Mandarin Oriental sinks into the red with $76.9m loss in 2019

Non-trading items related to the redevelopment of The Excelsior contributed to the loss.

Mandarin Oriental International suffered from a $76.9m (US$55.5m) loss attributable to shareholders in 2019, compared to a $60.14m (US$43.4m) profit in 2018, according to a news release. Combined total revenue of hotels under management declined 5% to $1.84m (US$1.33b) over the same period.

Contributing to the loss were non-trading items related to the redevelopment of The Excelsior as a commercial building, including a US$67m or 1% decrease in the valuation of its site and US$29m of accelerated depreciation of hotel assets and closure costs.

Its underlying profit attributable to shareholders fell 37% to US$41.2m at the same time, primarily due to the closure of The Excelsior in Hong Kong.

Its results were also impacted by the social unrest in Hong Kong and the major renovation at the Bangkok hotel, but its earnings were buoyed by the re-opening of the London hotel following the fire in 2018 and the receipt of related insurance proceeds.

The group expects its 2020 performance to be significantly impacted by the ongoing COVID-19 outbreak,, and its results will depend on the duration, geographic extent and impact of the coronavirus and the measures taken to control it.

“The Group’s results should, however, benefit from the newly renovated London and Bangkok hotels and the Group looks forward to the re-opening of the iconic Mandarin Oriental Ritz, Madrid in late summer,” Mandarin Oriental chairman Ben Keswick said.