It has been a challenging six months for Millennium & Copthorne Hotels (MLC) as weak trading in Asia and a group-wide refurbishment programme, which saw 181,000 room nights removed in the period, sent operating profits down 24 per cent to £45.4m.
In Asia, economic uncertainty, greater hotel capacity and higher costs dragged down performance. The hotel group lost customers in Manila and Seoul, with trading in South Korea affected by fewer Japanese visitors due to of political tensions earlier in the year. This pushed occupancy at the Millennium Seoul Hotel down 20 per cent. Refurbishment of the Grand Hyatt Taipei also affected occupancy rates, slicing £5m off revenue. The net result was an 8.3 per cent decline in hotel revenue to £151m across the division and a 7 per cent fall in revenue per available room (RevPAR).
In the US, hotel revenue fell by 1.5 per cent to £101m, although that was largely due to refurbishment. Occupancy actually inched up and RevPAR grew 9.5 per cent, helped by New York, where the room rate increased following renovation of its One UN hotel's west tower last year.
Australasia delivered a strong performance, with revenue up 5 per cent at £22m after stripping out one-off items, thanks to a 6 per cent rise in occupancy. RevPAR rose 10 per cent.
Credit Suisse expects full-year pre-tax profit of £138m, giving EPS of 30.7p (from £171m and 36.7p in 2012)
| MILLENNIUM & COPTHORNE (MLC) | ||||
|---|---|---|---|---|
| ORD PRICE: | 556p | MARKET VALUE: | £1.8bn | |
| TOUCH: | 555-556p | 12-MONTH HIGH: | 583p | LOW: 456p |
| DIVIDEND YIELD: | 2.4% | PE RATIO: | 15 | |
| NET ASSET VALUE: | 685p | NET CASH: | £43.9 | |
| Half-year to 30 Jun | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2012 | 374 | 79.0 | 18.3 | 2.08 |
| 2013 | 369 | 55.5 | 14.2 | 2.08 |
| % change | -1 | -30 | -22 | - |
Ex-div: 14 Aug Payment: 4 Oct | ||||
