TIDMMDO TIDMJAR TIDMJDS
RNS Number : 8225M
Mandarin Oriental International Ltd
03 August 2017
To: Business Editor 3rd August 2017
For immediate release
The following announcement was issued today to a Regulatory
Information Service approved by the Financial Conduct Authority in
the United Kingdom.
MANDARIN ORIENTAL INTERNATIONAL LIMITED
HALF-YEARLY RESULTS FOR THE SIX MONTHSED 30TH JUNE 2017
Highlights
l Lower earnings due to renovation of London property
l Strategic review of The Excelsior, Hong Kong announced
l Four new management contracts signed
"While earnings will continue to be impacted into 2018 by the
renovation of the London property, the Group's strong brand,
healthy balance sheet and portfolio growth will support its future
performance."
Ben Keswick
Chairman
Results
(unaudited)
Six months ended 30th June
2017 2016 Change
US$m US$m %
--------------------------------------------------------- ------ ----- ------
Combined total revenue of hotels under
management(1) 644.8 643.8 -
Underlying EBITDA (Earnings before interest,
tax, depreciation and amortization)(2) 61.5 70.8 -13
Underlying profit attributable to shareholders(3) 15.0 24.7 -39
Profit attributable to shareholders 15.0 22.9 -34
USc USc %
--------------------------------------------------------- ------ ----- ------
Underlying earnings per share(3) 1.19 1.97 -40
Earnings per share 1.19 1.82 -35
Interim dividend per share 1.50 1.50 -
US$ US$ %
--------------------------------------------------------- ------ ----- ------
Net asset value per share(4) 0.97 0.93 +4
Adjusted net asset value per share(4)(5) 3.13 3.10 +1
Net debt/shareholders' funds(4) 26% 25%
Net debt/adjusted shareholders' funds(4)(5) 8% 8%
--------------------------------------------------------- ------ ----- ------
(1) Combined revenue includes turnover of the Group's subsidiary
hotels in addition to 100% of revenue from associate, joint
venture and managed hotels.
(2) EBITDA of subsidiaries plus the Group's share of EBITDA
of associates and joint ventures.
(3) The Group uses 'underlying profit' in its internal financial
reporting to distinguish between ongoing business performance
and non-trading items, as more fully described in note 7 to
the condensed financial statements. Management considers this
to be a key measure which provides additional information to
enhance understanding of the Group's underlying business performance.
(4) At 30th June 2017 and 31st December 2016, respectively.
(5) The Group's freehold and leasehold interests are carried
in the consolidated balance sheet at amortized cost. Both the
adjusted net asset value per share and net debt/adjusted shareholders'
funds for 30th June 2017 and 31st December 2016 have been adjusted
to include the market value of the Group's freehold and leasehold
interests which were appraised as at 31st December 2016.
--------------------------------------------------------------------------------
The interim dividend of USc1.50 per share will be payable on
19th October 2017 to shareholders on the register of members
at the close of business on 25th August 2017.
MANDARIN ORIENTAL INTERNATIONAL LIMITED
HALF-YEARLY RESULTS FOR THE SIX MONTHSED 30TH JUNE 2017
OVERVIEW
Group earnings were lower during the first half of the year
primarily due to the impact of the ongoing renovation of the London
property. The collective results of the Group's other hotels were
largely in line with the first half of 2016.
In June, the Group announced it was undertaking a review of its
long-term strategic options with regard to The Excelsior, Hong
Kong, including testing market interest in a possible sale of the
property for redevelopment.
PERFORMANCE
Underlying earnings before interest, tax, depreciation and
amortization for the first six months of 2017 were US$62 million,
down from US$71 million in the first half of 2016.
Underlying profit for the period was US$15 million, compared
with US$25 million in 2016, and underlying earnings per share were
USc1.19, compared with USc1.97 in 2016. With no non-trading items
during the period, profit attributable to shareholders was also
US$15 million. This compares to US$23 million in 2016, after
deducting US$2 million of transaction costs related to the
acquisition of Mandarin Oriental, Boston.
An interim dividend of USc1.50 per share has been declared,
unchanged from last year.
At 30th June 2017, the Group's net debt was US$321 million,
compared to US$297 million at the end of 2016.
