Final Results 2013

For Immediate Release 21 February 2014

MILLENNIUM & COPTHORNE HOTELS PLC

FINAL RESULTS ANNOUNCEMENT

Fourth quarter and full year results to 31 December 2013

Highlights for the fourth quarter 2013:

Highlights for the full year 2013:

· 2013 Group revenue increased to the record level of £1,037.5m (2012: £768.3m), following recognition of £273.7m of revenue from the Glyndebourne development in Singapore.

· Hotel revenue fell by 1.5% to £738.0m (2012: £749.4m) in 12 months to 31 December 2013 reflecting:

o challenging conditions in Asian markets; and

o the impact of temporary room closures as a result of the Group's refurbishment programme, especially affecting Grand Hyatt Taipei and Millennium Hotel Minneapolis.

· 2013 Group RevPAR increased by 3.4% to £69.58 (2012: £67.32), driven by:

o overall improvement in room rates in the US; and

o increased occupancy in all regions except Singapore and some Asian destinations.

· Profit before tax increased to a record £263.6m (2012: £171.3m) for the year ended 31 December 2013 driven by the Glyndebourne development profit of £139.3m.

· For the fourth quarter of 2013, revenue and profit before tax were positively impacted by recognition of the Glyndebourne development. Group RevPar increased by 1.8% year-on-year to £70.07 (2012: £68.85) with gains in US, Europe and Australasia. Singapore continued its recent trend with RevPAR down by 5.9%, to £88.85 (Q4 2012: £94.45).

· In December 2013, the Group announced the proposed acquisition of a 5-star all-suite London hotel, located at Chelsea Harbour, for £65.0m. Post 31 December 2013, the Group further announced the proposed acquisition of the 4-star Novotel New York Times Square for $273.6m (£167.0m). These acquisitions are scheduled to complete in the first and second quarters of 2014 respectively.

· The Board proposes a final dividend of 11.51p per share and a special dividend of 9.15p per share, giving a total dividend payout for the year of 22.74p per share (2012: 13.59p), an increase of 67.3%.

Commenting today Mr Kwek Leng Beng, Chairman said:

"In 2013, the Group's performance was boosted significantly by the recognition of profit from the Glyndebourne development. We remain cautiously optimistic about the Group's full year performance in 2014 despite uncertainty affecting some regions, and poor weather conditions in US and UK in the first quarter. The Group's performance will be further impacted by our refurbishment programme and the resulting temporary removal of rooms from inventory."

Enquiries

Millennium & Copthorne Hotels plc

Wong Hong Ren, Chief Executive Officer Tel: +44 (0) 20 7872 2444

John Chang, Chief Financial Officer

Jonathon Grech, General Counsel and Company Secretary

Peter Krijgsman, Financial Communications (Media)

¹ See Note 1 of the financial statements.

This final results announcement contains certain statements that are or may be forward-looking with respect to the financial condition, results or operations and business of Millennium & Copthorne Hotels plc. By their nature forward-looking statements involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future. There are a number of factors that could cause actual results and developments to differ materially from those expressed or implied by such forward-looking statements. Undue reliance should not be placed on forward looking statements which speak only as of the date of this document. The Group accepts no obligation to publicly revise or update these forward-looking statements or adjust them to future events or developments, whether as a result of new information, future events or otherwise, except to the extent legally required.

BUSINESS REVIEW

In 2013, the Group made good progress against its key strategic objectives, whilst delivering record revenue and profit for the year due to recognition of profits from the Glyndebourne development. This performance demonstrates the strength of the Group's business model as an owner and operator of hotels, with gains generated through timely and opportunistic asset management, in addition to income from hospitality services.

Although there was a 3.4% rise in Group RevPAR during the year from £67.32 to £69.58, the Group's hotel revenue fell by 1.5% to £738.0m (2012: £749.4m) due to the impact of rooms temporarily lost to refurbishment as well as a reduction in hotel non-room revenue.

The biggest single element driving growth in annual revenue and profit was the impact of the Glyndebourne development - the sale of 147 out of 150 apartments built on the site of the former Copthorne Orchid Hotel in Singapore. This development generated revenues of £273.7m and pre-tax profit of £139.3m, which were recognised in 2013 following the grant of the temporary occupation permit by local authorities.

