MCK H1 2023 Results Announcement

Name of issuer
Reporting Period
Previous Reporting Period
Currency
Amount (000s)
Revenue from continuing operations$60,051
Total Revenue$60,051
Net profit/(loss) from continuing operations $6,177
Total net profit/(loss) $6,177
Amount per Quoted Equity Security
Imputed amount per Quoted Equity Security
Record Date
Dividend Payment Date
Prior comparable period
Net tangible assets per Quoted Equity Security$3.33
A brief explanation of any of the figures above
necessary to enable the figures to be understood
Name of person authorised to make this
announcement
Contact person for this announcement
Contact phone number
Contact email address
Date of release through MAP
No interim dividend has been declared
Results for announcement to the market
Millennium & Copthorne Hotels New Zealand Limited
6 months to 30 June 2023
6 months to 30 June 2022
NZD
Percentage change
(28.22%)
(28.22%)
(59.90%)
(59.90%)
Interim Dividend
8 August 2023
Not applicable
Not applicable
Not applicable
Current period
$3.37
Refer to the Media Release
Authority for this announcement
Takeshi Ito – Company Secretary
Takeshi Ito – Company Secretary
+64 21 591 531
takeshi.ito@millenniumhotels.com

---

Millennium & Copthorne Hotels New Zealand Limited and Subsidiaries
Condensed Interim Income Statement
FOR THE SIX MONTHS ENDED 30 JUNE 2023
UnauditedUnaudited
6 months6 months
DOLLARS IN THOUSANDSNOTEto 30/06/23to 30/06/22
Revenue60,051 83,656
Cost of sales(28,780) (32,015)
Gross profit31,271 51,641
Administrative expenses(12,981) (10,628)
Other operating expenses(9,564) (8,839)
Operating profit before finance income8,726 32,174
Finance income3,785 1,283
Finance costs(1,045) (1,407)
Net finance income2,740 (124)
Profit before income tax11,466 32,050
Income tax expense(3,085) (9,113)
Profit for the period8,381 22,937
Profit for the period attributable to:
Equity holders of the parent6,177 15,403
Non-controlling interests2,204 7,534
Profit for the period 8,381 22,937
Basic earnings per share (cents)
43.90c9.74c
Diluted earnings per share (cents)43.90c9.74c
The attached notes form part of, and are to be read in conjunction with, these financial statements.
Page 1

Millennium & Copthorne Hotels New Zealand Limited and Subsidiaries
Condensed Interim Statement of Comprehensive Income
FOR THE SIX MONTHS ENDED 30 JUNE 2023
UnauditedUnaudited
6 months6 months
DOLLARS IN THOUSANDSNoteto 30/06/23to 30/06/22
Profit for the period8,381 22,937
Items that are or may be reclassified to profit or loss
Foreign exchange translation movements894 2,656
- Tax (expense)/credit on foreign exchange(5) (15)
889 2,641
Total comprehensive income for the period9,270 25,578
Total comprehensive income for the period attributable to:
Equity holders of the parent7,066 18,044
Non-controlling interests2,204 7,534
Total comprehensive income for the period9,270 25,578
DETAILS OF SPECIFIC RECEIPTS/OUTLAYS, REVENUE/EXPENSES
Classified under:
Administrative expenses
Audit fees(176) (160)
Other operating expenses
Depreciation of Property, Plant & Equipment(3,444) (3,383)
Depreciation of Investment Property(511) (98)
Depreciation of Right-Of-Use Assets (411) (532)
Leasing and rental expenses(341) (342)
Finance income
Interest income3,785 1,250
Finance costs
Interest expense-(1)
Interest expense on lease liability(895) (1,395)
Foreign exchange loss(144) (1)
The attached notes form part of, and are to be read in conjunction with, these financial statements.
Page 2

Millennium & Copthorne Hotels New Zealand Limited a
nd Subsidiaries
Condensed Interim Statement of Changes in Equity
FOR THE SIX MONTHS ENDED 30 JUNE 2023
Unaudited
Unaudited
Unaudited
Unaudited
Unaudited
Unaudited
Share
Exchange
Accumulated
Treasury
Unaudited
Non-contro
lling
Total
DOLLARS IN THOUSANDS
NOTE
Capital
Reserves
Losses
Stock
Total
Interests
Equity
Balance at 1 January 2022
383,266

(2,025)

132,974

(26)

514,189

103,610

617,799

Movement in exchange translation reserve
-

2,641

-

-

2,641

-

2,641

Income and expense recognised directly in equity
-

2,641

-

-

2,641

-

2,641

Profit for the period
-

-

15,403

-

15,403

7,534

22,937

Total comprehensive income for the period
-

2,641

15,403

-

18,044

7,534

25,578

Transactions with owners, recorded directly in equi
ty :
Dividends paid to:
Equity holders of the parent
5
-

-

(5,537)

-

(5,537)

-

(5,537)

Non-controlling interests
-

-

-

-

-

(3,705)

(3,705)

-

-

26

-

26

1,349

1,375

Balance at 30 June 2022
383,266

616

142,866

(26)

526,722

108,788

635,510

Balance at 1 January 2023
383,266

(1,396)

149,175

(26)

