A good performance by hotels in Singapore, other parts of Asia and London in 2012 helped boost revenue per available room (revPAR) by 3.9% at Millennium & Copthorne Hotels.
But operating profits dropped by 14.7% to £163.3 million on revenue down by 6.4% to £768.3 million over 2011.
Chairman Kwek Leng Beng said the group “overcame more challenging conditions” in some markets during the second half of 2012.
“This illustrates the earnings benefit of a balanced portfolio of assets in good locations, as well as our ability to respond effectively to changes in the economic climate, whilst continuing to control costs, invest in our assets and improve our attractiveness to customers,” he said.
“During the current year we will deploy our strong balance sheet to invest in our existing asset portfolio, thereby supporting the core earnings engine of the group.
“We continue to monitor acquisition opportunities, although prices continue to remain unjustifiably high.”
He revealed that like-for-like revPAR declined by 1.1% in the first six weeks of the year, with Singapore down 10.2%, London 9.6% and New York 1.6%.
“Whilst this reflects competitive trading conditions in some of our key markets, the period is not indicative for the year as a whole.”
The group plans to open 21 hotels offering 5,440 rooms, mainly under management contracts. Two of these will open in China this year.
“Uncertain global economic conditions continue to cast shadows over the hospitality sector,” warned Kwek Leng Beng.
“The euro crisis, slower growth in China and the unresolved fiscal cliff in the United States all contributed to this during 2012.
“The board considers that our owner/operator business model, combined with our strong balance sheet and a global spread of assets in many of the world’s most significant travel destinations equips us to withstand the pressure which may result from such conditions, whilst continuing to build a foundation for future growth.”
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