Euro Disney 1st-Half Loss Cut Sharply : Entertainment: Lower costs and better attendance helped theme park’s performance.

Euro Disney, the financially troubled Paris theme park, said Friday that it has sharply cut its losses for the first half of its fiscal year, thanks to higher attendance and lower costs.

Helped by a “significant increase” in visitors, the net loss for the six months to March fell to $49.7 million, better than some analysts had forecast, from $218.8 million in the same year-ago period.

“These results show we are on the right track,” said Chairman Philippe Bourguignon. “Nevertheless, it is premature to draw conclusions on the full year before the end of the summer.”

Stock market analysts had forecast losses between $57.8 million and $60.7 million.

The company said losses shrank mainly due to lower financial costs following a financial restructuring completed last year. Operating margins were also improved, thanks to cost cuts.

Euro Disney, 39%-owned by Walt Disney Co., has struggled to convince enough Europeans of the charms of Mickey Mouse since opening in April, 1992.

Hit by a savage recession, low attendance and weak spending by those visitors who did turn up, the theme park had to restructure its debt with commercial banks and relaunch itself with a new marketing and business plan.

After months of complex bank talks, it raised fresh capital through a $1.17-billion rights issue last summer and used the funds to reduce its debt.

It also negotiated waivers on lease payments, royalty and management fees to conserve cash.

The share issue also brought in a major new investor, Saudi billionaire Prince Al Waleed ibn Talal ibn Abdulaziz al Saud, who bought up 25% of Euro Disney’s capital and agreed to an option to build a $100-million business conference center next to the theme park.

With its medium-term financing secure and on the back of big cost cuts, Euro Disney lowered ticket prices for the forthcoming high summer season.

It is also banking on this summer’s new roller-coaster ride, Space Mountain, which simulates being blasted out of a giant cannon.

The company said operating revenue for the theme park rose 7% to $349 million in the first half, from $324 million a year ago.

Theme park revenue rose 9% to $201 million due to a “significant increase in attendance,” but this was partly offset by lower ticket prices to local residents in the winter and lower food prices.

Hotel revenue rose 7% to $137 million due to a “significant rise” in occupancy, but this was partly offset by lower room rates. Lease rental expense fell $124 million due to the financial restructuring, the company said.

The company cut its net loss for the 1993-94 financial year to $372 million from a disastrous $1.1 billion in the previous year.