Millennium & Copthorne harshly learnt the pitfalls to investing in China earlier this year, when the hotel operator discovered that the former chief executive of a subsidiary had illegally sold four key assets. The group's interest in the assets now sits at $17.9m (£11.9m) and, having taken legal advice, management reckons the assets can be recovered, so no write-down provision has yet been taken.
But this unwelcome commotion is just a sideshow compared with the positive sales numbers the hotel group is now witnessing after the difficult recession. Revenue per available room (revPAR), a significant performance indicator, rose 9.3 per cent to £57.66, with double-digit performances in New York, Singapore and Asia. The trend is encouraging, with the second quarter seeing 14.7 per cent year-on-year revPAR growth, as both occupancy levels and the prices of rooms went up, while the figure for the month of July was up 14.3 per cent. The group's worldwide build pipeline is currently 30 hotels, offering 8,818 rooms, with a particular focus on India and the Middle East.
Forecasts are under review following these results.
Millennium & Copthorne (MLC) | ||||
|---|---|---|---|---|
| ORD PRICE: | 480p | MARKET VALUE: | £1.5bn | |
| TOUCH: | 478-480p | 12-MONTH HIGH: | 504p | LOW: 290p |
| DIVIDEND YIELD: | 1.4% | PE RATIO: | 18 | |
| NET ASSET VALUE: | 597p | NET DEBT: | 10% | |
| Half-year to 30 Jun | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2008 | 316 | 30.5 | 7.5 | 2.08 |
| 2009 | 351 | 50.2 | 12.0 | 2.08 |
| % change | +11 | +65 | +60 | - |
Ex-div:11 Aug Payment: 8 Oct | ||||
