- Euro Disney SCA

EURO DISNEY S.C.A.
Combined General Meeting
March 25, 2004
François Pinon
Deputy General Counsel
Euro Disney S.A.
1st RESOLUTION
g
Approval of the annual accounts of the Company for the
Fiscal Year ended September 30, 2003 and discharge
to the Gerant and the Supervisory Board
Ordinary General Meeting
2nd RESOLUTION
g
Approval of the consolidated accounts of
the Euro Disney S.C.A. Group for the
Fiscal Year ended September 30, 2003
Ordinary General Meeting
3rd RESOLUTION
g
Allocation of net income for the Fiscal
Year ended September 30, 2003
Ordinary General Meeting
4th RESOLUTION
g
Approval of the deferral for the payment of the
management fees and the royalties and approval of the
conditional renunciation in relation to these sums due by
the Company for the last three quarters of the Fiscal Year
ended September 30, 2003
Ordinary General Meeting
5th RESOLUTION
g
Approval of a new subordinated credit
facility granted by The Walt Disney
Company
Ordinary General Meeting
6th RESOLUTION
g
Approval of the continuation of previously
approved related-party agreements
Ordinary General Meeting
8th RESOLUTION
g
Powers to carry out formalities
Ordinary General Meeting
7th RESOLUTION
g
Decrease in capital by reduction of the
nominal value of the Company’s shares
Extraordinary General Meeting
Andre Lacroix
Chairman and Chief Executive Officer
Euro Disney S.A.
Jeffrey R. Speed
Senior Vice President
and
Chief Financial Officer
Euro Disney S.A.
Fiscal 2003 Full Year Results
Fiscal 2004 1st Quarter Revenues
Important Facts about your Company
Status of the Financial Restructuring
Fiscal 2003 Full Year Results
Fiscal 2004 1st Quarter Results
Important Facts about your Company
Status of the Financial Restructuring
Fiscal 2003 Full Year Results
Fiscal 2004 1st Quarter Results
Important Facts about your Company
Status of the Financial Restructuring
Fiscal 2003 Full Year Results
Fiscal 2004 1st Quarter Results
Important Facts about your Company
Status of the Financial Restructuring
Fiscal 2003 Full Year Results
Fiscal 2004 1st Quarter Results
Important Facts about your Company
Status of the Financial Restructuring
Business Context
¾ Challenging macro-economic and geo-political environment
g
Wars in the Middle East
g
Recessions in Key markets
g
Work stoppage and social unrest
¾ Price discounting across the industry.
2003: Consolidated Statement of Income - As Reported
2003
As reported
(in millions of euros)
€
2002
Variation
€
€
%
Revenues
Revenues
1053.1
1053.1
1076.0
1076.0
(22.9)
(22.9)
(2.1)%
(2.1)%
Costs
Costs and
and Expenses
Expenses
(920.7)
(920.7)
(900.3)
(900.3)
(20.4)
(20.4)
2.3%
2.3%
206.1
206.1
275.3
275.3
(69.2)
(69.2)
(25.1)%
(25.1)%
(200.3)
(200.3)
(170.8)
(170.8)
(29.5)
(29.5)
17.3%
17.3%
11.9
11.9
(38.0)
(38.0)
49.9
49.9
(56.0)
(56.0)
(33.1)
(33.1)
(22.9)
(22.9)
EBITDA
EBITDA ((Earning
Earning before
before
Interest,
Interest, Taxes,
Taxes, Depreciation
Depreciation and
and Amortisation)
Amortisation)
Lease
Lease and
and Net
Net Financial
Financial Charges
Charges
Exceptional
Exceptional income
income (loss)
(loss)
Net
Net Loss
Loss
-69.2%
69.2%
Fiscal Year 2003 Results: Basis of Presentation
Before
Accounting
change 2003
as reported
Accounting
change
impact
€
€
€
1053.1
1053.1
--
1053.1
1053.1
EBITDA
EBITDA
206.1
206.1
20.0
20.0
226.1
226.1
Depreciation
Depreciation and
