Euro Disney says it expects net loss

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EURO DISNEY, which owns the Paris theme park inspired by Walt Disney's fantasy world, has admitted that is likely to lose money in its first trading year.

Confident predictions, made at the time of the share flotation three years ago, that Euro Disney would make profits in its first year have grown steadily less credible.

Despite an extravagant opening ceremony in April recession in Europe - particularly affecting holidaymakers' pockets - has hit revenues from the site.

Euro Disney said yesterday that it 'anticipates that it will incur a net loss for the fiscal year ending 30 September'.

It will be the company's first loss, but analysts are forecasting losses in future years as well.

Nigel Reed, at the stockbroker Paribas, predicts that the after-tax loss this year will be Fr300m ( pounds 31m) and he says losses are likely to be similar in 1993.

Revenues this year include profits from the first half earned from intererst on cash remaining from the share float. Doubts about Euro Disney's long-term future are heightened because this year's first-half profit will be replaced with likely losses from the winter season.

Mr Reed also calculates that the average spending per head on food and merchandise is 10 per cent down on expectations. But he added that some costs may be taken out with experience.

Shares in Euro Disney, quoted in London and Paris, fell 7p yesterday to 1,023p and have tumbled from 1,684p in March.

It also released figures showing that 3.6 million people have been to Euro Disneyland since its opening, with 1 million from France. Daily attendance is 35,300.

Euro Disney's own research indicates that French visitors are holding off until the quieter season. A spokesman said: 'It is early days. We cannot be sure what trading will be like in winter.'