GROUP REVIEW
Overall Group earnings were lower during the first half of the
year mainly due to the impact of the ongoing phased renovation in
London. The Group's results were also negatively impacted by
inclusion for the first time of the traditionally weak first
quarter of the Boston hotel, which was acquired at the end of April
2016. Elsewhere, weaker results in Jakarta and New York were more
than offset by improved performances in Paris, Munich and
Washington. Results across the rest of the portfolio, including
Hong Kong, were broadly stable.
The renovation of Mandarin Oriental Hyde Park, London remains on
schedule, with the first phase due to complete in August. The
second phase, which will commence in September, is expected to
complete in the second quarter of 2018.
STRATEGIC REVIEW OF THE EXCELSIOR, HONG KONG
Following an announcement in June, the Group is pursuing
strategic options for The Excelsior, Hong Kong, which include the
possible sale of the property for redevelopment. The wholly-owned
property, which is the Group's only four star hotel, is situated on
a prime commercial site that has approval for the development of a
commercial building. The process is continuing and a further
announcement will be made once a decision is reached on the
preferred course of action.
NEW DEVELOPMENTS
The Group announced four management contracts during the first
half of 2017. New hotels, each with branded residences, are
scheduled to open in Dubai and Honolulu in 2020, and in Melbourne
in 2022. The Group has also taken over the management of a hotel in
Santiago, Chile, which will be rebranded as Mandarin Oriental,
Santiago once an extensive guestroom and public area renovation has
been completed.
OUTLOOK
While earnings will continue to be impacted into 2018 by the
renovation of the London property, the Group's strong brand,
healthy balance sheet and portfolio growth will support its future
performance.
Ben Keswick
Chairman
Mandarin Oriental International Limited
Consolidated Profit and Loss Account
(unaudited)
Six months ended 30th June Year ended 31st December
2017 2016 2016
Underlying Non- Underlying Non- Underlying Non-
business trading business trading business trading
performance items Total performance items Total performance items Total
US$m US$m US$m US$m US$m US$m US$m US$m US$m
Revenue (note 2) 286.7 - 286.7 288.2 - 288.2 597.4 - 597.4
Cost of sales (189.1) - (189.1) (185.6) - (185.6) (383.4) - (383.4)
------- ----------- ------- ------- -------
Gross profit 97.6 - 97.6 102.6 - 102.6 214.0 - 214.0
Selling and
distribution
costs (19.8) - (19.8) (20.0) - (20.0) (39.7) - (39.7)
Administration
expenses (55.3) - (55.3) (52.3) (1.8) (54.1) (104.5) (1.8) (106.3)
----------- ------- ------- ----------- ------- ------- ----------- ------- -------
Operating profit
(note
3) 22.5 - 22.5 30.3 (1.8) 28.5 69.8 (1.8) 68.0
Financing charges (6.2) - (6.2) (5.9) - (5.9) (12.1) - (12.1)
Interest income 0.6 - 0.6 0.7 - 0.7 1.3 - 1.3
Net financing
charges (5.6) - (5.6) (5.2) - (5.2) (10.8) - (10.8)
Share of results
of
associates and
joint
ventures (note
4) 3.0 - 3.0 5.0 - 5.0 11.2 (0.3) 10.9
----------- ------- -------
Profit before tax 19.9 - 19.9 30.1 (1.8) 28.3 70.2 (2.1) 68.1
Tax (note 5) (4.7) - (4.7) (5.6) - (5.6) (13.7) - (13.7)
----------- ------- ------- ----------- ------- ------- ----------- ------- -------
Profit after tax 15.2 - 15.2 24.5 (1.8) 22.7 56.5 (2.1) 54.4
----------- ------- ------- ----------- ------- ------- ----------- ------- -------
Attributable to:
Shareholders of
the
Company 15.0 - 15.0 24.7 (1.8) 22.9 57.3 (2.1) 55.2
Non-controlling
interests 0.2 - 0.2 (0.2) - (0.2) (0.8) - (0.8)
----------- ------- ------- ----------- ------- ------- ----------- ------- -------
15.2 - 15.2 24.5 (1.8) 22.7 56.5 (2.1) 54.4
----------- ------- ------- ----------- ------- ------- ----------- ------- -------
USc USc USc USc USc USc
Earnings per
share
(note 6)
- basic 1.19 1.19 1.97 1.82 4.56 4.40
- diluted 1.19 1.19 1.96 1.82 4.54 4.38
----------- ------- ----------- ------- ----------- -------
Mandarin Oriental International Limited
Consolidated Statement of Comprehensive Income
(unaudited) Year ended
Six months ended 31st
30th June December
2017 2016 2016
US$m US$m US$m
Profit for the period 15.2 22.7 54.4