and amortisation
amortisation
(65.6)
(65.6)
(9.4)
(9.4)
(75.0)
(75.0)
2003
(in millions of euros)
Revenues
Royalties
Royalties and
and management
management fees
fees
(8.1)
(8.1)
--
(8.1)
(8.1)
Income
Income before
before lease
lease and
and financial
financial charges
charges
132.4
132.4
10.6
10.6
143.0
143.0
Net
Net Loss
Loss
(56.0)
(56.0)
10.6
10.6
(45.4)
(45.4)
Fiscal Year 2003 First Semester
¾ Increase in top line revenues, primarily in first quarter
=> Revenues increase 8%
¾ Increased costs and expenses linked to the new two-park Resort
=> Decreased EBITDA Margin*
As % of revenues: 12% vs 19% in FY’02
*Before royalties and management fees and change in accounting for major renovations
Fiscal Year 2003 Second Semester
¾ Decline in volume and revenue during second semester
=> Revenues down 9%
¾ Prudent yield management to preserve pricing
¾ Management implemented proactive cost control and productivity
measures
=> Stable EBITDA Margin*
As % of revenues: 29% vs 30% in FY’02
*Before royalties and management fees and change in accounting for major renovations
Key Financial Results
(in millions of euros)
Revenues
Revenues
EBITDA*
EBITDA*
As
As %
% of
of revenues
revenues
Variation
2003
2002
€
€
1053.1
1053.1
1076.0
1076.0
(22.9)
(22.9)
(2.1)%
(2.1)%
226.1
226.1
275.3
275.3
(49.2)
(49.2)
(17.9)%
(17.9)%
22%
22%
26%
26%
* Before royalties and management fees and accounting change for major renovations
€
%
(4)
(4) ppt
ppt
The Resort Segment
(in millions of euros)
Revenues
Revenues
EBITDA
EBITDA **
As
As %
% of
of revenues
revenues
2003
2002
€
€
€
%
1029.5
1029.5
1048.7
1048.7
(19.2)
(19.2)
(1.8)%
(1.8)%
215.5
215.5
262.9
262.9
(47.4)
(47.4)
(18.0)%
(18.0)%
21%
21%
25%
25%
* Before royalties and management fees and accounting change for major renovations
Variation
(4)
(4) ppt
ppt
The Resort Segment: Theme Parks
Theme
Theme Parks
Parks
2003
2002
€
€
508.5
508.5
526.0
526.0
(17.5)
(17.5)
(3.3)%
(3.3)%
Attendance
Attendance (in
(in millions)
millions)
12.4
12.4
13.1
13.1
(0.7)
(0.7)
(5.3)%
(5.3)%
Average
Average guest
guest spending
spending
((in
in euros,
euros, excluding
excluding V.A.T)
V.A.T)
40.7
40.7
40.1
40.1
0.6
0.6
+1.5%
+1.5%
Revenues
Revenues (in
(in millions
millions of
of euros)
euros)
Variation
€
%
The Resort Segment: Hotels and Disney Village
Hotels
Hotels and
and Disney
Disney Village
Village
Revenues
Revenues (in
(in millions
millions of
of euros)
euros)
Occupancy
Occupancy
Average
Average spending
spending per
per room
room
((in
in euros,
euros, excluding
excluding V.A.T)
V.A.T)
2003
2002
€
€
416.7
416.7
85.1%
85.1%
183.5
183.5
411.7
411.7
Variation
€
+5.0
+5.0
88.2%
88.2%
175.1
175.1
%
+1.2%
+1.2%
(3.1)ppt
(3.1)ppt
+8.4
+8.4
+4.8%
+4.8%
Real Estate Development Segment
2003
2002
(in millions of euros)
€
€
Revenues
Revenues
23.6
23.6
27.3
27.3
(3.7)
(3.7)
(13.6)%
(13.6)%
EBITDA
EBITDA **
10.6
10.6
12.4
12.4
(1.8)
(1.8)
(14.5)%
(14.5)%
As
As %
% of
of revenues
revenues
45%
45%
45%
45%
* Before royalties and management fees and accounting change for major renovations
Variation
€
%
--
Operating Costs
(in millions of euros)
2003*
2002
€
€
Variation
€
%
Direct
Direct operating
operating costs
costs
625.8
625.8
613.3
613.3
+12.5
+12.5
+2.0%
+2.0%
Marketing
Marketing and
and Sales
Sales costs
costs
105.2
105.2
95.4
95.4
+9.8
+9.8
+10.3%
+10.3%
96.0
96.0
92.0
92.0
+4.0
