MCK 2019 Annual Report
1 | MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019
MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019 | 2
Calendar
Annual Report issued 20 March 2020
Dividend Paid 15 May 2020
Annual Meeting 26 May 2020
Half Year End 30 June 2020
Financial Year End 31 December 2020
BK Chiu
Managing Director
Colin Sim
Chairman
Profit After Tax & NCI
2015
$21.7m
2016
$40.4m
2017
$43.1m
2018
$49.4m
2019
$49.7m
Revenue
2015
$136.5m
2016
$172.0m
2017
$187.3m
2018
$218.8m
2019
$229.7m
Total Assets
2019
$1,008m
2015
$590.0m
2016
$713.9m
2017
$828.2m
2018
$898.2m
Dividend
2019
7.5cps
2015
2.8cps
2016
5.0cps
2017
6.0cps
2018
7.5cps
Net Asset Backing / Per Share
2019
$4.52
2015
$2.46
2016
$3.09
2017
$3.72
2018
$4.04
Group Equity
2019
$715.3m
2015
$389.3m
2016
$489.1m
2017
$588.9m
2018
$640.3m
Contents
Chairman’s Review 03 - 04
Managing Director’s Review 05 - 06
Partnerships 07 - 08
Directors’ Profiles 09
Hotel Ownership 10
Financial Statements FIN 01 - 32
Corporate Governance CG 01 - 04
Regulatory Disclosures REG 01 - 04
and Statutory Information
Lake Te Anau
Oriental Bay Wellington
Housekeeping at M Social AucklandTrail biking - a popular pasttime in New Zealand.
Jimmy Cook’s Bar at Copthorne Hotel Auckland City which features 72 gins from 14 countries.
Featuring (from left to right) Paul Mii (Hotel Maintenance) who built the display at the bar to
showcase all the drinks, Anna Zhukova (Restaurant Manager) and Tim Reynolds (General Manager.)
1 | MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019
MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019 | 2
Calendar
Annual Report issued 20 March 2020
Dividend Paid 15 May 2020
Annual Meeting 26 May 2020
Half Year End 30 June 2020
Financial Year End 31 December 2020
BK Chiu
Managing Director
Colin Sim
Chairman
Profit After Tax & NCI
2015
$21.7m
2016
$40.4m
2017
$43.1m
2018
$49.4m
2019
$49.7m
Revenue
2015
$136.5m
2016
$172.0m
2017
$187.3m
2018
$218.8m
2019
$229.7m
Total Assets
2019
$1,008m
2015
$590.0m
2016
$713.9m
2017
$828.2m
2018
$898.2m
Dividend
2019
7.5cps
2015
2.8cps
2016
5.0cps
2017
6.0cps
2018
7.5cps
Net Asset Backing / Per Share
2019
$4.52
2015
$2.46
2016
$3.09
2017
$3.72
2018
$4.04
Group Equity
2019
$715.3m
2015
$389.3m
2016
$489.1m
2017
$588.9m
2018
$640.3m
Contents
Chairman’s Review 03 - 04
Managing Director’s Review 05 - 06
Partnerships 07 - 08
Directors’ Profiles 09
Hotel Ownership 10
Financial Statements FIN 01 - 32
Corporate Governance CG 01 - 04
Regulatory Disclosures REG 01 - 04
and Statutory Information
Lake Te Anau
Oriental Bay Wellington
Housekeeping at M Social AucklandTrail biking - a popular pasttime in New Zealand.
Jimmy Cook’s Bar at Copthorne Hotel Auckland City which features 72 gins from 14 countries.
Featuring (from left to right) Paul Mii (Hotel Maintenance) who built the display at the bar to
showcase all the drinks, Anna Zhukova (Restaurant Manager) and Tim Reynolds (General Manager.)
3 | MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019
MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019 | 4
MCK’s hotels will need to work resourcefully
to ensure that they are well positioned in key
segments throughout this year without the
benefit of any major events in New Zealand
until 2021 and with tourism coming off its
historic peak. We expect that MCK’s land
development operations will deliver positive
contributions to the bottom line during the
coming year and sales of the Zenith Residences
units will add to overall profitability.
The Board will continue to oversee progress
against Management’s targets closely to ensure
that shareholders are able to receive positive
returns despite what are expected to be difficult
trading conditions during this year.
On behalf of my fellow MCK directors, I thank
all of MCK’s management and staff for their
efforts in 2019.
Colin Sim
Chairman
10 February 2020
Australia Update
During 2019, six apartments at the Zenith
Residences were sold and achieved attractive
margins. Other units are being actively
marketed for sale and we expect that these
sales will boost MCK’s 2020 results.
Leasing of the remaining portfolio continues
at an annual average occupancy rate of 92.6%.
The Board is targeting further sales in 2020.
Dividend Announcement
MCK’s Board has resolved to declare and pay
all shareholders a fully imputed dividend of
7.5 cents per share which is the same as 2018
and reflects MCK’s stable earnings profile. The
dividend, payable to all shareholders,will be
paid on 15 May 2020 with a record date of 8
May 2020.
Outlook
The recent travel issues associated with the
Novel Coronavirus will impact on MCK’s first
quarter operations and results. A number of
our hotels in high tourism areas are receiving
cancellations from several Chinese operators
as the Chinese and New Zealand Governments’
travel bans and other containment measures
come into effect. Cancellations received to
date will result in revenue loss of between
NZ$2 million and NZ$3 million with more
cancellations expected for future months. We
have been advised that this revenue loss will
not be covered by insurance. Management is
implementing urgent response plans to mitigate
the effect of these cancellations. A health and
safety plan is now in full effect at MCK’s
hotels. Given that the situation is extremely
fluid, the Board will monitor the situation
carefully and will update shareholders if the
position changes.
With increased hotel inventory in Auckland and
other key tourism hotspots in New Zealand,
Financial Performance & Financial Position
Millennium & Copthorne Hotels New Zealand
Limited (NZX:MCK) is pleased to report
that, for the year ended 31 December 2019, it
generated a profit attributable to owners of the
parent of $49.7 million (2018: $49.4 million).
MCK also noted an increase in revenue for the
year to $229.7 million (2018: $218.8 million).
Its 2019 profit before tax and non-controlling
interests was $85.4 million (2018: $85.1
million) reflecting consistent performance in
more challenging market conditions for its
hotel and residential property development
operations. Despite these challenges, MCK’s
earnings per share increased to 31.39 cents per
share (2018: 31.21 cents per share).
As at 31 December 2019, MCK recorded
shareholders’ funds excluding non-controlling
interests of $715.3 million (2018: $640.3
million) and total assets of $1,008.2 million
(2018: $898.2 million) with net asset backing
(with land and building revaluations and before
distributions) increasing to 451.78 cents per
share (2018: 404.41 cents per share).
New Zealand Hotel Operations
In an environment which has seen increased
inventory in key tourism centres coupled
with a slowing in the growth of international
visitors to New Zealand, the New Zealand
hotels were able to maintain their revenue at
levels seen over the past three years which
totaled $126.6 million (2018: $126.5 million)
and Revenue per Available Room (RevPAR)
increasing slightly to $132.46 (2018: $130.63).
Occupancy for the year remained steady at
80.8% (2018: 80.9%). Gross Operating Profit
decreased by 1.9 %. This was due to increasing
cost pressures during 2019 such as utility and
payroll cost increases which are expected to
continue into 2020.
In 2019 MCK’s “book direct” and “think
local” initiatives saw increases in the number
of bookings made by customers directly with
MCK. This is an encouraging trend and one
which MCK is keen to see improve further.
Geographically, MCK’s marketing operations
focused on diversifying its customer base
originating from new and emerging markets
such as South-East Asia and India. With some
key markets showing signs of weakness,
we believe that growth from such emerging
markets will be a key factor in maintaining
market share and growing future revenues.
Within New Zealand itself, MCK was
pleased with the performance of several of
its regional hotels such as Kingsgate Hotel
Dunedin, Copthorne Hotel Palmerston North,
and Kingsgate Hotel Te Anau which traded
positively during the year and indicate an
increasing strength in such hotels.
2019 also saw MCK’s talent pool upskilling
with completions through the Service IQ
programmes which assisted with retaining key
operational staff at a number of our hotels.
MCK continues to be focused on development
of employees in an environment where
attracting and retaining skilled employees will
continue to contribute to productivity gains.
MCK is disappointed by the judgment in
relation to the Accommodation Provider
Targeted Rate handed down by the High
Court last week. We are reviewing our options
with our external lawyers and will determine
whether an appeal should be pursued in the
next few weeks.
CDL Investments New Zealand Limited
(“CDLI”)
CDLI announced an operating profit after tax
for the year ended 31 December 2019 of $34.1
million (2018: $33.6 million). This marks
ten successive years of profit growth. Given
slowing markets, this is a very creditable result
and reflected a resourceful sales strategy in the
latter half of 2019.
MCK is encouraged that CDLI is progressing
well with development works and has
commenced sales at Dominion Road (South
Auckland) and Kewa Road (North Shore)
already.
CDLI maintained its ordinary dividend to 3.5
cents per share which MCK will again take in
cash when paid in May this year.
CHAIRMAN’S
REVIEW
Indoor pool at Millennium Hotel Rotorua.
Courtyard Garden at Millennium Hotel Rotorua.
Social Lounge at M Social Auckland.
3 | MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019
MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019 | 4
MCK’s hotels will need to work resourcefully
to ensure that they are well positioned in key
segments throughout this year without the
benefit of any major events in New Zealand
until 2021 and with tourism coming off its
historic peak. We expect that MCK’s land
development operations will deliver positive
contributions to the bottom line during the
coming year and sales of the Zenith Residences
units will add to overall profitability.
The Board will continue to oversee progress
against Management’s targets closely to ensure
that shareholders are able to receive positive
returns despite what are expected to be difficult
trading conditions during this year.
On behalf of my fellow MCK directors, I thank
all of MCK’s management and staff for their
efforts in 2019.
Colin Sim
Chairman
10 February 2020
Australia Update
During 2019, six apartments at the Zenith
Residences were sold and achieved attractive
margins. Other units are being actively
marketed for sale and we expect that these
sales will boost MCK’s 2020 results.
Leasing of the remaining portfolio continues
at an annual average occupancy rate of 92.6%.
The Board is targeting further sales in 2020.
Dividend Announcement
MCK’s Board has resolved to declare and pay
all shareholders a fully imputed dividend of
7.5 cents per share which is the same as 2018
and reflects MCK’s stable earnings profile. The
dividend, payable to all shareholders,will be
paid on 15 May 2020 with a record date of 8
May 2020.
Outlook
The recent travel issues associated with the
Novel Coronavirus will impact on MCK’s first
quarter operations and results. A number of
our hotels in high tourism areas are receiving
cancellations from several Chinese operators
as the Chinese and New Zealand Governments’
travel bans and other containment measures
come into effect. Cancellations received to
date will result in revenue loss of between
NZ$2 million and NZ$3 million with more
cancellations expected for future months. We
have been advised that this revenue loss will
not be covered by insurance. Management is
implementing urgent response plans to mitigate
the effect of these cancellations. A health and
safety plan is now in full effect at MCK’s
hotels. Given that the situation is extremely
fluid, the Board will monitor the situation
carefully and will update shareholders if the
position changes.
With increased hotel inventory in Auckland and
other key tourism hotspots in New Zealand,
Financial Performance & Financial Position
Millennium & Copthorne Hotels New Zealand
Limited (NZX:MCK) is pleased to report
that, for the year ended 31 December 2019, it
generated a profit attributable to owners of the
parent of $49.7 million (2018: $49.4 million).
MCK also noted an increase in revenue for the
year to $229.7 million (2018: $218.8 million).
Its 2019 profit before tax and non-controlling
interests was $85.4 million (2018: $85.1
million) reflecting consistent performance in
more challenging market conditions for its
hotel and residential property development
operations. Despite these challenges, MCK’s
earnings per share increased to 31.39 cents per
share (2018: 31.21 cents per share).
As at 31 December 2019, MCK recorded
shareholders’ funds excluding non-controlling
interests of $715.3 million (2018: $640.3
million) and total assets of $1,008.2 million
(2018: $898.2 million) with net asset backing
(with land and building revaluations and before
distributions) increasing to 451.78 cents per
share (2018: 404.41 cents per share).
New Zealand Hotel Operations
In an environment which has seen increased
inventory in key tourism centres coupled
with a slowing in the growth of international
visitors to New Zealand, the New Zealand
hotels were able to maintain their revenue at
levels seen over the past three years which
totaled $126.6 million (2018: $126.5 million)
and Revenue per Available Room (RevPAR)
increasing slightly to $132.46 (2018: $130.63).
Occupancy for the year remained steady at
80.8% (2018: 80.9%). Gross Operating Profit
decreased by 1.9 %. This was due to increasing
cost pressures during 2019 such as utility and
payroll cost increases which are expected to
continue into 2020.
In 2019 MCK’s “book direct” and “think
local” initiatives saw increases in the number
of bookings made by customers directly with
MCK. This is an encouraging trend and one
which MCK is keen to see improve further.
Geographically, MCK’s marketing operations
focused on diversifying its customer base
originating from new and emerging markets
such as South-East Asia and India. With some
key markets showing signs of weakness,
we believe that growth from such emerging
markets will be a key factor in maintaining
market share and growing future revenues.
Within New Zealand itself, MCK was
pleased with the performance of several of
its regional hotels such as Kingsgate Hotel
Dunedin, Copthorne Hotel Palmerston North,
and Kingsgate Hotel Te Anau which traded
positively during the year and indicate an
increasing strength in such hotels.
