Millennium & Copthorne Hotels Drops on Business Traveler Caution
Millennium & Copthorne Hotels Plc (MLC), which owns, asset manages or operates more than 100 hotels worldwide, dropped the most in 18 months in London trading after saying the euro zone’s difficulties are affecting clients.
“We are noticing more caution amongst business customers, reflecting anxiety about events affecting the euro zone,” Chairman Kwek Leng Beng said in a statement today. “Economic uncertainty strengthens the case for our maintaining a strong balance sheet.” The shares of the Horley, England-based company fell as much as 7.9 percent.
European Central Bank President Mario Draghi said yesterday that turmoil caused by sovereign debt is damping growth in the 17-nation euro currency area and a “mild recession” is on the cards.
Millennium & Copthorne’s “cautious statement” may affect InterContinental Hotels Group Plc (IHG), which reports on Nov. 8, and Whitbread Plc (WTB), owner of the Premier Inn budget-hotel chain, Nigel Hicks, an analyst at Liberum Capital, said in a statement today. Hicks has a “buy” recommendation on Millennium & Copthorne shares.
The company’s stock traded 6.5 percent lower at 405 pence as of 10:48 a.m.
The company is interested in acquisitions in “gateway” cities, company executives said on a conference call today.
Third-quarter pretax profit climbed 66 percent to 69.3 million pounds ($111 million) and the company is “on track” for the fourth quarter, it said today.
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