+4.0
+4.3%
+4.3%
827.0
827.0
800.7
800.7
+26.3
+26.3
+3.3%
+3.3%
8.1
8.1
35.5
35.5
(27.4)
(27.4)
(77.2)%
(77.2)%
75.0
75.0
64.1
64.1
+10.9
+10.9
+17.0%
+17.0%
910.1
910.1
900.3
900.3
+9.8
+9.8
+1.0%
+1.0%
General
General and
and Administrative
Administrative costs
costs
Sub
Sub Total
Total Operating
Operating Costs
Costs
Royalties
Royalties and
and Management
Management fees
fees
Depreciation
Depreciation and
and amortisation
amortisation
Operating Costs
*Before accounting change for major renovations
Increased Lease and Financial Charges
2003
(in millions of euros)
Lease
Lease and
and Financial
Financial Charges
Charges
2002
Variation
€
€
€
%
200.3
200.3
170.8
170.8
+29.5
+29.5
17.3
17.3 %
%
Increase
Increase mainly
mainly due
due to:
to:
-- Increased
Increased principal
principal reimbursement
reimbursement
+18.2
+18.2
-- Increased
Increased interest
interest charges
charges and
and other
other
+11.3
+11.3
Cash Flow
2003
2002
Variation
(in millions of euros)
€
€
Beginning Cash Equivalent Balance
21.3
21.3
548.4
548.4
(527.1)
(527.1)
Cash
Cash flow
flow from
from Operating
Operating Activities
Activities
88.1
88.1
48.7
48.7
+39.4
+39.4
Proceeds
Proceeds from
from Fixed
Fixed Assets
Assets Sales
Sales
45.4
45.4
1.4
1.4
+44.0
+44.0
€
Capital
Capital Expenditures
Expenditures and
and other
other investements
investements
(74.2)
(74.2)
(271.1)
(271.1)
+196.9
+196.9
Cash
Cash Flow
Flow used
used in
in Financing
Financing Activities
Activities
(34.6)
(34.6)
(306.1)
(306.1)
+271.5
+271.5
46.0
46.0
21.3
21.3
+24.7
+24.7
Ending Cash Equivalent
Equivalent Balance
Balance
Fiscal 2003 Full Year Results
Fiscal 2004 1st Quarter Revenues
Important Facts about your Company
Status of the Financial Restructuring
Fiscal 2004: 1st Quarter Revenues
Quarterly Revenue - Year over Year % Change
15%
16%
1%
0%
Q1 03
Q2 03
(1% )
Q3 03
Q4 03
(7% )
(11% )
-15%
Q1 04
Fiscal 2003 Full Year Results
Fiscal 2004 1st Quarter Revenues
Important Facts about your Company
Status of the Financial Restructuring
Fiscal 2003 Full Year Results
Fiscal 2004 1st Quarter Revenues
Important Facts about your Company
Status of the Financial Restructuring
Status of the Financial Restructuring
¾ New agreement announced on March 22, 2004:
g
Waiver extension until May 31, 2004
g
New TWDC subordinated credit facility of €25M until May 31, 2004
g
Security Deposit increased to €100 million
¾ Allows negotiating parties more time to reach a long-term resolution to
the Company’s financial difficulties.
2003, a difficult year for
the tourism industry...
KUONI
- 11 %
THOMAS COOK
- 10 %
MY TRAVEL GROUP plc
French receipts decrease 5% (average)
-4%
Growth opportunities in Europe
Disneyland Resort Paris
Guests
16%
Non - guests
84%
Europe population: 329 M
2OO4 Plan
Relaunch growth
Create an international executive team
Complete our financial restructuring
Repeaters’ business performance
(FY '97= base 100)
160
140
Repeaters
120
100
80
60
40
20
0
FY'97
FY'98
FY'99
FY'00
FY'01
FY'02
FY'03
+40%
Growth opportunities in Europe
Disneyland Resort Paris
Guests
16%
Non - guests
84%
Europe population: 329 M
ƒ Maximize quality
ƒ Relentless innovation
ƒ Marketing push
ƒ Maximize quality
ƒ Relentless innovation
ƒ Marketing push
ƒ Maximize quality
ƒ Relentless innovation
ƒ Marketing push
Yann Caillere
President & Chief Operating Officer
Euro Disney S.A.