2019 also saw MCK’s talent pool upskilling
with completions through the Service IQ
programmes which assisted with retaining key
operational staff at a number of our hotels.
MCK continues to be focused on development
of employees in an environment where
attracting and retaining skilled employees will
continue to contribute to productivity gains.
MCK is disappointed by the judgment in
relation to the Accommodation Provider
Targeted Rate handed down by the High
Court last week. We are reviewing our options
with our external lawyers and will determine
whether an appeal should be pursued in the
next few weeks.
CDL Investments New Zealand Limited
(“CDLI”)
CDLI announced an operating profit after tax
for the year ended 31 December 2019 of $34.1
million (2018: $33.6 million). This marks
ten successive years of profit growth. Given
slowing markets, this is a very creditable result
and reflected a resourceful sales strategy in the
latter half of 2019.
MCK is encouraged that CDLI is progressing
well with development works and has
commenced sales at Dominion Road (South
Auckland) and Kewa Road (North Shore)
already.
CDLI maintained its ordinary dividend to 3.5
cents per share which MCK will again take in
cash when paid in May this year.
CHAIRMAN’S
REVIEW
Indoor pool at Millennium Hotel Rotorua.
Courtyard Garden at Millennium Hotel Rotorua.
Social Lounge at M Social Auckland.
5 | MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019
MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019 | 6
A return to Christchurch in a meaningful way is another project which we
have been working on. At the end of 2019, there was media speculation
that MCK might sell its former Copthorne Hotel Christchurch Central site
which was incorrect. Our site is close to the soon-to-be-completed
Te Pae Christchurch Convention Centre and the Avon River. We have
several design concepts that will take advantage of both aspects and
will give Christchurch the additional visitors and accommodation in the
central city.
In 2019, we took a good look at how we as a company could innovate
and use innovative technologies from the ground up. Construction costs,
timeliness and quality assurance remain challenges for new-build hotels.
We therefore took deeper dives into modular and volumetric construction
and engaged with our global colleagues on its viability. Our proposed
Whangarei hotel which we announced in November 2019 will likely
utilize these technologies. This can be an opportunity to utilize what
we have been looking at in New Zealand. The experience with this
technology may be put to use both in our Christchurch rebuild, a new
hotel in Queenstown on land that we own next to Lake Wakatipu and
other regional locations.
It is therefore obvious to all that these are “interesting times” indeed.
As difficult as the current issues are, we must have confidence that we
will get through the immediate crisis, reverse the downward trend in
productivity and continue to seek opportunities over time.
B K Chiu
Managing Director
The oft-quoted saying “may you live in interesting
times” has certainly proved true for the last two
years and even more so over the first few weeks
of this year. Perhaps these might be described as
“existential” times.
COVID-19 has demonstrated the obvious and the not-so-obvious
linkages within the global economy and their fragility. One immediate
impact on an export dependent economy like New Zealand is the quick
downturn of the export sectors and tourism is one of them. There are
and will be further negative business, asset and employment impacts on
large to small and medium enterprises. What are mere numbers from the
Ministry of Business, Innovation and Employment showing the broad
range of business sectors benefitting from tourism are now playing
out in the real world in real time to the distress of many -- the airlines,
airports, telco companies, banks, rental vehicle operators, taxis, coaches,
restaurants, retail, petrol stations, rural businesses, tourist attractions,
and accommodation. It is inevitable that a broad spectrum of livelihoods
will be affected. At the government level, the GST take will plummet.
The social costs including health and employment will follow. Tourism
touches many means of livelihood more than most people realise.
New Zealand’s tourism and agricultural sectors are
both real economies whose productivity competes
brilliantly with the rest of the world. Yet these two
sectors of the economy, particularly tourism, have
been badly neglected by policy makers. Both sectors
have been hobbled with new productivity-depleting
costs which are selectively discriminating. False
facts and spurious conclusions have been used to
justify new tax and rating policies onto minority
accommodation owning ratepayers. They reduce the
tourism industry’s overall competitiveness with our
international competitors. They hurt our economy.
A crisis like this focuses the mind. We need an open and honest debate
moderated by academia, the business community, industry stakeholders
as well as Government. The recent findings of the NZ Productivity
Commission looking into local government funding are welcome and
a useful starting point. The investigation by the Commission into areas
such as tourism infrastructure, land taxation and property development
also made us focus on many of the same issues we have to deal with as
an employer, rate payer and property owner across New Zealand. We
welcome a more constructive dialogue with central and local Government
on all of these issues and the opportunity to resolve them with
principled discipline and wisdom rather than a piecemeal approach
based on expediency.
Over the past five years we have paid a lot of attention to making sure
that MCK’s financial position is robust and we have also sought to ensure
that our operations have sufficient resilience to withstand a crisis such
as the one we are facing now. Since the post-Canterbury earthquake of
2011, we have channeled our resources into our New Zealand properties.
Shareholders have been able to receive the rewards of that investment and
hard work.
All that said, we cannot forget to keep our eye on our day-to-day business.
While it is clear that effects of COVID-19 will have significant impacts
for the world generally, it is important to focus on what we are doing now
as well as what we expect to do when normalcy returns. Our immediate
focus is preserving our business – that means mitigating revenue losses
and the effects on our staff and our hotels and having a renewed focus on
cost management. We are in regular contact with our Chinese and local
agents and customers and working with them to maintain our business
relationships which we have built up over many years.
Our future focus is on the fact that New Zealand will be hosting some
major geopolitical and sporting events from 2021 including the Asia-
Pacific Economic Co-Operation (APEC) Forum, the 36th defence of
the America’s Cup in Auckland and the Women’s Rugby World Cup.
All these and their associated events have the potential to reinvigorate
the tourism sector in New Zealand and put New Zealand on the global
tourism map once again. For MCK to ensure we take maximum
advantage of these events, we must use the opportunities this year to
ensure that our key properties are ready. That is why we are implementing
the steps to refurbish and improve our properties during 2020 in readiness
for a busy 2021.
As a group, we remain confident with our owner
/ operator strategy which has seen us reinvest in
our hotels, selectively acquire new properties such
as Millennium Hotel New Plymouth Waterfront
and, for CDL Investments, we have increased our
residential development land portfolio. We continue
to look for other selective opportunities which will
broaden our New Zealand footprint and we have the
financial resources to do that.
DIRECTOR’S
REVIEW
MANAGING
Roy Clifton (Hotel Maintenance) attending to the herb seedlings grown in
the greenhouse nursery in Copthorne Hotel & Resort Bay of Islands.
Kaffir limes and chillis growing in our hotels’ gardens.
5 | MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019
MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019 | 6
A return to Christchurch in a meaningful way is another project which we
have been working on. At the end of 2019, there was media speculation
that MCK might sell its former Copthorne Hotel Christchurch Central site
which was incorrect. Our site is close to the soon-to-be-completed
Te Pae Christchurch Convention Centre and the Avon River. We have
several design concepts that will take advantage of both aspects and
will give Christchurch the additional visitors and accommodation in the
central city.
In 2019, we took a good look at how we as a company could innovate
and use innovative technologies from the ground up. Construction costs,
timeliness and quality assurance remain challenges for new-build hotels.
We therefore took deeper dives into modular and volumetric construction
and engaged with our global colleagues on its viability. Our proposed
Whangarei hotel which we announced in November 2019 will likely
utilize these technologies. This can be an opportunity to utilize what
we have been looking at in New Zealand. The experience with this
technology may be put to use both in our Christchurch rebuild, a new
hotel in Queenstown on land that we own next to Lake Wakatipu and
other regional locations.
It is therefore obvious to all that these are “interesting times” indeed.
As difficult as the current issues are, we must have confidence that we
will get through the immediate crisis, reverse the downward trend in
productivity and continue to seek opportunities over time.
B K Chiu
Managing Director
The oft-quoted saying “may you live in interesting
times” has certainly proved true for the last two
years and even more so over the first few weeks
of this year. Perhaps these might be described as
“existential” times.
COVID-19 has demonstrated the obvious and the not-so-obvious
linkages within the global economy and their fragility. One immediate
impact on an export dependent economy like New Zealand is the quick
downturn of the export sectors and tourism is one of them. There are
and will be further negative business, asset and employment impacts on
large to small and medium enterprises. What are mere numbers from the
Ministry of Business, Innovation and Employment showing the broad
range of business sectors benefitting from tourism are now playing
out in the real world in real time to the distress of many -- the airlines,
airports, telco companies, banks, rental vehicle operators, taxis, coaches,
restaurants, retail, petrol stations, rural businesses, tourist attractions,
and accommodation. It is inevitable that a broad spectrum of livelihoods
will be affected. At the government level, the GST take will plummet.
The social costs including health and employment will follow. Tourism
touches many means of livelihood more than most people realise.
New Zealand’s tourism and agricultural sectors are
both real economies whose productivity competes
brilliantly with the rest of the world. Yet these two
sectors of the economy, particularly tourism, have
been badly neglected by policy makers. Both sectors
have been hobbled with new productivity-depleting
costs which are selectively discriminating. False
facts and spurious conclusions have been used to
justify new tax and rating policies onto minority
accommodation owning ratepayers. They reduce the
tourism industry’s overall competitiveness with our
international competitors. They hurt our economy.
A crisis like this focuses the mind. We need an open and honest debate
moderated by academia, the business community, industry stakeholders
as well as Government. The recent findings of the NZ Productivity
Commission looking into local government funding are welcome and
a useful starting point. The investigation by the Commission into areas
such as tourism infrastructure, land taxation and property development
also made us focus on many of the same issues we have to deal with as
an employer, rate payer and property owner across New Zealand. We
welcome a more constructive dialogue with central and local Government
on all of these issues and the opportunity to resolve them with
principled discipline and wisdom rather than a piecemeal approach
based on expediency.
Over the past five years we have paid a lot of attention to making sure
that MCK’s financial position is robust and we have also sought to ensure
that our operations have sufficient resilience to withstand a crisis such
as the one we are facing now. Since the post-Canterbury earthquake of
2011, we have channeled our resources into our New Zealand properties.
Shareholders have been able to receive the rewards of that investment and
hard work.
All that said, we cannot forget to keep our eye on our day-to-day business.
While it is clear that effects of COVID-19 will have significant impacts
for the world generally, it is important to focus on what we are doing now
as well as what we expect to do when normalcy returns. Our immediate
focus is preserving our business – that means mitigating revenue losses
and the effects on our staff and our hotels and having a renewed focus on
cost management. We are in regular contact with our Chinese and local
agents and customers and working with them to maintain our business
relationships which we have built up over many years.
Our future focus is on the fact that New Zealand will be hosting some
major geopolitical and sporting events from 2021 including the Asia-
Pacific Economic Co-Operation (APEC) Forum, the 36th defence of
the America’s Cup in Auckland and the Women’s Rugby World Cup.
All these and their associated events have the potential to reinvigorate
the tourism sector in New Zealand and put New Zealand on the global
tourism map once again. For MCK to ensure we take maximum
advantage of these events, we must use the opportunities this year to
ensure that our key properties are ready. That is why we are implementing
the steps to refurbish and improve our properties during 2020 in readiness
for a busy 2021.
As a group, we remain confident with our owner
/ operator strategy which has seen us reinvest in
our hotels, selectively acquire new properties such
as Millennium Hotel New Plymouth Waterfront
and, for CDL Investments, we have increased our
residential development land portfolio. We continue
to look for other selective opportunities which will
broaden our New Zealand footprint and we have the
financial resources to do that.
DIRECTOR’S
REVIEW
MANAGING
Roy Clifton (Hotel Maintenance) attending to the herb seedlings grown in
the greenhouse nursery in Copthorne Hotel & Resort Bay of Islands.
Kaffir limes and chillis growing in our hotels’ gardens.
7 | MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019
MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019 | 8
Partnership with
Kapiti Cheese
In collaboration with Fonterra,
Millennium Hotels and Resorts
New Zealand once again created a
National Cheese Festival ‘Festival
du Fromage’. Fonterra supplied
MCK hotels with ‘inspiration kits’
for our chefs to come up with
concepts for their dishes.
Cheese dishes ranged in variety
from “Kapiti Five Cheese Pizza” to
“6-Hours Braised Beef Short Rib
with Kikorangi Blue Cheese Rosti”.
PARTNERSHIPS FOR
Sustainability & New Zealand Fashion Week
Grand Millennium Auckland became home to two beehives as part of
the “Bees Up Top” Initiative.
When New Zealand Fashion Week announced the theme for 2019
event was sustainability, being the elite sponsor for the event,
Millennium Hotels and Resorts New Zealand celebrated with a
honey theme.
Grand Millennium Auckland, selected as an accommodation hub for
designers, buyers, and guests coming into town for the fashion festival,
created a Secret Garden. Part of the lobby was converted into a garden
space with a wall made from plants where guests were able to relax in.
Guests were also able to take flower seeds home to grow.
Our hotels also took part in creating signature honey themed cocktails
such as the “Bee’s Knees” consisting of gin, honey, and lemon which
was a popular choice of drinks to guests before or after the show.
“Secret Garden” display for New Zealand Fashion Week.
New Zealand Fashion Week model casting
at Grand Millennium Auckland Atrium Bar.
THE FUTURE
FUN FACT
Over 100,000 bees
live in our 2 hives
at Grand Millennium
Auckland.
