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Profits jump at Millennium & Copthorne thanks to strong demand for New York hotels

There was no mention of the proposed £1.8bn takeover offer from chairman Kwek Leng Beng though …

chelsea harbour
M&C has around 120 hotels across the world, including the Chelsea Harbour Hotel in west London

Stronger demand in New York helped to boost third quarter profits at Millennium & Copthorne Hotels PLC (LON:MLC).

Revenues at the global hotelier, which owns the Chelsea Harbour hotel in London, jumped 12.5% to £748mln (Q3 2016: £665mln) in the three months through to the end of September.

READ: Millennium & Copthorne set to go private as Singapore group makes bid

Group revenue per available room – a key metric used in the industry – climbed 4.6% to £89.75 (Q3 2016: £85.78), although some of that was currency gains as well.

Q3 profits up 17%

The top line growth helped M&C to deliver a £55mln pre-tax profit for the period, 17% higher than £47mln it reported in the third quarter of last year.

The reopening of the Millennium Hilton New York One UN Plaza – which had been closed for refurbishment last year – and the addition of the Grand Millennium Auckland at the end of 2016 were largely responsible for the solid performance, the company said.

Excluding those two hotels, the FTSE 250-listed group said like-for-like revenues were flat compared to the third quarter of 2016.

Things weren’t as bright in London either, with like-for-like revenue per available room in the capital falling 2.5%.

No word on proposed takeover

Monday’s results statement contained no fresh comments on the £1.8bn takeover offer made recently by Millennium’s Singaporean chairman, Kwek Leng Beng, who is looking to take the business private.

Earlier in October, his Hong Leong Group conglomerate offered to buy the 34.8% of shares it doesn’t already own for 552.5p each, or £624mln in total.

M&C’s board has recommended the offer but several big shareholders are said to be unhappy with it, claiming it undervalues the company.

Shares were marginally higher at 589.5p on Monday morning.

Quick facts: Millennium & Copthorne

Price: 687 GBX

LSE:MLC
Market: LSE
Market Cap: £2.23 billion
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