Mandarin In.sg Regulatory News (MDO)

RNS Number : 1343Q

Mandarin Oriental International Ld

29 July 2010

 

To: Business Editor 29th July 2010

For immediate release

 

The following announcement was issued today to a Regulatory Information Service approved by the Financial Services Authority in the United Kingdom.

 

MANDARIN ORIENTAL INTERNATIONAL LIMITED

HALF-YEARLY RESULTS FOR THE SIX MONTHS ENDED 30TH JUNE 2010

 

Highlights

·; Occupancy-led recovery continues

·; New Mandarin Oriental hotel opened in Macau

·; Hotel projects in Abu Dhabi and Doha announced

 

"While a full recovery is dependent on global economic conditions, the Group's performance is expected to improve as rates and occupancies continue to move towards pre-crisis levels."

 

Simon Keswick, Chairman

29th July 2010

 

Results 

	(unaudited)
Six months ended 30th June
		Restated
	2010	2009	Change
	US$m	US$m	%
Combined total revenue of hotels under management(1)	474.2	389.7	+22
EBITDA (Earnings before interest, tax, depreciation and
amortization)(2)	57.8	34.5	+68
Underlying profit attributable to shareholders(3)	13.5	1.1	n/a
Profit attributable to shareholders	13.5	74.2	―82
	US¢	US¢	%
Underlying earnings per share(3)	1.36	0.11	n/a
Earnings per share	1.36	7.53	―82
Interim dividend per share	2.00	2.00	-
	US$	US$	%
Net asset value per share	0.87	0.92	―5
Adjusted net asset value per share(4)	2.12	2.11	+1
Net debt/shareholders' funds	17%	13%
Net debt/adjusted shareholders' funds(4)	7%	6%
(1) Combined revenue includes turnover of the Group's subsidiary hotels in addition to 100% of revenue from associate, joint venture and managed hotels. (2) EBITDA of subsidiaries plus the Group's share of EBITDA of associates and joint ventures. (3) Underlying profit attributable to shareholders and underlying earnings per share exclude non-trading items such as gains on disposals and provisions against asset impairment. (4) The adjusted net asset value per share and net debt/adjusted shareholders' funds have been adjusted to include the market value of the Group's freehold and leasehold interests which are carried in the consolidated balance sheet at amortized cost.
The interim dividend of US¢2.00 per share will be payable on 13th October 2010 to shareholders on the register of members at the close of business on 20th August 2010. The ex-dividend date will be on 18th August 2010, and the share registers will be closed from 23rd to 27th August 2010, inclusive.

 

 

 

MANDARIN ORIENTAL INTERNATIONAL LIMITED

HALF-YEARLY RESULTS FOR THE SIX MONTHS ENDED 30TH JUNE 2010

 

OVERVIEW

Occupancy in the Group's hotels benefited from increased demand in the first half of 2010. The strongest performances were in Asia, particularly Hong Kong. Occupancies have, however, not yet reached the levels achieved in 2008, limiting the Group's capacity to raise average room rates. Across the portfolio, strict cost control measures continued to be enforced, and the hotels have successfully maintained or enhanced their relative market positions.

 

PERFORMANCE

Earnings before interest, tax, depreciation and amortization for the first six months of 2010 were US$58 million compared to US$35 million in the first half of 2009. The Group's underlying profit for the period was US$13 million, up from US$1 million in the same period in 2009. Profit attributable to shareholders was also US$13 million, which compares with US$74 million in the first half of 2009 which included a gain on a property disposal.

 

For the first six months of 2010, underlying earnings per share were US¢1.36, compared with US¢0.11 in 2009 or US¢7.53 including the non-trading items.

 

An unchanged interim dividend of US¢2.00 per share has been declared.

 

GROUP REVIEW

Subsidiaries

The Group's two wholly-owned Hong Kong hotels benefited from increased demand particularly from the corporate segment. At Mandarin Oriental, Hong Kong, revenue per available room ('RevPAR') increased by 46% over the same period last year, with improvements in both occupancy and rate. The Excelsior, Hong Kong also achieved stronger occupancy, at 84%, and produced an increase in RevPAR of 30%. Mandarin Oriental, Tokyo, which operates under a long-term lease, attracted higher occupancy despite new competitive supply in the market. The Manila hotel saw an increase in its corporate travel segment. Mandarin Oriental, Jakarta achieved a significantly higher average rate following its re-opening at the end of 2009 after a comprehensive renovation, but it will need time to build occupancy in an over-supplied market.

 

In Europe, the performance of the Group's wholly-owned London hotel remained strong in a market which was less affected in 2009 by the weaker global economy. Both the Munich and Geneva hotels recorded higher RevPAR as a result of strengthening demand. In the USA, the first-half performance at the 80%-owned Washington D.C. hotel declined in comparison with the same period in 2009, which had benefited from activities surrounding the Presidential Inauguration.

 

Associates and Joint Ventures

The share of results of associates and joint ventures rose due to stronger market conditions in Singapore, Kuala Lumpur, New York and Miami. Bangkok started the year well, but was impacted by political protests from March onwards.

