US market star performer for Fairmont

27 October 2005
US market star performer for Fairmont

US hotels were the star performers in the third quarter of 2005 for Fairmont Hotels and Resorts, but its international properties did not fare so well.

The North American-based company owns or manages 88 luxury hotels, primarily in the Americas, UK, Africa and Middle East.

Earnings before interest, tax, depreciation and amortisation (EBITDA) slumped to $79.2m (£44m) from $207.7m (£116m) in the same period in 2004. However, the 2004 figure include gains from disposals of $144.2m (£81m) compared with gains of just $17.9m (£10m) in 2005.

Company-owned hotels boosted EBITDA by 440% in the US and by 5.2% in Canada, but international properties recorded a 38% fall.

Similarly, turnover from US- and Canadian-owned properties rose by 28.1% and 10.2% respectively but fell by 3.8% overseas.

Fairmont's owned hotels boosted revenues in the three months to the end of September by 15.7% to $240m (£134m) compared with $207.5m (£116m) the previous year.

The hotels managed by Fairmont, which includes the Savoy in London, boosted turnover by 12.4% to $511m (£287m) while those managed by its Delta subsidiary registered a 17.7% rise in turnover to $125m (£70m).

"We expect that our US hotels will continue to benefit from strong industry fundamentals and perform to our original expectations," said chief executive officer William Fatt.

"Although we experienced some weakness in our international portfolio in the third quarter, we anticipate that these hotels will experience modest year-over-year growth in the fourth quarter."

The group anticipates a full-year EBITDA of between $165m (£93m) and $175m (£98m).

By Angela Frewin

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