Other comprehensive income/(expense)
---------
Items that will not be reclassified
to profit or loss:
--------- --------- ----------
Remeasurements of defined benefit
plans - - (3.1)
Tax on items that will not be reclassified - - 0.5
--------- --------- ----------
- - (2.6)
Items that may be reclassified subsequently
to profit or loss:
--------- --------- ----------
Net exchange translation differences
- net gains/(losses) arising during
the period 61.6 (4.3) (56.1)
Cash flow hedges
- net (losses)/gains arising during
the period (0.5) - 2.5
Tax relating to items that may be
reclassified 0.1 - (0.4)
Share of other comprehensive income/(expense)
of associates and joint ventures 4.6 4.2 (1.7)
--------- --------- ----------
65.8 (0.1) (55.7)
Other comprehensive income/(expense)
for the period, net of tax 65.8 (0.1) (58.3)
--------- --------- ----------
Total comprehensive income/(expense)
for the period 81.0 22.6 (3.9)
--------- --------- ----------
Attributable to:
Shareholders of the Company 80.6 22.8 (3.0)
Non-controlling interests 0.4 (0.2) (0.9)
--------- --------- ----------
81.0 22.6 (3.9)
--------- --------- ----------
Mandarin Oriental International Limited
Consolidated Balance Sheet
(unaudited) At 31st
At 30th June December
2017 2016 2016
US$m US$m US$m
Net assets
Intangible assets 44.5 43.9 44.3
Tangible assets 1,416.0 1,386.9 1,352.1
Associates and joint ventures 176.6 171.6 163.8
Other investments 10.7 11.1 10.7
Deferred tax assets 2.2 2.5 2.6
------- ------- --------
Non-current assets 1,650.0 1,616.0 1,573.5
Stocks 6.1 6.3 5.9
Debtors and prepayments 84.6 92.6 94.2
Current tax assets 4.4 1.3 5.2
Bank and cash balances 157.2 181.7 182.6
------- ------- --------
Current assets 252.3 281.9 287.9
------- ------- --------
Creditors and accruals (131.4) (126.9) (140.1)
Current borrowings (0.2) (3.3) (2.5)
Current tax liabilities (9.2) (7.9) (8.7)
------- ------- --------
Current liabilities (140.8) (138.1) (151.3)
------- ------- --------
Net current assets 111.5 143.8 136.6
Long-term borrowings (477.8) (482.0) (477.4)
Deferred tax liabilities (55.7) (57.5) (56.1)
Pension liabilities (3.8) (1.0) (3.2)
Other non-current liabilities (1.0) (1.7) -
------- ------- --------
1,223.2 1,217.6 1,173.4
------- ------- --------
Total equity
Share capital 62.9 62.8 62.8
Share premium 492.8 490.3 490.4
Revenue and other reserves 663.1 659.7 616.2
------- ------- --------
Shareholders' funds 1,218.8 1,212.8 1,169.4
Non-controlling interests 4.4 4.8 4.0
------- ------- --------
1,223.2 1,217.6 1,173.4
------- ------- --------
Mandarin Oriental International Limited
Consolidated Statement of Changes in Equity
Attributable
to Attributable
shareholders to non-
Share Share Capital Revenue Hedging Exchange of the controlling Total
capital premium reserves reserves reserves reserves Company interests equity
US$m US$m US$m US$m US$m US$m US$m US$m US$m
Six months
ended 30th
June 2017
(unaudited)
At 1st January
2017 62.8 490.4 286.2 501.2 (0.6) (170.6) 1,169.4 4.0 1,173.4
Total
comprehensive
income - - - 15.0 (0.4) 66.0 80.6 0.4 81.0
Dividends paid
by the
Company - - - (31.4) - - (31.4) - (31.4)
Issue of
shares 0.1 - - - - - 0.1 - 0.1
Share-based
long-term
incentive
plans - - 0.1 - - - 0.1 - 0.1
Transfer - 2.4 (18.9) 16.5 - - - - -
------- ------- -------- -------- -------- -------- ------------ ------------ -------
At 30th June
2017 62.9 492.8 267.4 501.3 (1.0) (104.6) 1,218.8 4.4 1,223.2
Six months
ended 30th
June 2016
(unaudited)
At 1st January
2016 62.8 490.3 284.5 504.7 (2.7) (112.9) 1,226.7 5.0 1,231.7
Total
comprehensive
income - - - 22.9 - (0.1) 22.8 (0.2) 22.6
Dividends paid
by the
Company - - - (37.7) - - (37.7) - (37.7)
Share-based
long-term
incentive
plans - - 1.0 - - - 1.0 - 1.0
------- ------- -------- -------- -------- -------- ------------ ------------ -------
At 30th June
2016 62.8 490.3 285.5 489.9 (2.7) (113.0) 1,212.8 4.8 1,217.6
------- ------- -------- -------- -------- -------- ------------ ------------ -------
Total comprehensive income for the six months ended 30th June
2017 included in revenue reserves comprised profit attributable to
shareholders of the Company of US$15.0 million (2016: US$22.9
million). There was no net fair value loss on other investments in
2017 (2016: nil).
