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2004-02-03 16:22:53

Kerzner Reports Record Earnings

Kerzner International reported record earnings from its Paradise Island operations for the second consecutive year on Monday, achieving gross revenue of $521 million in 2003.

Fourth quarter revenue for last year reached $116.9.

Speaking with company executives via a conference call, CEO Butch Kerzner noted the impact of the organisation's Bahamas operations in achieving Kerzner International's $71.5 million net income for 2003.

"In 2003 we combined strong earnings performance with some major growth initiatives for the future," Mr. Kerzner said.

"Adjusted earnings per share for the year was $2.36, an increase of 15 percent over last year. The improvements in our results were driven primarily by Paradise Island, Mohegan Sun and lower interest expense," he said.

Occupancy levels and room rates at the Atlantis resort were also up for the last three months of 2003.

Fourth quarter occupancy levels averaged 73 percent at a $218 average daily room rate (ADR), compared with an average occupancy of 72 percent and ADR of $216 in the same period the year before.

The company's exclusive Ocean Club resort continued to show strong performance achieving an average occupancy of 75 percent and an ADR of $633 in the fourth quarter of 2003 as compared to an average occupancy of 72 percent and an ADR of $627 in the fourth quarter of 2002.

Company executives proudly pointed out that those results were achieved despite the resort's four-week closure in September in order to start construction of the Ocean Club expansion.

In a company statement, Kerzner officials reaffirmed plans to continue the Phase III expansion on Paradise Island.

Noting that the construction of three new luxury villas as the first component of that expansion should be completed by the summer of 2004, the statement indicated that two other elements of the Phase III expansion are scheduled to begin this year.

According to the statement, expansion of the Marina Village - which includes new restaurants and retail space to be developed around the Atlantis Marina - and an expansion to Harbourside at Atlantis - which will add approximately 120 two-bedroom suites to the existing timeshare facility - are both expected to be completed in 2005.

The 1,200-room hotel planned as a part of the Phase III development, significant expansion to the water attractions at Atlantis and a second golf course on Athol Island are all in the stage of architectural planning and are expected to be completed by Christmas 2006, the statement indicated.

Kerzner International last year made a number of announcements regarding its expansion.

One of those announcements was the signing of a $40 million deal to acquire Club Mediterranae on Paradise Island.

The Club Med property borders the boundary of the proposed site of the new 1,200-room hotel, making it ideally positioned for inclusion in future expansion plans.

Club Med will house construction workers for the three-year project, then may be cleared for more Atlantis buildings, according to a company official.

The acquisition of the Club Med property was expected to help Kerzner achieve its goal of creating 5,000 hotel rooms in The Bahamas.

Kerzner also announced during that time that it was taking the Atlantis brand international, revealing plans to develop a $650 million Arabian-inspired resort in the United Arab Emirates city of Dubai.

That project is expected to include a 1,000-room hotel and water theme park situated on 1.5 miles of beachfront.

Darrin Culmer, The Bahama Journal 

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