unaudited) 2010 2009 Amount %
Revenues 1,216.1 1,212.7 3.4 0.3%
Costs and expenses (1,208.5) (1,195.4) (13.1) 1.1%
Operating margin 7.6 17.3 (9.7) n/m
Net financial charges (79.1) (89.4) 10.3 (11.5)%
Gain from equity investments - 0.1 (0.1) n/m
Loss before taxes (71.5) (72.0) 0.5 (0.7)%
Income taxes - - - n/a
Net loss (71.5) (72.0) 0.5 (0.7)%
n/m: not meaningful.
n/a: not applicable.
Real estate development operating segment
Fiscal Year Variance
(EUR in millions, unaudited) 2010 2009 Amount %
Revenues 59.8 17.9 41.9 >100%
Costs and expenses (33.3) (8.8) (24.5) >100%
Operating margin 26.5 9.1 17.4 >100%
Net financial charges - 0.2 (0.2) n/m
Loss from equity investments (0.2) (0.3) 0.1 (33.3)%
Income before taxes 26.3 9.0 17.3 >100%
Income taxes - - - n/a
Net profit 26.3 9.0 17.3 >100%
n/m: not meaningful.
n/a: not applicable.
EXHIBIT 3
EURO DISNEY S.C.A.
Fiscal Year 2010 Results Announcement
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
September 30,
(EUR in millions, unaudited) 2010 2009
Non-current assets
Property, plant and equipment 1,974.4 2,035.5
Investment property 14.8 39.7
Intangible assets 48.1 54.2
Restricted cash 74.6 70.2
Other 12.6 13.2
2,124.5 2,212.8
Current assets
Inventories 29.2 35.6
Trade and other receivables 116.3 111.8
Cash and cash equivalents 400.3 340.3
Other 15.5 14.6
561.3 502.3
Total assets 2,685.8 2,715.1
Shareholders' equity
Share capital 39.0 39.0
Share premium 1,627.3 1,627.3
Accumulated deficit (1,518.4) (1,478.5)
Other (6.6) (1.2)
Total shareholders' equity 141.3 186.6
Minority interests 94.0 100.4
Total equity 235.3 287.0
Non-current liabilities
Borrowings 1,811.7 1,880.3
Deferred revenues 10.6 29.1
Provisions 17.7 17.5
Other 72.4 63.4
1,912.4 1,990.3
Current liabilities
Trade and other payables 317.9 275.1
Borrowings 123.4 89.9
Deferred revenues 93.2 68.9
Other 3.6 3.9
538.1 437.8
Total liabilities 2,450.5 2,428.1
Total equity and liabilities 2,685.8 2,715.1
EXHIBIT 4
EURO DISNEY S.C.A.
Fiscal Year 2010 Results Announcement
CONSOLIDATED STATEMENTS OF Cash FlowS
Fiscal Year
(EUR in millions, unaudited) 2010 2009
Net loss (45.2) (63.0)
Items not requiring cash outlays or with no impact on
working capital:
- Depreciation and amortization 167.4 160.8
- Net book value of investment property sold 24.9 -
- Increase in valuation and reserve allowances 1.4 1.5
- Other 5.3 6.9
Net change in working capital account balances:
- Change in receivables, other assets and deferred income (4.2) 5.6
- Change in inventories 6.0 1.4
- Change in payables and other liabilities 81.1 10.9
Cash flow generated by operating activities 236.7 124.1
Capital expenditures for tangible and intangible assets (86.5) (71.8)
Increase in equity investments (0.3) (0.3)
Cash flow used in investing activities (86.8) (72.1)
Net sales / (purchases) of treasury shares - 0.2
Repayments of borrowings (89.9) (86.2)
Cash flow used in financing activities (89.9) (86.0)
Change in cash and cash equivalents 60.0 (34.0)
Cash and cash equivalents, beginning of period 340.3 374.3
Cash and cash equivalents, end of period 400.3 340.3
SUPPLEMENTAL CASH FLOW INFORMATION
Fiscal Year
(EUR in millions, unaudited) 2010 2009
Supplemental cash flow information:
Interest paid 48.5 77.5
Non-cash financing and investing transactions:
Deferral into borrowings of accrued interest under TWDC
and CDC subordinated loans 27.8 24.8
Deferral into borrowings of royalties and management fees 25.0 50.0
EXHIBIT 5
EURO DISNEY S.C.A.