Year ended 31st December 2016
At 1st January 2016 62.8 490.3 284.5 504.7 (2.7) (112.9) 1,226.7 5.0 1,231.7
Total comprehensive income - - - 52.6 2.1 (57.7) (3.0) (0.9) (3.9)
Dividends paid by the Company - - - (56.5) - - (56.5) - (56.5)
Dividends paid to non-controlling
interests - - - - - - - (0.1) (0.1)
Share-based long-term incentive
plans - - 2.2 - - - 2.2 - 2.2
Transfer - 0.1 (0.5) 0.4 - - - - -
---- ----- ----- ------ ----- ------- ------- ----- -------
At 31st December 2016 62.8 490.4 286.2 501.2 (0.6) (170.6) 1,169.4 4.0 1,173.4
---- ----- ----- ------ ----- ------- ------- ----- -------
Total comprehensive income for the year ended 31st December 2016
included in revenue reserves comprised profit attributable to
shareholders of the Company of US$55.2 million and net actuarial
loss on employee defined benefit plans of US$2.6 million. There was
no net fair value loss on other investments in 2016.
Mandarin Oriental International Limited
Consolidated Cash Flow Statement
(unaudited) Year ended
Six months ended 31st
30th June December
2017 2016 2016
US$m US$m US$m
Operating activities
----------------- ------- ----------
Operating profit 22.5 28.5 68.0
Depreciation 26.0 26.2 57.7
Amortization of intangible assets 1.0 1.0 2.1
Other non-cash items 0.3 - 2.7
Movements in working capital 5.7 (15.5) (3.8)
Interest received 0.7 0.8 1.3
Interest and other financing charges
paid (7.0) (5.5) (10.4)
Tax paid (4.5) (7.6) (19.0)
----------------- ------- ----------
44.7 27.9 98.6
Dividends and interest from associates
and
joint ventures 2.0 4.3 9.1
Cash flows from operating activities 46.7 32.2 107.7
Investing activities
----------------- ------- ----------
Purchase of tangible assets (36.2) (31.2) (77.0)
Purchase of intangible assets (0.9) (0.7) (2.7)
Payment on Munich expansion (note
8) (2.9) - -
Acquisition of Mandarin Oriental,
Boston (note 9) - (140.0) (140.0)
Purchase of other investments (0.7) (1.1) (1.3)
Advance to associates and joint ventures (1.9) (1.2) (2.8)
Repayment of loans to associates
and joint ventures 0.8 - 0.9
Sale of tangible assets - - 0.1
Cash flows from investing activities (41.8) (174.2) (222.8)
Financing activities
----------------- ------- ----------
Drawdown of borrowings - 51.5 51.5
Repayment of borrowings (2.4) (0.8) (1.6)
Dividends paid by the Company (note
10) (31.4) (37.7) (56.5)
Dividends paid to non-controlling
interests - (0.1) (0.1)
Cash flows from financing activities (33.8) 12.9 (6.7)
----------------- ------- ----------
Net decrease in cash and cash equivalents (28.9) (129.1) (121.8)
Cash and cash equivalents at beginning
of period 182.5 308.6 308.6
Effect of exchange rate changes 3.6 2.0 (4.3)
----------------- ------- ----------
Cash and cash equivalents at end
of period 157.2 181.5 182.5
----------------- ------- ----------
Mandarin Oriental International Limited
Notes to Condensed Financial Statements
1. ACCOUNTING POLICIES AND BASIS OF PREPARATION
The condensed financial statements have been prepared in
accordance with IAS 34 'Interim Financial Reporting'. The condensed
financial statements have been prepared on a going concern basis.
