The increase in net profit is largely attributable to the improved performance of Oaks Hotels & Resorts, a strong increase in real estate income and revaluation gains of Baht 670 million from business acquisitions relating to the Sun International and Oaks Elan Darwin transactions. Excluding the revaluation gains, 2015 net profit for MHG increased by 16% year-on-year.
MHG achieved these strong results in a period characterised by weak economic conditions, currency fluctuations, political uncertainty and other headwinds including the Bangkok bombing in 3Q15, demonstrating the benefits of the group’s geographic diversification strategy.
Oaks’ strong performance in 2015 was largely due to effective cost controls at both operating and financial levels. Real estate income was boosted by strong sales of The Residences by Anantara Layan Phuket, which saw robust interest from both domestic and international buyers and drove revenue from the group’s real estate business 30% higher than in 2014. Additionally, overall RevPar of the hotel portfolio (excluding Oaks) organically increased by 10% in 2015, reflecting strong underlying hotel performance.
During 2015 MHG also achieved a number of key milestones. MHG acquired seven hotels from Tivoli Hotels and Resorts in Portugal and Brazil, before completing the transaction with the acquisition of the remaining seven hotels in Portugal earlier this month. The combined 14-hotel, EUR 294.2 million Tivoli transaction is highly attractive with a 9.6x EV/EBITDA multiple underpinned by well-located real estate, a strong brand value and a highly loyal customer base. In addition, this largest-ever acquisition by the group marked its strategic entry into Europe and Latin America with a strong operating platform to drive further growth.
MHG also acquired six properties and a tour operating company from Cheli & Peacock. The camps and lodges in Kenya have joined the group’s prestigious Elewana portfolio in East Africa. Oaks also made its brand debut in Australian Northern Territory with the acquisition of Elan Soho Suites, which was later renamed Oaks Elan Darwin.
In addition, two new-build Anantara resorts opened – Banana Island Resort Doha by Anantara in Qatar in January and Anantara Peace Haven Tangalle Resort in Sri Lanka in January. A third Anantara was added with the re-flagging of the MHG-owned Four Seasons Bangkok to Anantara Siam Bangkok, the property becoming the brand’s flagship in Thailand. MHG’s dynamic upscale AVANI brand also added AVANI Seychelles Barbarons Resort in the Indian Ocean. Overall in 2015 MHG added a total of 17 properties to its growing portfolio and expanded its footprint into four new countries – Qatar, the Seychelles, Portugal and Brazil.