Conferences
In 2019 the National
Conference Sales team
focused on keeping in
front of our clients
and maintaining a
strong relationship.
They won the best
Independent stand at
MEETINGS 2019, the
biggest business events
tradeshow in New Zealand.
Alison Smith (National
Director of Sales,
Conferences and
Incentives) at the
MEETINGS trade show.
Kapiti cheese
board for the
Festival du
Fromage.
7 | MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019
MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019 | 8
Partnership with
Kapiti Cheese
In collaboration with Fonterra,
Millennium Hotels and Resorts
New Zealand once again created a
National Cheese Festival ‘Festival
du Fromage’. Fonterra supplied
MCK hotels with ‘inspiration kits’
for our chefs to come up with
concepts for their dishes.
Cheese dishes ranged in variety
from “Kapiti Five Cheese Pizza” to
“6-Hours Braised Beef Short Rib
with Kikorangi Blue Cheese Rosti”.
PARTNERSHIPS FOR
Sustainability & New Zealand Fashion Week
Grand Millennium Auckland became home to two beehives as part of
the “Bees Up Top” Initiative.
When New Zealand Fashion Week announced the theme for 2019
event was sustainability, being the elite sponsor for the event,
Millennium Hotels and Resorts New Zealand celebrated with a
honey theme.
Grand Millennium Auckland, selected as an accommodation hub for
designers, buyers, and guests coming into town for the fashion festival,
created a Secret Garden. Part of the lobby was converted into a garden
space with a wall made from plants where guests were able to relax in.
Guests were also able to take flower seeds home to grow.
Our hotels also took part in creating signature honey themed cocktails
such as the “Bee’s Knees” consisting of gin, honey, and lemon which
was a popular choice of drinks to guests before or after the show.
“Secret Garden” display for New Zealand Fashion Week.
New Zealand Fashion Week model casting
at Grand Millennium Auckland Atrium Bar.
THE FUTURE
FUN FACT
Over 100,000 bees
live in our 2 hives
at Grand Millennium
Auckland.
Conferences
In 2019 the National
Conference Sales team
focused on keeping in
front of our clients
and maintaining a
strong relationship.
They won the best
Independent stand at
MEETINGS 2019, the
biggest business events
tradeshow in New Zealand.
Alison Smith (National
Director of Sales,
Conferences and
Incentives) at the
MEETINGS trade show.
Kapiti cheese
board for the
Festival du
Fromage.
9 | MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019
MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019 | 10
DIRECTORS’ PROFILES
B K CHIU
Managing Director
Mr. Chiu is also the Managing Director of CDL Investments
New Zealand Limited. Prior to joining the company, Mr.
Chiu was Regional Vice - President and Managing Director,
Asia of Merisant Company. He holds a Masters degree
in agricultural economics and marketing from Massey
University, Palmerston North. Mr. Chiu was last re-elected to
the Board at the 2017 annual meeting of shareholders.
COLIN SIM
Chairman & Independent Director
Mr. Sim is the executive chairman of the East Quarter
Group of companies (East Quarter Hurstville, EQ Projects
and EQ Constructions) (EQ) in Australia. EQ is currently
involved in the development and construction of residential
units across New South Wales. Mr. Sim is also an executive
director of Waterbrook Lifestyle Resorts (Waterbrook);
an award-winning creator, developer and operator or
luxury resort lifestyles for retirees. Mr Sim has strong
analytical skills and extensive experience in construction and
property development/investment in Australia. He studied
Mechanical Engineering in London and has lived in Sydney,
Australia for the last 40 years. Mr. Sim was appointed to
the Board in July 2017 and was elected to the Board at the
2018 Annual Meeting of shareholders.
EIK SHENG KWEK
Non-Executive Director
Mr. Kwek is currently the Group Chief Strategy Officer of
City Developments Limited (“CDL”) and has been in that
role since 2018. Mr. Kwek joined CDL in 2009, covering
Business Development for overseas projects before being
appointed as Head of Corporate Development. He assumed
his role as Chief Strategy Officer in 2014 and was additionally
appointed Head, Asset Management in April 2016. Prior
to joining CDL, he was with the Hong Leong Group of
companies in Singapore specialising in corporate finance
roles since 2006. He is also Executive Director of Millennium
& Copthorne Hotels Limited, previously listed on the London
Stock Exchange as Millennium & Copthorne Hotels plc. He
holds a Bachelor of Engineering in Electrical and Electronics
Engineering from Imperial College of Science, Technology
and Medicine and a Master of Philosophy in Finance from
Judge Business School, Cambridge University. Mr. Kwek
was appointed to the Board on 1 January 2020 and will be
required to be elected by shareholders at the next annual
meeting of shareholders.
GRAHAM MCKENZIE
Independent Director, Member of the
Audit Committee
Mr. McKenzie is a Barrister and Solicitor with over thirty years
experience in corporate and commercial law and is a former
Partner and Consultant to Bell Gully, a leading New Zealand
law firm. He is currently a member of the New Zealand Law
Society Disciplinary Tribunal. Mr. McKenzie is a member
of the New Zealand Law Society and the Queensland Law
Society, Australia and holds a Bachelor of Laws degree
from Victoria University, Wellington and a Master of Laws
degree from Warwick University, England. Mr. McKenzie
was a Director of CDL Investments New Zealand Limited
from 2005 to 2006. Mr. McKenzie was last re-elected to the
Board at the 2019 annual meeting of shareholders.
KEVIN HANGCHI
Non-Executive Director
Mr. Hangchi is currently Senior Vice President, Hong
Leong Management Services Pte. Limited. He has global
transactional experience across many of the Hong Leong
Group’s entities including listings and public offerings,
mergers and acquisitions as well as capital markets issuances
and banking facilities. Mr. Hangchi has been called to the
English and Singaporean bars and holds an honours degree in
Accountancy and Law from the University of Southampton.
Mr. Hangchi was last re-elected to the Board at the 2018
annual meeting of shareholders.
RICHARD BOBB
Independent Director, Chair of the
Audit Committee
Mr. Bobb is a Chartered Accountant with over thirty five years
experience. He is currently a member of the Professional
Conduct Tribunal of the Institute of Chartered Accountants
in Australia and was a member of New South Wales
Joint State Taxes Committee of the Institute of Chartered
Accountants in Australia and the CPA Australia. He was also
a member and past Chairman of the Joint Legislation Review
Committee and a member and past Chairman the Legislation
Review Board of the Institute of Chartered Accountants in
Australia and the CPA Australia. He is admitted as a Barrister
in New South Wales. Mr. Bobb was last re-elected to the
Board at the 2018 annual meeting of shareholders.
QUANTUM LIMITEDMILLENNIUM &
COPTHORNE HOTELS
NEW ZEALAND LIMITED
OWNED
Millennium Hotel Queenstown
Copthorne Hotel Auckland City
Copthorne Hotel Rotorua
Copthorne Hotel Palmerston North
Copthorne Hotel Wellington Oriental Bay
Copthorne Hotel & Apartments
Queenstown Lakeview
Kingsgate Hotel Dunedin
FRANCHISED
Millennium Hotel & Resort
Manuels Taupo
Copthorne Hotel & Resort Hokianga
Copthorne Hotel Grand Central
New Plymouth
Copthorne Hotel & Resort Solway
Park Wairarapa
Kingsgate Hotel The Avenue
Wanganui
OWNED
Millennium Hotel New Plymouth
Waterfront
Millennium Hotel Rotorua
M Social Auckland
Copthorne Hotel & Resort Bay of Islands
(49%)
Copthorne Hotel & Resort Queenstown
Lakefront
Kingsgate Hotel Greymouth
Kingsgate Hotel Te Anau
Copthorne Hotel Wellington Oriental Bay
MANAGED
Grand Millennium Auckland
Kingsgate Hotel Autolodge Paihia
HOSPITALITY
SERVICES LIMITED
HOTEL OWNERSHIP
MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019 | 9
9 | MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019
MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019 | 10
DIRECTORS’ PROFILES
B K CHIU
Managing Director
Mr. Chiu is also the Managing Director of CDL Investments
New Zealand Limited. Prior to joining the company, Mr.
Chiu was Regional Vice - President and Managing Director,
Asia of Merisant Company. He holds a Masters degree
in agricultural economics and marketing from Massey
University, Palmerston North. Mr. Chiu was last re-elected to
the Board at the 2017 annual meeting of shareholders.
COLIN SIM
Chairman & Independent Director
Mr. Sim is the executive chairman of the East Quarter
Group of companies (East Quarter Hurstville, EQ Projects
and EQ Constructions) (EQ) in Australia. EQ is currently
involved in the development and construction of residential
units across New South Wales. Mr. Sim is also an executive
director of Waterbrook Lifestyle Resorts (Waterbrook);
an award-winning creator, developer and operator or
luxury resort lifestyles for retirees. Mr Sim has strong
analytical skills and extensive experience in construction and
property development/investment in Australia. He studied
Mechanical Engineering in London and has lived in Sydney,
Australia for the last 40 years. Mr. Sim was appointed to
the Board in July 2017 and was elected to the Board at the
2018 Annual Meeting of shareholders.
EIK SHENG KWEK
Non-Executive Director
Mr. Kwek is currently the Group Chief Strategy Officer of
City Developments Limited (“CDL”) and has been in that
role since 2018. Mr. Kwek joined CDL in 2009, covering
Business Development for overseas projects before being
appointed as Head of Corporate Development. He assumed
his role as Chief Strategy Officer in 2014 and was additionally
appointed Head, Asset Management in April 2016. Prior
to joining CDL, he was with the Hong Leong Group of
companies in Singapore specialising in corporate finance
roles since 2006. He is also Executive Director of Millennium
& Copthorne Hotels Limited, previously listed on the London
Stock Exchange as Millennium & Copthorne Hotels plc. He
holds a Bachelor of Engineering in Electrical and Electronics
Engineering from Imperial College of Science, Technology
and Medicine and a Master of Philosophy in Finance from
Judge Business School, Cambridge University. Mr. Kwek
was appointed to the Board on 1 January 2020 and will be
required to be elected by shareholders at the next annual
meeting of shareholders.
GRAHAM MCKENZIE
Independent Director, Member of the
Audit Committee
Mr. McKenzie is a Barrister and Solicitor with over thirty years
experience in corporate and commercial law and is a former
Partner and Consultant to Bell Gully, a leading New Zealand
law firm. He is currently a member of the New Zealand Law
Society Disciplinary Tribunal. Mr. McKenzie is a member
of the New Zealand Law Society and the Queensland Law
Society, Australia and holds a Bachelor of Laws degree
from Victoria University, Wellington and a Master of Laws
degree from Warwick University, England. Mr. McKenzie
was a Director of CDL Investments New Zealand Limited
from 2005 to 2006. Mr. McKenzie was last re-elected to the
Board at the 2019 annual meeting of shareholders.
KEVIN HANGCHI
Non-Executive Director
Mr. Hangchi is currently Senior Vice President, Hong
Leong Management Services Pte. Limited. He has global
transactional experience across many of the Hong Leong
Group’s entities including listings and public offerings,
mergers and acquisitions as well as capital markets issuances
and banking facilities. Mr. Hangchi has been called to the
English and Singaporean bars and holds an honours degree in
Accountancy and Law from the University of Southampton.
Mr. Hangchi was last re-elected to the Board at the 2018
annual meeting of shareholders.
RICHARD BOBB
Independent Director, Chair of the
Audit Committee
Mr. Bobb is a Chartered Accountant with over thirty five years
experience. He is currently a member of the Professional
Conduct Tribunal of the Institute of Chartered Accountants
in Australia and was a member of New South Wales
Joint State Taxes Committee of the Institute of Chartered
Accountants in Australia and the CPA Australia. He was also
a member and past Chairman of the Joint Legislation Review
Committee and a member and past Chairman the Legislation
Review Board of the Institute of Chartered Accountants in
Australia and the CPA Australia. He is admitted as a Barrister
in New South Wales. Mr. Bobb was last re-elected to the
Board at the 2018 annual meeting of shareholders.
