London is leading a revpar recovery for Millennium & Copthorne Hotels with October seeing a small rise of +0.6% in the UK capital compared to continuing, if easing, decreases in New York and Singapore of -17.9% and -26.6% respectively.
Reporting its Q3 results, the group said revpar during October across all its hotels was down by -12.8% on the same period last year but figures have continued to improve throughout 2009.
M&C chairman Mr Kwek Leng Beng said: "I believe that the industry is moving in the right direction. The rate of decline of our global revpar has slowed quarter-on-quarter and this trend has continued into October. Traditionally, we experience strong trading in the fourth quarter and our current bookings are showing some positive momentum in demand."
He added it was too early to accurately predict how trading might be in 2010 but like other groups which have reported recently, he ventured to guess the worst was over.
During Q3 the group reported pre-tax profits of £21.9m – down 36.3% on a constant currency basis compared to the same quarter last year. Total revenue came in at £160.4m – down by -7.8%. Over the nine months the group showed pre-tax profits of £52.4m – a drop of 49.8% on total revenue of £476m which was down 19.5% compared to 2008.
On a regional basis during the third quarter, the group said Singapore was continuing to improve, while London's revpar decline of -6.2% could have been attributed to two key events – the biennial Farnborough Air Show which took place in July 2008 and not this year and the timing of Ramadan which this year shortened the lucrative Middle East summer season in August by two weeks. With no similar impacts in September revpar was virtually flat at -0.8%.
Leng Beng said the group was continuing to focus on delivering operating costs savings – so far amounting to £66.8m over nine months' trading. Group cuts backs included reduced staffing, redesigned processes and careful attention to detail, he added.
The group also reported new contracts in place in the Middle East – expanding the pipeline in the third quarter by five hotels to 27 and by 954 rooms to 8,460.
M&C subsidiary Singapore-based CDL Hospitality Trusts, reporting gross revenue of S$22.9m – down 21.4%, said nevertheless demand had recovered strongly in Q3 with average occupancy reaching 86.1% during the period – making it the REIT's strongest quarter this year in terms of occupancy rates and revpar.
Vincent Yeo, CEO of M&C REIT Management Limited said the prospects for Singapore tourism were continuing to improve as visitor numbers increased on the back of major Government and tourist board initiatives to make Singapore an attractive destination.
"The Formula One Singapore Grand Prix night race, along with the introduction of F1 Rocks marked a significant step forward in Singapore's transformation into a world-class travel destination."
He added that business confidence was returning to Singapore in the form of new entertainment venues from restaurants to nightclubs, family and sporting attractions and new concept and boutique hotels, plus the revitalisation of Singapore's main shopping area of Orchard Road.
"We are excited by this phase of transformation of Singapore's tourism industry…With the normalisation of capital markets, our strong balance sheet will also enable us to pursue acquisition opportunities so as to enhance returns to shareholders," Yeo concluded.