Hospitality sectorfirm sets bt17billion expansion plan

The company has also set an additional budget of more than Bt5 billion until 2012 for mergers and acquisitions.

Group chief financial officer Pratana Manomaiphiboon said the decision on new capital expenditure had been made with an optimistic view of better economic and political stability, with less pressure on oil prices and inflation.

Senior finance director Prapharat Tangkawattana said Minor granted franchise licences for its two key restaurant brands - The Pizza Company and Swensen's - to an investor in India two weeks ago.

"More than 50 restaurants will be opened in India by the franchisee over the next five years," she said.

Minor will also open its branded restaurants and hotels in emerging markets like Vietnam. The company will focus on expanding the number of franchised restaurants under The Pizza Company and Sizzler brands in Cambodia and China.

"We've already opened 37 owned restaurant outlets and another two franchised restaurants under The Pizza Company and Sizzler brands in China. We will increase the number of franchised restaurants in China to more than 100 within the next five years and add another 50 owned restaurant outlets to the market over that period," said Prapharat.

Expansion will continue even though The Pizza Company posted a historic drop in sales of 0.1 per cent in the first half of the year. Second-quarter revenue dropped 7.2 per cent year on year, against growth of 4-5 per cent in the first quarter. Pratana believes that with adjustments in marketing strategy, annualised revenue will be positive.

Minor has 967 quick-service restaurants operated under brands including The Pizza Company, Swensen's, Sizzler, Dairy Queen, Burger King, Le Jazz and The Coffee Club. About 37 per cent have been franchised and opened abroad, including in Saudi Arabia, Kuwait, China and Cambodia under its major brands of The Pizza Company, Swensen's and Sizzler.

Prapharat said under its expansion plan, the company would spend Bt6.1 billion to open new outlets in the next five years, both domestically and abroad. It expects to increase the number of its restaurants to 1,035 this year and 1,742 by 2012.

Prapharat said Minor would also allocate Bt8.5 billion in the next five years to expand its branded hotels, including Anantara, JW Marriott and Four Seasons, both in Thailand and promising markets like the Maldives and Africa. The company is targeting Vietnam and Cambodia for future expansion, including the provision of management contracts.

The company expects to increase its number of hotel rooms from less than 3,000 to about 5,000 by 2012.

Another Bt3 billion will be spent on residential projects for Bangkok, Khao Lak and Koh Samui.

Minor posted second-quarter revenue of Bt3.8 billion, up 22.58 per cent from Bt3.1 billion in the same quarter last year. It achieved a net profit of Bt351 million, up 52.61 per cent from Bt230 million last year.

Minor's first-half revenue totalled Bt8.2 billion, up 20.59 per cent from Bt6.8 billion in same period last year. It achieved a net profit of Bt1.1 billion, up 61.53 per cent from Bt681 million in last year's first half.