Profit up 39% in spite of global slowdown
So far, so good. The slowing global economy appears to have had only a modest effect on Banyan Tree Holdings' bottomline to date.
In the three months to end-March, it posted a robust 38-per-cent rise in profit to $15.4 million from a year earlier, largely driven by hotel investment and sales of luxury villas, town homes and bungalows boasting its prestigious brand.
"For the hotel business, there is a slight downturn in the corporate business but this has been more than offset by the increase in leisure business," said Banyan Tree executive chairman Ho Kwon Ping.
Banyan Tree is a leading manager and developer of premium resorts, hotels and spaces in the Asia-Pacific, with 23 resorts and hotels, 64 spas, 65 galleries and two golf courses.
First quarter revenues rose 34 per cent to $140.3 million. However, expenses grew at a similar pace, by 32 per cent.
Mr Ho said he expected both its hotel business and property sales to remain strong for the balance of this year.
"We do not seem to be affected by the sub-prime crisis and we remain optimistic that this year we should be able to perform quite well," he said.
Mr Khoo Chen Hsung, research vice-president at CIMB-GK, said the result was above his expectations and "very encouraging".
Meanwhile, Banyan Tree also announced that it signed a new contract with Galaxy Entertainment Group, Asia's second-biggest listed casino operator, to manage a resort in Macau.
Banyan Tree will design and manage 254 rooms in the resort, which is expected to open in around 2010.
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