Millennium & Copthorne's hotels in London, New York, Asia boost pretax profit

Nov 13, 07 | 8:58 am

By Marc Jones

Millennium & Copthorne (MLC.L: Quote, Profile , Research) said its hotels in London, New York and Asia led a 24 percent rise in third-quarter pretax profit and it planned to review its management structure before appointing a new chief executive.

M&C, which operates more than 100 upmarket hotels around the world, said on Wednesday pretax profit rose to 28.8 million pounds ($60.1 million) from 23.2 million a year ago.

It said the fourth quarter had begun well with revenue per available room (REVPAR) -- the hotel industry's main measurement of performance -- rising by 10.5 percent in the first four weeks of October as Asia booms and London and New York prosper.

The firm's room rates were 13 percent higher than a year ago in New York, 11.5 percent higher in London and 11 percent higher in Asia.

Stand-in CEO Wong Hong Ren told Reuters he expected to see the strong growth in room rates continue through 2008 although he said raising prices at its hotel on Wall Street could be a little more tricky, without elaborating.

"Our business in Asia is particularly good. In cities like Hong Kong and Singapore we see very strong to demand due to the state of the Asia economies."

Shares in the firm rose 4.4 percent in early trading to 536 pence, buoyed by the strong trading figures, before settling up 1 percent by 1015 GMT.

"These are extremely good numbers with the group showing no current signs of a downturn," said BlueOar analyst Mark Brumby.

Singapore-based City Developments Ltd. (CTDM.SI: Quote, Profile , Research), which is part owned by M&C Chairman Kwek Leng Beng, owns 52 percent of M&C.

Property plans

M&C's shares have come under pressure in recent months with investors jittery that a fall in property prices could see the firm's value slide.

Wong Hong Ren said M&C did not expect to be affected by any downturn while it had no plans to follow the lead of many of the larger hotel groups and split the firm into separate property and operating company. "We are an owner and operator of assets... I don't think that there is any plan for that."

In August M&C's chief executive left after just five months in the job while the firm's chief finance officer job is also vacant.

External source: To read complete article: Click Here

Source: Reuters