Euro Dis­ney’s magic re­turns as it fore­casts full re­cov­ery by 2021

The Daily Telegraph - Business - - Business - By Chris­tian Sylt

THEME park op­er­a­tor Euro Dis­ney has fore­cast that it is on track to make a full re­cov­ery by 2021 fol­low­ing the ter­ror­ist at­tacks in France over the past two years.

It is the magic touch that the re­sort on the out­skirts of Paris is look­ing for as a big year comes to a close. In March it cel­e­brated its 25th an­niver­sary and three months later me­dia gi­ant the Walt Dis­ney Com­pany took full own­er­ship of what is Europe’s most pop­u­lar tourist at­trac­tion in a €2-a-share of­fer.

Some 49pc of the park’s vis­i­tors come from France, fol­lowed by Bri­tain, which pro­vided 17pc of the to­tal. How­ever, at­ten­dance is down from a peak of 16m in 2012 to 13.4m last year, down 9.5pc on 2015, due to the cloud over the tourism in­dus­try in France. In turn, rev­enue for the year end­ing Sept 30 2016 dropped 7pc to €1.3bn (£1.2bn) while costs rose 5pc, driven by in­vest­ment ahead of the an­niver­sary and ris­ing salar­ies and se­cu­rity costs. It left it with an un­der­ly­ing loss of €34m but the clouds are start­ing to clear.

In the six months to March 31 2017 at­ten­dance rose 5pc on the same pe­riod the pre­vi­ous year with rev­enue in­creas­ing €19m to €623m and oc­cu­pancy up three per­cent­age points to 81pc. Doc­u­ments filed in connection with the takeover state that “the full re­cov­ery fol­low­ing Novem­ber 2015 events in Paris (in terms of vol­umes and rev­enues) is ex­pected by FY2021”.

It has got off to a strong start as Dis­ney is back­ing a €1.5bn share re­cap­i­tal­i­sa­tion and will use the ma­jor­ity of the pro­ceeds to re­pay debt. Euro Dis­ney’s clas­sic at­trac­tions such as its Star Wars sim­u­la­tor have been up­dated for its birth­day, while the site plans next year to pre­miere per­for­mances by comic book char­ac­ters such as Spi­der-Man and Iron Man from Marvel En­ter­tain­ment, which was ac­quired by Dis­ney for $4bn in 2009.

“The 25th an­niver­sary clearly is res­onat­ing,” says Peter Welch, VP of mar­ket­ing and sales for Dis­ney­land Paris in the UK and Ire­land. “There’s the in­vest­ment in the shows, the pa­rade and, like any busi­ness, it’s prob­a­bly not one fac­tor. When the stars are aligned you get a mo­men­tum and we def­i­nitely have that with the UK mar­ket.”

Tes­ti­mony to this, Euro Dis­ney’s half year re­sults state that the boost in at­ten­dance was due to more guests vis­it­ing from the UK and France, par­tially off­set by fewer from Bel­gium.

Brexit could even play into Euro Dis­ney’s hands as it buys more from UK firms than those in any coun­try out­side France, ac­count­ing for 30pc of its an­nual €77.5m spend­ing on sup­pli­ers.

Dis­ney­land Paris marked its 25th an­niver­sary this year

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