Symphony’s MINT reports 49 per cent increase in net profits
Minor International (MINT), a portfolio company of Symphony International, has reported a year-on-year net profit increase of 49 per cent in the first half of 2012.
The increase was driven by an improvement in the hospitality business, the consolidation of Oaks Hotels and Resorts during the period and the continued strong performance of the restaurant business. MINT also announced an investment in a hotel in Phuket.
Since the quick post-flood rebound in tourist arrivals in Q1 2012, the hotel business's low-season Q2 2012 continued to see robust growth year-on-year, with net profit rising 30 per cent year-on-year to THB364m in the quarter.
In the first half of 2012, EBITDA of MINT's hospitality business increased significantly by 52 per cent year-on-year, attributable primarily to the solid improvement in hotel operations and consolidation of Oaks Hotels and Resorts in Australia. Revenue per available room of MINT's hotel portfolio increased by 18 per cent in 1H12, on the back of strong occupancy of 69 per cent in 1H12 compared to 58 per cent in 1H11. This was a result of improvement of hotels in Thailand, together with the addition of Oaks rooms, which run at relatively higher occupancy. In addition, MINT recognized the full first half contribution from Oaks in 1H12 as opposed to one-month contribution in 1H11 upon the completion of the acquisition. 1H12 sales progress of Anantara Vacation Club was outstanding, where sales more than tripled that of 1H11, and was above the budgeted 1H12 figures.
The restaurant business continued to report strong growth, with a 1H12 EBITDA increase of 19 per cent. MINT's restaurant portfolio's total system sales growth in 1H12 was 14.0 per cent, as 1H12 same store sales increased by 7.1 per cent, coupled with store expansion of 105 stores year-on-year. The robust performance was attributable to strong domestic consumption, which drove both the number of customers and average revenue per customer, coupled with the company's on-going pro-active marketing efforts, which resulted in strong same store sales growth, in particular for The Pizza Company, Swensen's and Dairy Queen brands. The opening of new restaurant outlets alongside business expansion of major retail operators, together with continued growth of the company's franchised business, also contributed to restaurant performance during 1H12.
Retail trading business continued to see gradual recovery from the flood in 4Q11 into the first half of 2012. The contract manufacturing of consumer goods recently resumed full operations in early June. Nevertheless, the unit's increase in 1H12 EBITDA of 16 per cent year-on-year was primarily because of the insurance claim received in 1Q12. The retail trading business continues to be a profitable operation of MINT's business, although still small compared to MINT's total business, with 1H12 revenue contribution of 10 per cent and net profit contribution of five per cent.
MINT also announced its investment in one of Phuket's most luxurious hotels, Bundarika Villas & Suites. Located on the secluded Layan Beach with 400 meters of private beach, the hotel will be rebranded to Anantara after total refurbishment to further strengthen MINT's five-star deluxe brand in one of Asia's most established tourist destinations. The hotel features 77 villas and suites on 23 rai of beachfront land. In addition to the hotel, MINT also acquires 32 rai of adjacent hillside land with panoramic sunset views of the Andaman Sea. The adjoining land will be developed into high-end residential project. Total investment size is estimated at THB3bn. MINT holds 95 per cent interest in the hotel in partnership with original founder, who retains a five per cent interest and will continue to work closely with MINT to ensure this a successful investment. The hotel will undergo renovation and operational improvement program to enable it to be re-launched as Phuket's second Anantara next year.
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