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Millennium & Copthorne reports dip in second-quarter profits

The new chief executive of Millennium & Copthorne Hotels is developing a strategic plan for the business following her appointment in June.

Jennifer Fox was speaking as the group reported an £11 million dip in second quarter pre-tax profits to £39 million.

Revenue per available room fell by 5.3% year-on-year to £82.01 while overall revenue slipped by £2 million to £260 million.

Fox, who was previously president of Fairmount Hotels & Resorts, said: “I am pleased to have joined M&C and see there is opportunity to strengthen the company and drive results for our shareholders.

“Since arriving on 19 June, I have reinforced the leadership team with two key appointments in a group chief marketing officer and a head of human resources.

“In the past six weeks I have been reviewing the earnings profile and potential of our most important properties. A strategic plan currently is being developed.”

M&C chairman, Kwek Leng Beng, said: “I am pleased to welcome Jennifer Fox as group CEO.  I am working with her closely to expedite the changes we agree are necessary to improve performance as a niche owner-operator of hospitality assets.

“I am confident that her expertise in branding and marketing will bring benefits to the group.”

He went on to describe first half results as “mixed” as the company reported half-year profits down by £2 million to £65 million with hotel revenue declining by £14 million to £404 million.

Revenue per available room at M&C hotels in London fell by 15.1% in the first six months of 2018 due to £40 million refurbishment of the group’s flagship property in Mayfair.

Kwek said: “Whilst North Asia and New Zealand saw higher revenue, our London hotels under-performed partly due to their slow adjustment to competitive market conditions in addition to the impact of refurbishment at our Mayfair property.

“Although New York revpar was up, mainly due to improvements at Millennium Hilton New York One UN Plaza, the region remains unprofitable.  Singapore was down slightly.

“Since the close of the second quarter, we underlined our commitment to stepping up investment in group assets by closing the Mayfair hotel entirely at the beginning of July.

“We look forward to its re-opening as our flagship property in Q1 next year. Additional refurbishment projects in London and New York will be announced in due course.

“Given current volatile political and economic conditions – especially Brexit and the unfolding trade tensions between the United States, China and Europe – the group continues to be cautious about the immediate future.

“However, this will not affect our plan to step up investment in our hotels, which we regard as essential to the group’s long-term health.”

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