The condensed financial statements have not been audited or
reviewed by the Group's auditor pursuant to the UK Auditing
Practices Board guidance on the review of interim financial
information.
There are no new standards or amendments, which are effective in
the current accounting period and relevant to the Group's
operations, that have a significant effect on the Group's
accounting policies. There have been no changes to the accounting
policies described in the 2016 annual financial statements.
2. REVENUE
Six months ended 30th June
2017 2016
US$m US$m
By geographical area:
Hong Kong 109.8 109.3
Other Asia 51.5 51.8
Europe 72.9 87.3
The Americas 52.5 39.8
286.7 288.2
----- -----
3. EBITDA FROM SUBSIDIARIES (EARNINGS BEFORE INTEREST, TAX, DEPRECIATION AND AMORTIZATION)
Six months ended 30th June
2017 2016
US$m US$m
By geographical area:
Hong Kong 31.4 33.4
Other Asia 13.2 13.4
Europe 1.1 8.1
The Americas 3.8 2.6
------ ------
Underlying EBITDA from subsidiaries 49.5 57.5
Non-trading items
- acquisition-related costs (note 7) - (1.8)
------ ------
EBITDA from subsidiaries 49.5 55.7
Less: depreciation and amortization (27.0) (27.2)
------ ------
Operating profit 22.5 28.5
------ ------
4. SHARE OF RESULTS OF ASSOCIATES AND JOINT VENTURES
Depreciation Operating Net Net
and profit/ financing profit/
EBITDA amortization (loss) charges Tax (loss)
US$m US$m US$m US$m US$m US$m
Six months ended
30th June 2017
By geographical area:
Other Asia 10.2 (4.2) 6.0 (0.7) (1.1) 4.2
Europe 0.9 (0.4) 0.5 - - 0.5
The Americas 0.9 (1.5) (0.6) (1.1) - (1.7)
------ ------------- --------- ---------- ----- --------
12.0 (6.1) 5.9 (1.8) (1.1) 3.0
Six months ended
30th June 2016
By geographical area:
Other Asia 10.1 (3.8) 6.3 (0.7) (1.0) 4.6
Europe 0.6 (0.2) 0.4 - - 0.4
The Americas 2.6 (1.5) 1.1 (1.1) - -
------ ------------- --------- ---------- ----- --------
13.3 (5.5) 7.8 (1.8) (1.0) 5.0
------ ------------- --------- ---------- ----- --------
5. TAX
Six months ended 30th June
2017 2016
US$m US$m
Tax (charged)/credited to profit and loss is
analyzed as follows:
Current tax (5.9) (6.8)
Deferred tax 1.2 1.2
----- -----
(4.7) (5.6)
----- -----
By geographical area:
Hong Kong (4.0) (3.9)
Other Asia (0.1) (0.2)
Europe (0.6) (1.1)
The Americas - (0.4)
----- -----
(4.7) (5.6)
----- -----
Tax relating to components of other comprehensive income or
expense comprises cash flow hedges of US$0.1 million (2016:
nil).
Tax on profits has been calculated at rates of taxation
prevailing in the territories in which the Group operates.
Share of tax of associates and joint ventures of US$1.1 million
(2016: US$1.0 million) is included in share of results of
associates and joint ventures (note 4).
6. EARNINGS PER SHARE
Basic earnings per share are calculated on the profit
attributable to shareholders of US$15.0 million (2016: US$22.9
million) and on the weighted average number of 1,257.2 million
(2016: 1,255.9 million) shares in issue during the period.
Diluted earnings per share are calculated on profit attributable
to shareholders of US$15.0 million (2016: US$22.9 million) and on
the weighted average number of 1,261.0 million (2016: 1,261.2
million) shares after adjusting for the number of shares which are
deemed to be issued for no consideration under the share-based
long-term incentive plans based on the average share price during
the period.