531,019

111,682

642,701

Movement in exchange translation reserve
-

889

-

-

889

-

889

Income and expense recognised directly in equity
-

889

-

-

889

-

889

Profit for the period
-

-

6,177

-

6,177

2,204

8,381

Total comprehensive income for the period
-

889

6,177

-

7,066

2,204

9,270

Transactions with owners, recorded directly in equi
ty :
Dividends paid to:
Equity holders of the parent
5
-

-

(4,747)

-

(4,747)

-

(4,747)

Non-controlling interests
-

-

-

-

-

(3,940)

(3,940)

-

-

(374)

-

(374)

1,863

1,489

Balance at 30 June 2023
383,266

(507)

150,231

(26)

532,964

111,809

644,773

The attached notes form part of, and are to be read in
conjunction with, these financial statements.
Attibutable to Equity Holders of the Group
Movement of non-controlling interests without a cha
nge in control
Movement of non-controlling interests without a cha
nge in control
Page 3

Millennium & Copthorne Hotels New Zealand Limited and Subsidiaries
Condensed Interim Statement of Financial Position
AS AT 30 JUNE 2023UnauditedAudited
as atas at
DOLLARS IN THOUSANDSNOTE30/06/2331/12/22
SHAREHOLDERS' EQUITY
Issued capital
3383,266 383,266
Reserves149,724 147,779
Treasury stock3(26) (26)
Non-controlling interests111,809 111,682
Total equity644,773 642,701
Represented by:
NON CURRENT ASSETS
Property, plant and equipment258,906 255,279
Development properties 201,823 205,308
Investment properties36,156 36,381
Investment in associates2 2
Total non-current assets496,887 496,970
CURRENT ASSETS
Cash and cash equivalents58,342 61,387
Short term bank deposits106,097 111,946
Trade and other receivables22,491 14,436
Inventories1,374 1,409
Income tax receivable3,088 -
Development properties24,848 23,038
Total current assets216,240 212,216
Total assets713,127 709,186
NON CURRENT LIABILITIES
Lease liabilities27,772 25,458
Provision for deferred taxation9,621 9,717
Total non-current liabilities37,393 35,175
CURRENT LIABILITIES
Trade and other payables28,385 28,024
Trade payables due to related parties
62,407 2,248
Lease liabilities169 233
Income tax payable- 805
Total current liabilities30,961 31,310
Total liabilities68,354 66,485
Net assets644,773 642,701
Net Asset Backing before Distributions (cents per share)
The attached notes form part of, and are to be read in conjunction with, these financial statements.
Page 4

Millennium & Copthorne Hotels New Zealand Limited and Subsidiaries
Condensed Interim Statement of Cash Flows
FOR THE SIX MONTHS ENDED 30 JUNE 2023UnauditedUnaudited
6 months6 months
DOLLARS IN THOUSANDSNOTEto 30/06/23to 30/06/22
CASH FLOWS FROM OPERATING ACTIVITIES
Cash was provided from:
Receipts from customers52,108 92,411
Interest received3,673 1,058
55,781 93,469
Cash was applied to:
Payments to suppliers and employees(44,449) (41,175)
Purchase of development land- (19,380)
Interest paid- (1)
Income tax paid(7,083) (8,518)
(51,532) (69,074)
Net cash inflow from operating activities4,249 24,395
CASH FLOWS FROM INVESTING ACTIVITIES
Cash was provided from/(applied to):
Purchase of property, plant and equipment(5,051) (3,565)
Purchase of investment property(286) (9,850)
Proceed from the sale of property, plant and equipment3 -
(Investments in) / withdrawals from short term bank deposits5,849 (37,374)
Net cash inflow/(outflow) from investing activities515 (50,789)
CASH FLOWS FROM FINANCING ACTIVITIES
Cash was provided from/(applied to):
Repayment of borrowings- (1,000)
Principal repayment of lease liability(1,082) (1,647)
Dividends paid to shareholders of Millennium & Copthorne
Hotels New Zealand Ltd
5(4,747) (5,537)
Dividends paid to non-controlling interests (3,940) (3,705)
Net cash outflow from financing activities(9,769) (11,889)
Net (decrease)/increase in cash and cash equivalents(5,005) (38,283)
Add opening cash and cash equivalents61,387 58,143
Exchange rate adjustment1,960 3,103
Closing cash and cash equivalents58,342 22,963
The attached notes form part of, and are to be read in conjunction with, these financial statements.
Page 5

