CHIEF EXECUTIVE OFFICER (“CEO”)
Q1 As the newly appointed CEO, what are
your priorities and key challenges?
A1
Sustainability has always been at the back of
my mind, be it achieving optimal room rates,
occupancy, managing operational costs or
wages etc. These are issues pertinent to an
owner-operator.
As our hotels are free from management
encumbrances, we have less leakages
to our income. On the other hand, this
also demands significant effort and close
monitoring on various aspects of our
operations. Ensuring sustainability and
maintaining our competitive edge in a
market dominated by third party managers
(global brands) is something that keeps me
awake at night.
The company has an enviable portfolio of
well-located, quality hotel assets, having
made good acquisitions in the past. We
will continue to do so. While we were not
the eventual buyer, our recent participation
to acquire the most iconic site in Sydney
reflects our commitment to grow and
enhance our portfolio.
Going forward, we will continue to strive for
sustainability whilst growing our business.
ANNUAL REPORT 2014/2015
INTERVIEW WITH SENIOR MANAGEMENT
Q2 You have been converting hotels,
preferring to take one-off gains at the
expense of recurring income. What is
the direction of the company moving
forward?
A2
We firmly believe that every property in our
portfolio should continually be evaluated.
This entails constant evaluation on the
trade-offs between one-off development
gains and existing business with a recurring
income stream.
Given our properties were purchased two
decades ago, there will be fair value gains
from revaluing our hotel portfolio. Such
an exercise will inevitably result in annual
fluctuations when the market is down.
Similarly, premature asset sales to realise
one-off gains will erode the overall scale of
our business and reduce the level of future
recurring income. As we move forward,
we are mindful of how these decisions
will impact the long term interests of our
shareholders.
Q3 What are the prospects of your business
in Australasia?
A3
Fundamentally, we are operating hotels in
one of the most challenging parts of the
world, where businesses constantly grapple
with productivity issues amidst a high labour
cost environment.
As early investors in Australasia, we had the
benefit of securing assets situated at prime
locations at distressed prices. Given the
shortage of rooms and higher replacement
costs, our businesses will continue to enjoy
improving rates and occupancy, in addition
to long term asset appreciation.
Q4 Why focus on Australasia? Is the Company
looking for opportunities in other regions?
A4
Australasia remains a key market for
the Group. We have gained good working
knowledge, having spent some 20 years
MR OW YEW HENG
Chief Executive Officer & Executive Director
BBus Accounting & Management (University of Technology, Sydney)