QUANTUM LIMITEDMILLENNIUM &
COPTHORNE HOTELS
NEW ZEALAND LIMITED
OWNED
Millennium Hotel Queenstown
Copthorne Hotel Auckland City
Copthorne Hotel Rotorua
Copthorne Hotel Palmerston North
Copthorne Hotel Wellington Oriental Bay
Copthorne Hotel & Apartments
Queenstown Lakeview
Kingsgate Hotel Dunedin
FRANCHISED
Millennium Hotel & Resort
Manuels Taupo
Copthorne Hotel & Resort Hokianga
Copthorne Hotel Grand Central
New Plymouth
Copthorne Hotel & Resort Solway
Park Wairarapa
Kingsgate Hotel The Avenue
Wanganui
OWNED
Millennium Hotel New Plymouth
Waterfront
Millennium Hotel Rotorua
M Social Auckland
Copthorne Hotel & Resort Bay of Islands
(49%)
Copthorne Hotel & Resort Queenstown
Lakefront
Kingsgate Hotel Greymouth
Kingsgate Hotel Te Anau
Copthorne Hotel Wellington Oriental Bay
MANAGED
Grand Millennium Auckland
Kingsgate Hotel Autolodge Paihia
HOSPITALITY
SERVICES LIMITED
HOTEL OWNERSHIP
10 | MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019
11 | MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019
MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019 | 12
MILLENNIUM HOTELS & RESORTS IN NEW ZEALAND
Grand Millennium Auckland
71 Mayoral Drive, Auckland
Phone +64 9 366 3000
grandmillennium.auckland@millenniumhotels.co.nz
Millennium Hotel Rotorua
Cnr Eruera & Hinemaru Streets, Rotorua
Phone +64 7 347 1234
Fax +64 7 348 1234
millennium.rotorua@millenniumhotels.co.nz
Millennium Hotel & Resort Manuels Taupo
243 Lake Terrace, Taupo
Phone +64 7 378 5110
Fax +64 7 378 5341
millennium.taupo@millenniumhotels.co.nz
Millennium Hotel Queenstown
Cnr Frankton Road & Stanley Street, Queenstown
Phone +64 3 450 0150
Fax +64 3 441 8889
millennium.queenstown@millenniumhotels.co.nz
Millennium Hotel New Plymouth Waterfront
1 Egmont St, New Plymouth
Phone +64 6 769 5301
Fax +64 6 769 5302
millennium.newplymouth@millenniumhotels.co.nz
M COLLECTION
Copthorne Hotel & Resort Bay of Islands
Tau Henare Drive, Paihia
Phone +64 9 402 7411
Fax +64 9 402 8200
copthorne.bayofislands@millenniumhotels.co.nz
Copthorne Hotel & Resort Hokianga
S.H 12 Omapere, Hokianga
Phone +64 9 405 8737
Fax +64 9 405 8801
copthorne.hokianga@millenniumhotels.co.nz
Copthorne Hotel Auckland City
150 Anzac Avenue, Auckland
Phone +64 9 379 8509
Fax +64 9 379 8582
copthorne.aucklandcity@millenniumhotels.co.nz
Copthorne Hotel Rotorua
Fenton Street, Rotorua
Phone +64 7 348 0199
Fax +64 7 346 1973
copthorne.rotorua@millenniumhotels.co.nz
Copthorne Hotel Grand Central
New Plymouth
42 Powderham Street, New Plymouth
Phone +64 6 758 7495
Fax +64 6 758 7496
copthorne.newplymouth@millenniumhotels.co.nz
Copthorne Hotel Palmerston North
110 Fitzherbert Avenue, Palmerston North
Phone +64 6 356 8059
Fax +64 6 356 8604
copthorne.palmerston@millenniumhotels.co.nz
Copthorne Hotel & Resort Solway
Park Wairarapa
High Street, South Masterton
Phone +64 6 370 0500
Fax +64 6 370 0501
reservations@solway.co.nz
Copthorne Hotel Wellington Oriental Bay
100 Oriental Parade, Wellington
Phone +64 4 385 0279
Fax +64 4 384 5324
copthorne.orientalbay@millenniumhotels.co.nz
Copthorne Hotel & Resort
Queenstown Lakefront
Cnr Adelaide Street and Frankton Road, Queenstown
Phone +64 3 450 0260
Fax +64 3 442 7472
copthorne.lakefront@millenniumhotels.co.nz
Copthorne Hotel & Apartments
Queenstown Lakeview
88 Frankton Road, Queenstown
Phone +64 3 442 7950
Fax +64 3 442 8066
copthorne.lakeview@millenniumhotels.co.nz
Kingsgate Hotel Autolodge Paihia
Marsden Road, Paihia
Phone +64 9 402 7416
Fax +64 9 402 8348
kingsgate.paihia@millenniumhotels.co.nz
Kingsgate Hotel The Avenue Wanganui
379 Victoria Avenue, Wanganui
Phone +64 6 349 0044
Fax +64 6 345 3250
kingsgate.wanganui@millenniumhotels.co.nz
Kingsgate Hotel Greymouth
32 Mawhera Quay, Greymouth
Phone +64 3 768 5085
Fax +64 3 768 5844
kingsgate.greymouth@millenniumhotels.co.nz
Kingsgate Hotel Te Anau
20 Lakefront Drive, Te Anau
Phone +64 3 249 7421
Fax +64 3 249 8037
kingsgate.teanau@millenniumhotels.co.nz
Kingsgate Hotel Dunedin
10 Smith Street, Dunedin
Phone +64 3 477 6784
Fax +64 3 474 0115
kingsgate.dunedin@millenniumhotels.co.nz
M Social Auckland
196 - 200 Quay Street, Auckland
Phone +64 9 377 0349
msocial.auckland@millenniumhotels.com
View from Copthorne Hotel & Apartments Queenstown Lakeview.
Financial Statements – Contents
Consolidated Income Statement FIN 1
Consolidated Statement of Comprehensive Income FIN 1
Consolidated Statement of Changes in Equity FIN 2 - 3
Consolidated Statement of Financial Position FIN 4
Consolidated Statement of Cash Flows FIN 5 - 6
Notes to the Financial Statements FIN 7 - 28
Audit Report FIN 29 - 32
Corporate Governance
Corporate Governance Statement CG 1 - 4
Regulatory Disclosures and Statutory Information – Contents
Shareholder Information REG 1 - 2
Statutory Information REG 3 - 4
Staff members of Copthorne Hotel & Resort Bay of Islands Roy Clifton (Hotel Maintainance),
Brad Watts (General Manager) and Chef Dhir Sanghi in the herb garden.
MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019 | 11
11 | MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019
MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019 | 12
MILLENNIUM HOTELS & RESORTS IN NEW ZEALAND
Grand Millennium Auckland
71 Mayoral Drive, Auckland
Phone +64 9 366 3000
grandmillennium.auckland@millenniumhotels.co.nz
Millennium Hotel Rotorua
Cnr Eruera & Hinemaru Streets, Rotorua
Phone +64 7 347 1234
Fax +64 7 348 1234
millennium.rotorua@millenniumhotels.co.nz
Millennium Hotel & Resort Manuels Taupo
243 Lake Terrace, Taupo
Phone +64 7 378 5110
Fax +64 7 378 5341
millennium.taupo@millenniumhotels.co.nz
Millennium Hotel Queenstown
Cnr Frankton Road & Stanley Street, Queenstown
Phone +64 3 450 0150
Fax +64 3 441 8889
millennium.queenstown@millenniumhotels.co.nz
Millennium Hotel New Plymouth Waterfront
1 Egmont St, New Plymouth
Phone +64 6 769 5301
Fax +64 6 769 5302
millennium.newplymouth@millenniumhotels.co.nz
M COLLECTION
Copthorne Hotel & Resort Bay of Islands
Tau Henare Drive, Paihia
Phone +64 9 402 7411
Fax +64 9 402 8200
copthorne.bayofislands@millenniumhotels.co.nz
Copthorne Hotel & Resort Hokianga
S.H 12 Omapere, Hokianga
Phone +64 9 405 8737
Fax +64 9 405 8801
copthorne.hokianga@millenniumhotels.co.nz
Copthorne Hotel Auckland City
150 Anzac Avenue, Auckland
Phone +64 9 379 8509
Fax +64 9 379 8582
copthorne.aucklandcity@millenniumhotels.co.nz
Copthorne Hotel Rotorua
Fenton Street, Rotorua
Phone +64 7 348 0199
Fax +64 7 346 1973
copthorne.rotorua@millenniumhotels.co.nz
Copthorne Hotel Grand Central
New Plymouth
42 Powderham Street, New Plymouth
Phone +64 6 758 7495
Fax +64 6 758 7496
copthorne.newplymouth@millenniumhotels.co.nz
Copthorne Hotel Palmerston North
110 Fitzherbert Avenue, Palmerston North
Phone +64 6 356 8059
Fax +64 6 356 8604
copthorne.palmerston@millenniumhotels.co.nz
Copthorne Hotel & Resort Solway
Park Wairarapa
High Street, South Masterton
Phone +64 6 370 0500
Fax +64 6 370 0501
reservations@solway.co.nz
Copthorne Hotel Wellington Oriental Bay
100 Oriental Parade, Wellington
Phone +64 4 385 0279
Fax +64 4 384 5324
copthorne.orientalbay@millenniumhotels.co.nz
Copthorne Hotel & Resort
Queenstown Lakefront
Cnr Adelaide Street and Frankton Road, Queenstown
Phone +64 3 450 0260
Fax +64 3 442 7472
copthorne.lakefront@millenniumhotels.co.nz
Copthorne Hotel & Apartments
Queenstown Lakeview
88 Frankton Road, Queenstown
Phone +64 3 442 7950
Fax +64 3 442 8066
copthorne.lakeview@millenniumhotels.co.nz
Kingsgate Hotel Autolodge Paihia
Marsden Road, Paihia
Phone +64 9 402 7416
Fax +64 9 402 8348
kingsgate.paihia@millenniumhotels.co.nz
Kingsgate Hotel The Avenue Wanganui
379 Victoria Avenue, Wanganui
Phone +64 6 349 0044
Fax +64 6 345 3250
kingsgate.wanganui@millenniumhotels.co.nz
Kingsgate Hotel Greymouth
32 Mawhera Quay, Greymouth
Phone +64 3 768 5085
Fax +64 3 768 5844
kingsgate.greymouth@millenniumhotels.co.nz
Kingsgate Hotel Te Anau
20 Lakefront Drive, Te Anau
Phone +64 3 249 7421
Fax +64 3 249 8037
kingsgate.teanau@millenniumhotels.co.nz
Kingsgate Hotel Dunedin
10 Smith Street, Dunedin
Phone +64 3 477 6784
Fax +64 3 474 0115
kingsgate.dunedin@millenniumhotels.co.nz
M Social Auckland
196 - 200 Quay Street, Auckland
Phone +64 9 377 0349
msocial.auckland@millenniumhotels.com
View from Copthorne Hotel & Apartments Queenstown Lakeview.
Financial Statements – Contents
Consolidated Income Statement FIN 1
Consolidated Statement of Comprehensive Income FIN 1
Consolidated Statement of Changes in Equity FIN 2 - 3
Consolidated Statement of Financial Position FIN 4
Consolidated Statement of Cash Flows FIN 5 - 6
Notes to the Financial Statements FIN 7 - 28
Audit Report FIN 29 - 32
Corporate Governance
Corporate Governance Statement CG 1 - 4
Regulatory Disclosures and Statutory Information – Contents
Shareholder Information REG 1 - 2
Statutory Information REG 3 - 4
Staff members of Copthorne Hotel & Resort Bay of Islands Roy Clifton (Hotel Maintainance),
Brad Watts (General Manager) and Chef Dhir Sanghi in the herb garden.
FIN 1 | MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019
FIN 1
MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019 | FIN 2
FIN 2
FIN 3 | MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019
FIN 3
MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019 | FIN 4
FIN 4
FIN 4
The accompanying notes form part of, and should be read in conjunction with, these financial statements
FIN 5 | MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019
FIN 5
:9
:99
:9
MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019 | FIN 6
FIN 6
FIN 6
FIN 7 | MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019
FIN 7
Notes to the Consolidated Financial Statements for the year ended 31 December 2019
•
•
•
MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019 | FIN 8
FIN 8
Notes to the Consolidated Financial Statements for the year ended 31 December 2019
FIN 9 | MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019
FIN 9
Notes to the Consolidated Financial Statements for the year ended 31 December 2019
•
•
•
FIN 9
Notes to the Consolidated Financial Statements for the year ended 31 December 2019
•
•
•
MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019 | FIN 10
FIN 10
Notes to the Consolidated Financial Statements for the year ended 31 December 2019
•
•
•
•
•
FIN 11 | MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019
FIN 11
Notes to the Consolidated Financial Statements for the year ended 31 December 2019
MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019 | FIN 12
FIN 12
Notes to the Consolidated Financial Statements for the year ended 31 December 2019
FIN 13 | MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019
FIN 13
Notes to the Consolidated Financial Statements for the year ended 31 December 2019
MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019 | FIN 14
FIN 14
Notes to the Consolidated Financial Statements for the year ended 31 December 2019
FIN 15 | MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019
FIN 15
Notes to the Consolidated Financial Statements for the year ended 31 December 2019
MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019 | FIN 16
FIN 16
Notes to the Consolidated Financial Statements for the year ended 31 December 2019
•
•
•
•
•
•
•
FIN 17 | MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019
FIN 17
Notes to the Consolidated Financial Statements for the year ended 31 December 2019
FIN 17
Notes to the Consolidated Financial Statements for the year ended 31 December 2019
FIN 17
Notes to the Consolidated Financial Statements for the year ended 31 December 2019
MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019 | FIN 18
FIN 18
Notes to the Consolidated Financial Statements for the year ended 31 December 2019
FIN 19 | MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019
FIN 19
Notes to the Consolidated Financial Statements for the year ended 31 December 2019
MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019 | FIN 20
FIN 20
Notes to the Consolidated Financial Statements for the year ended 31 December 2019
FIN 20
Notes to the Consolidated Financial Statements for the year ended 31 December 2019
FIN 21 | MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019
FIN 21
Notes to the Consolidated Financial Statements for the year ended 31 December 2019
FIN 21
Notes to the Consolidated Financial Statements for the year ended 31 December 2019
FIN 21
Notes to the Consolidated Financial Statements for the year ended 31 December 2019
FIN 21
Notes to the Consolidated Financial Statements for the year ended 31 December 2019
MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019 | FIN 22
FIN 22
Notes to the Consolidated Financial Statements for the year ended 31 December 2019
FIN 23 | MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019
FIN 23
Notes to the Consolidated Financial Statements for the year ended 31 December 2019
MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019 | FIN 24
FIN 24
Notes to the Consolidated Financial Statements for the year ended 31 December 2019
FIN 24
Notes to the Consolidated Financial Statements for the year ended 31 December 2019
FIN 25 | MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019
FIN 25
Notes to the Consolidated Financial Statements for the year ended 31 December 2019
Policy applicable from 1 January 2019
MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019 | FIN 26
FIN 26
Notes to the Consolidated Financial Statements for the year ended 31 December 2019
Short-term leases and leases of low-value assets
FIN 27 | MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019
FIN 27
Notes to the Consolidated Financial Statements for the year ended 31 December 2019
MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019 | FIN 28
FIN 28
Notes to the Consolidated Financial Statements for the year ended 31 December 2019
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FIN 29 | MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019
© 2020 KPMG, a New Zealand partnership and a member firm of the KPMG network of independent
member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. FIN 29
Independent Auditor’s Report
To the shareholders of Millennium & Copthorne Hotels New Zealand Limited
Report on the audit of the consolidated financial statements
Opinion
In our opinion, the accompanying consolidated
financial statements of Millennium & Copthorne
Hotels New Zealand Limited (the ’company’) and its
subsidiaries (the 'group') on pages FIN1 to FIN 28:
i.present fairly in all material respects the Group’s
financial position as at 31 December 2019 and
its financial performance and cash flows for the
year ended on that date; and
ii.comply with New Zealand Equivalents to
International Financial Reporting Standards and
International Financial Reporting Standards.