Millennium & Copthorne Hotels New Zealand Limited and Subsidiaries
Condensed Interim Statement of Cash Flows
FOR THE SIX MONTHS ENDED 30 JUNE 2023
UnauditedUnaudited
6 months6 months
DOLLARS IN THOUSANDSNOTEto 30/06/23to 30/06/22
RECONCILIATION OF NET PROFIT FOR THE PERIOD
TO CASH FLOWS FROM OPERATING ACTIVITIES
Profit for the period8,381 22,937
Adjusted for non cash items:
(Gain)/Loss on Sale of Fixed Assets3 2
Foreign Exchange (Gain)/ Loss144 (1)
Depreciation of Property, Plant & Equipment3,444 3,383
Depreciation of Right-Of-Use Assets 411 532
Depreciation of Investment Property511 98
Income tax expense / (credit)3,085 9,113
Adjustments for movements in working capital:
Decrease/(Increase) in receivables(8,055) 8,532
Decrease in inventories35 50
(Increase)/Decrease in development properties1,952 (7,635)
Increase/(Decrease) in payables1,262 (2,738)
Increase/(Decrease) in related parties159 (1,359)
Cash generated from operations11,332 32,914
Interest paid- (1)
Income tax paid(7,083) (8,518)
Net cash inflow from operating activities4,24924,395
Reconciliation of movement of liabilities to cash flows arisingUnauditedUnaudited
from financing activities6 months6 months
to 30/06/23to 30/06/22
As at 01 January- 1,000
Repayment of borrowings- (1,000)
Financing cash flows- (1,000)
As at 30 June- -
The attached notes form part of, and are to be read in conjunction with, these financial statements.
Page 6

Page 7

Millennium & Copthorne Hotels New Zealand Limited and Subsidiaries
Notes to the Condensed Interim Financial Statements
for the six months ended 30 June 2023 (unaudited)

1. Significant accounting policies

Millennium & Copthorne Hotels New Zealand Limited is a company domiciled in New Zealand, registered under
the Companies Act 1993 and listed on the New Zealand Stock Exchange. Millennium & Copthorne Hotels New
Zealand Limited (the “Company”) is a Financial Markets Conduct Reporting Entity in terms of Financial Markets
Conduct Act 2013 and the Financial Reporting Act 2013. The condensed interim financial statements of the
Company for the six months ended 30 June 2023 comprise the Company and its subsidiaries (together referred
to as the “Group”). The registered office is located at level 7, 23 Customs Street East, Auckland, New Zealand.

The principal activities of the Group are ownership and operation of hotels in New Zealand; residential
development and sale of land in New Zealand; ownership and leasing of investment properties in New Zealand
and development and sale of residential units in Australia.

The condensed interim financial statements were authorised for issuance on 08 August 2023.

(a) Statement of compliance

The condensed interim financial statements have been prepared in accordance with New Zealand Generally
Accepted Accounting Practice (NZ GAAP). They comply with NZ IAS 34 Interim Financial Reporting. The
condensed interim financial statements do not include all of the information required for full annual financial
statements.

The accounting policies and methods of computation applied by the Group in these condensed interim financial
statements are the same as those applied by the Group in its financial statements for the year ended 31 December
2022.


2. Segment reporting

Segment information is presented in the condensed interim financial statements in respect of the Group’s reporting
segments. Operating segments are the primary basis of segment reporting. The Group has determined that its
chief operating decision maker is the Board of Directors on the basis that it is this group which determines the
allocation of resources to segments and assesses their performance.

Inter-segment pricing is determined on an arm’s length basis. Segment results include items directly attributable
to a segment as well as those that can be allocated on a reasonable basis.

Segment capital expenditure is the total cost incurred during the period to acquire segment assets that are expected
to be used for more than one period.

Operating segments
The Group consisted of the following main operating segments:
• Hotel operations, comprising income from the ownership and management of hotels.
• Residential land development, comprising the development and sale of residential land sections.
• Investment property, comprising rental income from the ownership and leasing of retail shops and industrial
properties.
• Residential and commercial property development, comprising the development and sale of residential
apartments.

Geographical segments
The Group operates in the following main geographic segments:
• New Zealand
• Australia
Segment revenue is based on the geographical location of the asset. The Group has no major customer
representing greater than 10% of the Group’s total revenue.

Page 8
Millennium & Copthorne Hotels New Zealand Limited a
nd Subsidiaries
Notes to the Condensed Interim Financial Statements

for the six months ended 30 June 2023 (unaudited)

2.
Segment reporting -
continued
(a) Operating Segments

Hotel Operations
Residential Land
Development
Investment Property
Residential Property
Development
Group
Dollars in thousands
6 months to
30/06/23
6 months to
30/06/22
6 months to
30/06/23
6 months to
30/06/22
6 months to
30/06/23
6 months to
30/06/22
6 months to
30/06/23
6 months to
30/06/22
6 months to
30/06/23
6 months to
30/06/22
External revenue
47,452
27,260
10,749
47,730
1,219
84
631
8,582
60,051
83,656
Earnings before interest, depreciation & amortisation
7,702
876
4,600
31,414
1,199
(14)
(409)
3,911
13,09
2
36,187
Finance income
1,195
482
1,713
513
-
-
877
288
3,78
5
1,283
Finance expense
(1,038)
(1,404)
(6)
(2)
-
-
(1)
(1)

(1,045)
(1,407)
Depreciation and amortisation
(3,438)
(3,378)
(3)
(
1)
(511)
(98)
(3)
(4)
(3,955)
(3,481)
Depreciation of Right-of-use assets
(392)
(521)
(14
)
(7)
-
-
(5)
(4)
(411)
(532)
Profit before income tax
4,029
(3,945)
6,290
31,917

688
(112)
459
4,190
11,466
32,050
Income tax expense
(992)
1,049
(1,761)
(8,937)
(193
)
31
(139)
(1,256)
(3,085)
(9,113)
Profit after income tax
3,037
(2,896)
4,529
22,980
495
(81)
320
2,934
8,381
22,937











