Millennium and Copthorne Revenue Falls £6.3m in first quarter

Millennium and Copthorne hotel group has reported a £6.3m drop in revenue after its international hotels were affected by a series of economic and internal factors.

Announcing its first quarter results, the group explained the drop from £175.5m in the first quarter of 2012 to £169.2m for the same period this year was due to various issues.

Operating profit fell by 48.3% to £10.7m (£20.7m for the same period last year), as the group's high operating leverage (costs) meant that most of the reduction in revenue hit M&C's bottom line.

But it wasn't all doom and gloom, as RevPAR for the group increased by 1.6% and net cash increased from £52.2m in December 2012, to £65.5m (before paying 2012 final dividend of £37.3m) .

Chairman Kwek Leng Beng said: "Although Group RevPAR increased by 1.6% over the three months ended 31 March 2013, revenue declined due to a number of factors, which are unlikely to abate in the foreseeable future."

He also explained that Asia, which had accounted for over 40% of Group revenue last year and has led M&C's revenue and profit growth in recent years, is now facing a number of political, economic and other challenges that are likely to continue to impact the company's performance.

But he added: "Against this challenging backdrop, the group's strong financial position equips us to overcome the on-going economic headwinds and gives us flexibility, both to act quickly on attractive acquisition opportunities and to support our asset investment activities. We are continuing to strengthen and reinvigorate the group's management team."

M&C is part way through a £240m programme of investment into the Group's existing portfolio.