We have audited the accompanying consolidated
financial statements which comprise:
—the consolidated statement of financial position
as at 31 December 2019;
—the consolidated statements of comprehensive
income, changes in equity and cash flows for
the year then ended; and
—notes, including a summary of significant
accounting policies and other explanatory
information.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (New Zealand) (‘ISAs (NZ)’). We
believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
We are independent of the group in accordance with Professional and Ethical Standard 1 (Revised) Code of
Ethics for Assurance Practitioners issued by the New Zealand Auditing and Assurance Standards Board and the
International Ethics Standards Board for Accountants’ Code of Ethics for Professional Accountants (‘IESBA
Code’), and we have fulfilled our other ethical responsibilities in accordance with these requirements and the
IESBA Code.
Our responsibilities under ISAs (NZ) are further described in the auditor’s responsibilities for the audit of the
consolidated financial statements section of our report.
Our firm has also provided other services to the group in relation to taxation compliance and taxation advisory.
Subject to certain restrictions, partners and employees of our firm may also deal with the group on normal terms
within the ordinary course of trading activities of the business of the group. These matters have not impaired our
independence as auditor of the group. The firm has no other relationship with, or interest in, the group.
Materiality
The scope of our audit was influenced by our application of materiality. Materiality helped us to determine the
nature, timing and extent of our audit procedures and to evaluate the effect of misstatements, both individually
and on the consolidated financial statements as a whole. The materiality for the consolidated financial
statements as a whole was set at $4.1million determined with reference to a benchmark of group profit before
tax. We chose the benchmark because, in our view, this is a key measure of the group’s performance.
© 2020 KPMG, a New Zealand partnership and a member firm of the KPMG network of independent
member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. FIN 29
Independent Auditor’s Report
To the shareholders of Millennium & Copthorne Hotels New Zealand Limited
Report on the audit of the consolidated financial statements
Opinion
In our opinion, the accompanying consolidated
financial statements of Millennium & Copthorne
Hotels New Zealand Limited (the ’company’) and its
subsidiaries (the 'group') on pages FIN1 to FIN 28:
i.present fairly in all material respects the Group’s
financial position as at 31 December 2019 and
its financial performance and cash flows for the
year ended on that date; and
ii.comply with New Zealand Equivalents to
International Financial Reporting Standards and
International Financial Reporting Standards.
We have audited the accompanying consolidated
financial statements which comprise:
—the consolidated statement of financial position
as at 31 December 2019;
—the consolidated statements of comprehensive
income, changes in equity and cash flows for
the year then ended; and
—notes, including a summary of significant
accounting policies and other explanatory
information.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (New Zealand) (‘ISAs (NZ)’). We
believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
We are independent of the group in accordance with Professional and Ethical Standard 1 (Revised) Code of
Ethics for Assurance Practitioners issued by the New Zealand Auditing and Assurance Standards Board and the
International Ethics Standards Board for Accountants’ Code of Ethics for Professional Accountants (‘IESBA
Code’), and we have fulfilled our other ethical responsibilities in accordance with these requirements and the
IESBA Code.
Our responsibilities under ISAs (NZ) are further described in the auditor’s responsibilities for the audit of the
consolidated financial statements section of our report.
Our firm has also provided other services to the group in relation to taxation compliance and taxation advisory.
Subject to certain restrictions, partners and employees of our firm may also deal with the group on normal terms
within the ordinary course of trading activities of the business of the group. These matters have not impaired our
independence as auditor of the group. The firm has no other relationship with, or interest in, the group.
Materiality
The scope of our audit was influenced by our application of materiality. Materiality helped us to determine the
nature, timing and extent of our audit procedures and to evaluate the effect of misstatements, both individually
and on the consolidated financial statements as a whole. The materiality for the consolidated financial
statements as a whole was set at $4.1million determined with reference to a benchmark of group profit before
tax. We chose the benchmark because, in our view, this is a key measure of the group’s performance.
MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019 | FIN 30
FIN 30
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit
of the consolidated financial statements in the current period. We summarise below those matters and our key
audit procedures to address those matters in order that the shareholders as a body may better understand the
process by which we arrived at our audit opinion. Our procedures were undertaken in the context of and solely
for the purpose of our statutory audit opinion on the consolidated financial statements as a whole and we do not
express discrete opinions on separate elements of the consolidated financial statements
The key audit matter How the matter was addressed in our audit
1.Valuation of Hotel Land and Building assets
Refer to note 9 of the
consolidated financial
statements.
Hotel land and buildings of
$546.2 million (representing 68%
of net assets) are recognised at
fair value in the financial
statements. To establish fair
value, each hotel is required to
undergo an independent
valuation on a tri-annual basis. In
the intervening years,
management complete an
internal valuation assessment,
and assess whether the carrying
value of each hotel continues to
reflect fair value.
The external valuations and
internal valuation assessments
are based on discounted future
cashflow models which include a
number of assumptions taking
into consideration future
economic and market conditions.
The key assumptions (including
forecast growth, occupancy rates
and revenue per available room)
are inherently judgemental and
consequently a change in the
assumptions could have a
material impact on the valuations
and the carrying value of the
hotel land and buildings.
Our procedures on the independently valued hotels involved the following:
−Using our own valuation specialist to assist us in assessing the
appropriateness of the valuation model used, including compliance
with relevant accounting standards and alignment to market practice.
−We assessed the scope of work performed, competency,
professional qualifications and experience of the external expert
engaged by the group.
−We challenged the key assumptions used within each valuation in
determining the fair value of these hotel assets. This included a
comparison of occupancy rates, revenue per available room, market
growth and expected inflation with externally derived data including
external hotel industry reports.
−We also performed our own assessment of other key inputs such as
estimated future costs, discount rates and terminal multipliers, and
considered the external expert's estimates with historical hotel
performance.
−We performed sensitivities and break-even analysis on the key
assumptions.
Our testing indicated that the estimates and assumptions used were
appropriate in the context of the group's property portfolio.
For those hotels assets that were not independently valued within the tri-
annual valuation cycle, we performed the following procedures to ensure
these assets continue to reflect fair value.
−We reviewed the valuation methodology applied to the internal
valuation models and involved our valuation specialists.
−
We reviewed key assumptions against budget, past performance and
the previous external valuation and identified properties where there
were indicators of a significant change in fair value.
−Where indicators of a change in fair value were identified we
performed a detailed review the internal valuation model applying
procedures consistent with those we performed for external
valuations.
Our testing indicated that the estimates and assumptions used were
appropriate in the context of the group's property portfolio.
FIN 31 | MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019
FIN 31
Other information
The Directors, on behalf of the group, are responsible for the other information included in the entity’s Annual
Report. Other information includes the Chairman’s Review, Managing Director’s Review, disclosures relating to
corporate governance, the financial summary and the other information included in the Annual Report. Our
opinion on the consolidated financial statements does not cover any other information and we do not express
any form of assurance conclusion thereon.
In connection with our audit of the consolidated financial statements our responsibility is to read the other
information and, in doing so, consider whether the other information is materially inconsistent with the
consolidated financial statements or our knowledge obtained in the audit or otherwise appears materially
misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this
other information, we are required to report that fact. We have received the Chairman's Review and have
nothing to report in regards to it. The Annual Report is expected to be made available to us after the date of this
Independent Auditor's Report and we will report the matters identified, if any, to those charged with
governance.
Use of this independent auditor’s report
This independent auditor’s report is made solely to the shareholders as a body. Our audit work has been
undertaken so that we might state to the shareholders those matters we are required to state to them in the
independent auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept
or assume responsibility to anyone other than the shareholders as a body for our audit work, this independent
auditor’s report, or any of the opinions we have formed.
Responsibilities of the Directors for the consolidated financial
statements
The Directors, on behalf of the company, are responsible for:
—the preparation and fair presentation of the consolidated financial statements in accordance with generally
accepted accounting practice in New Zealand (being New Zealand Equivalents to International Financial
Reporting Standards) and International Financial Reporting Standards;
—implementing necessary internal control to enable the preparation of a consolidated set of financial
statements that is fairly presented and free from material misstatement, whether due to fraud or error; and
—assessing the ability to continue as a going concern. This includes disclosing, as applicable, matters related
to going concern and using the going concern basis of accounting unless they either intend to liquidate or to
cease operations, or have no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the consolidated financial
statements
Our objective is:
—to obtain reasonable assurance about whether the consolidated financial statements as a whole are free
from material misstatement, whether due to fraud or error; and
—to issue an independent auditor’s report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance
with ISAs NZ will always detect a material misstatement when it exists.
MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019 | FIN 32
FIN 31
Other information
The Directors, on behalf of the group, are responsible for the other information included in the entity’s Annual
Report. Other information includes the Chairman’s Review, Managing Director’s Review, disclosures relating to
corporate governance, the financial summary and the other information included in the Annual Report. Our
opinion on the consolidated financial statements does not cover any other information and we do not express
any form of assurance conclusion thereon.
In connection with our audit of the consolidated financial statements our responsibility is to read the other
information and, in doing so, consider whether the other information is materially inconsistent with the
consolidated financial statements or our knowledge obtained in the audit or otherwise appears materially
misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this
other information, we are required to report that fact. We have received the Chairman's Review and have
nothing to report in regards to it. The Annual Report is expected to be made available to us after the date of this
Independent Auditor's Report and we will report the matters identified, if any, to those charged with
governance.
Use of this independent auditor’s report
This independent auditor’s report is made solely to the shareholders as a body. Our audit work has been
undertaken so that we might state to the shareholders those matters we are required to state to them in the
independent auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept
or assume responsibility to anyone other than the shareholders as a body for our audit work, this independent
auditor’s report, or any of the opinions we have formed.
Responsibilities of the Directors for the consolidated financial
statements
The Directors, on behalf of the company, are responsible for:
—the preparation and fair presentation of the consolidated financial statements in accordance with generally
accepted accounting practice in New Zealand (being New Zealand Equivalents to International Financial
Reporting Standards) and International Financial Reporting Standards;
—implementing necessary internal control to enable the preparation of a consolidated set of financial
statements that is fairly presented and free from material misstatement, whether due to fraud or error; and
—assessing the ability to continue as a going concern. This includes disclosing, as applicable, matters related
to going concern and using the going concern basis of accounting unless they either intend to liquidate or to
cease operations, or have no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the consolidated financial
statements
Our objective is:
—to obtain reasonable assurance about whether the consolidated financial statements as a whole are free
from material misstatement, whether due to fraud or error; and
—to issue an independent auditor’s report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance
with ISAs NZ will always detect a material misstatement when it exists.
FIN 32
Misstatements can arise from fraud or error. They are considered material if, individually or in the aggregate,
they could reasonably be expected to influence the economic decisions of users taken on the basis of these
consolidated financial statements.
A further description of our responsibilities for the audit of these consolidated financial statements is located at
the External Reporting Board (XRB) website at:
http://www.xrb.govt.nz/standards-for-assurance-practitioners/auditors-responsibilities/audit-report-1/
This description forms part of our independent auditor’s report.
The engagement partner on the audit resulting in this independent auditor's report is Aaron Woolsey.
For and on behalf of
KPMG
Auckland
10 February 2020
CG 1 | MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019
16 | MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019
CORPORATE GOVERNANCE STATEMENT
Millennium & Copthorne Hotels New Zealand Limited is committed to maintaining strong corporate
governance in line with best practice at all times. Its corporate governance framework and objectives,
adopted in 2018, in the Board’s opinion, complies materially with the NZX Corporate Governance Code (the
“NZX Code”) as well as the Financial Markets Authority Corporate Governance Principles and Guidelines
(the FMA Principles) and is as follows:
PRINCIPLE 1 – ETHICAL BEHAVIOUR
Directors should set high standards of
ethical behaviour, model this behaviour and
hold Management accountable for these
standards being followed throughout the
organisation.
All of MCK’s directors are bound by the
Board’s Code of Ethics which is as follows:
• Directors shall undertake their duties
with due care and diligence at all times
and will conduct themselves honestly
and with integrity. Directors shall not do
anything, or cause anything to be done,
which may or does bring MCK or the
Board into disrepute.
• All Directors must act in the best
interests of the company and exercise
unfettered and independent judgement.
