NEW YORK— Millennium & Copthorne Plc expects the Iraq war and the SARS outbreak would hit its first-half profit hard, though its shares rose as it held out hope of a recovery in the United States and Europe. Operating more than 90 hotels in the United States, Europe, Asia and Australasia, M&C reported a 38% slump in first-quarter profit and weak trading figures for April., according to a report in Reuters. However, its shares traded 6.9% higher by 232.5 pence Wednesday morning after chairman Kwek Leng Beng said in a statement that recovery may be around the corner. “The conflict (in Iraq) is over and we are experiencing an improvement in the business environment in Europe and the U.S.,” he said. Previously, M&C shares had fallen by nearly 40% over the past 12 months. M&Cs properties in Europe and the U.S. were the worst hit in the slump that followed the September 11, 2001 terrorist attacks, with business travel falling sharply, the report indicated. The company said Asia continued to be a problem area, where business was severely affected by the spread of the deadly SARS virus, which had sharply reduced travel to and out of the region, the company said, according to the Reuters/ report. M&C said the SARS outbreak did not have a big impact until the third week of March, but had seriously affected business in April and May. The company, 52-percent owned by Singapore property firm City Developments Ltd., said RevPAR fell 5% year-on-year. In April, overall RevPAR fell 26%, with Asia down 52% and New York and London down 23% and 25%, respectively, according to the report. M&C, which managed to boost 2002 pretax profit by 11% by holding down costs, said it planned to cut costs further and would sell some of its non-core assets. SOURCE: Reuters
