International hotels group Millennium and Copthorne saw the key metric of revenue per available room (RevPAR) rise strongly in the first quarter, as travellers flocked to London and Singapore.
RevPAR rose to £59.17 in the first quarter from £55.28 in the corresponding period of 2011, a 7.0% increase in actual terms and a rise of 6.0% once exchange rate fluctuations are stripped out.
On a like-for-like basis group RevPAR grew by 5.6% (excluding the three Christchurch hotels, Copthorne Orchid and Stuttgart). The increase was largely a result of higher room rates rather than more heads on pillows.
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RevPAR in what Millennium & Copthorne (M&C) calls its key gateway cities increased, with like-for-like Singapore RevPAR up by 7.7%, London up by 7.0% and New York up by 0.6%.
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"Looking forward, we expect continuing healthy progress in London, Singapore and certain other Asian destinations and we are focusing on improving performance at our US properties," said Kwek Leng Beng, Chairman of M&C.
Total revenue rose 0.7% to £175.5m from £174.2m the year before, representing a 0.3% decline on a constant exchange rates (CER) basis. The bulk of that revenue came from the hotels business, where revenue rose 0.2% (-0.8% on a CER basis) to £172.4m from £172.0m in the first quarter of 2011.
Like-for-like total revenue in constant currency increased by 5.4% to £173.5m (2011: £164.6m).
Headline profit before tax surged 28.3% (CER: +25.1%) to £25.4m from £19.8m the year before, while basic earnings per share climbed 26.7% to 5.7p from 4.5p last year.
Net debt reduced from £100.2m at the end of 2011 £31.1m and gearing tumbled to 1.5% from the end-2011 level of 4.8%.
"With a strong balance sheet and gearing approaching zero, we are in a good position, both to continue investing in our property portfolio to improve returns and to grow the portfolio when we identify attractive strategic investment opportunities. We have been actively seeking such opportunities since the second half of last year, but vendors' price expectations in key gateway cities are still too high," Kwek Leng Beng said.
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