 

DEVELOPMENTS

Mandarin Oriental currently operates 26 hotels and has a further 16 under development. Together these represent 17 hotels in Asia, 13 hotels in The Americas and 12 hotels in Europe, Middle East and North Africa. In addition the Group operates, or has under development, 14 Residences at Mandarin Oriental connected to the Group's properties.

 

The new 213-room Mandarin Oriental, Macau, located in the prestigious One Central complex, opened at the end of June. The Group has recently announced that it will brand and manage the 92 Residences and Apartments at Mandarin Oriental located above the hotel.

 

In the first half of 2010, Mandarin Oriental announced two new management contracts that will give the Group its first presence in the Middle East. Mandarin Oriental, Abu Dhabi will open in 2013 with 195 rooms and 50 Residences at Mandarin Oriental. Mandarin Oriental, Doha will open in 2014 with 160 rooms and 95 serviced apartments.

 

While some of the current 16 development projects continue to face delays, the Group is reviewing an increasing number of opportunities in key city centre and resort destinations around the world.

 

OUTLOOK

While a full recovery is dependent on global economic conditions, the Group's performance is expected to improve as rates and occupancies continue to move towards pre-crisis levels.

 

 

Simon Keswick

Chairman

29th July 2010

 

Mandarin Oriental International Limited
Consolidated Profit and Loss Account
	(unaudited)
	Six months ended 30th June																									Year ended 31st December
																														Restated
	2010												2009													2009
			Non-trading												Non-trading													Non-trading
	Underlying				items				Total			Underlying						items				Total			Underlying					Items				Total
	US$m				US$m				US$m				US$m					US$m				US$m				US$m				US$m				US$m
Revenue (note 2)	237.3				-				237.3				205.2					-				205.2				438.0				-				438.0
Cost of sales	(154.3)				-				(154.3)				(142.3)					-				(142.3)				(298.1)				-				(298.1)
Gross profit	83.0				-				83.0				62.9					-				62.9				139.9				-				139.9
Selling and distribution costs	(17.5)				-				(17.5)				(15.7)					-				(15.7)				(33.6)				-				(33.6)
Administration expenses	(40.3)				-				(40.3)				(34.2)					-				(34.2)				(78.5)				(4.2)				(82.7)
Operating profit (note 3)	25.2				-				25.2				13.0					-				13.0				27.8				(4.2)				23.6
Financing charges	(7.6)				-				(7.6)				(10.0)					-				(10.0)				(19.1)				-				(19.1)
Interest income	0.6				-				0.6				2.0					-				2.0				3.9				-				3.9
Net financing charges	(7.0)				-				(7.0)				(8.0)					-				(8.0)				(15.2)				-				(15.2)
Share of results of associates and joint ventures (note 4)	1.7				-				1.7				(1.1)					(5.4)				(6.5)				0.9				(5.7)				(4.8)
Gain on disposal of joint venture (note 5)	-				-				-				-					78.5				78.5				-				80.8				80.8
Profit before tax	19.9				-				19.9				3.9					73.1				77.0				13.5				70.9				84.4
Tax (note 6)	(6.4)				-				(6.4)				(2.8)					-				(2.8)				(1.1)				-				(1.1)
Profit after tax	13.5				-				13.5				1.1					73.1				74.2				12.4				70.9				83.3
Attributable to:
Shareholders of the Company	13.5				-				13.5				1.1					73.1				74.2				12.5				70.9				83.4
Minority interests	-				-				-				-					-				-				(0.1)				-				(0.1)
	13.5				-				13.5				1.1					73.1				74.2				12.4				70.9				83.3
									US¢													US¢												US¢
Earnings per share (note 7)
- basic									1.36													7.53												8.47
- diluted									1.36													7.50												8.43

 

 

Mandarin Oriental International Limited
Consolidated Statement of Comprehensive Income
		(unaudited)
		Six months ended							Year ended
						30th June			31st December
						Restated				Restated
		2010				2009				2009
		US$m				US$m				US$m
Profit for the period		13.5				74.2				83.3
Actuarial losses on employee benefit plans		-				-				8.7
Net exchange translation differences		(17.3)				13.7				15.7
Fair value (losses)/gains on cash flow hedges		(6.7)				6.8				7.2
Share of other comprehensive income of associates		1.4				0.1				2.2
Tax relating to components of other comprehensive
income (note 6)		0.9				(1.3)				(2.8)
Other comprehensive income for the period		(21.7)				19.3				31.0
Total comprehensive income for the period		(8.2)				93.5				114.3
Attributable to:
Shareholders of the Company		(7.5)				93.8				114.4
Minority interests		(0.7)				(0.3)				(0.1)
		(8.2)				93.5				114.3

 

 

 