The weighted average number of shares is arrived at as
follows:
Ordinary shares in millions
2017 2016
Weighted average number of shares for basic
earnings per share calculation 1,257.2 1,255.9
Adjustment for shares deemed to be issued
for no consideration under the share-based
long-term incentive plans 3.8 5.3
------- -------
Weighted average number of shares for diluted
earnings per share calculation 1,261.0 1,261.2
------- -------
Additional basic and diluted earnings per share are also
calculated based on underlying profit attributable to shareholders.
A reconciliation of earnings is set out below:
Six months ended 30th June
2017 2016
Basic Diluted Basic Diluted
earnings earnings earnings earnings
per share per share per share per share
US$m USc USc US$m USc USc
Profit attributable
to shareholders 15.0 1.19 1.19 22.9 1.82 1.82
Non-trading items
(note 7) - 1.8
Underlying profit
attributable to
shareholders 15.0 1.19 1.19 24.7 1.97 1.96
---- ----
7. NON-TRADING ITEMS
Non-trading items are separately identified to provide greater
understanding of the Group's underlying business performance. Items
classified as non-trading items include gains and losses arising
from the sale of businesses, investments and properties; impairment
of non-depreciable intangible assets and other investments;
provisions for the closure of businesses; acquisition-related costs
in business combinations; provisions against asset impairment and
writebacks; and other credits and charges of a non-recurring nature
that require inclusion in order to provide additional insight into
underlying business performance.
An analysis of non-trading items after interest, tax and
non-controlling interests is set out below:
Six months ended 30th June
2017 2016
US$m US$m
Acquisition-related costs
- administration expenses - 1.8
----- -----
8. PAYMENT ON MUNICH EXPANSION
The Group paid a further US$2.9 million instalment in respect of
the land purchase price for the expansion of Mandarin Oriental,
Munich during the six months ended 30th June 2017. As at 30th June
2017 and 31st December 2016, cumulative costs paid by the Group
amounted to US$19.8 million and US$16.9 million respectively, the
majority of which have been included within Other Debtors pending
transfer of title in the underlying land.
9. ACQUISITION OF MANDARIN ORIENTAL, BOSTON
In April 2016, the Group completed its US$140.0 million
acquisition of Mandarin Oriental, Boston, a hotel that the Group
had managed since its opening in 2008. The consideration of
US$140.0 million represented the fair value of the tangible assets
acquired at the acquisition date. There was no goodwill arising on
acquisition.
10. DIVIDS
Six months ended 30th June
2017 2016
US$m US$m
Final dividend in respect of 2016 of USc2.50
(2015: USc3.00) per share 31.4 37.7
----- -----
An interim dividend in respect of 2017 of USc1.50 (2016:
USc1.50) per share amounting to a total of US$18.9 million (2016:
US$18.8 million) has been declared by the Board and will be
accounted for as an appropriation of revenue reserves in the second
half of the year ending 31st December 2017.
11. CAPITAL COMMITMENTS
Total capital commitments at 30th June 2017 and 31st December
2016 amounted to US$258.8 million and US$270.9 million
respectively.
