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SCMP Reporter

FOLLOWING recent hotel purchases and improved conditions in its main markets, CDL Hotels International is expected to boost earnings by as much as 102 per cent to $455.8 million.

  Analysts forecast company earnings for the year ended December 31 to be between $295 million and $455.8 million, or a rise of between 31 and 102 per cent.

  The consensus forecast of The Estimate Directory is for growth of 67 per cent to $374.6 million from $224.8 million in 1993.

    The company is due to announce its 1994 year-end result tomorrow.

  The result would be bolstered by an exceptional item of $86.3 million from the sale of a holding in Apollo Enterprises.

  Some analysts believe profit attributable to shareholders, excluding the exceptional item, could soar by as much as 50 per cent.

  Earnings per share is predicted to jump 67 per cent to 25 cents while the dividend per share is expected to grow 50 per cent to six cents, as stated in the directory.

  The prospective price-earnings ratio is seen as 12.4 times, against the industry average of about 14 times. Dividend yield is expected to be improved from 1.3 per cent to 1.9 per cent.

  The stock is believed to be trading at more than a 36 per cent discount to an estimated net asset value of $5.10 per share.

  Since the beginning of last year, the scrip has outperformed the Hang Seng Index by 22.56 per cent.

  Earnings growth has mainly been achieved through a broader earnings base following recent purchases and improved market conditions.

  In the past two years, the company has gone on a buying spree, purchasing a number of hotels worldwide.

  It originally focused on Malaysia, Singapore and Taiwan but subsequently moved into New Zealand, Britain and the United States.

   Last year, it expanded its portfolio from 29 hotels with 6,000-plus rooms to 34 hotels with 9,000-plus hotel rooms.

  The five new hotels are The Hotel Millenium Hilton and Hotel Macklowe in New York, Hyatt Kingsgate in Sydney, Bailey's Hotel in London and Waitangi Resort Hotel in New Zealand.

 This month, CDL hotels also bought a 100-room hotel in New Zealand to be renamed as a Quality chain hotel.

  It is also interested in taking a stake in Donald Trump's Plaza Hotel in New York although the result of negotiations is not yet known.

  It appears that the company has been successful in capitalising on the recovery of the tourism market globally.

  Markets such as those of Singapore, New Zealand, Britain and the US have seen improved occupancies and room rates, while Hong Kong is still experiencing a healthy growth as a result of a tight hotel room supply.

  The company will become less dependent on operations in Singapore and Taiwan with the diversification of its businesses to other parts of the world, such as New Zealand and Australia, which have seen an upturn in the hotel industry.

  According to the consensus forecast of The Estimate Directory for this year, the company's earnings will grow by a meagre four per cent to $388 million.

  The earnings per share will be flat at 25 cents while dividend per share will jump by 12 per cent to seven cents.

  Prospective price-earnings multiple this year is forecast as 12.4 with a dividend yield of 2.2 per cent.

 CDL Hotels is controlled by Singaporean-based Hong Leong Investment Holdings.



Growth and better markets could increase earnings 102pc