Hotel Operations

Global revenue per available room (RevPAR) increased in 2013 by 3.4% to £69.58 (2012: £67.32). Positive RevPAR performance in London, New Zealand, New York and Regional US outweighed the fall in RevPAR in Singapore, Rest of Asia and UK regional hotels. Our operating tactics were consistent with previous years, with sales teams focused on achieving an optimal balance between occupancy and average room rate across the estate.

During 2013, there was a greater emphasis on driving revenue through higher occupancy ratios rather than increased room rates. This reflected a more competitive trading environment in some regions - especially Singapore - and other factors, notably the absence of the Olympics in London compared to 2012 and the reduced number of Japanese visitors to Seoul mainly as a result of political tensions.

Hotel revenues for the year totalled £738.0m - a reduction of 1.5% compared to 2012 (£749.4m). Apart from market pressure affecting business levels in parts of Asia, revenues were further impacted by the removal of a net 290,000 room nights from the system over the course of the year mainly due to the Group's ongoing asset management programme. As the programme continues, management anticipates that this effect will reverse. For example almost 14,000 room nights re-entered the system in 2013, with significantly higher room rates, following the refurbishment of ONE UN.

The Group achieved a consolidated hotel gross operating margin of 35.4% for the year (2012: 38.5%). The fall was mainly due to lower operating profit margins at our Asian properties. Central costs for the year increased by 29.5% to £30.7m (2012: £23.7m), mainly because of our continuing drive to strengthen the central management team.

Acquisitions

Our financial position remained strong throughout the year, which placed the Group in a good position to grow through acquisition. With the global economy showing signs of recovery, hotel capital values have increased, although at a faster rate than hotel earnings.

In December 2013, we announced the proposed acquisition of a leasehold interest in a luxury, all-suite hotel located within the Chelsea Harbour district in London. The property currently offers 154 suites and 4 penthouses and is situated in a prestigious riverside area that will be going through further transformation and improvement in the near future. The property is in an improving and already attractive area of the city and will fit efficiently into our existing portfolio of London properties with minimum impact on central management costs. The purchase price for the hotel is £65.0m, subject to standard purchase price adjustments. Completion is expected to occur during the first quarter of 2014.

Since the year-end, the Group has also announced that it has entered into a conditional agreement to acquire the 480 room 4-star Novotel New York Times Square for $273.6m (£167.0m) subject to standard purchase price adjustments. Completion is expected to occur during the second quarter of 2014.

Additionally in December 2013, our hospitality real estate investment trust associate, CDL Hospitality Trusts ("CDLHT") acquired the 35 villa Jumeirah Dhevanafushi, its second luxury resort hotel in the Maldives.

Development

In April 2013, the Group completed its purchase of a 1,563.7m² plot of land adjacent to the Millennium Seoul Hilton for a price of £17.2m. Architectural detailing is underway for a construction project, incorporating a hotel and serviced apartment complex which will be complementary to the Millennium Seoul Hilton.

In December 2013, we recognised revenues and costs arising from the 147 units sold in the Glyndebourne development in Singapore, following local authorities' grant of the temporary occupation permit. Work on this development commenced in 2011 following the closure of the Copthorne Orchid Hotel, which formerly occupied the site. The development resulted in revenue of £273.7m and an operating profit of £139.3m. The level of profit reflects the successful timing of the project, and the low historical book value of the land. Since the year-end, two further apartments have been sold, the profits of which will be recognised in 2014.

Construction of the Group's hotel in Tokyo's Ginza district is proceeding according to plan, with works scheduled to complete at the end of 2014. The new property will be a significant addition to the Group's portfolio, adding a new key gateway destination for business and leisure travellers in the capital of one of the world's largest economies. The site was acquired in 2011 for an initial capital outlay of JPY9.5b (£55.1m). Total construction costs are estimated at JPY5.6b (£32.5m).

Having fully examined a range of alternative scenarios for the Millennium Hotel St Louis, the Group determined that refurbishment of the property was unlikely to offer attractive returns in the foreseeable future. The hotel was closed in January 2014. The Group is considering a full range of options for the freehold property, which occupies a 17,033m² site in the city. In addition, the Group closed two hotels in New Zealand in 2013.

Refurbishment

The Group considers that in the current hotel trading environment it is vital to invest in our asset portfolio in order to enhance trading performance, especially in our main gateway city properties. Results from those hotels where we have completed significant renovations have generated higher room rates and RevPAR compared to their pre-renovation performance. Since the current programme commenced in 2011, £87.8m of the programme total of £240m had been spent up to 31 December 2013, mainly on the refurbishment of several key hotels including the west tower of ONE UN New York, Millennium Seoul Hilton, Millennium Hotel Minneapolis and Grand Hyatt Taipei. In 2013, £41.6m was spent under the programme, of which £3.5m was spent in the fourth quarter.

