Mar. 2--He has been feted as the turnaround specialist who revived the fortunes of EuroDisney, but Philippe Bourguignon is under fire over his failure to work the same kind of magic at Club Mediterranee. 

Bourguignon has been chief executive and chairman of the French holiday group since April 1997, returning it to profit in 2000. 

But since then, profits have declined and the share price has followed, dropping from over euro150 (UKpound 94) in 2000 to euro49 (UKpound 30.60) last week. 

In January, Club Med reported a loss of euro62 million (UKpound 39 million) for the fiscal year ending 31 October, its first loss in four years. 

The poor results have brought the critics out in force, with many attacking Bourguignon's attempt to turn the company -- famed for its all-inclusive holiday villages where no cash changes hands -- into a broader lifestyle offering. 

Club Med's core business needs work, they say. Its image is dated and its clubs are also no longer destinations for the young and beautiful. 

A cartoon in France's Le Monde newspaper earlier this year summed up the group's predicament: a weary holidaymaker arrives at a deserted Club Med beach, drops his suitcases and cries, "All alone, at last!". 

But if he is feeling the strain, Bourguignon, on a charm offensive in London, is not showing it. The 54-year-old marketing specialist admits he feels under pressure but qualifies this by noting that, as for any chief executive, it is simply part of the job. 

He is keen to stress that, despite the group's current problems, he did deliver on the three-year turnaround plan announced when he joined. Bourguignon said: "We delivered what we said we would deliver. In 2000 we put Club Med back in good shape with good fundamentals." 

But that was not enough to help the group withstand the economic slowdown, particularly in the US. The 11 September terrorist attacks were the final blow -- in Bourguignon's words, "an earthquake". 

With hindsight, he admits, a number of both internal and external factors are to blame for the group's troubles. The US, in particular, has been problematic, mainly due to the external economic climate and partly to decisions made in 1998 and 1999 to increase capacity. 

To stem the losses, a restructuring plan was announced last year that closed 17 resorts, some permanently. A cost-cutting programme was also implemented. 

But recent reports that Club Med's major shareholders -- the Agnelli family, which ousted the founders, Serge Trigano and his father -- have become disenchanted with Bourguignon's recent performance have only added to the pressure. The big question is: when will things get better? Bourguignon will not be drawn, pointing out that there are two critical months, March and April, still to go. In the US, much of the turnaround will depend on cutting costs and the success of a new ad campaign, "Wanna Play?", targeted at young people and families. 

Bourguignon said: "If we have implemented our plans, Club Med is set to rebound when demand recovers. The only question we have is how fast demand will recover." 

He defends his decision to expand the group into the broader leisure market by buying health clubs and opening urban "leisure centres" for which his Club Med World concept is the flag-carrier. 

"I am convinced the model is good. The choice for Club Med was to leverage our assets, namely our worldwide presence, our strong human resources and our strong brand," he said. 

For now the focus is on fixing the group's core business and Bourguignon is adamant the model is not out of date. "The idea that the concept is obsolete or would appeal to French people and not to non-French people is ridiculous, ridiculous," he said. 

He believes that, as with the car industry, where Peugeot has surprised rivals by the success of its strategy, there is not just one model that works in tourism. He argues that the model used by tour operators in the UK and Germany -- based on high volume, low margins -- does not work for Club Med. 

"At Club Med, we have a huge strength and a small weakness: we do not have one global competitor but we have a competitor in every market," he said. 

He does not rule out strategic alliances but argues in favour of regional ones as opposed to just one global alliance. "We know we need to do something, but we are in no rush. We have a strong balance sheet, a lot of assets, limited debt." 

People who work closely with him say Bourguignon is keen to be seen as someone who will stay at Club Med. The next few months will show whether he can finally lose his Turnaround Specialist epithet and become known instead as the man in charge of one of the world's most successful leisure groups. 

-----To see more of Sunday Business, or to subscribe to the newspaper, go to http://www.sundaybusiness.co.uk UKpound preceding a numeral refers to the United Kingdom's pound sterling. (c) 2003, Sunday Business, London. Distributed by Knight Ridder/Tribune Business News. DIS,