EURO DISNEY S.C.A. Reports 2012 Annual Results

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 for its consolidated group (the "Group") for the fiscal year 2012 which ended September 30, 2012 (the "Fiscal Year")[1].

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 for its consolidated group (the "Group") for the fiscal year 2012 which ended September 30, 2012 (the "Fiscal Year")^[1].

Key Operating Statistics  ^[2]

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1.  The Group's consolidated financial accounts for Fiscal Year 2012 were reviewed by the Gérant on November 7, 2012.

2.  Please refer to Exhibit 8 for a definition of EBITDA, Free cash flow and key operating statistics.

 

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

"Fiscal year 2012 was marked by key milestones in Euro Disney's history. First, our 20^th Anniversary celebration drove unprecedented awareness across Europe and contributed to our performance in the second semester with a 5% growth in our resort revenues. Second, with the support of The Walt Disney Company, the Group significantly improved its debt profile with a €1.3 billion refinancing transaction.

We reached a record 16 million in attendance, reflecting the sound fundamentals of our business, core strategies and strong appeal of our product, in a still challenging economic context. The increase in guest satisfaction and business growth we see today are the early returns on the investments made both in our assets and our Cast over the last 18 months.

Fiscal Year 2012 marked a new chapter for Disneyland Paris. We are confident in our ability to build, together with our Cast Members, on our successes to further develop the Resort, drive business growth and reach sustainable profitability in the coming years."

2012 Refinancing of the Group

On September 18, 2012, the Group announced the refinancing of its debt, excluding debt already extended by The Walt Disney Company ("TWDC"), with new financing provided by TWDC and two of its French subsidiaries, for an overall amount of € 1,332 million (the "2012 Refinancing"). The 2012 Refinancing was completed on September 27, 2012. With this refinancing, the Group's average interest rate on its debt decreases meaningfully and the Group benefits from greater operational flexibility by removing the restrictive covenants under previously existing debt agreements, notably those related to restrictions on capital expenditures. Moreover, the extended debt maturity combined with a more gradual debt repayment schedule and a final repayment in 2030 will better position the Group to invest in long-term growth and drive value for all shareholders.  

For more information on the 2012 Refinancing, refer to the press releases issued on September 18, 2012 and on September 27, 2012, available on the Company's website.

Revenues by Operating Segment

Resort operating segment revenues increased by € 43.3 million to € 1,315.0 million from € 1,271.7 million in the prior year.

Theme parks revenues increased 4% to € 750.5 million from € 723.2 million in the prior year due to a 3% increase in attendance to 16.0 million, combined with a 1% increase in average spending per guest to € 46.44. The increase in attendance was due to more guests visiting from France and Belgium, partly offset by fewer guests from Spain, Italy and the Netherlands. The increase in average spending per guest resulted from higher spending on merchandise and food and beverage, partly offset by lower spending on admissions.

Hotels and Disney Village^® revenues increased 2% to € 518.6 million from € 510.8 million in the prior year due to a 6% increase in average spending per room to € 231.33, partly offset by a 3.1 percentage point decrease in hotel occupancy to 84.0%. The increase in average spending per room resulted from higher daily room rates, partly offset by lower spending on food and beverage. The decrease in hotel occupancy resulted from 60,000 fewer room nights sold compared to the prior year due to fewer guests visiting from our foreign markets, as well as lower business group activity, partly offset by more French guests staying overnight.

Other revenues increased by € 8.2 million to € 45.9 million from € 37.7 million in the prior year, due to higher revenues from travel services sold to guests and higher sponsorship revenues.

Real estate development operating segment revenues decreased by € 13.2 million to € 9.3 million from € 22.5 million in the prior year due to a lower number of transactions closed during the Fiscal Year compared with the prior year. Given the nature of the Group's real estate development activity, the number and size of transactions vary from one year to the next.

Costs and Expenses

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, royalties and management fees were € 76.8 million and € 74.2 million, respectively.

Direct operating costs increased by € 25.4 million compared to the prior year, mainly due to labor rate inflation and volume-related Resort operating segment costs, partly offset by reduced costs associated with lower real estate development activity.

Marketing and sales expenses increased by € 7.4 million compared to the prior year, driven by additional media initiatives and increased sales activities.

General and administrative expenses increased by € 5.4 million compared to the prior year due to labor rate inflation as well as increased companywide human resources initiatives and higher IT project spending.

Net Financial Charges

n/a: not applicable.

 

Financial expense, excluding the impact of the 2012 Refinancing, decreased by € 4.2 million driven by lower average borrowings compared to the prior year, as well as higher interest capitalized as part of the construction cost of long-lived assets.

