The fall in the value of sterling has added £43m and £7m to Millennium & Copthorne’s reported revenue and profit before tax respectively for the first nine months of 2016, according to a trading update released by the company.
The drop in value of the pound had a “significant impact” on the group’s results, it reports, with group revenue increasing by 8.1% to £665m, while profit before tax increased 4.1%. The report suggests the increase in revenue is a result of higher property revenue, increased contribution from the REIT and a positive foreign exchange impact of £43m.
The group’s London hotels saw third quarter occupancy increase by 4.8%, “reflecting higher inbound tourism” and a stronger revenue performance supported by revpar growth of 2.4%. On a constant currency basis, group revpar in London fell by 15% for the three weeks ended 21 October.
Refurbishments for the Millennium Hotel London Mayfair are planned for the end of this year. To minimise the impact on London occupancy, there will be a gap of at least 12 months before Millennium Hotel London Knightsbridge undertakes smaller scale refurbishment work.
Kwek Leng Beng, Millennium & Copthorne chairman, said: “Our London hotels have seen some positive benefits from leisure travellers following the EU referendum in June 2016 although the outlook for the UK economy is uncertain. We are monitoring the performance in all our markets closely and the group’s financial position remains strong. The group has a long term perspective and considers asset ownership as key to its strategy.”