All Directors must carry out their
duties with integrity and honesty and
participate in open and constructive
discussions.
• To the best of their ability, Directors will
use reasonable endeavours to ensure
that MCK’s records and documents
(including its financial reports) are
true and complete and comply with
the requisite reporting standards and
controls.
• So that the Board may determine a
Director’s independence and to ensure
that there are no conflicts of interest,
all Directors shall promptly disclose
all relevant business and / or personal
interests they may have to the Board
forthwith as well as any relationships
they may have with MCK.
• All Directors shall ensure that they do
not support any organisation other than
in a personal capacity without the prior
written approval of the Chairman.
• Directors shall not accept any gifts or
personal benefits from external parties
if it could be perceived that this could
compromise or influence any decision by
the Board or by MCK.
• All Directors shall maintain and protect
the confidentiality of all information
about MCK at all times except where
disclosure is permitted or required by
law.
• All Directors shall ensure that they do
not use company information and /
or property for personal gain or profit.
All Directors shall use and / or retain
company information and property only
for business purposes in their capacity
as Directors of MCK or to meet legal
obligations.
• All Directors shall comply with the laws
and regulations that apply to MCK.
• All Directors shall immediately report
any illegal or unethical behaviour
of which they become aware to the
Chairman of the Board and to the
Chairman of the Audit Committee.
All of MCK’s employees are expected to act
in the best interests of MCK and to enhance
the reputation of the company. MCK also has
a number of operational policies which must
be followed by employees and the MCK Code
of Conduct forms part of each employee’s
employment agreement.
MCK also believes in fair dealing with its
customers and suppliers, shareholders,
employees and other stakeholders and
external third parties.
MCK revised its Share Trading Policy in 2018
which applies to Directors and Officers. It
also has a global Whistleblowing Policy which
extends to all management and employees.
The Whistleblowing Policy facilitates the
disclosure and impartial investigation of
any serious wrongdoing. This policy advises
employees of their right to disclose serious
wrongdoing, and sets out the Company’s
internal procedures for receiving and
dealing with such disclosures. The policy is
consistent with, and facilitates, the Protected
Disclosures Act 2000 and is supported by
the Board.
PRINCIPLE 2 – BOARD COMPOSITION
AND PERFORMANCE
To ensure an effective Board, there should be
a balance of independence, skills, knowledge,
experience and perspectives.
MCK’s Board has responsibility, control and
oversight of the business activities, strategic
direction and the governance of MCK and
its subsidiary companies. It looks at how
the company is operating, how risk and
compliance are managed, approving financial
and other reports and capital expenditure
and reporting to MCK’s shareholders. The
Board approves MCK’s budgets and business
plans as well as significant projects and has
statutory obligations for other matters such
as the payments of dividends and the issue of
shares. The Board is accountable to MCK’s
shareholders for the company’s performance.
Certain powers are delegated to Board
Committees and Subcommittees. The role of
the Committees is detailed under Principle 3.
Day-to-day management is delegated to the
Managing Director and senior management.
The levels of authority are approved by way
of a Delegated Authorities Manual which
is reviewed by the Audit Committee and
ultimately approved by the Board.
Appointments to the Board are considered by
the Board and the Board takes into account
the skills required to allow it to carry out its
functions and governance role. The Board
does not impose a restriction on the tenure
of any Director as it considers that such a
restriction may lead to the loss of experience
and expertise from the Board.
MCK’s Constitution specifies a minimum
number of three directors and a maximum
number of nine directors at any one time.
Two directors must ordinarily be living in New
Zealand. In line with the NZX Main Board
Listing Rules, MCK is required to have at
least two Independent Directors. Currently,
MCK has determined that its Chair Colin
Sim and Messrs. Bobb and McKenzie are
Independent Directors as none of them have
a Disqualifying Relationship (as that term is
defined in the NZX Main Board Listing Rules)
or Substantial Product Holders. Messrs Chiu,
Hangchi and Tan are not considered by the
Board to be Independent Directors.
Board meetings are generally held quarterly
with additional meetings convened when
required. The table below details directors’
attendances during 2019.
DirectorMeetings attended in 2019
Colin Sim (Chair)3/3
BK Chiu (Managing
Director)
3/3
Graham McKenzie3/3
Kevin Hangchi3/3
Kian Seng Tan (*)3/3
Richard Bobb3/3
(*) Mr. Tan retired from the Board on 31 December 2019
and Mr. ES Kwek was appointed from 1 January 2020.
MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019 | 17
In 2018, the Board devised its own Skills
Matrix to demonstrate the skills, experience
and diversity of its Board.
Skill / AttributeRelevant Director
Retail, marketing, brand
and sales experience
Chiu
Governance experience Chiu, Hangchi,
McKenzie, Sim
Large enterprise /
Multinational business or
leadership experience
Chiu, Hangchi,
Sim, Tan
Accounting / Finance /
Tax experience
Bobb, Hangchi
Legal or Regulatory
knowledge and experience
Hangchi, McKenzie
Business strategy
experience
Chiu, Sim, Tan
Property development /
management experience
Chiu, Sim
The Board encourages all directors to
undertake their own continuous education so
that they can perform their duties as directors
and provide maximum benefit to the Board
and to shareholders.
In 2018, MCK also adopted its own Diversity
and Inclusion Policy which is a separate
stand-alone document.
PRINCIPLE 3 – BOARD COMMITTEES
The Board should use committees where this
will enhance its effectiveness in key areas
while still retaining board responsibility.
Committees help the Board in carrying out
its responsibilities and MCK currently has
one standing committee being its Audit
Committee which is comprised solely
of Independent Directors. The current
members of the Audit Committee are Richard
Bobb (Chair) and Graham McKenzie. The
Managing Director and senior management
attend only by invitation.
The table below reports attendance of the
Audit Committee members during 2019
DirectorMeetings attended
in 2019
Richard Bobb2/2
Graham McKenzie2/2
The Board also forms subcommittees as and
when required.
MCK does not currently have a Remuneration
or Nominations Committee. The Board as
a whole deals with the issues that would
normally be dealt with by these committees
and conducts periodic reviews of its fees and
the remuneration of the Managing Director
and senior management. Vacancies and
appointments to the Board are considered by
the Board as a whole. For those reasons, MCK
does not consider it necessary to form and
maintain either Committee at this time.
MCK has in the past formed a Due Diligence
Committee (DDC) to oversee, review and
report on material or complex transactions
and will do so when required. The DDC will
comprise only of Independent Directors,
members of senior management and external
advisors directly involved in the transaction.
The Board has not established a protocol
which sets out procedures to be followed in
the event of a takeover offer being received
by the Company. This is because the Board
considers that receipt of a takeover offer to
be a very unlikely event in light of CDL Hotels
Holdings New Zealand Limited’s long-term
majority shareholding in the Company.
MCK is also the owner of property assets
including “sensitive land” (as defined under
the Overseas Investment Act 2015) which,
if the subject of an overseas takeover offer,
would require regulatory and / or government
approvals for their acquisition.
MCK’s Board believes that the Company
would have sufficient time to adopt protocols
and procedures necessary to respond to any
such offer when received and to communicate
those to shareholders. MCK’s Board
therefore believes that it is reasonable and
appropriate for the Company not to follow
Recommendation 3.6 of the new Code at this
time but agrees with the principles behind
Recommendation 3.6.
PRINCIPLE 4 – REPORTING &
DISCLOSURE
The Board should demand integrity in
financial and non-financial reporting and
in the timeliness and balance of corporate
disclosures.
As an NZX-listed entity, MCK recognises
the need to ensure that it is fully compliant
in terms of reporting and disclosure and
has in place a Continuous Disclosure Policy
(CDP) which applies to MCK, its subsidiaries
(“Group”), and all their respective directors
and employees. The Board has appointed
the Chairman, the Chairman of the Audit
Committee, the Managing Director, the
Company Secretary and the Vice President
Finance to act as MCK’s Continuous
Disclosure Committee (the Disclosure
Committee). A quorum of the Disclosure
Committee shall consist of no less than three
(3) of these persons.
The Disclosure Committee is responsible for:
• Determining what information amounts
to material information and must be
disclosed;
• Determining the timing of disclosure of
any information in accordance with the
CDP;
• Approving the content of any disclosure
to NZX (including matters not directly
covered by the CDP);
• Ensuring that all employees and
directors within the Group whom the
Committee considers appropriate
receive a copy of the CDP and
appropriate training with respect to it;
• Developing mechanisms designed to
identify potential material information
(e.g. agenda item on management
meetings); and
• Liaising with legal advisers in respect of
MCK’s compliance with its continuous
disclosure obligations.
The key points from the CDP are:
• No person may release material
information concerning MCK to any
person who is not authorised to receive
it without the approval of the Disclosure
Committee.
• The Board will consider at each
Board meeting whether there is any
information that may require disclosure
in accordance with the CDP, and will
note any disclosures made subsequent
to the prior meeting. Any employee or
director of MCK must inform a member
of the Disclosure Committee as soon as
practicable after that person becomes
aware of any material information.
• The CDP includes a list of incidents
which should be disclosed to a
member of the Disclosure Committee.
The Disclosure Committee must
confer, decide whether disclosure is
required, and coordinate disclosure
of any material information in a form
specified by the Listing Rules as soon as
practicable after it becomes aware of the
existence of material information, unless
it determines:
a a reasonable person would not expect
the information to be disclosed; and
b the information is confidential and its
confidentiality is maintained; and
c one or more of the following applies:
i it would breach the law to
disclose the information; or
ii the information concerns an
incomplete proposal or
negotiation; or
iii the information comprises
matters of supposition or
is insufficiently definite to
warrant disclosure; or
iv the information is generated for
internal management purposes
of MCK or its subsidiaries; or
v the information is a trade secret
The Disclosure Committee will ensure that
all Board members, not already aware of
the information, are promptly provided
with it.
• The Disclosure Committee is
responsible for MCK’s obligations under
the Listing Rules to release material
information to NZX to the extent
necessary to prevent development or
MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019 | CG 2
18 | MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019
subsistence of a market for its listed
securities which is materially influenced
by false or misleading information
emanating from the issuer or any
associated person of the issuer; or other
persons in circumstances in each case
which would give such information
substantial credibility.
• All employees of MCK, as soon as
practicable after becoming aware
of a rumour or speculation that is
“generally available to the market”, must
disclose the existence of that rumour
or speculation to a member of the
Disclosure Committee.
• The Disclosure Committee is also
responsible for co-ordinating MCK’s
responses to leaks and inadvertent
disclosures. Even in the event that leaked
or inadvertently disclosed information
is not price sensitive, the Disclosure
Committee should consider whether the
information should be released to NZX
via its market announcement platform
in order to provide investors with equal
access.
• All external communications by MCK
must comply with the CDP, any media
policy and the Company’s rules with
respect to confidential information. No
material information is to be disclosed
to such persons before it is released to
NZX.
• Slides and presentations used in
briefings should be released to NZX for
immediate release to the market.
Prior to approval and release of MCK’s half
year and full year results, the Vice President
Finance and Company Secretary are required
to provide a letter of representation to the
Board (or its nominated subcommittee) that
the financial statements have been prepared
in accordance with generally accepted
accounting practice and are correct in all
material respects.
The Continuous Disclosure Policy was
reviewed in 2019.
PRINCIPLE 5 – REMUNERATION
The remuneration of directors and executives
should be transparent, fair and reasonable.
The total pool for Directors’ Fees is capped
at $200,000 and was last approved by
shareholders in 1996. The level of fees was
last reviewed by the Board as a whole in 2019.
All non-executive directors are entitled to
receive a base fee of NZ$38,000 per annum.
The Board Chair receives an annual fee of NZ
$42,000 per annum. The Chair of the Audit
Committee receives a further NZ$9,000
per annum and member(s) of the Audit
Committee receive NZ$7,000 per annum.
Executive Directors do not receive Directors’
or Committee fees.
Employee (including the Managing Director
and senior management) remuneration
is made up of two primary components
being a fixed component and a short term
incentive. Remuneration is determined with
reference to market information as well as the
responsibilities of the position, experience and
overall performance. Short term incentives
are designed to reward high performing
employees with appropriate incentives which
are measured on key performance indicators
which are reviewed and monitored regularly
and company performance. The Company
reserves the right to suspend or adjust
incentives if targets are not met. MCK does
not currently have an employee share plan or
a long term incentive scheme.
Employees are eligible for a range of benefits
including discounted accommodation at
MCK’s hotels in New Zealand and Millennium
& Copthorne Hotels around the world
(subject to availability).
PRINCIPLE 6 – RISK MANAGEMENT
Directors should have a sound understanding
of the material risks faced by the issuer
and how to manage them. The Board
should regularly verify that the issuer has
appropriate processes that identify and
manage potential and material risks.
While risks are a part of doing business, it
does need to be monitored and addressed.
MCK’s Board, Audit Committee and
Management Team all have a role in
identifying areas of risk and understanding
their impact on the Company as well as how
these areas are to be managed and mitigated.
MCK’s Management Team is responsible for
the day-to-day identification, assessment
and management of risks applicable to the
Company as well as the implementation of
appropriate controls, processes and policies
to manage such risks. Management also
ensures that there are training programmes
in place to identify, manage, mitigate or
eliminate hazards and risks in the workplace.
The Audit Committee’s role is to review
and report to the Board on the adequacy of
Management’s oversight and implementation
of risks with particular regard to financial and
operational risks. The Audit Committee also
has oversight of the Company’s Internal Audit
function and reviews internal audit reports as
part of its duties.
