Expansion planned at Macdonald
Macdonald Hotels is continuing to expand its portfolio, spending more than £15m on refurbishment, new builds and acquisitions, despite revealing mediocre interim results this week.
Over the six-month period to 3 April, Macdonald Hotels acquired Linden Hall Hotel in Northumberland for £5.25m, opened the Cardrona Hotel, Golf and Country Club in the Scottish Borders, secured planning permission for a new-build, £18m, 156-bedroom hotel in Sheffield city centre and is starting work on a new joint-venture hotel in Cardiff.
The northern hotel group reported a 1% overall growth in room yields to £46.25, an increase driven by a 3% growth in occupancy to 63%. Average room rates in the six months to 3 April dropped 2% to £73.29, however.
InterContinental to sell hotels
InterContinental Hotels, the hotels arm of the demerged Six Continents, announced it could sell up to half of its owned hotels to unlock value for shareholders at an interim results meeting last week.
The group intends to cut back on capital expenditure and sell a number of assets. Chief executive Richard North has instigated an asset review of the entire owned estate, and up to 800 jobs could be lost.
M&B puts itself under scrutiny
Mitchells & Butlers (M&B) has unveiled plans to refinance the business, cut costs and boost sales in its first financial statement as a standalone company.
The 2,095-strong managed pub and restaurant group now intends to scrutinise the business and return at least £400m to shareholders. In the six months to 12 April, it has boosted marketing, promotions and pricing to drive sales, improved staff productivity by 5%, cut purchasing costs by 6% and reduced overheads to save £5m in the second half and an estimated £10m in 2004.
Turnover edged up by 0.9% to £793m in the six months, but pre-tax profits dropped from £100m to £93m. Drink sales fell by 1% but food sales increased by 2.7%.
Declines in like-for-like sales have improved, from 4.5% in the eight weeks to the end of November to 3.7% in the 12 weeks to 12 April and 3.1% in the eight weeks to 10 May.
Sars hits M&C
The impact of SARS on Millennium & Copthorne (M&C), meant the company's profits warning last week came as no surprise.
The combined impact of the virus and the war in Iraq meant revpar for the group in Asia was down 52% in April.
The company said it would continue to monitor its cost base carefully. In Asia, shorter working weeks for staff have been introduced as well as the mothballing of guestrooms and the closure of unprofitable outlets. A £4m profit on the sale of one of the company's staff hostels in London has also improved the bottom line.
In the three months to 31 March, pre-tax profits fell from £7.6m to £4.7m.