Cash & cash equivalents and short term bank deposits
51,926
50,451
65,097
75,076
-
-
47,416
56,306
164,4
39
181,833
Tax receivable
2,696
-
372
-
-
-
20
-
3,088
-
Other segment assets
267,497
257,403
204,920
198,58
6
36,156
33,084
37,025
29,107
545,598
518,180
Investment in associates
-
-
2
2
-
-
-
-
2
2
Total assets
322,119
307,854
270,391
273,664
36,156
33,084
84,46
1
85,413
713,127
700,015











Segment liabilities
(56,428)
(48,440)
(921)
(1,804)

-
-
(1,384)
(1,923)
(58,733)
(52,167)
Tax liabilities
(8,955)
(6,824)
(339)
(4,352)
-
-
(327)
(1,162)
(9,
621)
(12,338)
Total liabilities
(65,383)
(55,264)
(1,260)
(6,156)

-
-
(1,711)
(3,085)
(68,354)
(64,505)











Property, plant and equipment expenditure
7,470
10,
625
6
-
-
-
13
40
7,489
10,665
Investment property expenditure
-
-
-
-
285
9,850
-

-
285
9,850
Residential land development expenditure
-
-
2,420
5,996
-
-
-
-
2,420
5,996
Purchase of land for residential land development
-
-
-
19,380
-
-
-
-
-
19,380

Page 9
Millennium & Copthorne Hotels New Zealand Limited a
nd Subsidiaries
Notes to the Condensed Interim Financial Statements

for the six months ended 30 June 2023 (unaudited)
2.
Segment reporting -
continued


(b) Geographic Segments
New Zealand
Australia
Group
Dollars in thousands
6 months to
30/06/23
6 months to
30/06/22
6 months to
30/06/23
6 months to
30/06/22
6 months to
30/06/23
6 months to
30/06/22
External revenue
59,420
75,074
631
8,582
60,051
83,656
Earnings before interest, depreciation & amortisation
13,510
32,285
(418)
3,902
13,092
36,187
Finance income
2,908
995
877
288
3,785
1,283
Finance expense
(1,044)
(1,406)
(1)
(1)
(1,045)
(1,407)
Depreciation and amortisation
(3,952)
(3,477)
(3)
(4)
(3,955)
(3,481)
Depreciation of Right-of-use assets
(406)
(528)
(5)
(4)
(411)
(532)
Profit before income tax
11,016
27,869
450
4,181
11,466
32,050
Income tax expense
(2,949)
(7,860)
(136)
(1,253)
(3,085)
(9,113)
Profit after income tax
8,067
20,009
314
2,928
8,381
22,937







Cash & cash equivalents and short term bank deposit
s
117,023
125,527
47,416
56,306
164,439
181,833
Tax receivable
3,068
-
20
-
3,088
-
Other segment assets
508,573
489,073
37,025
29,107
545,598
518,180
Investment in associates
2
2
-
-
2
2
Total assets
628,666
614,602
84,461
85,413
713,127
700,015







Segment liabilities
(57,349)
(50,244)
(1,384)
(1,923)
(58,733)
(52,167)

Tax liabilities
(9,294)
(11,176)
(327)
(1,162)
(9,621)
(12,338)
Total liabilities
(66,643)
(61,420)
(1,711)
(3,085)
(68,354)
(64,505)








Property, plant and equipment expenditure
7,476
10,625
13
40
7,489
10,665
Investment property expenditure
285
9,850
-
-
285
9,850
Residential land development expenditure
2,420
5,996
-
-
2,420
5,996
Purchase of land for residential land development
-
19,380
-
-
-
19,380

Page 10

Millennium & Copthorne Hotels New Zealand Limited and Subsidiaries
Notes to the Condensed Interim Financial Statements
for the six months ended 30 June 2023 (unaudited)


3. Share capital


Ordinary shares Redeemable preference shares
Shares $ 000s Shares $ 000s
Total shares issued – fully paid

Balance at 30 June 2022 105,578,290 350,048 52,739,543 33,218
Balance at 30 June 2023 105,578,290 350,048 52,739,543 33,218


Ordinary shares repurchased and
held as treasury stock



Balance at 30 June 2022 (99,547) (26) - -
Balance at 30 June 2023 (99,547) (26) - -


Shares issued – fully paid

Balance at 30 June 2022 105,478,743 350,022 52,739,543 33,218
Balance at 30 June 2023 105,478,743 350,022 52,739,543 33,218



At 30 June 2023, the authorised share capital consisted of 105,578,290 ordinary shares (2022: 105,578,290 ordinary
shares) with no par value and 52,739,543 redeemable preference shares (2022: 52,739,543) with no par value.




4. Earnings per share

The basic earnings per share of 3.90 cents (30 June 2022: 9.74 cents) is based on the profit attributable to ordinary
shareholders of $6.18 million (30 June 2022: $15.40 million) and weighted average number of ordinary shares and
redeemable preference shares outstanding during the period ended 30 June 2023 of 158,218,286 (30 June 2022:
158,218,286).

The redeemable preference shares are included in the computation of earnings per share as they rank equally with
ordinary shares in respect of distributions made by the Company except any distribution in the case of liquidation.

