A dire fourth quarter forced shares in Millennium & Copthorne Hotels (MLC) down nearly 5 per cent following the release of the group's annual results. The key metric here is revenue per available room (RevPAR), which fell 3.7 per cent. Revaluations and impairment losses led to an 86 per cent crash in pre-tax profits to a mere £11m during the final quarter. Even on adjusted basis, which excludes those impairments and revaluations, pre-tax profits dropped nearly 6 per cent to £152m for the year as a whole.
The main culprit was Asia, where slower regional economic growth has meant less corporate travel and lower consumer spending in Singapore, and weaker demand in China. Last year RevPAR fell 9 per cent across Singapore and the rest of Asia combined, while London and New York also reported declines in this measure due to refurbishment work.
Things aren't looking much better now, either. During the first 31 days of trading in 2016, group RevPAR fell 5.9 per cent. Declines of 10 per cent were recorded in Europe and the US, along with a 3.6 per cent drop in Asia. That offset a 21 per cent improvement in Australia.
Consensus forecasts, according to Bloomberg data, project EPS of 26p for 2016, compared with 30p in 2014.
| MILLENNIUM & COPTHORNE HOTELS (MLC) | ||||
|---|---|---|---|---|
| ORD PRICE: | 371p | MARKET VALUE: | £1.2bn | |
| TOUCH: | 367-374p | 12-MONTH HIGH: | 608p | LOW: 360p |
| DIVIDEND YIELD: | 1.7% | PE RATIO: | 19 | |
| NET ASSET VALUE: | 701p | NET DEBT: | 22% | |
| Year to 31 Dec | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2011 | 0.82 | 193 | 51.0 | 12.5 |
| 2012 | 0.77 | 171 | 42.0 | 13.6 |
| 2013 | 1.06 | 295 | 69.4 | 13.6 |
| 2014 | 0.83 | 188 | 34.0 | 13.6 |
| 2015 | 0.85 | 109 | 19.9 | 6.4 |
| % change | +3 | -42 | -41 | -53 |
Ex-div: 17 Mar Payment: 13 May | ||||