Sommaire
ƒ Improving our quality
Sommaire
ƒ Improving our quality
ƒ Sales
Sommaire
ƒ Improving our quality
ƒ Sales
ƒ Productivity of our operations
Sommaire
ƒ Improving our quality
ƒ Sales
ƒ Productivity of our operations
ƒ Development of our Cast members
IMPROVING OUR QUALITY
Improving our quality
Two axes of work
ƒ Service quality
Improving our quality
Two axes of work
ƒ Service quality
ƒ Product quality
Guest Satisfaction
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
83%
75%
Completely and very
satisfied
Satisfied
Unsatisfied
22%
14%
3%
2000
3%
2004
The key points of our
service quality
ƒ The frequency of our surveys
The key points of our
service quality
ƒ The frequency of our surveys
ƒ The key indicators
The key points of our
service quality
ƒ The frequency of our surveys
ƒ The key indicators
ƒ The whole Company involved in the process by
the end of 2004
The product quality
Creation of new products
ƒ The Easter egg hunt
The product quality
Creation of new products
ƒ The Easter egg hunt
ƒ The Peter Pan show
The product quality
Creation of new products
ƒ The Easter egg hunt
ƒ The Peter Pan show
ƒ The Lion King carnival
Improvement of
existing products
ƒ
ƒ
ƒ
ƒ
ƒ
ƒ
ƒ
ƒ
ƒ
Halloween
Christmas
Tarzan show
Small World
Interactive menus for kids
Hakuna Matata
Theme dedicated Boutique spaces
WiFi in the hotels
Disney Village Parking
SALES
Sales
Major Objective
• Be more aggressive and efficient in terms of
sales
Sales
Major Objective
• Be more aggressive and efficient in terms of
sales
The good news
• Arrival of Norbert Stiekema, Vice President
Sales
Sales (cont.)
ƒ Launching a training plan for all sales teams
Sales (cont.)
ƒ Launching a training plan for all sales teams
ƒ Conclude lasting agreements with our
principal European partners
Sales (cont.)
ƒ Launching a training program for all the sales
teams
ƒ Reach lasting agreements with our main
European partners
ƒ Create products specific to each country
Sales (cont.)
ƒ Launching a training program for all the sales
teams
ƒ Reach lasting agreements with our main
European partners
ƒ Create products specific to each country
ƒ Reinforce the sales organizations
Sales (cont.)
ƒ On the German market
ƒ Opening of the hotel Mövenpick Dream Castle this
Summer
ƒ Creation of new brochures
ƒ Specific special offers
ƒ 3 regions tested
Sales (cont.)
ƒ On the German market
ƒ Opening of the hotel Mövenpick Dream Castle this
Summer
ƒ Creation of new brochures
ƒ Specific special offers
ƒ 3 regions tested
ƒ Setting up a sales network in Russia, Poland
and Hungary
Sales (cont.)
