Press Release - Half Year Results

Press Release - Half Year Results

27-Feb-1998

THAKRAL PROFITS UP 10%

The Joint Chairman of Thakral Holdings Limited, Mr Ted Harris, today announced an after tax profit for the six months ended 31 December 1997 of $15.2 million (1996 $13.8 million) an increase of 10.1%.

Total revenue rose from $101.7 million to $107 million - an increase of 5%. Earnings per stapled security rose to 3.16 cents, an increase of 3%.

An interim dividend of 2.5 cents per stapled security has been declared and is payable on 31 March 1998.

Mr Harris said:

"The operating profit from the hotels division again emphasizes the benefit of the diverse portfolio. Increases were achieved by our hotels in Sydney, Melbourne, Adelaide and Launceston while there were unsatisfactory results from the Atrium Hotel in Darwin and the Grand Mercure on the Gold Coast. However, overall, excluding Pacific Bay Resort which operated for only part of the previous period, the operating profit from the hotels division increased from $19.8 million to $20 million.

This result was achieved in the face of a down turn in inbound tourism and increased competition especially in Darwin and the Gold Coast. The differing results between Thakral hotels underlines the advantage of a diversified portfolio of properties both in terms of geographical spread and the different type of business that each property attracts.

In the period under review, there was a strong contribution from Pacific Century Hotels, the Group's joint venture Trust and owner of the Hilton on the Park in Melbourne.

Thakral's retail and commercial division, which owns the newly named Thakral House and retail ramps at Wynyard Station in Sydney, the Australia on Collins Shopping Centre in Melbourne, the Oasis Retail Centre on the Gold Coast and Bayside Commercial and Retail Centre at Brighton Le Sands, recorded a 3% increase in profits contributing $5.9 million to the Group result.

The sale of residential lots and apartments at the 95 ha Pacific Bay property, located 3 klms north of Coffs Harbour, which was acquired in the knowledge that it would take both time and effort to return a profit from the resort section of the property, has substantially exceeded operating losses from the hotel, providing shareholders with a satisfactory return. As a result of a strategic marketing campaign the Resort, is now showing significantly improved occupancy for the six months at 61% and in January, 92%. In excess of $1 million in marketing the Pacific Bay Resort has been expended in the period under review and this amount has been written off against the profits.

Thakral's hotels contributed approximately 67% of the Group's gross profit and have only a minor exposure to South East Asia, the business of which contributes less than 4% of gross operating profit.

Having regard to the results achieved for the 7 months of this financial year (January produced a result in excess of budget and last January) the Board anticipates the full year result will be not less than the 1997 record year."

The Board proposes to implement a share buy-back scheme for 20 million shares subject to obtaining all relevant approvals.

The Board has decided to continue the Distribution Reinvestment Plan but to discontinue the current 5% discount.

THG is a listed hotel owner and manager in Australia, owning some 3,094 rooms in its own right or through PCH and managing 3,488 rooms under the All Seasons brand. The group also holds diversified investments in shopping centres, commercial offices and public carparking generally associated with the hotels.

Contact:
John Schaap
Managing Director
Ph: 9272 8888
0417 217 632

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