12. FINANCIAL INSTRUMENTS
Financial instruments by category
The fair values of financial assets and financial liabilities,
together with carrying amounts at 30th June 2017 and 31st December
2016 are as follows:
Other financial
Derivatives instruments
Loans and used for Available- at amortized Total carrying Fair
receivables hedging for-sale cost amount value
US$m US$m US$m US$m US$m US$m
30th June 2017
Assets
Other investments - - 10.7 - 10.7 10.7
Debtors 53.3 - - - 53.3 53.3
Bank and cash
balances 157.2 - - - 157.2 157.2
------------
210.5 - 10.7 - 221.2 221.2
------------ ------------- ---------- --------------- ---------------- -------
Liabilities
Other non-current
liabilities - (1.0) - - (1.0) (1.0)
Borrowings - - - (478.0) (478.0) (478.0)
Trade and other
payables
excluding
non-financial
liabilities - - - (124.2) (124.2) (124.2)
------------
- (1.0) - (602.2) (603.2) (603.2)
------------ ------------- ---------- --------------- ---------------- -------
Other financial
Derivatives instruments
Loans and used for Available- at amortized Total carrying Fair
receivables hedging for-sale cost amount value
US$m US$m US$m US$m US$m US$m
31st December 2016
Assets
Other investments - - 10.7 - 10.7 10.7
Debtors 65.8 - - - 65.8 65.8
Bank and cash
balances 182.6 - - - 182.6 182.6
------------
248.4 - 10.7 - 259.1 259.1
------------ ------------- ---------- --------------- ---------------- -------
Liabilities
Borrowings - - - (479.9) (479.9) (479.9)
Trade and other
payables
excluding
non-financial
liabilities - (0.6) - (134.1) (134.7) (134.7)
- (0.6) - (614.0) (614.6) (614.6)
------------ ------------- ---------- --------------- ---------------- -------
Fair value estimation
(i) Financial instruments that are measured at fair value
For financial instruments that are measured at fair value in the
balance sheet, the corresponding fair value measurements are
disclosed by level of the following fair value measurement
hierarchy:
(a) Inputs other than quoted prices in active markets that are
observable for the asset or liability, either directly or
indirectly ('observable current market transactions')
The fair values of derivative financial instruments are
determined using rates quoted by the Group's bankers at the balance
sheet date. The rates for interest rate swaps and caps and forward
foreign exchange contracts are calculated by reference to market
interest rates and foreign exchange rates.
The fair values of unlisted investments, which are classified as
available-for-sale and mainly include club and school debentures,
are determined using prices quoted by brokers at the balance sheet
date.
(b) Inputs for assets or liabilities that are not based on
observable market data ('unobservable inputs')
The fair values of other unlisted securities, which are
classified as available-for-sale, are determined using valuation
techniques by reference to observable current market transactions
(including price-to earnings and price-to book ratios of listed
securities of entities engaged in similar industries) or the market
prices of the underlying investments with certain degree of entity
specific estimates.
There were no changes in valuation techniques during the six
months ended 30th June 2017 and the year ended 31st December
2016.
The table below analyzes financial instruments carried at fair
value at 30th June 2017 and 31st December 2016, by the levels in
the fair value measurement hierarchy:
Observable
current Unobservable
market transactions inputs Total
US$m US$m US$m
30th June 2017
Assets
Available-for-sale financial assets
- unlisted investments 2.1 8.6 10.7
-------------------- ------------ -----
Liabilities
Derivative designated at fair
value
- through other comprehensive
income (1.0) - (1.0)
31st December 2016
Assets
Available-for-sale financial assets
- unlisted investments 2.1 8.6 10.7
-------------------- ------------ -----
Liabilities
Derivative designated at fair
value
* through other comprehensive income (0.6) - (0.6)
-------------------- ------------ -----
There were no transfers among the two categories during the six
months ended 30th June 2017 and the year ended 31st December
2016.
Movement of financial instruments which are valued based on
unobservable inputs during the six months ended 30th June 2017 and
the year ended 31st December 2016 are as follows:
Available-
for-sale
financial
assets
US$m
At 1st January 2017 8.6
Additions -
----------
At 30th June 2017 8.6
----------
At 1st January 2016 8.1
Additions 0.5
----------
At 31st December 2016 8.6
----------
(ii) Financial instruments that are not measured at fair
value
The fair values of current debtors, bank and cash balances,
current creditors and current borrowings are assumed to approximate
their carrying amounts due to the short-term maturities of these
assets and liabilities.
The fair values of long-term borrowings are based on market
prices or are estimated using the expected future payments
discounted at market interest rates.
13. RELATED PARTY TRANSACTIONS
In the normal course of business the Group undertakes a variety
of transactions with certain of its associates and joint
ventures.
The most significant of such transactions are management fees of
US$6.2 million (2016: US$6.5 million) received from the Group's six
(2016: six) associate and joint venture hotels which are based on
long-term management agreements on normal commercial terms.
There were no other related party transactions that might be
considered to have a material effect on the financial position or
performance of the Group that were entered into or changed during
the first six months of the current financial year.
Amounts of outstanding balances with associates and joint
ventures are included in debtors and prepayments, as
appropriate.
