Millennium & Copthorne Hotels' rooms revenue hit due to militant attacks, competition

Millennium & Copthorne Hotels' rooms revenue hit due to militant attacks, competition
Chairman of Millennium & Copthorne Hotels Kwek Leng Beng (Second from left)
PHOTO: Millennium & Copthorne Hotels

Millennium & Copthorne Hotels said on Friday rooms revenue fell in 2016 as militant attacks across Europe hurt tourism, while more rooms in major cities and increased competition from non-traditional services hit business elsewhere.

Hoteliers are facing rising competition from online holiday rental startups such as Airbnb, just as there has been an increase in supply of rooms in major cities. Additionally, attacks in Europe have hurt travel demand.

The operator of the Millennium, Grand Millennium, Copthorne and Kingsgate hotels said revenue per available room (RevPar), a key industry measure, fell 2.3 per cent in constant currency terms in the year ended Dec. 31.

M&C said the London business was impacted by the Paris attacks of November 2015 and reduced corporate business travel in the second half of the year.

The hotelier said its New York business was hit by refurbishment to a hotel tower, while corporate business at its Singapore unit was dampened by shorter average length of customer stay and a rate strategy that was not well suited to market conditions.

RevPar, however, increased by 6.6 per cent on a reported basis, boosted by a fall in the value of sterling against major currencies following the June 23 Brexit vote.

Full-year revenue grew 9.3 per cent to 926 million pounds (S$1.6 billion), it said, while pretax profit fell marginally to 108 million pounds.

M&C also said Tan Kian Seng, who joined as interim president of Asia in October, would take charge as interim group chief executive officer from March 1 following current head Aloysius Lee's retirement at the end of this month.

M&C, majority-owned by Singaporean businessman Kwek Leng Beng's property company, has focused on expanding into "gateway cities" such as London, Singapore and New York.

 

More about

Hotels
Purchase this article for republication.

BRANDINSIDER

SPONSORED

Most Read

Your daily good stuff - AsiaOne stories delivered straight to your inbox
By signing up, you agree to our Privacy policy and Terms and Conditions.