The Board is ultimately responsible for
the oversight and implementation of the
Company’s responses to risk management.
MCK’s Board has identified three main risks
areas being Reputational, Operational and
Financial Risks. Reputational Risks may
arise through errors or omissions by staff or
Management, failed procedures, an incident
that affects guests or staff or external events.
Operational Risks may arise from change in
the competitive or regulatory environment,
customer demand changes or even failing to
keep properties competitive. Financial risks
may arise where earnings or cashflow change
or are affected in some way due to market
conditions or events within or outside MCK’s
control.
MCK has a series of internal controls in place
covering such areas as financial monitoring
and reporting, human resources and risk
management. The primary responsibility for
monitoring and reporting against internal
controls and remedying any deficiencies lies
with Management.
MCK has currently outsourced its internal
audit function to conduct audits and reviews
of the Company’s operations. Details appears
under Principle 7.
MCK also keeps current insurances
appropriate to its business with reputable
global insurers.
PRINCIPLE 7 – AUDITORS
The Board should ensure the quality and
independence of the external audit process.
External Audit plays a critical role in ensuring
the integrity of financial reporting. The role
of the external auditor is to plan and carry out
an audit of MCK’s annual financial reports
and review the half-yearly reports. The Audit
Committee reviews the performance and
independence of the external auditors.
MCK has in place an External Auditor
Independence Policy which deals with
the provision of services by the MCK’s
external auditors, auditor rotation and the
relationships between the external auditor
and the Company. The policy states that:
The Audit Committee shall only recommend
to the Board a firm to be external auditor if
that firm:
• would be regarded by a reasonable
investor, with full knowledge of all
relevant facts and circumstances,
as capable of exercising objective
and impartial judgment on all issues
encompassed within the auditor’s
engagement;
• audit partners are members of
Chartered Accountants Australia New
Zealand (CAANZ);
• has not, within two years prior to the
commencement of the audit, had as
a member of its audit engagement
team MCK’s Managing Director, Vice
President Finance, Group Accounting
Manager, or any member of the
Company’s Management who acts in a
financial oversight role.
• does not allow the direct compensation
of its audit partners for selling non-audit
services to MCK.
The general principles to be applied in
assessing non-audit services are as follows:
a the external auditor should not
have any involvement in the
production of financial
information or preparation of
financial statements such that
they might be perceived as
auditing their own work. This
CG 3 | MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019
MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019 | 19
includes the provision of
bookkeeping and payroll services
as well as valuation services
where such valuation forms an
input into audited financial
information;
b the external auditor should not
perform any function of
management, or be responsible
for making management
decisions;
c the external auditor should
not be responsible for the design
or implementation of financial
information systems; and
d the separation between internal
audit and external audit should
be maintained.
MCK’s Audit Committee shall pre-approve
all audit and related services that are to be
provided by the auditor. Aside from core
external audit services, it is appropriate for
the MCK’s auditors to provide the following
services:
• due diligence (except valuations) on
proposed transactions;
• review of financial information where
third party verification is required or
deemed necessary (outside the normal
audit process);
• completion audits / reviews;
• financial model preparation or review;
• accounting policy advice;
• listing advice;
• accounting/technical training; and
• taxation services of an assurance nature.
It is not considered appropriate for MCK’s
external auditors to provide:
• book keeping services related to
accounting records or financial
statements;
• tax planning and strategy services
unless specifically approved by the Audit
Committee;
• appraisal / valuation services including
opinions as to fairness;
• provision of payroll services;
• the design or implementation of
financial information systems;
• outsourced internal audit and risk
management services;
• legal services;
• management functions;
• broker / dealer / investment adviser /
investment banking services;
• advocacy for the Company;
• actuarial services; and
• assistance in the recruitment of senior
management.
These prohibitions apply to all offices of the
audit firm, including overseas offices and
affiliates.
The billing arrangements for services provided
by MCK’s external auditors should not include
any contingent fees.
MCK’s expects that its external auditors
will rigorously comply with their own
internal policies on independence and all
relevant professional guidance, including
independence rules and guidance issued by
CAANZ.
The nature of services provided by MCK’s
auditors and the level of fees incurred should
be reported to the Audit Committee Chairman
semi-annually (or sooner where requested) to
enable the Committee to perform its oversight
role and report back to the Board. This policy
does not prescribe any particular ratio of
non-audit service fees to audit fees but the
Committee shall monitored the fees and ratio.
The continued appointment of MCK’s external
auditors is confirmed annually by the Board on
recommendation from the Audit Committee.
Rotation of the lead audit partner or firm
will be required every five years. Lead audit
partners who are rotated will be subject
to a 2 year cooling off period (i.e. 2 years
must expire between the rotation of an audit
partner and that partner’s next engagement
with the Company).
The hiring by MCK of any former lead
audit partner or audit manager must first
be approved by the Chairman of the Audit
Committee. There are no other restrictions on
the hiring of other staff from the audit firm.
KPMG are currently MCK’s external auditor
and the lead external audit engagement
partner was rotated in 2018.
The Audit Committee monitors local and
overseas practice on auditor independence
regularly to ensure that this policy remains
consistent with best practice and meets
MCK’s requirements.
MCK’s external auditors also attend the
Company’s Annual Meeting to answer any
questions from shareholders as to the audit
and the content of the Annual Report.
MCK has an internal audit function to
conduct audits and reviews of the Company’s
operations which is independent of the
External Auditors. A programme of work is
developed annually and submitted to the
Audit Committee for approval. The areas
covered by internal audit are those which
pose an operational business risk for MCK’s
hotels and corporate office functions. In this
way, the internal audit function strengthens
MCK’s internal controls and provides the
Audit Committee and the Board with an
assessment of the functioning and overall
adequacy of MCK’s processes.
PRINCIPLE 8 – SHAREHOLDER RIGHTS
& COMMUNICATION
The Board should respect the rights of
shareholders and foster constructive
relationships with shareholders that
encourage them to engage with the issuer.
MCK is committed to providing shareholders
and stakeholders with timely information on
its activities and performance. MCK does this
through a number of channels including:
• announcements in accordance with
continuous disclosure as required under
the Listing Rules;
• publication of the company’s annual
and interim reports which are sent to all
shareholders; and
• encouraging shareholders to attend the
Annual Meeting in May of each year to
hear the Chairman and the Managing
Director provide updates on the
company’s performance, ask questions
of the Board and vote on the resolutions
to be determined at the meeting.
Resolutions at shareholder meetings are
usually determined by poll where each
ordinary shareholder has one vote per
share.
Relevant communications, copies of annual
reports and key corporate governance
documents and policies are now available on
a dedicated webpage http://mckhotels.co.nz/
investors/
Shareholders also receive a discount card
for use at MCK’s hotels within New Zealand
which provides them with a twenty percent off
Best Available Rate (subject to availability).
MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019 | CG 4
REG 1 | MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019
- 1 -
REGULATORY DISCLOSURES
20 LARGEST ORDINARY SHAREHOLDERS (as at 2 March 2020) (Listing Rule 3.7.1 c)
Rank Shareholder No. of Securities %
1. CDL HOTELS HOLDINGS NEW ZEALAND LIMITED 74,743,077 70.79
2. BNP PARIBAS NOMINEES (NZ) LIMITED - NZCSD 5,962,409 5.65
3. ACCIDENT COMPENSATION CORPORATION - NZCSD 3,349,088 3.17
4. NATIONAL NOMINEES LIMITED - NZCSD 3,248,576 3.08
5. HSBC NOMINEES (NEW ZEALAND) LIMITED A/C STATE STREET -NZCSD 2,535,440 2.40
6. CITIBANK NOMINEES (NEW ZEALAND) LIMITED - NZCSD 2,084,456 1.97
7. HSBC NOMINEES (NEW ZEALAND) LIMITED - NZCSD 1,628,057 1.54
8.
JPMORGAN CHASE BANK NA NZ BRANCH-SEGREGATED CLIENTS ACCT -
NZCSD
1,560,365 1.48
9. LENG BENG KWEK 906,000 0.86
10. AMALGAMATED DAIRIES LIMITED 684,980 0.65
11. SKY HILL LIMITED 657,300 0.62
12. KAY HONG CHIAM 475,251 0.45
13. MFL MUTUAL FUND LIMITED - NZCSD 463,297 0.44
14. CUSTODIAL SERVICES LIMITED 397,780 0.38
15. JALAER INVESTMENTS LIMITED 278,977 0.26
16. GEOK LOO GOH 168,002 0.16
17. ASB NOMINEES LIMITED 166,953 0.16
18. SITA SINGH 151,000 0.14
19. ASB NOMINEES LIMITED 140,000 0.13
20. HOWARD CEDRIC ZINGEL 139,915 0.13
NZCSD is the New Zealand Central Securities Depositary and provides a custodial depositary service to its clients and does not have
a beneficial interest in the shares held in its name.
20 LARGEST REDEEMABLE PREFERENCE SHAREHOLDERS (as at 2 March 2020) (Listing Rule 3.7.1 c))
Rank Shareholder No. of Securities %
1. CDL HOTELS HOLDINGS NEW ZEALAND LIMITED 45,224,095 85.75
2. BNP PARIBAS NOMINEES (NZ) LIMITED - NZCSD 2,945,671 5.59
3. HSBC NOMINEES (NEW ZEALAND) LIMITED - NZCSD 1,683,950 3.19
4. ACCIDENT COMPENSATION CORPORATION - NZCSD 935,848 1.77
5. LENG BENG KWEK 453,000 0.86
6. NATIONAL NOMINEES LIMITED - NZCSD 397,131 0.75
7. KAY HONG CHIAM 211,324 0.40
8. ASB NOMINEES LIMITED 136,323 0.26
9. ALAN DAVID WHITE 110,130 0.21
10. JENNIFER GAYE SIMPSON 43,000 0.08
11. CUSTODIAL SERVICES LIMITED 40,300 0.08
12. THEODORE JOHN VAN GELDERMALSEN + MARGARET GAY FREEMANTLE 38,000 0.07
13. HOWARD CEDRIC ZINGEL 31,592 0.06
14. JOAN LESLEY THOMPSON 30,200 0.06
15. ROGER EDWARD HAYWARD + SUSAN ELIZABETH HAYWARD 28,909 0.05
16. CUSTODIAL SERVICES LIMITED 23,900 0.05
17. SEA AND PEAK EQUITIES LIMITED 23,400 0.04
18. CUSTODIAL SERVICES LIMITED 21,200 0.04
19. LING FOO KOK 20,134 0.04
20. RICHARD ALEXANDER COUTTS 18,256 0.03
NZCSD is the New Zealand Central Securities Depositary and provides a custodial depositary service to its clients and does not have
a beneficial interest in the shares held in its name.
HOLDINGS SIZE – ORDINARY SHARES (as at 2 March 2020)
Range Total Holders Number of shares Percentage of Issued Capital
1 - 99 5 208 0.00
100 - 199 32 4,869 0.00
200 - 499 458 158,661 0.15
500 - 999 310 219,373 0.21
1,000 - 1,999 212 305,179 0.29
2,000 - 4,999 238 746,423 0.71
5,000 - 9,999 123 859,817 0.81
10,000 - 49,999 110 2,019,251 1.91
50,000 - 99,999 16 1,182,640 1.12
100,000 - 499,999 9 2,038,678 1.93
500,000 - 999,999 3 2,248,280 2.13
1,000,000 + 2 95,794,911 90.73
Rounding 0.01
Total 1518 105,578,290 100.00
HOLDINGS SIZE – REDEEMABLE PREFERENCE SHARES (as at 2 March 2020)
Range Total Holders Number of shares Percentage of Issued Capital
100 - 199 35 5,390 0.01
200 - 499 40 12,467 0.02
500 - 999 24 16,596 0.03
1,000 - 1,999 22 31,324 0.06
2,000 - 4,999 19 68,530 0.13
5,000 - 9,999 13 81,323 0.15
10,000 - 49,999 20 426,441 0.81
100,000 - 499,999 4 910,777 1.73
1,000,000 + 2 51,186,695 97.06
Rounding 0.00
Total 179 52,739,543 100.00
MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019 | REG 2
- 2 -
DOMICILE OF ORDINARY SHAREHOLDERS (as at 2 March 2020)
Number Number of shares Percentage of Issued Capital
674,008,201 4241 dnalaeZ weN97.37
418,777,2 49 sredloh saesrevO2.63
Total 1,518 105,578,290 100.00
DOMICILE OF REDEEMABLE PREFERENCE SHAREHOLDERS (as at 2 March 2020)
Number Number of shares Percentage of Issued Capital
679,489,15 861 dnalaeZ weN98.57
765,457 11 sredloh saesrevO1.43
Total 179 52,739,543 100.00
WAIVERS FROM NZX LIMITED
No waive rs were sought from NZX in 2019. MCK adopted the new NZX List ing Rules on 2 March 2020.
SUBSTANTIAL PRODUCT HOLDERS
According to notice s given to the Company under the Financial Marke ts Conduct Act 2013, as at 2 March 2020, the substantial product holders in the Company
are noted below:
Securities Class %
770,931,47 detimiL dnalaeZ weN sgnidloH sletoH LDCOrdinary Shares 70.79%
Standard Life Aberdeen plc 10,182,794 Ordinary Shares 9.65%
Aberdeen Standard Inve st ments (Asi a) Limited 10,182,794 Ordinary Shares 9.65%
CDL Hotels Holdings New Zealand Limited is a wholly owned subsidiary of Mill ennium & Copthorne Hotels Limited (formerly Mill ennium & Copthorne Hotels plc).