Mandarin Oriental International Limited
Principal Risks and Uncertainties
The Board has overall responsibility for risk management and
internal control. The following have been identified previously as
the areas of principal risk and uncertainty facing the Company, and
they remain relevant in the second half of the year:
l Economic and Financial Risk
l Commercial and Market Risk
l Pandemic, Terrorism and Natural Disasters
l Key Agreements
l Reputational Risk and Value of the Brand
l Regulatory and Political Risk
For greater detail, please refer to pages 89 and 90 of the
Company's Annual Report for 2016, a copy of which is available on
the Company's website www.mandarinoriental.com.
Responsibility Statement
The Directors of the Company confirm to the best of their
knowledge that:
(a) the condensed financial statements have been prepared in
accordance with IAS 34; and
(b) the interim management report includes a fair review of all
information required to be disclosed by the Disclosure Guidance and
Transparency Rules 4.2.7 and 4.2.8 issued by the Financial Conduct
Authority in the United Kingdom.
For and on behalf of the Board
James Riley
Stuart Dickie
Directors
The interim dividend of USc1.50 per share will be payable
on 19th October 2017 to shareholders on the register of members
at the close of business on 25th August 2017. The shares
will be quoted ex-dividend on the Singapore Exchange and
the London Stock Exchange on 23rd and 24th August 2017, respectively.
The share registers will be closed from 28th August to 1st
September 2017, inclusive.
Shareholders will receive their cash dividends in United
States dollars, unless they are registered on the Jersey
branch register where they will have the option to elect
for sterling. These shareholders may make new currency elections
for the 2017 interim dividend by notifying the United Kingdom
transfer agent in writing by 29th September 2017. The sterling
equivalent of dividends declared in United States dollars
will be calculated by reference to a rate prevailing on 4th
October 2017.
Shareholders holding their shares through CREST in the United
Kingdom will receive their cash dividends in sterling only
as calculated above. Shareholders holding their shares through
The Central Depository (Pte) Limited ('CDP') in Singapore
will receive their cash dividends in United States dollars
unless they elect, through CDP, to receive Singapore dollars.
Shareholders on the Singapore branch register who wish to
deposit their shares into the CDP system by the dividend
record date, being 25th August 2017, must submit the relevant
documents to M & C Services Private Limited, the Singapore
branch registrar, no later than 5.00 p.m. (local time) on
24th August 2017.
Mandarin Oriental Hotel Group
Mandarin Oriental Hotel Group is an international hotel
investment and management group with deluxe and first class hotels,
resorts and residences in sought-after destinations around the
world. Having grown from its Asian roots into a global brand, the
Group now operates 30 hotels and eight residences in 20 countries
and territories, with each property reflecting the Group's oriental
heritage and unique sense of place. Mandarin Oriental has a strong
pipeline of hotels and residences under development. The Group has
equity interests in a number of its properties and adjusted net
assets worth approximately US$3.9 billion as at 30th June 2017.
Mandarin Oriental's aim is to be recognized as the world's best
luxury hotel group. This will be achieved by investing in the
Group's exceptional facilities and its people, while maximizing
profitability and long-term shareholder value. The Group regularly
receives recognition and awards for outstanding service and quality
management. The Group is committed to exceeding its guests'
expectations through exceptional levels of hospitality, while
maintaining its position as an innovative leader in the hotel
industry. The strategy of the Group is to open the hotels currently
under development, while continuing to seek further selective
opportunities for expansion around the world.
The parent company, Mandarin Oriental International Limited, is
incorporated in Bermuda and has a standard listing on the London
Stock Exchange, with secondary listings in Bermuda and Singapore.
Mandarin Oriental Hotel Group International Limited, which operates
from Hong Kong, manages the activities of the Group's hotels.
Mandarin Oriental is a member of the Jardine Matheson Group.
- end -
For further information, please contact:
Mandarin Oriental Hotel Group International
Limited
James Riley / Stuart Dickie (852) 2895 9288
Jill Kluge / Sally de Souza (852) 2895 9167
Brunswick Group Limited
Kirsten Molyneux (852) 3512 5053
As permitted by the Disclosure Guidance and Transparency Rules
of the Financial Conduct Authority in the United Kingdom, the
Company will not be posting a printed version of the Half-Yearly
Results announcement to shareholders. The Half-Yearly Results
announcement will remain available on the Company's website,
www.mandarinoriental.com, together with other Group
announcements.
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR DXGDIIDGBGRB
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