Refurbishment of the west wing of the Grand Hyatt Taipei was completed during the third quarter of 2013, with work currently underway on renovation of the east wing, which was closed when the west wing re-opened. The hotel is scheduled to re-open fully in the third quarter of 2014. Grand Hyatt Taipei is our largest current refurbishment project, with costs to the end of 2013 totalling £29m and a final anticipated total refurbishment cost of £62m.

In the US, refurbishment of the Millennium Hotel Minneapolis completed during the second quarter of 2013, with a total refurbishment cost of £14.4m. The hotel fully re-opened in May, 2013, since when it has received a much improved rating from guests, both directly and through hotel review sites. In the second half of 2013, RevPAR for the hotel was £52.89 compared to £44.19 in the same period of 2012, representing an increase of 19.7%.

The Group will continue to upgrade and improve its properties, with a number of refurbishment projects ready to commence in 2014, subject to relevant consents.

First Sponsor Capital Limited

M&C's associate, First Sponsor Capital Limited ("FSCL") continues to make good progress with development in Chengdu, People's Republic of China. The Group's investment in FSCL is a key part of its China strategy, building our brand proposition in this key market. It also enables the Group to participate in hotel ownership through mixed use property development in a capital efficient manner.

For the year ended 31 December 2013, the Group has recognised £7.4m as its share of FSCL's net profit after tax (2012: £9.3m). 2013 profits arose mainly as a result of FSCL's disposal of the land in Humen and profits on the sale of the remaining Chengdu Cityspring residential units, the bulk of which were sold in 2012. The 196-room M Hotel Chengdu, part of the Chengdu Cityspring project, soft opened in September 2013. It is managed by the Group. Progress on the Wenjiang development land site in Chengdu, purchased in November 2011 and branded as Millennium Waterfront, is on track. The land is designated for residential, commercial and hotel development. The total residential component comprises 50 apartment blocks with 7,110 units. The sale of 10 blocks of 1,618 residential units had been launched at 31 December 2013. At that date 1,490 out of the 1,618 residential units launched had been sold either under option agreements or sale and purchase agreements. FSCL has also commenced the sales of some auxiliary retail commercial units and sales have been encouraging. Development will be phased according to demand. Construction of a Millennium branded hotel with convention facilities commenced in the second quarter of last year and is scheduled to open in 2017.

FSCL has informed the Group that it is considering an initial public offering and listing on the Singapore Stock Exchange of its principal operating subsidiary, First Sponsor Group Limited later in 2014.

Asset Disposals

The Group recognised profit of £9.1m from land sales in New Zealand during the year (2012: £6.3m). We also announced during the fourth quarter of 2013 that the Group had signed a Collective Sale Agreement ("CSA") with other selling unit-holders in Tanglin Shopping Centre, a shopping-cum-office complex situated within the Orchard Road tourist district in Singapore, in which the Group has approximately a 34% interest. This sale process will be directed by an independent sales committee, representing all selling unit-holders. In common with these unit holders, the Group is bound by a confidentiality agreement with respect to the proposed disposal which is highly conditional.

During 2013, the Copthorne Hotel Birmingham became the subject of a compulsory purchase order as part of the redevelopment of Birmingham city centre. The Group entered into an agreement with the developer of the scheme that grants the Group a number of options including the construction of a new hotel and/or the sale of the existing site, the timings of which are currently unknown.

The Group is also in discussions with the appropriate authorities in Scotland regarding the impact of the redevelopment of the local area on the Millennium Hotel Glasgow.

Board changes

The Group was pleased to welcome Susan Farr as a new Independent Non-Executive Director in December 2013. Ms Farr has specialist knowledge and experience of marketing, business development and corporate communications and will make a valuable contribution to the business. In addition, her appointment reflects the Group's support for the recommendations of the 2011 Davies Report on Board Diversity, with Ms Farr becoming the Group's first female Director. Ian Batey announced his resignation as an Independent Non-Executive Director, effective on 20 February 2014. The Group is grateful to Mr Batey for his services.

