News

27 May 2011

Societe Bain de Mer sales hit by gaming

Hotel and casino group Societe des Bains de Mer (BAIN.PA), Monaco's biggest employer, said occupancy rates were still far from their 2007/2008 peak and sales in its fiscal year ended March were broadly flat.www.reuters.com

Chief Executive Bernard Lambert said on Wednesday that the group, which owns landmarks Hotel de Paris, Hotel Hermitage and Casino de Monte-Carlo, enjoyed a 10 percent rise in hotel sales in the fiscal year just ended.

But the improvement failed to compensate for lower gaming revenues, which make up more than half of total sales. He said a smoking ban introduced late in 2008 continued to affect trading.

"For me, we are still not out of the crisis," Lambert told the Reuters Global Luxury and Fashion Summit in Paris.

"Everybody has predicted that recovery would take a long time; the peak (in terms of occupancy rates) was really exceptional."

Asked if sales for the year to March 2011 would be flat, Lambert said: "Yes, that is correct."

The company made sales of 347 million euros in 2010, a second year of decline, and scraped just 1 million euros of profit.

Founded in 1863, the Monaco group also owns the opera house where it will host the July 2 wedding of Prince Albert and South African Olympic swimmer Charlene Wittstock.

Lambert said the event would attract tourists to the tiny Mediterranean principality, but he stressed it was difficult to predict whether it would boost revenues overall in the current year to March 2012.

"If the economic environment improves, there are good chances that our (hotel) sales will improve, but in gaming, it remains very unpredictable," he said.

The group, which is controlled by the Monaco government through a 69 percent stake, plans to open a beach club in Abu Dhabi in September and a hotel in about two years, coinciding with the opening of a new Louvre museum planned for the oil-rich emirate.

As part of a series of moves to play down the less profitable casino business, it also plans to open a hotel in Morocco by 2013, and longer term it aims to have a hotel in London and Paris.

"Our objective is to have a flag in London and then in Paris," Lambert said.

Societe des Bains de Mer also operates the Monte-Carlo Bay Hotel & Resort and Monte-Carlo Beach Hotel as well as spa and real estate services. Its regular clients tend to come from France, Great Britain, Italy and Russia, Lambert said.

Will Waterman

www.reuters.com