Kingdom Hotels revenue drops 12 per cent
Riyadh, March 15, 2010
Kingdom Hotel Investments (KHI), a leading emerging markets hotel investment company, said its group revenue for last year plunged 12 per cent to $246.4 million from $278 million in 2008 owing to 'a tough economic climate.'
A part of Kingdom Holding Company, Dubai-based KHI enjoys strong relationships with three leading global hotel operators - Four Seasons Hotels and Resorts, Fairmont Hotels and Resorts and Movenpick Hotels and Resorts.
Announcing the results for the 12 months ended December 31, 2009, the KHI said the group's adjusted Ebitda including real estate sales dropped 24 per cent to $71.4 million from $94.1 million the previous year.
The revenue per available room (RevPAR) fell 11 per cent during the period, while the consolidated RevPAR fell seven per cent, the KHI said in a statement. The group, however, posted a 27 per cent jump in net profit which soared to $21.8 million.
The company said the development pipeline was on track with three projects in Seychelles, Marrakesh and Accra expected to reach post construction/pre completion stage this year.
KHI expects to register mid single digit growth in RevPAR during 2010, underpinned by good growth in Asia, said a top official.
Commenting on the results, KHI chief executive officer Sarmad Zok said the trading environment in 2009 remained challenging. RevPAR declines slowed in the second half of the year as the overall portfolio proved resilient and the company benefited from the diversity of our properties by both geography and market segment.
During the year we were able to realise substantial value from the sale of four assets and through the monetisation from our associate investments. 'The assets sale generated $87 million in value and $37 million in gains,' he noted.
According to Zok, the KHI remains profitable and cash generative. 'It spent $181 million in 2009 to advance its development projects,' he added.
Zok said the group will selectively consider strategic acquisitions within its targets markets this year. 'We will continue to manage the business tightly in the expectation that the current recovery in market conditions will remain slow and fragile,' he noted.
'Our focus on prudent asset management and cost control has enabled KHI to actively manage the business during the downturn. We are well positioned to execute our plans for the strategic development of the portfolio during the current year and into the medium term,' he added.-TradeArabia News Service