SINGAPORE - A BET on big spending by Manchester United supporters has turned sour for mainboard-listed Rowsley.
The hospitality group, controlled by billionaire Peter Lim, today warned that it expects to post a pre-tax loss for the year ended Dec 31 based on a preliminary review of its fourth quarter results.
The loss is mainly attributable to:
* Impairment on goodwill arising from the acquisition of RSP Architects, Planners and
Engineers (Pte) in 2013, due to the weak property market in Singapore; and
* Impairment of investment value in the UK hospitality assets due to lower than expected
revenue from Old Trafford Supporters Club and GG Hospitality Management.
Rowsley announced to great fanfare in 2015 that it was embarking on a new strategy in the hospitality business with the acquisitions of a hotel, cafe and hotel management company owned by the famed Class of 92 Manchester United footballers, which includes Gary Neville and Ryan Giggs plus the former's brother Phil Neville, Paul Scholes and Nicky Butt.
Rowsley said it would pay £29.1 million (S$63 million at the prevailing exchange rate then) for a 75 per cent shareholding in each of three companies.
They hold the assets of Hotel Football, a 133-room soccer-themed luxury boutique hotel located strategically across Manchester United's homeground Old Trafford stadium; Café Football, a 120-seat restaurant in east London; and GG Collections, a hotel management company that manages Hotel Football and Café Football.
The stakes had come from Mr Lim, who also owns Valencia soccer club in Spain, and the five former Manchester United stars.
An ST report then had described Hotel Football as an inviting, surprising and playful venue for the ultimate match day experience.
While prices are not cheap with rooms on match day against a top opponent costing upward of £250, fans are allowed entry into the Old Trafford Supporters Club, which has space for 750 people, located in the basement for a nominal £1 which will go to local charities.
Besides its prime location next to the Theatre of Dreams, the hotel also boasts a rooftop futsal pitch, a panoramic view of the city, and a cafe menu designed by a chef with two Michelin stars.
In its statement today, Rowsley said the group remains confident of its business model, in particular, its investments in RSP and the growth potential of its UK hospitality assets.
Rowsley shares ended 1.5 per cent lower at 13 cents. The profit warning came out after the market closed.