SINGAPORE - The Shangri-La group will launch its new business hotel brand in Orchard Road next month.
Hotel Jen Orchardgateway, the first hotel under the Jen brand, will open for business on Sept 17.
All preparatory work for the launch was completed by Aug 1 and it is envisaged that many of the Traders hotels in the group's portfolio will be gradually rebranded as Hotel Jen, said Shangri-La Asia.
The Jen brand came about after Shangri-La bought a hotel on Hong Kong Island and wanted to develop a name and identity that would launch a new concept to cater to business travellers in the highly competitive Hong Kong market and carry it forward into China, said brand consultant MetaDesign, which worked on the new concept, on its website.
"It is the group's intent to add to the portfolio of this brand of hotels by pursuing suitable management contract opportunities with third-party owners and/or developers," said Shangri-La Asia in its results statement.
The dual-listed group reported on Wednesday that half-year net profit dropped sharply to US$76.2 million (S$95 million) from US$215.3 million.
Sales for the six months to June 30 were flat at US$1.01 billion.
Owing to weak market conditions in China as well as the additional start-up losses of the new hotels, profit from the hotel ownership segment decreased by US$11.3 million to US$37.8 million.
The group's bottom line was also hit by lower share of fair value gains on investment properties, which fell substantially to US$40.4 million from US$189.6 million in the same period last year. The amount of fair value gains last year included US$182.3 million contributed by the newly opened Jing An Kerry Centre (Phase II) in Shanghai.
Earnings per share shrank to 2.44 US cents from 6.896 US cents previously while net asset value per share was US$2, down from US$2.02 as at Dec 31.
Hotel ownership continues to be the main source of revenue and operating profit.
As at June 30, the group had equity interest in 63 operating hotels and two hotels under operating lease, representing a room inventory of 29,100 across the Asia-Pacific and Europe.
In China, the challenging business environment confronting the luxury hotel segment continued to dog the hotelier.
The overall weighted average room yields (RevPAR) for this segment registered a 4 per cent decrease when compared to the same period last year.
Hotels in Hong Kong, Singapore and Malaysia generally benefited from the continuing robust demand from both leisure and business travellers. They registered improvements in weighted average RevPAR of 6 per cent, 5 per cent and 1 per cent, respectively.
Meanwhile, the political unrest in Thailand cost Shangri-La dearly, with its two hotels there recording a drop in weighted
average RevPAR and average occupancies of 26 per cent and 16 percentage points, respectively.
In Singapore, the yield of the group's serviced apartments recorded a marginal increase of 3 per cent for the Shangri-La Apartments but a drop of 17 per cent for the Shangri-La Residences.
Commercial spaces, on the other hand, recorded steady improvement in yields of 5 per cent and 7 per cent for Tanglin Mall and Tanglin Place, respectively.
Shangri-La said its financial performance this year has been weighed down by the difficult operating environment faced by its hotels in China, where the market has been characterised by weak demand and emergence of additional competitive supply in most cities.
It does not expect the operating performance to show a remarkable improvement for the remainder of this year.
The company declared an interim dividend of six HK cents a share, down from eight HK cents previously.
Shangri-La shares were not traded yesterday in Singapore.
In Hong Kong, they ended 16 HK cents lower at HK$12.14.
This article was first published on August 22, 2014.
Get a copy of The Straits Times or go to straitstimes.com for more stories.