Mandarin Oriental has reservations about demand
Luxury hotel operator Mandarin Oriental International has reported 33 per cent growth in underlying full-year profit but has warned that economic and financial turmoil in the euro zone and the United States will hurt demand.
The group, which has a 42-strong portfolio, including the famed Mandarin Oriental hotel in Central, expects growth to be driven by a new hotel in Paris and by recovery in its hotel in Tokyo. Underlying profit jumped to US$59 million last year from US$44.4 million in 2010.
Net profit was 52 per cent higher at US$67.5 million, which included one-off items such as an US$8 million net non-trading profit and a US$10 million gain from a long-term leasehold interest in its London hotel.
Chairman Simon Keswick said in a statement yesterday that 'current economic challenges in Europe and the US may impact some of the group's markets this year'.
Last year, Mandarin Oriental said demand was so strong on the mainland that China became its second largest source of business after the US and accounted for 13 per cent of the group's total room nights.
The group's spokesperson said that the hotel at the CCTV complex in Beijing was under reconstruction after it was destroyed in a massive blaze three years ago.
She said the hotel was scheduled to open in 2014.
The group's hotels did best in Europe on the back of buoyant demand and limited supply in the top-end segment. Revenue per available room (Revpar), or a benchmark in gauging profitability of a hotel, jumped 20 per cent on a like-for-like basis over 2010, based on an average room rate of about US$700 (HK$5,446) per night.
In Hong Kong, the group's boutique hotel at Landmark and the Mandarin Oriental on Connaught Road had Revpar growing 14 per cent, while the Excelsior Hotel in Causeway Bay fared even better with 18 per cent growth.
Landmark Mandarin was charging US$520 per room per night last year, and US$468 per room per night at the Mandarin Oriental Hong Kong.