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Mandarin Oriental profit dips slightly on hotel renovations
BRITISH hotel management group Mandarin Oriental's profit for the 2017 financial year dipped by 1 per cent to US$54.9 million on the back of renovations of both Mandarin Oriental Hyde Park, London as well as the Hotel Ritz, Madrid.
The mainboard-listed group's chairman, Ben Keswick, however, said the group will benefit from the renovations in the long term.
Overall, revenue crept up to US$610.8 million from US$597.4 million the previous year. The group also clocked higher earnings per share at 4.37 US cents compared with 4.56 US cents in 2016, and a 9 per cent increase in net asset value per share to US$1.01.
Mandarin Oriental reported 5 per cent overall higher revenue per available room (RevPAR) in US dollar terms.
The performance of Mandarin Oriental Hyde Park was affected by the phased renovation and "ongoing security concerns" in the city, the group said, denting RevPAR by 37 per cent as a result.
The first phase of renovations was completed in September 2017, with the second phase, involving the Hyde Park wing, now underway.
The group announced that it is reviewing options for The Excelsior in Hong Kong, including possible redevelopment into commercial property, after failing to receive strong offers for it.
The Excelsior itself saw increased occupancy, leading to a 7 per cent increase in RevPAR.
Mandarin Oriental revealed it currently has 15 hotels and nine residences under development, all scheduled to become operational within five years.
In addition, the group's maiden entry into Australia will be marked by a new 197-room hotel and 146 branded residences located in Melbourne, due to open in 2022.
A final dividend of 1.5 US cents per share will be paid on May 16, 2018.