The calculation of diluted earnings per share of 3.90 cents (30 June 2022: 9.74 cents) is the same as basic earnings
per share.



5. Dividends

The following dividends were paid during the interim periods:



Group
Dollars In Thousands
Unaudited
30/06/23
Unaudited
30/06/22


Ordinary dividend: 3.0 cents per qualifying share (2022: 3.5 cents) 4,747 5,537
Supplementary dividend: 0.529412 cents per qualifying share (2022:
0.617647 cents)

98

112

4,845 5,649

Page 11

Millennium & Copthorne Hotels New Zealand Limited and Subsidiaries
Notes to the Condensed Interim Financial Statements
for the six months ended 30 June 2023 (unaudited)


6. Related party transactions

Millennium & Copthorne Hotels New Zealand Limited is a 75.78% (2022: 75.78%) (economic interests from both
ordinary and preference shares) owned subsidiary of CDL Hotels Holdings New Zealand Limited which is a wholly
owned subsidiary of Millennium & Copthorne Hotels Ltd in the United Kingdom. The ultimate parent company is Hong
Leong Investment Holdings Pte Limited in Singapore.


At balance date there were related party advances owing from/(owing to) the following related companies:


Group
Dollars In Thousands
Nature of balance Unaudited
30/06/23
Unaudited
30/06/22
Trade payables and receivables due to
related parties

Millennium & Copthorne Hotels Limited Recharge of
expenses
(2,096) (3,144)

Millennium & Copthorne International
Limited
Recharge of
expenses
& provision of
management and
marketing support



(102)



33

CDL Hotels Holdings New Zealand Limited Recharge of
expenses
(51) 157

CDLH (BVI) One Limited Rent payment (158) 336

(2,407) (2,618)

No debts with related parties were written off or forgiven during the period. No interest was charged on these payables
during 2023 and 2022. There are no set repayment terms.


7. Capital commitments

As at 30 June 2023, the Group has entered into contractual commitments for capital expenditure and development
expenditure.


Group
Dollars In Thousands
Unaudited
30/06/2023
Unaudited
30/06/2022
Capital expenditure on property, plant and equipment 2,072 1,559
Development expenditure 21,471 15,451
Capital expenditure on investment properties 60 3,100
Land purchases 20,407 -

44,010 20,110

As at 30 June 2023, the Group had entered into contractual commitments for development expenditure, and
construction of investment properties. Contractual agreements for the purchase of land are subject to a satisfactory
outcome of the Group's due diligence process, board approval, and OIO approval. Development expenditure
represents amounts contracted and forecast to be incurred in the remainder of 2023 in accordance with the Group’s
development programme.

8. Changes in contingent liabilities and contingent assets since last annual balance sheet date

The Group’s subsidiaries, CDL Investments New Zealand Limited and subsidiary, were named as respondents in a
High Court judicial review proceeding which was brought by the Applicant, Winton Property Investments Limited, in
relation to a recent decision relating to the Group’s acquisition of land in Havelock North which was advised to the
market on 21 July 2021 and which has settled. The Applicant sought, inter alia, an order setting aside the decision of
the Overseas Investment Office in respect of the approval and/or a declaration that Ministers erred at law in making
their decision to grant consent. The matter was heard in the High Court in February 2022 and a decision against the
Applicant was handed down in March 2022. Winton has appealed to the Court of Appeal and the appeal hearing
was held in May 2023. A decision has yet to be handed down by the Court of Appeal. The Group still considers the
likelihood of the Applicant being successful as low. It is not possible to determine what the financial effect would be, if
any, should the appeal be successful.

Page 12

Millennium & Copthorne Hotels New Zealand Limited and Subsidiaries
Notes to the Condensed Interim Financial Statements
for the six months ended 30 June 2023 (unaudited)


9. COVID-19 employer support

The Group has applied for and received $42,708 in respect of COVID-19 Leave Support Scheme for employees who
were self-isolating and were unable to work from home. In the previous period, the Group received $189,796 in
respect of COVID-19 Short-term Absence payment and Leave Support Scheme.

The employer support payments were applied as a deduction against payroll costs in personnel expenses in
accordance with NZ IAS 20. The personnel expenses are included in cost of sales, administration expenses and other
expenses in the income statement.





Personnel expenses



Group


Dollars In Thousands

Unaudited
6 months to
30/06/23
Unaudited
6 months to
30/06/22
Wages and salaries

20,599 14,169
COVID-19 employer support

(31) (150)
Employee related expenses and benefits

1,891 908
Contributions to defined contribution plans

310 198
Increase/(decrease) in liability for long-service leave

103 (3)

22,872 15,122




10. Australian acquisition

On 22 March 2023 the Company and its parent company, Millennium & Copthorne Hotels Limited, through a 50:50
joint venture, entered into a conditional sale and purchase agreement to acquire the Sofitel Brisbane Central hotel in
Australia at a purchase price of $190.59 million (A$177.70 million). The acquisition is subject to various conditions,
including Australian Foreign Investment Review Board approval (granted in June 2023), liquor licence transfer, and
landlord’s consent. The acquisition is expected to complete in the second half of 2023.


11. Subsequent event

Subsequent to the six month period ended 30 June 2023, the Group settled the purchase of a parcel of land in
Hamilton for approximately $4.0 million. The capital committed is included in Note 7.

