Disappointing trading drags Millennium & Copthorne profits down sharply

Disappointing trading drags Millennium & Copthorne profits down sharply

Deterioration in trading at hotels in key gateway cities of New York, London and Singapore hit profits in a “disappointing” first half of the year for Millennium & Copthorne Hotels.

Hotel operating profits fell by 21.7% to £47 million over the same period in 2015, with company pre-tax profits down by £6 million to £56 million.

This came as hotel revenue declined by 1.4% to £360 million. Group revenue per available room dropped by 4.2% to £67.91.

Revpar in Europe fell by 4.1% to £71.24, partly due to the continued impact of recent terrorist attacks.

“Both London and Paris have seen a significant reduction in tour groups and individual travellers visiting the cities compared to previous years,” the hotel firm said.

Chairman Kewk Leng Beng said: “We are disappointed by our hotel operating performance during the first half of 2016, particularly in New York and Singapore, which remain areas of focus for the group.

“The UK referendum vote to leave the European Union, together with recent terrorist activity, has further intensified uncertainty over the direction of the global economy.

“The group has a history of successfully navigating difficult economic environments given its broad geographic exposure and strong balance sheet.

“Against a backdrop of economic uncertainty, we are adopting a prudent strategy to protect the group's strong financial position, including a review of capital expenditure, whilst taking appropriate steps to strengthen areas of operating weakness."

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