Bass goes for hotels growth as profits leap

Bass has announced profits before tax and major exceptionals up by nearly 19% to £756m for the financial year ended 30 September.

Turnover on continuing operations was up by 22.8% to £3.78b, while operating profit rose by 24.8% to £776m.

This reflected a 23.7% hike in operating profit at Bass Hotels & Resorts and a 25.8% rise for its pubs and restaurants division.

But like-for-like sales in the pubs and restaurants were down by 2.8%. Bass has already put about 900 pubs up for sale.

Chief executive Tim Clarke said: "With the sale of Bass Brewers completed, the priority is to develop our high-growth global hotels and our high-return pubs and restaurants businesses.

"We intend to continue to build their strong brands, to reinforce their market-leading positions and to aim for above-average growth.

"Our leisure retail business last year reflected the polarisation between the growth in high-take branded outlets and pressures on smaller, unbranded local pubs."

Bass's hotels, which include Inter-Continental, Crowne Plaza and Holiday Inn, saw a 30% leap in turnover to more than $2.4b (£1.7b). Operating profit rose by $90m (£64m) to $584m (£417m).

It now operates in almost 100 countries, with more than 3,000 hotels and 491,000 bedrooms.

Apart from its acquisition of the 59-strong SPHC hotel group in the Asia-Pacific region, most of the growth came from the expansion of mid-market franchised hotels, particularly the Express brand.

Acquisitions aside, 280 hotels joined the Bass network, adding some 33,000 rooms. This was partly offset by 101 hotels that left the system.

Inter-Continental increased operating profit by 11.5% to $223m (£159m) - nearly 70% higher than it was in the year before it was acquired by Bass.

Bass said that more than 1.3 million roomnights were now booked through its Web site, www.basshotels.com, generating revenues of $140m (£100m).

The 550 pubs Bass acquired from Allied Domecq have been earmarked for conversion to branded outlets. Bass expects to have 300 converted by September 2001. The first 78 to be refurbished are showing sales up by more than 40%.

Food sales grew by 10.7% to £334m and now account for 23% of the pub and restaurant division sales. by David Shrimpton