While almost everybody else in China was glued to news about the Olympics, Singapore-based Frasers Hospitality yesterday opened its swankiest digs to date in the country, the 357-unit Fraser Suites CBD in Beijing, which cost US$135 million ($190 million).

Singapore President S R Nathan, in the Chinese capital at the invitation of that country’s government to watch the Games, took time out to open the 23-storey, purpose-built serviced apartment building, Frasers Hospitality’s second serviced block in Beijing and its sixth in China.

“China is the world’s biggest growth engine and Beijing is at the heart of this,” said Mr Choe Peng Sum, Frasers Hospitality’s chief executive. “Owning our own property in China puts us in a unique position in this market. Unlike other international brands, we are firmly planting our feet in China and we are here to stay.”

Fraser Suites, in the heart of Beijing’s business district, is part of a mixed-use development that also includes office and residential towers, as well as a retail mall by China’s biggest shipping group, Cosco, from whom Frasers bought the site.

The apartments come in a mix of studios or one- and two-bedroom units, and aretargeted at expatriates working here.

Frasers’ faith in China is amply testified by its plans to open at least another half-dozen properties in the country over the next 18 months. Added Mr Choe: “Our business development team is signing up more properties so that we may have up to 20 properties under the Frasers brand before the close of 2010.”

Besides Beijing, Nanjing, Shanghai and Shenzhen, Frasers will have apartments in Tianjin, Guangzhou, Chengdu, Dalian, Suzhou, Xian, Chongqing, Hangzhou, Wuxi and Hong Kong.

“Demand for our unique bled of hospitality, comfort, luxury and full service has been growing worldwide, particularly in a newly-developing economy like China which is so open to foreign business,” Mr Choe said.

Besides China, Frasers is targeting India, Vietnam, the Middle East and Eastern Europe. It’s currently operates over 5,000 units around the world, making it the second-largest serviced apartments operator in Singapore after CapitaLand’s Ascott Group.

A unit of Fraser and Neave, Frasers Hospitality hopes to 8,500 serviced units in its international portfolio before the decade is out.

Source : Today – 15 Aug 2008

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For the half-year ended in March, F&N booked a nearly 12 percent rise in earnings on-year to S$205 million. Revenue rose by the same margin to S$2.5 billion.

The property business is driving growth for F&N. Commercial properties led the way, thanks mainly to higher management fee income, and strong occupancy and rental rates.

Hui Choon Kit, General Manager, Treasury and Budget, Fraser and Neave, said: “Not only is the commercial property business doing very well, but from the presales of projects, we will continue to be able to deliver good earnings.

“So now the property earnings are very strong; 55 percent of PBIT (profit before income tax) comes from property.”

Anthony Cheong, Group Company Secretary, Fraser and Neave, said: “This has been the result in property profits over the last few years, which has outstripped the performance of all our other business groups.

“Without wanting to hold back on property, we still see the need to rebalance the profit contributions from… the various core businesses, and one way of achieving a great leap must be through M&A.”

The food and beverage business is one segment that F&N intends to expand.

Mr Cheong said: “As you know, I think we’ve received S$900 million from Temasek about a year ago, principally for the development of the F&B business, and you can expect that there is quite a lot of focus in that area.”

F&N said that the current market presents excellent opportunities to make investments at more reasonable values. It is proposing to pay an interim dividend of 5 cents a share.

Meanwhile, the aftermath of Cyclone Nargis affected F&N’s operations in the outskirts of Yangon.

Mr Cheong said: “The brewery building was damaged slightly and one sales office in Yangon was wiped out, but none of our employees have been injured, although a few have lost their homes.

“Because electricity and communication lines are down, we have great difficulty trying to get an update of the situation. But I think, one can expect that not very much beer will be drunk in the coming months. I think sales will be affected – we expect that.

“But the principal concern of course is recovery efforts and… to try and alleviate the plight of all those affected. I think the brewery is trying to do that as well by supplying water trucks to nearby villages.” – CNA/ms

Source : Channel NewsAsia – 9 May 2008

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IT HAS been more than six months since local food and beverage giant, Fraser and Neave (F&N) has been without a full-time chief executive officer following the hasty departure of Dr Han Cheng Fong last October.

Mr Lee Hsien Yang assumed the post of chairman in the middle of that same month and has since had to take on the CEO’s responsibilities at the same time. But he is on record as saying: “I have no desire to stay on as acting CEO or executive chairman for long.”

He also said that the company would be announcing a new CEO in “due course”. That was said at the company’s annual general meeting of shareholders in January.

It’s now coming to the end of April and there still is no CEO at F&N. F&N is not only the largest producer of soft drinks in Singapore, but the company is also into brewing beer, developing property, running serviced apartments and, under Times Publishing, printing and publishing.

Before that AGM, I had reported that the company had temporarily suspended its search for a CEO pending a review of its business units. The review was to determine whether the company was going to hive off its three main business units — food and beverage, property and printing and publishing — into separate companies or retain the status quo and keep the three businesses in one company.

This was vehemently denied by F&N group company secretary Anthony Cheong: “It has not been put on hold and is not ‘pending a review of the group’s future direction’.

However, the company was reported to have said that it was not in a hurry as it wanted to find the right person for the job.

But would it make sense to hire somebody to run F&N as it is now, only for him to see the company broken into separate units later on? Wouldn’t it be better to a make a decision now on the company’s direction and then decide on the appropriate person?

It was reportedly a finding by Dr Han, 65, that group morale would be adversely impacted should F&N be broken up that led to differences with then chairman Michael Fam and the former’s eventual departure from the company.

Many analysts believe that the sum of parts — that is if the group is broken up into separate business units and listed separately — would bring greater benefits to F&N’s shareholders.

It was only six years ago that F&N privatised Centrepoint Properties and Times Publishing and absorbed them into the main company. At that time, the rationale was: “The privatisation of Centrepoint and TimesPub is aimed at restructuring F&N into a stronger and more flexible group, to further enhance shareholder value and sustain long-term growth … F&N, as an entrepreneurial shareholder in these companies, already plays a proactive and pivotal role in charting the strategic directions of these businesses. The privatisation of Centrepoint and TimesPub will give more flexibility in managing their resources.”

Dr Fam also went on to add that “through appropriate rationalisation and consolidation measures, we hope to realise greater synergies within the group — for instance, by sharing best practices and tapping on the combined wealth of experience, knowledge and expertise of the management teams”.

While F&N should ensure that it finds the right person for the job, keeping its shareholders guessing for too long on where it’s going is also not fair to them.

Mr Lee is more than capable of running the company well, but his declaration that he does not want to be CEO or executive chairman for long might give the impression, rightly or wrongly, to shareholders that he is just doing a maintenance job.

Source : Today – 23 Apr 2008

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It attributed the strong performance to contributions from its property developments, including the Soleil @ Sinaran project in Singapore and other overseas projects.

Revenue for the first quarter rose 19 per cent year-on-year to S$1.3 billion.

F&N also plans to launch the sale of two other projects in Bedok and River Valley Road this year.

Its unit, Asia Pacific Breweries, posted an 8.5 per cent rise in first quarter earnings to about S$44 million.

Chairman Lee Hsien Yang said F&N’s businesses in the core markets of Singapore, Malaysia, Indochina and Australia have all contributed strongly to the sterling results.

F&N says the economic growth in the Asia-Pacific region is expected to be moderate for the next 12 months.

Barring unforeseen circumstances, it says the group’s profit will further improve in the current financial year. – CNA/ac

Source : Channel NewsAsia – 14 Feb 2008

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