Euro Disney plots careful path

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Euro Disney shares eased 3p to 198p yesterday after Philippe Bourguignon, chairman of the theme park operator, said he remained cautious about trading.

Euro Disney could see no effects of an upturn in consumption. "It is too soon to draw preliminary conclusions for the full year. There is still insufficient clarity about the summer.

"High short-term interest rates and instability in the glo bal currency markets remain important areas of uncertainty."

A growing number of British holidaymakers, a prime source of visitors to the park, are avoiding France because of sterling's weakness against the franc.

UK tourists visiting France must take 12.5 per cent more French currency than they did 18 months ago to counteract the exchange rate movement. A pound buys fewer than eight francs, compared with almost nine in January 1994.

Euro Disney recently announced a sharp fall in half-year losses from Fr 1.055bn (pounds 135m) to Fr 241m (pounds 31m), although the result mainly reflected benefits from the financial restructuring than from trading.

Attendances are picking up and the total number of visitors through the gates should exceed 10 million this year. Euro Disney, however, has had to sacrifice revenue to increase attendances by lowering admission and restaurant prices.

Theme park competition on the Continent is increasing. Port Aventura, in which the UK's Pearson group has a large shareholding, has opened in Spain and will attract upwards of 1.6 million visitors in its first year. A Warner Brothers operation will open in Germany next year.

While Euro Disney has made inroads into ironing out the seasonal nature of its business, it has yet to overcome the problem of balancing the weekly profile of visitors who still tend to prefer going to the park at weekends.

"Performances of the park and hotels in the low season are better today," Mr Bourguignon said. But, he added, the company had to work more on the mid-week period.