Dividends

In light of the Group's performance last year, the Board is recommending a final dividend of 11.51p per share (2012: 11.51p) and a special dividend of 9.15p per share (2012: £nil). Together with the interim dividend of 2.08p per share (2012: 2.08p), the total dividend for 2013 is 22.74p per share (2012: 13.59p), an increase of 67.3% over 2012.

Outlook

In 2014, the Group will continue to pursue its core strategic objective of improving returns on shareholders' capital whilst growing the business. We are looking forward to a year in which we will be fully re-opening all of the guest rooms at our largest hotel in Asia, the Grand Hyatt Taipei, before completing refurbishment of the public areas and restaurants and creating a truly outstanding five-star deluxe property. Elsewhere, we will continue to maximise the value of our real estate portfolio. We continue to be alert to acquisition and disposal opportunities.

The global economy is not fully restored to complete health, with pockets of uncertainty continuing to affect some travel destinations. However, we expect our properties in the main gateway cities to see improvements in 2014.

Group RevPAR was up 5.3% in the first six weeks of trading in 2014 on a reported currency basis, compared to the same period last year, with London down by 0.7%, New York up 5.8% and Singapore down 4.4%.

REGIONAL PERFORMANCE

For comparability, the following regional review is based on calculations in constant currency whereby 31 December 2012 average room rate and RevPAR have been translated at average exchange rates for the period ended 31 December. Full details are given in Appendices 1 and 2.

ASIA

SINGAPORE

REST OF ASIA

* % points

Singapore

Singapore continues to be a favoured destination for both leisure and business travellers and is positioning itself as a major new leisure destination through regeneration and investment in tourism infrastructure. This led to a significant increase in the number of available hotel rooms in 2013 and new room supply is forecast to grow at a CAGR of 4.4% for the next three years. In addition, slower growth in China had a dampening effect on corporate travel budgets last year. The net result of these two features was a fall in both average room rates and occupancy at our Singapore hotels in 2013. The increase in capacity has put demand on the pool of local management talent and together with the government's guest worker restrictions, driven up labour costs in general.

Rest of Asia

Year-on-year performance movement in Rest of Asia is mainly the result of two factors: the closure of rooms for refurbishment at Grand Hyatt Taipei and the impact of geo-political tensions between Japan and South Korea on Millennium Seoul Hilton. The west wing of Grand Hyatt Taipei was closed for refurbishment during the third quarter of 2012. The refurbishment was completed in the second quarter of 2013, at which point refurbishment of the east wing commenced. This second major refurbishment phase is scheduled to complete in the first half of 2014. The hotel had over 73,000 fewer room nights available in 2013 than 2012 - almost a quarter of the total. This has had a significant performance impact on the hotel. Grand Hyatt Taipei's re-opened and refurbished rooms achieved room rates that were 25% higher than the previous year.

Revenue from Millennium Seoul Hilton was lower last year mainly reflecting fewer Japanese visitors as a result of geo-political tensions. Management worked throughout the year to substitute Japanese business, which succeeded in restoring occupancy levels in the second half of the year, but at lower room rates. Millennium Seoul Hilton RevPAR was down by nearly 20% from 2012 as a result.

In the remainder of the Rest of Asia portfolio, Grand Millennium Kuala Lumpur performed well, with double digit RevPAR growth, reflecting sustained Malaysian economic growth and the location's increasing popularity for both leisure and business travellers. The Heritage Hotel Manila saw weaker performance in the second half of the year following the closure of its casino in July 2013. Grand Millennium Beijing was slightly down year-on-year due to a slowdown in the growth of the Chinese economy and lower Government spending on hospitality.

EUROPE

LONDON

REST OF EUROPE

* % points

London

Our London hotels continued their strong performance of recent years. Whilst the UK economic climate was subdued for most of 2013, the weak pound attracted more overseas visitors to the city. Management adjusted pricing strategies to reflect changes in the market's characteristics and the absence of the London Olympics, with revenue improvement driven mainly by increases in occupancy.

Rest of Europe

Performance in the majority of the Group's European hotels away from London was slightly down on 2012. Performance by our two Paris hotels reflected the uncertainty that continues to face the French economy. In the UK the performance was mixed. Whilst many of the UK's regional towns and cities have yet to participate in the perceived UK economic recovery, there were signs of improvement in our northern hotels, notably Aberdeen, Glasgow, Manchester and Newcastle.

