Luxury hotel group Mandarin Oriental has seen its earnings in the first half nosedive due to the closure for renovation of its flagship property in Hong Kong.
Despite this the international operator said conditions remained favourable in its key markets with room rates benefiting from growing demand and limited supply.
Turnover in the six months ended 30 June at hotels under management increased 2% to $398.4m (£214m), from 2005: $390.1m (£209.4m)
The Hong Kong hotel is due to reopen in September with some 200 rooms and most of the public areas completed. The full complement of 502 rooms is expected to be available by the end of the year.
Company chairman Simon Keswick said: "While revenues in the second half will continue to be affected by the Hong Kong renovation, overall market conditions in Mandarin Oriental's key locations are expected to remain strong for the remainder of the year."
Mandarin sold its New York hotel The Mark in February for $150m (£80.6m) and has entered into three new management contracts during the period.
These comprise a 292-room luxury resort on Hainan Island in China, scheduled to open in the first half of 2007; the Mandarin Oriental Barcelona, which is due to open in late 2007; and the management contract at a 120-room luxury hotel and 90 residences being developed in Dallas, Texas for 2009.
By Chris Druce