Millennium & Copthorne profits hit by refurbishmenst
Profits at Millennium & Copthorne Hotels came under pressure in the first quarter as the group was stung by the impact of refurbishments.
Pre-tax profit slumped 58% to £11 million in the three months to March 31 as the firm counted the cost of revamps in Mayfair and Singapore.
Millennium also bemoaned lower contributions from Asian hotels.
Total revenue for the first three months of the year came in at £215 million, down 0.9% on a year ago. On a like-for-like basis, revenue per available room dipped 0.8%.
Chairman Kwek Leng Beng said: “Despite the uncertainties and challenges in the global economy, we remain focused on making the best use of our hospitality assets.
“The group is prioritising the refurbishment of our key gateway city properties to reposition our hotels, whilst seeking to minimise the short-term negative impact on our trading results.
“Operationally, we must successfully manage the refurbishment process and re-focus our sales efforts so as to improve yields.”
The Singaporean added that an affiliation agreement with Hilton for the Millennium Times Square New York will help it to turn around the performance of the hotel more quickly.
Post the period end, for the first 21 days of April, like-for-like revenue per available room increased by 2.2%.
The results comes at a sensitive time for Millennium, which recently ditched its chief executive after only three months in the job.
The company announced in September that Jennifer Fox and the board had “mutually agreed” that she would step down.
Shares were up 1% in morning trade at 444p.