Hotel owner & operator Millennium & Copthorne NZ Ltd lifted profit after tax & non-controlling interests by 1.85% in the June half compared to the first half of 2016, on pretax earnings up 6.9%.
Key results, with first-half 2016 results in brackets and bearing in mind that those 2016 results were boosted by a $4.31 million non-recurring gain from the Millennium Christchurch insurance settlement, were:
- Average hotel occupancy 81.3% (82.3%)
- Group revenue & other income up 8.8% to $104.14 million ($95.71 million)
- Gross profit up 17.5% to $62.33 million ($53.04 million)
- Operating profit before finance income up 5.4% to $42.92 million ($40.72 million)
- Profit before income tax & non-controlling interests up 6.9% to $43.91 million ($41.08 million)
- Profit after tax & non-controlling interests up 1.85% to $24.23 million ($23.79 million)
- Earnings/share up 1.9% to 15.32c (15.04c).
Managing director BK Chiu said on Friday the increase in profit had again been driven by demand for accommodation and ongoing operational efficiencies, plus a strong sales performance by its 66.6%-owned land development subsidiary, CDL Investments NZ Ltd.
Mr Chiu said the Grand Millennium Auckland hotel on Mayoral Drive in Auckland (the former Rendezvous Grand Auckland, leased by Millennium & Copthorne since last September) continued to benefit from growth in revenue/available room (revpar): “The new addition to the Millennium brand has also added to the strength of our conferencing & incentive network of hotels from the Bay of Islands to Rotorua & Queenstown.”
On the progress of the Copthorne Hotel Auckland Harbourcity on Quay St, Auckland, into the M Social Auckland hotel, set to open in October, Mr Chiu said it was transitioning from a construction site to an operational hotel: “The recruitment & training of ‘M Bassadors’ has brought a different energy as the team practise & perfect every detail of food & beverage tastings, to the programming of multiple technology platforms.
“With the full replacement of all building services, and seismic strengthening to an A grade, the team will continue to test the services over the coming weeks. We are all looking forward to Aucklanders and visitors ‘getting Social’ when the hotel opens in October.”
Mr Chiu described Auckland Council’s introduction of a new targeted rate – based on capital value and levied only on a selected group of commercial accommodation providers including hotels, motels & serviced apartments – as “a crude & inequitable model to finance the city’s infrastructure & visitor promotions”.
“It is disappointing that despite the extensive submissions by the accommodation providers, the council went ahead with this short-sighted approach, that will not only impact the financials of targeted accommodation providers but also the long-term investment decisions of an industry that has brought many benefits to the city.”
Occupancy at the company’s Sydney investment, Zenith Residences, was steady at 95%. Remedial balcony work & painting has started and all floors are expected to be completed by mid-September.
Millennium & Copthorne Hotels NZ Ltd owns 66.6% of CDL Investments and, in turn, is 70.2%-owned, ultimately, by the Hong Leong Group of Singapore.
20 June 2016: Rendezvous hotel to become Grand Millennium
29 May 2013: Hotelier to convert Auckland waterfront Copthorne into Millennium
Attribution: Company release.