US

New York

REGIONAL US

* % points

New York

Our New York properties - ONE UN, Millennium Hilton, Millennium Broadway Hotel shared in the positive performance of the New York hotel market in 2013 with RevPAR up 5.5% to £138.53 (2012: £131.28). Normalisation of occupancy levels in 2013 was the leading driver of the region's performance, with the newly refurbished West Tower of ONE UN - which was closed for five months during 2012 - achieving higher room rates.

Regional US

The regional US portfolio covers a wide geographical area which often results in mixed performance depending on the relative strength of local economies. The region's performance has also been influenced by closure of hotels for refurbishments or other reasons. Millennium Hotel Minneapolis re-opened in May 2013 following completion of its £15m refurbishment. Since re-opening the hotel has received positive reviews and has seen double digit rate growth compared to 2012, although this was not enough to offset the lost revenue during the closure period.

Management decided in early 2013 to reduce the number of rooms operating in Millennium Hotel St. Louis by 600 to 180. The hotel was subjected to a thorough review during the year, culminating in management's decision to close the hotel completely from January 2014. Closure of the hotel improved regional RevPAR performance and profitability.

Excluding the impacts of Millennium Hotel St. Louis and Millennium Hotel Minneapolis, regional RevPAR was slightly up. The largest gainers were Millennium Biltmore Hotel Los Angeles, Millennium Maxwell House Nashville and Millennium Knickerbocker Hotel Chicago, whilst Millennium Scottsdale Resort and Villas - which has been earmarked for refurbishment in 2014 - delivered the poorest performance. Millennium Bostonian Hotel Boston overcame the shock of the city's marathon bombing in April, to maintain a steady performance compared to 2012.

NEW ZEALAND

* % points

Increasing visitor numbers from China helped lift performance by our New Zealand hotels during 2013, raising both occupancy and room rate. Revenue was lower compared to the previous year because of the closure of Kingsgate Hotel Parnell Auckland in August 2012, and because of higher insurance receipts relating to the Christchurch earthquake in the 2012 comparatives. On a like-for-like basis, revenue increased by 4.1%. Demolition of the Copthorne Hotel Christchurch Central is now complete and the Group is in discussion with local authorities as to the future of the site, freehold of which is owned by the Group.

FINANCIAL PERFORMANCE

For the full year to 31 December 2013, profit before tax increased by 53.9% to £263.6m (2012: £171.3m) principally due to the recognition of the profits on the Glyndebourne project.

Financial Performance - Full year overview

Total revenue increased by 35.0% to £1,037.5m (2012: £768.3m) for the full year to 31 December 2013.

Operating profit increased by 64.9% to £230.4m (2012: £139.7m). The increase was due to £139.3m of operating profit being recognised in relation to the Glyndebourne project. When this is stripped out, the Group's operating profit fell by 34.8% to £91.1m. This fall was due to two main factors. Firstly, more challenging hotel markets in Singapore and parts of Asia caused a reduction in revenue and profit contribution in Asia. Secondly, a net 290,000 room nights were taken out of inventory during the year mainly due to the Group's ongoing refurbishment programme. The resulting fall in revenue and profit was particularly evident at Millennium Hotel Minneapolis and Grand Hyatt Taipei.

Profit from joint ventures and associates in the year increased to £38.1m (2012: £37.2m) due to additional contributions from CDLHT.

Basic earnings per share increased by 67.9% to 70.5p (2012: 42.0p)

Dividends

The Board is recommending a final dividend of 11.51p per share (2012: 11.51p) plus a special dividend of 9.15p per share (2012: £nil). Together with the interim dividend of 2.08p per share (2012: 2.08p), the total dividend of 22.74p per share represents an increase of 67.3% over last year's total dividend of 13.59p per share. The dividend is determined by the Board on the basis of growth in profit after tax as well as the Group's future investment needs. Subject to approval by shareholders at the Annual General Meeting to be held on 1 May 2014, the final and special dividend will be paid on 16 May 2014 to shareholders on the register on 21 March 2014.

Foreign exchange translation

The Company publishes its Group financial statements in sterling. However, the majority of the Company's subsidiaries, joint ventures and associates report their revenue, costs, assets and liabilities in currencies other than sterling. The Company translates the revenue, costs, assets and liabilities of those subsidiaries, joint ventures and associates into sterling and this translation of other currencies into sterling could materially affect the amount of these items in the Group's financial statements, even if their values have not changed in their original currencies. The above table sets out the sterling exchange rates of the other principal currencies in the Group. Sterling strengthened appreciably in 2013, particularly against the Japanese yen, the effect of which can be seen in the translation reserve on page 12.