---

8 August 2023




MCK INTERIM RESULTS FOR SIX MONTHS TO 30 JUNE 2023

Summary of Unaudited 1H23 results:

• Strong progress on Revive and Thrive strategy; Hotel operations on track for profit
• Average hotel occupancy across the Group 59.8% (2022: 38.3%)
• Group revenue $60.05 million (2022: $83.66 million)
• Profit before income tax and non-controlling interests $11.47 million (2022: $32.05 million)
• Profit after tax and non-controlling interests $6.18 million (2022: $15.40 million)

New Zealand hotel owner / operator, Millennium & Copthorne Hotels New Zealand Limited
(NZX:MCK), has today announced its unaudited results for the six months to 30 June 2023, with its
New Zealand hotel operations showing a positive recovery to near pre-pandemic levels, and currently
on track for a return to profit in FY23.

MCK Chairman Colin Sim said that this was encouraging after a very challenging environment over the
last three years.

“A tremendous amount of work is being done on the hotels’ side of the business as part of our Revive
and Thrive strategy, and our performance and improving results confirm that we are on the right track.
We have seen a healthy increase in hotel occupancy over the past year as tourism has resurged. While
various challenges remain, we are expecting our hotel operations to return to profitability this year. We
are continuing to progress the acquisition of Sofitel Brisbane Central Hotel, with a number of conditions
now met. This will provide MCK with a beachhead into Australia which we have sought for some time
and we consider it to be an important part of our future growth strategy.”

“On the property development side, CDL Investments (CDI) did not have the benefit of any uplift from
land sales as it did last year. Our prior year results included a one-off contribution from CDI from a high
value land sale which boosted the results by $29.0 million. CDI’s results for 2023 reflect the downturn
which started last year and has continued into 2023.”

MCK Managing Director Stuart Harrison said that MCK’s New Zealand hotel operations were on track to
be independently profitable by the end of the year.

“Ensuring that our hotels are able to make and maintain consistent profitability is a key pathway to our
success over the next two years. Pleasingly, we are seeing increases in our revenues and occupancy,
however, ongoing staff shortages continue to limit our ability to maximise occupancy and parts of our

food and beverage operations. Our expectation is that there will be some improvement of these
constraints by the end of the year”.

“We saw a further resurgence of business into leisure locations such as the Bay of Islands, Rotorua,
Queenstown and Te Anau, and we expect to see an additional uplift across our hotel network as we
head towards summer. Considering the effects of the severe weather incidents which affected our
Auckland and Northland hotels in January and February, the 1H23 performance was a good result in
unexpectedly challenging circumstances”, he said.

Highlights for the six months include the condiJonal acquisiJon of SoKtel Brisbane Central hotel, for
AUD$177.7 million as a 50:50 joint venture with MCK’s parent company, Millennium & Copthorne
Hotels Limited; and conJnued investment into the refurbishment of the New Zealand hotel network.
While there were no new sales of the Zenith Apartments in Sydney in the last six months, contracts
have been exchanged for the sale of one sub-penthouse apartment with seNlement scheduled for
September 2023. MCK’s aim is to complete sales of the remaining apartments over the next two
years as the operaJonal focus shiOs towards the Brisbane investment.
Results Snapshot

For the six month period ended 30 June 2023, MCK has reported an unaudited profit before tax and
non-controlling interests of $11.47 million (2022: $32.05 million). Group revenue for the period was
$60.05 million (2022: $83.66 million), with profit after tax and non-controlling interests of $6.18 million
(2022: $15.40 million). The reductions are primarily due to lower sales activity recorded by MCK’s
majority-owned subsidiary CDL Investments New Zealand Limited (“CDI”) which reported revenue of
$11.97m (2022: $47.81m); and no one-off apartment sales (2022: $8.58m).

Earnings per share for the period was 3.90 cents per share (2022: 9.74 cps). Net Tangible Assets per
share as at 30 June 2023 remained stable at $3.37 per share (2022: $3.33 per share).

Update on Sofitel Brisbane Central acquisition

In relation to its purchase agreement for the Sofitel Brisbane Central hotel, MCK notes that approval
from Australia’s Foreign Investment Review Board has been obtained and that the parties are making
progress towards settlement.

“There are still a number of conditions that need to be completed before we can settle the transaction
but we believe that we remain on track to do so before the end of the calendar year”, said Mr. Harrison.
“We are excited to complete the purchase and to provide more information when we can on how this
purchase will benefit all of MCK’s shareholders”.


Outlook

MCK’s board and management remain focused on building on the positive momentum now being seen
by the New Zealand hotel operations and maximising returns over the coming months.

“We are targeting our New Zealand hotel operations to be profitable in their own right for the year. This
will be critical as we expect profit contributions from CDI and our Zenith Apartments sales to be softer
than previous years. CDI are optimistic that sales will increase in the second half of this year but
recognise that the total number of section sales for 2023 will be below the number seen in previous
years. CDI are actively looking at opportunities to add to their land portfolio including projects which
can be brought to market relatively quickly”.

“One-off events this year will provide a timely influx of overseas visitors across our hotel network and
the addition of new air services from later this year from key destinations in North America and Asia will
also help boost occupancies around the country”, he said.