Fiscal Year 2010 Results Announcement
CONSOLIDATED STATEMENT OF CHANGES IN Equity
Net loss for
(EUR in millions, September Fiscal Year September
unaudited) 30, 2009 2010 Other 30, 2010
Shareholders' equity
Share capital 39.0 - - 39.0
Share premium 1,627.3 - - 1,627.3
Accumulated deficit (1,478.5) (39.9) - (1,518.4)
Other (1.2) - (5.4) (6.6)
Total shareholders'
equity 186.6 (39.9) (5.4) 141.3
Minority interests 100.4 (5.3) (1.1) 94.0
Total equity 287.0 (45.2) (6.5) 235.3
EXHIBIT 6
STATEMENT OF CHANGES IN BORROWINGS
Fiscal Year 2010
(EUR in millions, September September
unaudited) 30, 2009 Increase Decrease Transfers(4) 30, 2010
CDC senior loans 238.9 - - (1.9) 237.0
CDC subordinated loans 776.8 23.4 (1) - (2.1) 798.1
Credit Facility -
Phase IA 96.6 1.2 (2) - (63.1) 34.7
Credit Facility -
Phase IB 69.0 0.7 (2) - (20.2) 49.5
Partner Advances -
Phase IA 304.9 - - (32.1) 272.8
Partner Advances -
Phase IB 89.8 0.1 (2) - (4.0) 85.9
TWDC loans 304.3 29.4 (3) - - 333.7
Non-current borrowings 1,880.3 54.8 - (123.4) 1,811.7
CDC senior loans 1.6 - (1.6) 1.9 1.9
CDC subordinated loans 1.8 - (1.8) 2.1 2.1
Credit Facility -
Phase IA 63.1 - (63.1) 63.1 63.1
Credit Facility -
Phase IB 20.2 - (20.2) 20.2 20.2
Partner Advances -
Phase IA - - - 32.1 32.1
Partner Advances -
Phase IB 3.2 - (3.2) 4.0 4.0
Current borrowings 89.9 - (89.9) 123.4 123.4
Total borrowings 1,970.2 54.8 (89.9) - 1,935.1
(1) Increase related to the contractual deferral of interests
on certain CDC subordinated loans, of which EUR 15.1 million is related to
the conditional deferral mechanism for the Fiscal Year, and EUR 5.1 million
is related to the conditional deferral mechanism for fiscal year 2009.
(2) Effective interest rate adjustment. As part of the 2005
Restructuring, these loans were significantly modified. In accordance with
IAS 39, the carrying value of this debt was replaced by the fair value after
modification. The effective interest rate adjustment has been calculated
reflecting an estimated market interest rate at the time of the modification
that was higher than the nominal rate.
(3) Increase related to the conditional deferral of EUR 25.0
million of royalties and management fees of the Fiscal Year and the
contractual deferral of interest on TWDC loans.
(4) Transfers from non-current borrowings to current
borrowings, based on the scheduled repayments over the next twelve months.
EXHIBIT 7
EURO DISNEY S.C.A.
Fiscal Year 2010 Results Announcement
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, merchandise and other services sold in
the theme parks, excluding value added tax.
Hotel occupancy rate is the average daily rooms sold 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, 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] For further detailed information, refer to the Group's
2009 reference document that was registered with the Autorité des marchés
financiers ("AMF") on January 28, 2010 under the number D.10-0030 and that is
available on the Company's website (corporate.disneylandparis.com) and
the AMF website (www.amf-france.org).
[3] Adjusted consolidated revenues correspond to consolidated
revenues under IFRS, excluding participant sponsorships and after removing
the effect of certain differences between IFRS and French accounting
principles.
Press Contact
Laurent Manologlou
Tel: +331-64-74-59-50
Fax: +331-64-74-59-69
e-mail: laurent.manologlou@disney.com
Investor Relations
Olivier Lambert
Tel: +331-64-74-58-55
Fax: +331-64-74-56-36
e-mail: olivier.lambert@disney.com
Corporate Communication
Jeff Archambault
Tel: +331-64-74-59-50
Fax: +331-64-74-59-69
e-mail: jeff.archambault@disney.com
Press Contact: Laurent Manologlou, Tel: +331-64-74-59-50, Fax: +331-64-74-59-69, e-mail: laurent.manologlou at disney.com. Investor Relations: Olivier Lambert, Tel: +331-64-74-58-55, Fax: +331-64-74-56-36, e-mail: olivier.lambert at disney.com. Corporate Communication, Jeff Archambault, Tel: +331-64-74-59-50, Fax: +331-64-74-59-69, e-mail: jeff.archambault at disney.com
Tags: Euro Disney S.c.a., France, Marne-la-vallée, November 10