ƒ On the German market
ƒ Opening of the hotel Mövenpick Dream Castle this
Summer
ƒ Creation of new brochures
ƒ Specific special offers
ƒ 3 regions tested
ƒ Setting up a sales network in Russia, Poland
and Hungary
ƒ New Internet strategy
PRODUCTIVITY OF OUR
OPERATIONS
Presentation
Operational Labor Management or
Planning of Operational Personnel
Operational
Labor Management
ƒ Management of +9 500 operational Cast
Members
Operational
Labor Management
ƒ Management of+ de 9500 operational Cast
Member
ƒ In 2003 adjustment of over 9% of the costs in
operational labor
Operational
Labor Management
ƒ Management of+ de 9500 operational Cast
Member
ƒ In 2003 adjustment of over 9% of the costs in
operational labor
ƒ Savings linked to the recruitment of
temporary labor
Operational
Labor Management
ƒ Management of+ de 9500 operational Cast
Member
ƒ In 2003 adjustment of over 9% of the costs in
operational labor
ƒ Savings linked to the recruitment of
temporary labor
ƒ Increasingly efficient control of set personnel
costs
Specialized Welcoming
Tourism Host
ƒ Multi-skilled program
Specialized Welcoming
Tourism Host
ƒ Multi-skilled program
ƒ Learning various skills in 3 x 5 months
Specialized Welcoming
Tourism Host
ƒ Multi-skilled program
ƒ Learning various skills in 3 x 5 months
ƒ These Cast Members are members of a
flexible team
Specialized Welcoming
Tourism Host
ƒ Multi-skilled program
ƒ Learning various skills in 3 x 5 months
ƒ These Cast Members are members of a
flexible team
ƒ Recognition of the professional title is under
study
THE DEVELOPMENT OF
OUR CAST MEMBERS
The development
of our CM
ƒ The renewal of labor relations
The development
of our CM
ƒ The renewal of labor relations
ƒ Over 44 000 training courses given in 2003 at
Disney University
The development
of our CM
ƒ The renewal of labor relations
ƒ Over 44 000 training courses given in 2003 at
Disney University
ƒ -2 points turnover compared to 2002
The development
of our CMs (cont.)
ƒ Work on national vocational qualification type of
recognition
The development
of our CMs (cont.)
ƒ Work on national vocational qualification type of
recognition
ƒ Easy access and strategic position
The development
of our CMs (cont.)
ƒ Work on national vocational qualification type of
recognition
ƒ Easy access and strategic position
ƒ A dedicated recruitment website from June 2004
Thank you for your attention
Have a wonderful day and enjoy our
product
ƒ Maximize quality
ƒ Relentless innovation
ƒ Marketing push
Easter
Season
ƒ Maximize quality
ƒ Relentless innovation
ƒ Marketing push
Fiscal 2004 1st Quarter Results
Revenue Evolution per Quarter (Year over year % change)
15%
16%
1%
0%
Q1 03
Q2 03
(1% )
Q3 03
Q4 03
(7% )
(11% )
-15%
Q1 04
2OO4 Plan
Relaunch growth
Create an international executive team
Complete our financial restructuring
2OO4 Plan
Relaunch growth
Create an international executive team
Complete our financial restructuring
François Pinon
Deputy General Counsel
Euro Disney S.A.
Antoine Jeancourt-Galignani
President of the Supervisory Board
Euro Disney S.C.A.
Statutory Auditors
Pricewaterhousecoopers Audit represented by Mr.
Jean-Christophe Georghiou
Caderas Martin represented by Mr. Antoine Gaubert
Questions
and
Answers
François Pinon
Deputy General Counsel
Euro Disney S.A.
1st RESOLUTION
g
Approval of the annual accounts of the Company for the
Fiscal Year ended September 30, 2003 and discharge
to the Gerant and the Supervisory Board
Ordinary General Meeting
2nd RESOLUTION
g
Approval of the consolidated accounts of
the Euro Disney S.C.A. Group for the
Fiscal Year ended September 30, 2003
Ordinary General Meeting
3rd RESOLUTION
g
Allocation of net income for the Fiscal
Year ended September 30, 2003
Ordinary General Meeting
4th RESOLUTION
g
Approval of the deferral for the payment of the
management fees and the royalties and approval of the
conditionnal renunciation in relation to these sums due by
the Company for the last three quarters of the Fiscal Year
ended September 30, 2003
Ordinary General Meeting
5th RESOLUTION
g
Approval of a new subordinated credit
facility granted by The Walt Disney
Company
Ordinary General Meeting
6th RESOLUTION
g
Approval of the continuation of previously
approved related-party agreements
Ordinary General Meeting
7th RESOLUTION
g
Decrease in capital by reduction of the
nominal value of the Company’s shares
Extraordinary General Meeting
8th RESOLUTION
g
Powers to carry out formalities
Ordinary General Meeting