Embattled Euro Disney Posts 3 Percent Profit Dip

PARIS – Troubled theme park and hotel operator Euro Disney SCA (search) Monday announced a 3 percent decline in revenue in its April-to-June quarter and said a deadline for lenders to approve a restructuring plan had been postponed to Sept. 30.

The operator of the Disney theme park in the Paris region also warned that it expects a "significant increase" in its net loss for the current fiscal year.

Revenue for the third quarter slid to 267 million euros ($322 million) from 275 million euros a year earlier. The company meanwhile faces mounting costs due to restructuring and a resumption of royalty payments to its biggest shareholder, The Walt Disney Co. (DIS).

Euro Disney shares plunged as much as 16 percent when trading opened before recovering to 28 euro cents (34 cents) in early afternoon — 9.7 percent below Friday's close.

Euro Disney again pushed back the deadline for approval of a 2.4 billion euros ($2.9 billion) rescue plan to save it from bankruptcy. Its biggest lenders — Walt Disney and French banking group Caisse des Depots et Consignations (search) — signed a memorandum of understanding in June, but the package needs approval from all 62 creditor banks.

"Some lenders have not given their agreement, which results in additional negotiations between the company, Walt Disney, and its lenders concerning the contents of the memorandum," Euro Disney said in a statement.

Euro Disney repeated its earlier warning that it will be unable to repay its debts if an agreement is not reached and its debt covenant waiver expires.

The company said theme park revenue rose slightly in the third quarter thanks to higher average guest spending, while actual numbers of visitors and hotel occupants fell.

Euro Disney said its 20 million euros ($24 million) in available cash and 42.7 million euros ($51.5 million) of unused credit from Walt Disney were enough to tide it over until its debt waivers expire at the end of next month.