Release Date: August 07, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Consolidated revenue increased by 89% to $4.6 billion, driven by the sale of Peninsula branded London residences and new hotel openings.
- The Peninsula London and Istanbul are showing positive momentum, with London achieving high RevPAR and significant revenue in recent months.
- The Repulse Bay and Peak Tower properties in Hong Kong experienced strong performance, with revenue improvements and high demand.
- The company received an A credit rating from Japan Credit Rating Agency Limited, reflecting strong financial management.
- Peninsula Merchandising revenue increased by 58%, indicating strong brand performance despite soft retail markets.
Negative Points
- The company reported a loss of $448 million for the period, compared to a profit of $95 million last year, due to high depreciation and interest costs.
- The Peninsula New York renovation impacted revenue, with a large portion of inventory unavailable during the period.
- Weak tourism sentiment in Hong Kong and a weak second quarter affected overall operating results.
- The company faces challenges in stabilizing new hotels in London and Istanbul, with profitability not yet achieved due to high fixed costs.
- The property revaluation deficit, although small in percentage terms, contributed to the negative financial results.
Q & A Highlights
Q: When do you expect the remaining six apartments to be sold?
A: Demand is quite good, and there have been many more viewings recently. We are not willing to compromise on pricing, and we expect some good news soon.
Q: Can you comment on the profitability of Peninsula London and Istanbul since opening?
A: Profitability is not yet good due to depreciation and interest costs. However, Peninsula London has shown strong revenue, being the highest in the Group for July. We expect improvements as revenue increases and interest costs decrease with residential sales.
Q: Is there going to be a new hotel in the near future?
A: No new hotels are planned as the focus is on stabilizing London and Istanbul. We prefer to invest in existing properties to create more value with less risk.
Q: What is your view on the outlook of Hong Kong?
A: The outlook is positive due to Hong Kong's professionalism, infrastructure, and strong financial services sector. While tied to China's fortunes, Hong Kong remains competitive and will benefit as China continues to grow.
Q: Do we have any questions from the floor?
A: No questions from the floor. Thank you very much.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
