Dubai: Kingdom Hotel Investments (KHI), the Dubai-based hotel and resort investment company, yesterday reported a 39 per cent fall in first-half net profit on a year earlier mainly due to a non-recurring deferred credit revenue of $12.8 million in the first half of 2006.
Before non-recurring items, the company's net profit for the period grew 24 per cent to $17.3 million.
Total first half revenue jumped 74 per cent to $74.3 million and hotel revenue increased by 63 per cent to $66.5 million. Earnings before tax rose by 103 per cent to $19.2 million "driven by acquisitions, comparable hotel performance and build up of recently opened hotels", KHI said in a statement. Meanwhile, earnings per share sunk 47 per cent to $0.1 for the first half.
The company attributed this to "the 2006 one-time gains that added nine cents per share to last period's profits, and a higher weighted number of shares as KHI went public in March 2006".
Excluding the impact of non-recurring items, earnings per share of $0.10 expanded by eight per cent during the period.
The company boasts a portfolio of 38 hotels in 22 countries including the UAE, which represents 7.36 per cent of KHI's total investments. The Fairmont Palm and Movenpick Pearl Dubai are scheduled to open in 2009, bringing close to 1,000 rooms onto the market.
The company said it will maintain an ongoing focus on diversification and operating acquisitions, primarily in emerging Asian market, as well as execution on its new developments. It's expected additional new debt is in excess of $100 million, a spokesperson said.
Sarmad Zok, KHI chief executive, said the 19 hotels the company acquired since 2006 represented 'a strong delivery' on its acquisition objectives. Since 2006 KHI has acquired interests in approximately $2 billion worth of hotels in emerging markets including Africa, Asia and the Middle East.
"We are now approaching a new phase in our development as we focus on integrating the diversified assets in our portfolio," he said. "We are on track to continue deploying capital in key areas of under penetrated growth or where we have invested. We will leverage our balance sheet to fund this next phase of organic growth and will continue to manage our development projects by scoping highest and best use projects on our land bank."
From the balance sheet
* Net profit before non-recurring items up 24 per cent to $17.3 million. * Total first half revenue jumps 74 per cent to $74.3 million * Hotel revenue increases by 63 per cent to $66.5 million. * Earnings before tax rises by 103 per cent to $19.2 million * Earnings per share sinks 47 per cent to $0.1 for the first half.