Revenue down £6.3m due a combination of factors:
- Ongoing refurbishment programme removed over 100,000 room nights over the period with the revenue and profit impact felt particularly at Grand Hyatt Taipei where 461 rooms were closed and Millennium Minneapolis, which was closed completely during the quarter;
- Regional geo-political tensions affected Millennium Seoul Hilton;
- Harsh weather conditions deterred travellers in Europe and the United States;
- Singapore performance was down, reflecting a slowing economy, continuing restraint in corporate travel budgets an increasing supply of competitor hotel rooms and a reduction in foreign labour quotas, which is putting pressure on costs.
Profit before tax has fallen by 34.7% as the Group's high operating leverage resulted in most of the reduction in revenue impacting the bottom line.
RevPAR up 1.6%. Group average room rate increased by 1.7% whilst occupancy decreased slightly by 0.1 percentage point.
Net cash increased from £52.2m at 31 December 2012 to £56.5m (before paying 2012 final dividend of £37.3m).
Commenting today Mr Kwek Leng Beng, Chairman said:
"Although Group RevPAR increased by 1.6% over the three months ended 31 March 2013, revenue declined due to a number of factors, which are unlikely to abate in the foreseeable future. Asia, which accounted for over 40% of Group revenues last year and has led our revenue and profit growth in recent years, is facing a number of political, economic and other challenges that are likely to impact performance. Europe also continues to face challenges as a result of austerity programmes and the ongoing fallout from the financial crisis. In addition, our ongoing refurbishment programme will reduce Group revenue and profits as rooms are taken out of the network over the course of the programme. Against this challenging backdrop, the Group's strong financial position equips us to overcome the ongoing economic headwinds and gives us flexibility, both to act quickly on attractive acquisition opportunities and to support our asset investment activities. We are continuing to strengthen and reinvigorate the Group's management team."