As at 2 March 2020, the total number of issued vo ting se cu rities of Millennium & Copthorne Hotels New Z ealand Limited (all of which are ordinary shares) w as
105,578,290. The Company holds 99,547 repurchased ordinary sh ares as treasury st ock.
The total number of non-voting redeemable preference shares was 52,739,543
. As t hese secu rities are non-vo ting secu rities, there is no requirement to provide
substantial product holder notice s.
STATUTORY INFORMATION
DIRECTORS (sect ion 211 (1)(i) Companies Act 1993)
As at 31 Dece mber 2019, the Company’s Direct ors were Messrs. C Sim, BK Chiu, R Bobb, K Hangchi, GA McKenzie and KS Tan. Messrs. Chiu, Hangchi and
Tan were appointed by Millennium & Copthorne plc (now Mill ennium & Copthorne Hotels Limited). Mr KS Tan retired from the Board on 31 Dece mber 2019 and
Mr. ES Kwek was appointed with effect from 1 January 2020.
The gender breakdown of the Board is 6 male direct ors and 0
female direct ors (2018: 6 male direct ors and 0 female direct ors) . MCK cu rrently has 3 female and 6
male offi ce rs (2018: 4 female and 6 male officers) .
INTERESTS REGISTER (se ct ions 189 (1) (c) and 211(1)(e) Companies Act 1993)
The Company maintains an Interest s Regist er as required under the Companies Act 1993. For the period under revi ew, the following entries were recorded:
USE OF COMPANY INFORMATION (sect ion 145 Companies Act 1993)
During 2019, the Board did not rece ive any notice s from any Direct ors of the Company requesting the use of co mpany information which they would have received
in their ca paci ty as Direct ors which would not otherwise have been ava ilable to them.
SHARE DEALING (sect ion 148, Companies Act 1993)
No share dealings by Direct ors occurred during 2019.
DIRECTORS’ AND ASSOCIATED PERSONS SHAREHOLDINGS (as at 31 Dece mber 2019)
Director 2018 2019
liN liN miS C
liN liN uihC K B
liN liN ihcgnaH K
liN liN naT SK
liN liN bboB R
liN liN eizneKcM AG
REMUNERATION (se ct ion 161 and 211(1)(f ), Companies Act 1993)
The total remuneration and va lue of other benefits earned by each of the Direct ors of the Company for the year ending 31 Dece mber 2019 was:
Director Remuneration
C Sim 42,000
B K Chiu (*) 588,300
K Hangchi 35,000
KS Tan (*) Nil
R Bobb 47,000
GA McKenzie 45,000
(*) Mr. KS Tan retired as a direct or on 31 December 2019. As he was Interim Group Chief Execu tive Office r of Mill ennium & Copthorne Hotels plc he and Mr. B K
Chiu were employees of the Company. Neither Mr. Tan nor Mr. Chiu rece ive d remuneration as a direct or of the Company or of any of the Company’s subsidiaries.
INDEMNITY AND INSURANCE (se ction 162, Companies Act 1993)
In accordance with the Company’s constitution, the Company has insu red all its Direct ors and the Directors of its subsidiaries against liabili ties to other parties
(except the Company or a related party of the Company) that may arise from their positions as Direct ors. The insu rance does not co ve r liabili ties arising from
cr iminal act ions.
- 3 -
GENERAL DISCLOSURES OF INTEREST (section 140(2), Companies Act 1993)
As at 31 December 2019, the Directors of the Company have made general disclosures of interest in the following companies:
C SIM
Chairman / Director of:
CDL Investments New Zealand Limited
Director of: Autocaps (Aust) Pty Ltd Autocaps Pastoral Division Pty Limited
Autocaps Vogue Pty Limited Bathurst Range Investments Pty Limited Builders Recycling Properties Pty Ltd
Builders Recycling Operations Pty Ltd CS Investments No. 1 Pty Ltd Desert Rose Group Pty Limited
Desert Rose Holdings Pty Limited DMM Investments (NSW) Pty Ltd East Quarter Group Pty Ltd
East Quarter Hurstville Pty Limited EQ Constructions Pty Ltd EQ Equity Pty Ltd
EQ Finance Services Pty Limited EQ Gosford Pty Ltd EQ Projects Pty Ltd
EQ Projects Holdings Pty Ltd EQ Property Holdings Pty Ltd EQ Revesby Pty Ltd
EQ Riverside Pty Ltd EQ Zetland Pty Ltd EQ Zetland Finance Pty Ltd
Hurstville NSW Pty Limited Llenruk Pty Ltd Naxta Pty Ltd
New Dale Sim Pty Ltd PBD Phoenix Pty Limited PCC Devco 1 Pty Limited
Phoenix Palm Developments Pty Limited Preslite Drive Technologies Pty Limited SSK Investments Pty Ltd
SSK Investments No 2 Pty Ltd SSK Investments O/S Pty Ltd Waterbrook Bayview Pty Ltd
Waterbrook Bayview Investment Pty Ltd Waterbrook Bayview Village Management Pty Ltd Waterbrook Bowral Pty Ltd
Waterbrook Bowral Investment Pty Ltd Waterbrook Brand Pty Ltd West Quarter Hurstville Pty Limited
R BOBB
Director of: Bobb Management Pty Ltd Birkenhead Holdings Pty Ltd
Birkenhead Investments Pty Ltd Continental Investments Pty Ltd Furscarbo Pty Ltd
Hotelcorp New Zealand Pty Ltd Kingsgate Hotel Pty Ltd Kingsgate Holdings Pty Ltd
Kingsgate Investments Pty Ltd Melmark Securities Pty Ltd. Millennium & Copthorne Hotels Pty Ltd.
RAB Capital Pty Ltd Star Securities Australia Pty Ltd Trans National Properties Ltd
BK CHIU
Chairman / Director of: Quantum Ltd Waitangi Resort Joint Venture Committee
Director of: All Seasons Hotels & Resorts Ltd CDL Investments New Zealand Ltd
CDL Land New Zealand Ltd Context Securities Ltd Hospitality Group Ltd
Hospitality Leases Ltd Hospitality Services Ltd Kingsgate Hotels & Resorts Ltd
Millennium & Copthorne NZ Ltd QINZ Holdings (New Zealand) Ltd QINZ (Anzac Avenue) Ltd
K HANGCHI
Director of: CDL Hotels Holdings New Zealand Limited KIN Holdings Limited
Hong Leong Finance Limited Hong Leong Finance Nominees Pte Ltd Hong Leong Nominees (Private) Limited
Millennium Securities Nominees Pte Ltd Millennium Securities Pte Ltd Singapore Nominees Private Ltd
Sun Yuan Holdings Pte Ltd Sun Yuan Overseas Pte Ltd
G A MCKENZIE
Director of: CMO Energy NZ GMACK Consulting Ltd
Luxottica Retail New Zealand Ltd McHarry Holdings Ltd Saw 2015 Ltd
EMPLOYEE REMUNERATION (section 211(1) (g) Companies Act 1993)
The number of employees or former employees of the Company and its subsidiaries (excluding publicly listed subsidiaries) who received remuneration and any
other benefits in their capacity as employees, the value of which was or exceeded $100,000 per annum in 2019 are as follows:
Remuneration and value
of other benefits
Number. of
employees
100,001 – 110,000 2
110,001 – 120,000 4
120,001 – 130,000 2
130,001 – 140,000 1
150,001 – 160,000 1
160,001 – 170,000 1
180,001 – 190,000 1
190,001 – 200,000 1
200,001 – 210,000 5
210,001 – 220,000 1
220,001 – 230,000 1
240,001 – 250,000 1
400,001 – 410,000 1
580,001 – 590,000 1
DONATIONS (section 211(1)(h) and (2)
The Company and its subsidiaries made donations to charity totaling $1,706 during the year.
AUDIT FEES (section 211(1)(j) and (2)
During the period under review, the following amounts were payable to the external auditors KPMG:
2018 ($’000) 2019 ($’000)
New Zealand Australia New Zealand Australia
Annual Audit
292 25 302 25
KPMG Other Services
64 nil 52 Nil
REG 3 | MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019
- 4 -
SUBSIDIARY COMPANIES AND DIRECTORS (section 211(2) of the Companies Act 1993)
The Company’s subsidiaries and their directors as at 31 December 2019 are listed below:
NAME DIRECTORS OWNERSHIP ACTIVITY
All Seasons Hotels and Resorts Ltd
BK Chiu, JB Pua 100% Non-trading
Birkenhead Holdings Pty Ltd
R Bobb, JB Pua 100%
Holding Company (Australia)
Birkenhead Investments Pty Ltd
R Bobb, JB Pua 100%
Holding Company (Australia)
CDL Investments New Zealand Ltd ()
C Sim, RJ Austin, BK Chiu,
J Henderson, KS Tan, VWE Yeo
66.26% Holding Company
CDL Land New Zealand Ltd (*)
JC Adams, BK Chiu, JB Pua 66.26% Property Investment & Development Company
Context Securities Ltd
BK Chiu, JB Pua 100% Investment Holding Company
Hospitality Group Ltd
BK Chiu, N Hood, KF Luxon 100% Holding Company
Hospitality Leases Ltd
BK Chiu 100% Lessee Company
Hospitality Services Ltd
BK Chiu, KF Luxon, JB Pua 100% Hotel Management Company
Hotelcorp New Zealand Ltd
R Bobb, JB Pua 100%
Holding Company (Australia)
KIN Holdings Ltd
JB Pua, K Hangchi 100%
Holding company
Kingsgate Holdings Pty Ltd
R Bobb, JB Pua 100%
Holding Company
Kingsgate Hotels And Resorts Ltd
BK Chiu, JB Pua 100% Franchise Holder
Kingsgate Hotels Ltd
JB Pua 100%
Non-trading
Kingsgate Hotel Pty Ltd
R Bobb, JB Pua 100%
Non-trading (Australia)
Kingsgate Investments Pty Ltd
R Bobb, JB Pua 100%
Residential Apartment Owner (Australia)
Kingsgate International Corporation Ltd
JB Pua, 100%
Holding Company
Millennium & Copthorne NZ Ltd
(formerly Millennium & Copthorne
Hotels Ltd)
BK Chiu, JB Pua 100% Non-trading
Millennium & Copthorne Hotels Pty Ltd
R Bobb, JB Pua 100% Non-trading (Australia)
QINZ (Anzac Avenue) Ltd
BK Chiu, JB Pua 100%
Hotel Owner
QINZ Holdings (New Zealand) Ltd
BK Chiu, JB Pua 100%
Holding Company
Quantum Ltd
BK Chiu, KF Luxon, JB Pua, 100%
Holding company
() Listed on the New Zealand Stock Exchange
(*) Mr. JC Adams was appointed as a Director on 15 February 2019
--Where the directors of the Company’s subsidiaries are employees of the Company, they do not receive any remuneration or other benefits as a director. Their
remuneration and other benefits are received as employees and are included in the relevant banding under Employee Remuneration.
--The following persons received remuneration as Directors of the Company’s subsidiaries during 2019: C Sim ($35,500), VWE Yeo ($30,000), RJ Austin
($35,000), J Henderson ($30,000).
MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019 | REG 4
41 | MILLENNIUM & COPTHORNE HOTELS NEW ZEALAND LIMITED ANNUAL REPORT 2019
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BOARD OF DIRECTORS
Colin Sim (Chairman & Independent Director)
BK Chiu (Managing Director)
Eik Sheng Kwek (Non-Executive Director)
Kevin Hangchi (Non-Executive Director)
Richard Bobb (Independent Director, Chair of the Audit Committee)
Graham McKenzie (Independent Director, Member of the Audit Committee)
SENIOR MANAGEMENT
Greg Borrageiro (Director, Information Technology)
Brendan Davies (Director, International Sales & Marketing)
Craig Fletcher (Director, Property Management)
Takeshi Ito (Vice President Legal & Company Secretary)
Karl Luxon (Vice President Operations)
Boon Pua (Vice President Finance)
Kim-Marie Rixson (Vice President, Human Resources)
Alison Smith (National Director of Sales, Conferences and Incentives)
Josie Wilson (National Distribution & Revenue Manager)
REGISTERED OFFICE & CONTACT DETAILS
Level 13, 280 Queen Street, Auckland, New Zealand
PO Box 5640, Victoria Street West, Auckland 1142
Telephone: (09) 353 5010
Facsimile: (09) 309 3244
Global Website: www.millenniumhotels.com
Investor Website: www.mckhotels.co.nz/investors
Email: sales.marketing@millenniumhotels.co.nz
AUDITORS
KPMG, Auckland
BANKERS
ANZ Bank New Zealand Limited
Hong Kong & Shanghai Banking Corporation Limited
SOLICITORS
Bell Gully
SHARE REGISTRAR
Computershare Investor Services Limited,
Level 2, 159 Hurstmere Road, Takapuna,
Private Bag 92119, Auckland 1020, New Zealand
Telephone: +64 9 488 8700
Facsimile: +64 9 488 8787
Email: enquiry@computershare.co.nz
STOCK EXCHANGE LISTING:
New Zealand Exchange (NZX)
Company Code: MCK
Data sourced from publicly available filings. Our datasets may not be complete. Automated analysis can produce errors. If you believe any data on this page is incorrect, please contact us at hello@nzxplorer.co.nz. For informational purposes only. Not investment advice.
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