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LONDON - HOTELIER Millennium & Copthorne shrugged off suggestions that current global economic troubles would put off travellers, saying it was cautiously optimistic and had 1 billion pounds to spend on deals.
M&C, which operates 112 upmarket hotels around the world, said on Wednesday that profit before tax for the year rose by a fifth to 157.4 million pound (S$433.16 million) on revenues of 669.6 million.
Revenue per available room (RevPAR) - the hotel industry's main measurement of performance - rose 9.7 per cent over the year as strong demand and rising prices at its flagship hotels in Singapore, London and New York boosted profits.
Its new financial year had got off to a strong start, it added, with RevPAR growth of 11 percent in the first four weeks of the year.
It said it was 'cautiously optimistic' for the future, given the 'current turmoil' in the global economy.
The firm's chairman and 53 per cent shareholder, Mr Kwek Leng Beng, told reporters that the firm was on the look-out for acquisitions but was in no rush, with the credit crisis expected to drive down asking prices.
'I think we can go up to a billion pounds ... Maybe in six months' time we might have a better opportunity at the right price.'
'We know Asia is a growth area, but to buy in chains in Asia it is not so easy. If you are prepared to buy a management company or a chain in Europe or the US, there may be possibilities.'
Mr Kwek said he also expected to appoint a new chief executive at some point.
'I have a number of people that have approached me and are interested. There is one very good one, but we have to let him study our structure.' 'Our strategy since 2004 has served us well, and we don't want him to deviate significantly,' he added.
Like many of its rivals, M&C's shares have almost halved over the last seven months as hotel stocks have been hit hard by worries that the credit crisis and a US-led global recession could corset business travel and put off holidaymakers.
By 0840 GMT they were 0.4 per cent higher at 405 pence as London's blue-chip FTSE 100 index dropped 1 percent.
M&C upped its year dividend by almost 50 per cent to 12.5 pence.
'Solid numbers, a good outlook, and the fact that the shares have given back around half of their year-ago value may have value investors looking at M&C,' said BlueOar analyst Mark Brumby.
'On the other hand, the likelihood that the global economy will slow may well weigh on sentiment, and the apparently 'revolving door' style of management may be an issue,' he added. -- REUTERS
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