Mandarin Oriental International Limited
Consolidated Balance Sheet
						(unaudited)				At 31st
		At 30th June								December
						Restated				Restated
		2010				2009				2009
		US$m				US$m				US$m
Net assets
Intangible assets		48.7				46.6				46.9
Tangible assets		948.2				961.2				976.6
Associates and joint ventures		70.7				63.7				68.4
Other investments		4.5				4.1				4.3
Loans receivable		4.2				4.8				3.1
Pension assets		16.0				6.3				16.5
Deferred tax assets		16.3				17.3				15.5
Non-current assets		1,108.6				1,104.0				1,131.3
Stocks		4.0				3.7				4.2
Debtors and prepayments		59.2				57.7				57.5
Current tax assets		6.5				15.1				6.8
Cash at bank		419.3				562.9				561.6
Current assets		489.0				639.4				630.1
Creditors and accruals		(79.0)				(79.7)				(91.5)
Current borrowings		(28.4)				(98.1)				(120.2)
Current tax liabilities		(5.9)				(4.9)				(4.9)
Current liabilities		(113.3)				(182.7)				(216.6)
Net current assets		375.7				456.7				413.5
Long-term borrowings		(538.0)				(585.1)				(557.1)
Deferred tax liabilities		(61.7)				(51.3)				(58.9)
Pension liabilities		(0.5)				-				(0.5)
Other non-current liabilities		(19.9)				(13.3)				(12.7)
		864.2			911.0					915.6
Total equity
Share capital		49.6				49.3				49.4
Share premium		175.6				170.2				171.3
Revenue and other reserves		635.3				687.3				690.5
Shareholders' funds		860.5				906.8				911.2
Minority interests		3.7				4.2				4.4
		864.2				911.0				915.6

 

 

Mandarin Oriental International Limited

Consolidated Statement of Changes in Equity

 

															Attributable to shareholders of the Company
																	Asset					Attributable to		Attributable to
							Share		Share			Capital			Revenue	revaluation			Hedging		Exchange	shareholders of			minority		Total
							capital		premium			reserves			reserves		reserves		reserves		reserves	the Company			interests		equity
							US$m		US$m			US$m			US$m		US$m		US$m		US$m		US$m		US$m		US$m
Six months ended 30th June 2010
At 1st January 2010
- as previously reported							49.4		171.3			272.4			436.8		182.5		(10.7)		(73.2)		1,028.5		4.5		1,033.0
- change in accounting policy for
	owner-occupied properties						-		-			-			6.0		(182.5)		-		59.2		(117.3)		(0.1)		(117.4)
- as restated							49.4		171.3			272.4			442.8		-		(10.7)		(14.0)		911.2		4.4		915.6
Total comprehensive income							-		-			-			13.5		-		(5.9)		(15.1)		(7.5)		(0.7)		(8.2)
Dividends paid by the Company							-		-			-			(49.4)		-		-		-		(49.4)		-		(49.4)
Issue of shares							0.2		4.3			-			-		-		-		-		4.5		-		4.5
Employee share option schemes							-		-			1.7			-		-		-		-		1.7		-		1.7
At 30th June 2010							49.6		175.6			274.1			406.9		-		(16.6)		(29.1)		860.5		3.7		864.2
Six months ended 30th June 2009
At 1st January 2009
- as previously reported							49.2		168.9			268.4			415.5		220.0		(16.3)		(99.3)		1,006.4		5.1		1,011.5
- change in accounting policy for
	owner-occupied properties						-		-			-			5.4		(220.0)		-		67.3		(147.3)		(0.6)		(147.9)
- as restated							49.2		168.9			268.4			420.9		-		(16.3)		(32.0)		859.1		4.5		863.6
Total comprehensive income							-		-			-			74.2		-		5.4		14.2		93.8		(0.3)		93.5
Dividends paid by the Company							-		-			-			(49.2)		-		-		-		(49.2)		-		(49.2)
Issue of shares							0.1		1.3			-			-		-		-		-		1.4		-		1.4
Employee share option schemes							-		-			1.7			-		-		-		-		1.7		-		1.7
At 30th June 2009							49.3		170.2			270.1			445.9		-		(10.9)		(17.8)		906.8		4.2		911.0
Year ended 31st December 2009
At 1st January 2009
- as previously reported							49.2		168.9			268.4			415.5		220.0		(16.3)		(99.3)		1,006.4		5.1		1,011.5
- change in accounting policy for
	owner-occupied properties						-		-			-			5.4		(220.0)		-		67.3		(147.3)		(0.6)		(147.9)
- as restated							49.2		168.9			268.4			420.9		-		(16.3)		(32.0)		859.1		4.5		863.6
Total comprehensive income							-		-			-			90.8		-		5.6		18.0		114.4		(0.1)		114.3
Dividends paid by the Company							-		-			-			(68.9)		-		-		-		(68.9)		-		(68.9)
Issue of shares							0.2		2.4			-			-		-		-		-		2.6		-		2.6
Employee share option schemes							-		-			4.0			-		-		-		-		4.0		-		4.0
At 31st December 2009							49.4		171.3			272.4			442.8		-		(10.7)		(14.0)		911.2		4.4		915.6
Total comprehensive income for the six months ended 30th June 2010 included in revenue reserves comprises profit attributable to shareholders of the Company of US$13.5 million (2009: US$74.2 million).
Total comprehensive income for the year ended 31st December 2009 included in revenue reserves comprises profit attributable to shareholders of the Company of US$83.4 million, and actuarial gains on employee benefit plans of US$7.4 million.