Changes since 2012

Since the 2012 Annual Report, the Directors have reassessed the presentation of the income statement in light of the Group's continuing evolution and best reporting practice and have made a number of disclosure and categorisation amendments to the income statement, together with relevant comparatives. Notable changes are the inclusion of certain other income and expenses into operating profit and the exclusion of share of profit of joint venture and associates from operating profit. In addition, the Group is no longer using the term 'Headline operating profit' which was historically used. The Directors consider that these adjustments better reflect the commercial dynamics of the Group and facilitate comparison with peers. The amendments have no impact on revenue, profit before tax or profit for the year.

Financial Position and Resources

Non-current assets

Non-current assets have reduced year-on-year, principally due the depreciation and amortisation charge of £38.0m recorded in the income statement in 2013, and the impact of foreign exchange movements.

The Group states land and buildings at depreciated deemed cost, being their UK GAAP carrying value, including revaluations as at 1 January 2004, together with additions thereafter less subsequent depreciation or provision for impairment. Since 2005, external professional open market valuations on certain of the Group's hotel portfolio have taken place at each year end aiming to cover the entire Group's hotel portfolio over a three year period. Based on external valuations conducted at 31 December 2013 on 30.7 % (based on net book value) of the Group's hotel portfolio, a valuation surplus of £249.0m is estimated but this has not been recorded in the accounts. Revaluation surplus of £90.5m and £197.2m for 2011 and 2012 respectively were previously estimated but not recorded in the accounts.

Provisions and other liabilities excluding interest bearing loans, bonds and borrowings

The balance as at 31 December 2013 is £341.4m, which is 27% lower than as at 31 December 2012. This is principally due to a reduction in deferred income as the balance in respect of the Glyndebourne development has been recognised in 2013 as part of revenue (2012: deferred income of £115.4m relating to Glyndebourne).

Financial structure

Group interest cover ratio for the year ended 31 December 2013 (excluding share of results of joint ventures and associates, other operating income and expense, and non-operating income) is 49.0 times (2012: 22.9 times).

At 31 December 2013, the Group had £424.0m cash and £226.4m of undrawn and committed facilities available, comprising revolving credit facilities which provide the Group with financial flexibility. Most of the facilities are unsecured with unencumbered assets representing 87.4% of fixed assets and investment properties. At 31 December 2013, total borrowing amounted to £342.7m of which £77.2m was drawn under £99.0m of secured bank facilities.

Future funding

Of the Group's total facilities of £586.9m, £138.7m matures within 12 months comprising £9.2m committed revolving credit facilities, £122.5m of uncommitted facilities and overdrafts subject to annual renewal and £7.0m secured term loans. Plans for refinancing the facilities are underway.

Treasury risk management

Group treasury matters are governed by policies and procedures approved by the Board of Directors. The treasury committee monitors and reviews treasury matters on a regular basis. A written summary of major treasury activity is presented at each Board meeting.

2014 changes in accounting policy and presentation

IFRS 10 Consolidated Financial Statements which replaces requirements in IAS 27 Consolidated and Separate Financial Statements and SIC 12 Consolidation - Special Purpose Entities. It introduces new criteria to determine whether entities in which the Group has an interest should be consolidated. It will first be effective for the Group's 2014 accounts, and the implementation of IFRS 10 will result in the Group consolidating CDLHT which was previously treated as an associate undertaking and not consolidated. The financial impact on the Group as at 31 December 2013 if IFRS 10 had been adopted at that date would have been to increase assets by £405m, increase liabilities by £229m and increase total shareholders' equity by £176m. Consolidated profit after tax for the year ended 31 December 2013 would have increased by £30m, and consolidated profit after tax, attributable to equity holders of the parent would have decreased by £3.6m.

Consolidated income statement

for the year ended 31 December 2013

The financial results above derive from continuing activities.

¹ See Note 1 for details.

Consolidated statement of comprehensive income

for the year ended 31 December 2013

Consolidated statement of financial position

as at 31 December 2013

Consolidated statement of cash flows

for the year ended 31 December 2013

Consolidated statement of changes in equity

for the year ended 31 December 2013

Notes to the condensed consolidated financial statements

1. General information

Basis of preparation

The consolidated financial statements in this results announcement for Millennium & Copthorne Hotels plc ("M&C" or "the Company") as at and for the year ended 31 December 2013 comprise the Company and its subsidiaries (together referred to as "the Group") and the Group's interests in joint ventures and associates.

