Uncertainties impacting economies in Asia will affect trading conditions, Millennium and Copthorne Hotels warned today.
The company saw first quarter pre-tax profits decline by 15.5% to £20.1 million from £23.8 million in the same period last year on revenue marginally down at £175.3 million.
M&C, which acquired the five-star Chelsea Harbour Hotel in London in March, described the trading pattern in the US and Europe as improving.
“However, in Asia trading conditions continue to be affected by social and political uncertainty, which is likely to impact performance going forward.”
Despite this, in the four weeks ended April 28, Asia revenue per available room (revPar) increased in constant currency terms by 4%. London was up 2.4%. US was up 5.9%. Australasia was up 11.9%.
Group revPAR was up by 4.2% in constant currency terms for the four week period.
Chairman Kwek Leng Beng said: “We expect trading conditions to be influenced by increasing social and political uncertainties affecting key Asian economies, which have already had an impact on exchange rates.
“Foreign exchange movements cannot be easily quantified but have the potential to impact results, when translating into sterling.
“Whilst reported revenues and profits fell because of the strong pound, the group enjoyed stable underlying trading during the first quarter.
“We made good progress on strategic growth initiatives, including completion of the Chelsea Harbour Hotel acquisition. With Europe and US showing signs of increasing stability, we remain cautiously optimistic about the rest of the year.”