“We have initiatives in place to manage market and economic challenges and we believe that
shareholders should be optimistic about MCK’s future as we look to revive and grow our core business.”

ENDS

Issued by Millennium & Copthorne Hotels New Zealand Limited

Enquiries to:
Stuart Harrison Managing Director +64 21 869 216

About Millennium & Copthorne Hotels New Zealand Limited

Millennium & Copthorne Hotels New Zealand Limited (NZX:MCK) is the only NZSX listed hotel owner –
operator with 18 owned / leased / franchised hotels based in New Zealand under the Millennium, Grand
Millennium, M Social, Copthorne and Kingsgate brands. As part of the Millennium & Copthorne Hotels
group, we are proud to be part of a global network of over 120 properties in gateway cities across Asia,
Europe, North America, the Middle East and New Zealand. MCK is also the majority shareholder in land
developer CDL Investments New Zealand Limited (NZX:CDI) and also has property interests in Australia
through its Kingsgate Group subsidiaries.

For more information, visit our website:
www.millenniumhotels.co.nz

---

WELCOME TO OUR WORLD OF HOSPITALITYWELCOME TO OUR WORLD OF HOSPITALITY

Looking Forward: Revive and Thrive Strategy
Looking Forward: Revive and Thrive StrategyLooking Forward: Revive and Thrive StrategyLooking Forward: Revive and Thrive Strategy
Our performance and improving results confirm that
we are on the right track
Our performance and improving results confirm that
we are on the right track
Our performance and improving results confirm that
we are on the right track
Our performance and improving results confirm that
we are on the right track
Goal:
Be the preferred hotel choice for travellers in our
region, grow our footprint and deliver value
for our guests, our team and our shareholders
PeopleDeliver memorable experiences for our guestsBuild careers that our people love to talk about
ProductProtect and expand our hotel presence in New Zealand & AustraliaInvest in a portfolio of real estate or development projects - and manage our investment in CDL Investments
Profit Drive improving revenue and profitLeverage our strong balance sheet to achieve growthDeliver long term value to our shareholders
Short term: Reviving our business for tourism marke
t momentum post-Covid
Medium to long term: Growth of our hotel network in
New Zealand and Australia

NZ Hotel Operations•
Positive recovery as borders open
•
Returned to profit HY23
CDL Investments •
Long term positive macro trends but short term rapid cool down on property sales
•
Muted HY23 contribution
Australia•
Ongoing apartment rental income
Results at a Glance
Results at a GlanceResults at a GlanceResults at a Glance

Balance Sheet positioned to execute on strategy and drive growth•
Ongoing pipeline of refurbishments and development
•
Continuing to look for acquisition opportunities
Bank Facilities•
HSBC Facility
$25.0m headroom
•
Utilised
$ nil
•
Expiry
31-Jan-24
•
Secured Property $37.7m
Strong Balance Sheet
Strong Balance SheetStrong Balance SheetStrong Balance Sheet

Refurbishments underway:•
Millennium Hotel Queenstown – rooms
•
Millennium Hotel Rotorua – rooms
•
Copthorne Hotel & Resort Bay of Islands –rooms, incl. accessible
•
Copthorne Hotel Palmerston North -recladding
Positive Recovery in New Zealand Hotel Operations
Positive Recovery in New Zealand Hotel OperationsPositive Recovery in New Zealand Hotel OperationsPositive Recovery in New Zealand Hotel Operations
On track for return to profitability in FY23

1H23 (January to June 2023):•
Moving to ‘business as usual’ environment, albeit impacted by staffing shortages
•
Still below 2019 base line levels
2H22 (June to December 2022):•
Borders re-opened June 2022
•
Resurgence of leisure and conference business
•
Re-opening of M Social Auckland
1H22 (January to June 2022):•
Impact of Covid – Omicron lockdowns & underpinned by MIQ
Revenue Tracking Towards Pre
Revenue Tracking Towards PreRevenue Tracking Towards PreRevenue Tracking Towards Pre-
---pandemic Levels
pandemic Levelspandemic Levelspandemic Levels

STRATEGIC FOCUS •
Apartment vacancy to allow for apartment sales
•
Maximise sales of remaining Sydney apartments
•
Brisbane central hotel settlement pending consents
Australia Update
Australia UpdateAustralia UpdateAustralia Update

Building a beachhead in Australia
Building a beachhead in AustraliaBuilding a beachhead in AustraliaBuilding a beachhead in Australia
Sofitel Brisbane Central Hotel
•
Unique opportunity, landmark property prominently located in the heart of Brisbane CBD
•
Funded via cash reserves (mostly held in AUD post Sydney apartment sales)
•
416 Rooms including 37 suites
•
Grand Ballroom (798sqm) & 8 meeting rooms
•
220 undercover parking lots
•
Outdoor swimming pool & 2 gyms
Location
249 Turbot Street, Brisbane City, Australia
Tenure
99-year leasehold (~97 years remaining)
Acquisition Price
A$177.7m plus acquisition costs
Interest
50% ownership alongside M&C Hotels (UK)
Settlement
Second half of 2023
(subject to FIRB and landlord consents)

