Mandarin Oriental M04 has recorded an underlying profit of US$28 million ($37.29 million), a reversal from its underlying loss of US$21 million in the same period last year, and more than double in 2019. This was driven by the recovery of key owned hotels in Asia, according to the group.
Net debt fell to US$233 million as at June 30, from US$376 million at the end of 2022.
The group’s available cash and committed facilities are at US$840 million.
Gearing as a percentage of adjusted shareholders’ funds was 5% at the end of June, taking into account the market value of the group’s properties.
An interim dividend of 1.5 US cents per share has been declared.
The group sold its Jakarta property during the period. The hotel will continue to be managed as a Mandarin Oriental hotel, and the transaction generated a post-tax gain on disposal of US$43 million.
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The valuation of the Causeway Bay site under development decreased between Dec 31, 2022 and June 30, 2023, resulting in a non-trading loss for the group of US$141 million.
Total losses attributable to shareholders were US$69 million in the first half of 2023, compared to losses of US$18 million in the same period last year.
The group says that the revenue per available room (RevPAR) was well ahead of both 2022 and 2019, and it delivered strong rates in many locations, with resorts performing especially well.
Occupancy also strengthened significantly across all regions compared to the first half of 2022, with “particular strength” seen in Europe and the Middle East where almost all of the hotels achieved record rates and strong occupancies.
The combined total revenue of hotels under management in the first half of 2023 was at US$882 million, representing a 30% increase compared to the same period last year, and 38% higher than 2019.
The group has several new openings scheduled for the second half of 2023, including four new hotels in Costa Navarino, London, Muscat and Zurich, a rebranding in Riyadh, and a standalone residences project on Fifth Avenue in New York.
With four new hotel management contracts and a standalone residences project in Madrid announced in the first half of the year, the group’s developments have expanded to 27 hotels – 14 of which have residences – and two standalone residences over the next five years.
Shares in Mandarin Oriental closed 2 US cents higher or 1.25% up at US$1.62 on July 28.
