By Staff writer
Kingdom Hotel Investments (KHI) saw its profits for the first half of the year rise 282% over the previous year.
Net income rose to US $27.9 million and revenue increased 71% to US $42.7million.
KHI said the extraordinary growth is down to the expansion of its real estate portfolio and increased liquidity.
Sarmad Zok, chief executive of KHI, said the growth was largely attributed to “a combination of the ramp-up in the earnings of our assets, that are still relatively immature from a cash flow standpoint.
There was a combination of an addition of assets and sale of real estate in Beirut, when we sold the chalets of the Movenpick Hotels.”
KHI is headquartered in Dubai and has 28 properties (7057 rooms) in its portfolio in 14 countries, managed and operated by Four Seasons Hotels, Fairmont Hotels and Movenpick Hotels.
The company is aggressively expanding after floating 25% of its stock on the Dubai International Financial Exchange and the London Stock Exchange last March.
The listing raised US $397 million and the offering was 14 times oversubscribed.
That enthusiasm for the company has boosted the confidence of KHI management, which is are planning major undertakings in the coming months in Africa, the Eastern bloc and Russia, as well as eying the Chinese market.
Since the flotation, KHI has increased its stake in the Four Seasons Hotel in Damascus, acquired a 100% equity stake in a hotel in Mauritius (at a cost of US$55 million) and acquired a 100% ownership stake in the Karon beach hotel in Phuket (US $100 million).
“We are in line with our expectations.
I know the net income results are stellar, but really the focus of this company for the next 12 months is going to be on the deal pipeline and the ability to execute transactions,” said Zok.
“We did six transactions since the IPO and we bought 11 hotels since the beginning of the year.
That’s relatively large. In the active deal pipeline are five projects that are signed memorandums of understanding in Asia mainly.”