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Largest hotel to date puts Action Hotels on track to meet targets

Last updated: 12:31 18 Apr 2016 BST, First published: 10:31 18 Apr 2016 BST

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Action Hotels continues to pursue the mid-ranged hotel market in the Gulf.

Action Hotels (LON:AHCG) is well on track to hit its targets after the completion of its tenth and largest hotel to date pushed total room count to just under 2,000.

The Brisbane property opened in March and broke even after the first month.

In its full year results for the period ending December 2015, the group saw a 30% increase in rooms, 92% since listing. 

The hotel group set the target of 2,500 rooms by 2018 but it now seems that figure is more like 2,650, given its current fully funded pipeline.

Net profit was up 47% on 2014 at $2.8mln, ahead of management expectations.

It also saw a positive start to 2016 as revenues were up 14% compared to the corresponding period.

Action Hotels continues to pursue the mid-ranged hotel market in the Gulf.

"It is definitely still a sector which remains under-supplied and there is a still a lot of demand," said chief executive Alain Debare.

The group's Kuwaiti hotels were the best performing, trading at an average 89.5% occupancy.

Its more mature hotels had stabilised, with an average occupancy of around 77%, but growth was coming from the newer hotels, particular its recent Australian builds.

"Australia is opportunistic for us, but has been performing really well. The hotel in Brisbane was quite amazing," said Debare.

"2016 is a key year for us as we are opening 6 hotels this year." 

Shareholders were just as pleased as the board recommended a final dividend of 1.47p per share for 2015, resulting in a full year dividend of 2.21p per share (2.17p per share in 2014).

Shares were up 10% to 57p.

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