CDL InvestmentsImpacted by residential market headwinds
Prestons Park, Christchurch
Tram Valley Rd Subdivision
STRATEGIC FOCUS •
Maximise sales in areas with strong demand
•
Develop section inventory & pipeline of developments
•
Increased focus on commercial areas to add value

Revive and Thrive FY23 to FY26
Revive and Thrive FY23 to FY26Revive and Thrive FY23 to FY26Revive and Thrive FY23 to FY26
Key initiatives
FY23Revival•
Bring all rooms back online
•
Build occupancy back to former levels
•
Attract and retain full complement of staff
•
Marketing and sales activity to drive guest visits
•
Continued investment in refurbishment and upgrades
FY23 - 24Early Stage Growth•
Identify opportunities to fill the gaps in the New Zealand hotel network
•
Build beachhead in Australia
•
Formalise strategy for sustainable operations
•
Continued investment in refurbishment and upgrades
FY25 - 26Accelerate Growth•
Optimise hotel network and under-utilised land and buildings
•
Expand footprint in Australia
•
Continued investment in refurbishment and upgrades

Sustainability in Action
Sustainability in Action Sustainability in Action Sustainability in Action
–
–––
joining forces to protect NZ’s Iconic Kiwi

Supporting Loyalty
Supporting LoyaltySupporting LoyaltySupporting Loyalty

Our business
Our businessOur businessOur business
NZ Hotel brands: •
Leng’s Collection – M Social
•
Millennium Collection
•
Copthorne Collection – incl Kingsgate
CDL Investments New Zealand: •
Land developments
•
Projects in progress across New Zealand
Australia: •
Zenith Residences – Exit Strategy
•
Conditional JV - Sofitel Brisbane Central
•
Own and operate hotels across New Zealand; building beachhead in Australia
•
Experienced executive team with new leadership
•
~1,007 team members across New Zealand and Australia
•
Own 66% shareholding in CDL Investments NZ – residential and commercial land development
•
NZX-listed. Board with independent Chairman, as well as representation from majority shareholder
•
MCK is 71% owned by CDL Hotels Holdings, a 100% subsidiary of Hong Leong Group

Our Hotel Networks
Our Hotel NetworksOur Hotel NetworksOur Hotel Networks
18
hotels in NZ
Opportunity to fill in the network2,250 rooms per night owned and managed1
hotel in Australia
*
Beachhead being established. Significant opportunity to build footprint*Conditional acquisition of Brisbane Central Hotel

EXPLORE OUR COLLECTIONS
Unique hotels with powerfully distinct personalities– from historic properties to trendy urban escapes.The Leng's Collection hotels represent the legacy ofour founders, the Leng generation of the Kwekfamily.Brands in the Leng's Collection include: The Bailey'sHotel, The Chelsea Harbour Hotel, Grand HotelPalace Rome, M Hotels, Studio M Hotels, M Social.
The global travellers’ choice in gateway cities. The Millennium Collection hotels are created with timeless elegance and famed for their conference and banquet offerings, world-class facilities and t
he
ultimate in personalized, gracious service. They ar
e
perfect for corporate, leisure, meetings and conventions.Brands in the Millennium Collection include: Grand Millennium Hotels and Millennium Hotels.
Comfortable hotels at a comfortable price. The Copthorne Collection hotels are firmly established
as
a true global brand recognized across the world as the preferred choice for both business and leisure travellers in providing comfortable service.Brands in the Copthorne Collection include: Copthorne Hotels and Kingsgate Hotels.

M Social Hotel Auckland
M Social Hotel AucklandM Social Hotel Auckland

Millennium Hotel Queenstown
Grand Millennium Hotel Auckland
Millennium Hotel New Plymouth

Copthorne Hotel & Resort Waitangi
Copthorne Hotel GreymouthCopthorne Hotel Palmerston North
Kingsgate Hotel Dunedin

DISCLAIMER
DISCLAIMERDISCLAIMERDISCLAIMER
This announcement has been prepared by Millennium &
Copthorne Hotels New Zealand Limited ("M&C Hotels")
. The details in this announcement provide general
information only. It is
not intended as investment, legal, tax or financial
advice or recommendation to any person and must no
t be relied on as such. You should obtain independen
t professional advice prior
to making any decision relating to your investment o
r financial needs.
All references to $ are to New Zealand dollars unle
ss otherwise indicated. Percentages may be subject
to rounding.
This announcement may contain forward-looking statem
ents. Forward-looking statements can include words s
uch as “expect”, “intend”, “plan”, “believe”, “cont
inue” or similar words in
connection with discussions of future operating or
financial performance or conditions. The forward-lo
oking statements are based on management's and direct
ors’ current expectations
and assumptions regarding the M&C Hotels business,
assets and performance and other future conditions,
circumstances and results. As with any projection
or forecast, forward-looking
statements are inherently susceptible to uncertaint
y and to any changes in circumstances. M&C Hotels a
ctual results may vary materially from those expres
sed or implied in the forward-
looking statements. M&C Hotels and its directors, em
ployees and/or shareholders have no liability whats
oever to any person for any loss arising from this
announcement or any
information supplied in connection with it. M&C Hot
els are under no obligation to update this announce
ment or the information contained in it after it has
been released. Past
performance is no indication of future performance.