These primary statements and selected notes comprise the audited consolidated financial results of the Group for the years ended 31 December 2013 and 2012. This information set out in this results announcement does not comprise statutory accounts within the meaning of Section 435 of the Companies Act 2006 but represents extracts from them. These extracts do not provide as full an understanding of the financial performance and position, or financial and investing activities, of the Group as the complete Annual Report.

The comparative figures for the financial year ended 31 December 2012 are not the Company's statutory accounts for that financial year. Those accounts have been reported on by the Company's auditor and delivered to the Registrar of Companies. The report of the auditor was (i) unqualified, (ii) did not include a reference to any matter to which the auditor drew attention by way of emphasis without qualifying their report, and (iii) did not contain a statement under section 498 (2) or (3) of the Companies Act 2006. The consolidated financial statements of the Group as at and for the financial year ended 31 December 2012 are available from the Company's website at:

http://www.millenniumhotels.com/corporate/investors/annual-reports-archive.html

The consolidated financial statements of the Group were prepared in accordance with International Financial Reporting Standards ("IFRS") as adopted by the EU. The consolidated financial statements for the year ended 31 December 2013 were prepared by applying the accounting policies and presentation that were used in the preparation of the Group's published consolidated financial statements for the year ended 31 December 2012.

The financial statements were approved by the Board of Directors on 20 February 2014.

The financial statements were prepared on a going concern basis, supported by the Directors' assessment of the Group's current and forecast financial position, and forecast trading for the foreseeable future; and are presented in the Company's functional currency of sterling, rounded to the nearest hundred thousand.

The Directors have reassessed the presentation of the income statement in light of the Group's continuing evolution and best reporting practice and have made a number of disclosure and categorisation amendments to the income statement, together with relevant comparatives. Notable changes are the inclusion of certain other income and expenses into operating profit and the exclusion of share of profit of joint ventures and associates from operating profit. In addition, the Group is no longer using the term 'Headline operating profit' which was historically used. The Directors consider that these adjustments better reflect the commercial dynamics of the Group and facilitate comparison with peers. The amendments have no impact on revenue, profit before tax or profit for the year. Comparatives in the consolidated income statement and operating segment information for 31 December 2012 have been restated to reflect the change in definition.

Non-GAAP information

Net cash/debt and gearing percentage

An analysis of net cash/debt and calculated gearing percentage is provided in note 7 'Non-GAAP measures'.

Notes to the condensed consolidated financial statements

2. Foreign currency translation

The Company publishes its Group financial statements in sterling. However, the majority of the Company's subsidiaries, joint ventures and associates report their revenue, costs, assets and liabilities in currencies other than sterling. The Company translates the revenue, costs, assets and liabilities of those subsidiaries, joint ventures and associates into sterling, and this translation of other currencies into sterling could materially affect the amount of these items in the Group's financial statements, even if their values have not changed in their original currencies. The following table sets out the sterling exchange rates of the other principal currencies of the Group.

3. Operating segment information

Disclosure of segmental information is principally presented in respect of the Group's geographical segments.

Segment results, assets and liabilities include items directly attributable to a segment as well as those that can be allocated on a reasonable basis. Unallocated items principally comprise: interest-bearing loans, borrowings, cash and cash equivalents, net finance expense, taxation balances and corporate expenses.

Geographical segments

The hotel and property operations are managed on a worldwide basis and operate in seven principal geographical areas as follows:

· New York

· Regional US

· London

· Rest of Europe (including the Middle East)

· Singapore

· Rest of Asia

· Australasia

The segments reported reflect the operating segment information included in the internal reports that the Chief Operating Decision Maker ("CODM"), which is the Board, regularly reviews.

The reportable segments are aligned with the structure of the Group's internal organisation which is based according to geographical region. Discrete financial information is reported to and is reviewed by the CODM on a geographical basis. Operating segments have Chief Operating Officers ("COOs") or equivalent who are directly accountable for the functioning of their segments and who maintain regular contact with the Chief Executive Officer and Chairman of the CODM to discuss the operational and financial performance. The CODM makes decisions about allocation of resources to the regions managed by the COOs.

Notes to the condensed consolidated financial statements

3. Operating segment information (continued)

Notes to the condensed consolidated financial statements

3. Operating segment information (continued)