The net financial expense linked to the 2012 Refinancing amounted to € 32.0 million. This amount was composed of costs related to the exercise of the Group's options to purchase assets of the Disneyland^® Park and the underlying land, as well as five hotels and the Disney Village^®, which were previously leased. These costs were partly offset by a net gain on the debt extinguishment. These impacts are detailed in the following table:

Net Loss

For the Fiscal Year, the Group's net loss amounted to € 100.2 million, compared to a net loss of € 63.9 million for the prior year. The € 36.3 million increase in the Group's net loss compared to the prior year was primarily due to the net impact of the 2012 Refinancing. Net loss attributable to owners of the parent and non-controlling interests amounted to € 85.6 million and € 14.6 million, respectively.

Cash Flows

Cash and cash equivalents as of September 30, 2012 were € 114.3 million, down € 251.8 million compared to September 30, 2011.

Free cash flow used for the Fiscal Year was € 9.3 million compared to € 89.1 million generated in the prior year.

Cash generated by operating activities for the Fiscal Year totaled € 142.7 million compared to € 168.7 million generated in the prior year. This decrease resulted from higher working capital requirements mainly due to the timing impacts related to the 2012 Refinancing, notably accrued interest on the refinanced debt paid in September 2012 which was initially scheduled to be paid in fiscal year 2013 and thereafter. Partly offsetting this timing impact, the Group benefitted from lower working capital requirements related to real estate activity and to the additional deferral into long-term debt of € 8.9 million of prior-year royalties.

Cash used in investing activities for the Fiscal Year totaled € 152.0 million, compared to € 79.6 million in the prior year. This increase mainly reflected investments related to a multi-year expansion of the Walt Disney Studios^® Park, which includes a new attraction, and investments to enhance the overall guest experience for Disneyland^®Paris' 20^th Anniversary celebration.

Cash used in financing activities for the Fiscal Year totaled € 242.5 million, compared to € 123.3 million used in the prior fiscal year. This increase mainly reflected scheduled repayment of bank borrowings made by the Group until the 2012 Refinancing, as well as the cash impacts of the 2012 Refinancing.

Update on Recent and Upcoming Events

20^th Anniversary celebration

The celebration of Disneyland^®Paris' 20^th Anniversary launched in April. This event features a number of brand new guest experiences, including Disney Dreams^®!, a nighttime spectacular which has achieved one of the highest satisfaction ratings ever for a show or an attraction.

Scheduled Debt Repayments

The Group plans to repay € 1.4 million of its debt with TWDC in fiscal year 2013, consistent with the new scheduled maturities agreed as part of the 2012 Refinancing.

Villages Nature

The Villages Nature project, developed through a 50% joint venture with Groupe Pierre & Vacances - Center Parcs, cleared several stages of its development in the past several months, including: receipt of building permits for the first tranche of 857 apartments and cottages, the majority of the facilities; and the necessary authorizations from the regional prefect. The sales launch to individual investors is expected to begin in the first semester of fiscal year 2013 with opening to the public planned in 2016.

Results Webcast: November 8, 2012 at 11:00 CET

To connect to the webcast and consult the analyst presentations of the fiscal year 2012 results:

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

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 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 Statements of Changes in Equity
Exhibit 6 - Statement of Changes in Borrowings
Exhibit 7 - Consolidated Semestrial Statements of Income
Exhibit 8 - Definitions

EXHIBIT 1

EURO DISNEY S.C.A.

Fiscal Year 2012 Results Announcement

Consolidated Statements of Income

n/m: not meaningful.

n/a: not applicable.

EXHIBIT 2

EURO DISNEY S.C.A.

Fiscal Year 2012 Results Announcement

Consolidated Segment Statements of Income

Resort operating segment

 n/m: not meaningful.

 n/a: not applicable.

 

Real estate development operating segment

n/m: not meaningful.

n/a: not applicable.

EXHIBIT 3

EURO DISNEY S.C.A.

Fiscal Year 2012 Results Announcement

Consolidated Statements of Financial Position

EXHIBIT 4

EURO DISNEY S.C.A.

Fiscal Year 2012 Results Announcement

Consolidated Statements of Cash Flows

Supplemental Cash Flow Information

 

EXHIBIT 5

EURO DISNEY S.C.A.

Fiscal Year 2012 Results Announcement

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

EXHIBIT 6

STATEMENT OF CHANGES IN BORROWINGS

 

EXHIBIT 7

EURO DISNEY S.C.A.

Fiscal Year 2012 Results Announcement

Consolidated Semestrial Statements of Income

First Half

n/m: not meaningful.

n/a: not applicable.

Second Half

n/m: not meaningful.

n/a: not applicable.

EXHIBIT 8

EURO DISNEY S.C.A.

Fiscal Year 2012 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 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, merchandise and other services sold in hotels, excluding value added tax.

Press Contact
Laurent Manologlou
Tel: +331-64-74-59-50
Fax: +331-64-74-59-69
e-mail: [email protected]

Investor Relations
Olivier Lambert
Tel: +331-64-74-58-55
Fax: +331-64-74-56-36
e-mail: [email protected]

Corporate Communication
François Banon
Tel: +331-64-74-59-50
Fax: +331-64-74-59-69
e-mail: [email protected]