re: what...no one reporting back - magoo Hi SCD,I may have...

re: what...no one reporting back - magoo Hi SCD,

I may have misheard that figure at the AGM. In any case, a colleague spoke to ETC this morning regarding some of their $$ values.

While ETC isn't ready to release official annual room rates (they're currently being audited/finalised) their corporate relations mngr made the following comments:

- They're generating around $2.50-$3.67 per room per night in Australia - although no offical average room rate or annual rate has been quoted. However, if you say $2.50 per night for 255 nights (70% room occupancy), that's AUD$640 per room per year.

- Regarding their Rydges deal in Australia, they have rolled out to 1,450 rooms of a 4,000 room deal whereby they receive a GUARANTEED $1 per room per night. Apparently this is guaranteed for 7 years. Small bikkies really, but nice to have as a back stop.

- Now, the value of each US room is said to be higher both in terms of dollars per room and room occupancy. Once again no official figure was quoted. However this may be where the $785 was discussed at the AGM - as a rough estimate.

To keep it simple, even if you assume a room rate of $640 aussie per year x total rooms to 57,000 (including additional 25,000 by end of year target), that's AUD$36.5 mill without factoring "much more" for the US market or US dollar.

By the way, I am told the value of the IHG contract extension (from 4-7 years) is US$5 million over those three years. I thought they said $9mill at the AGM so I'll have to clarify - could have been for the total term.

In terms of revenue forecast, you said you expect ETC to earn approx $3m iin the current quarter based on current number of rooms (32,000) and I agree. My calculations are based on the following:

1450 Rydges rooms (before rolling out the balance of 4000 rooms) with guaranteed $1 per night = $132,000 guaranteed
+
$1.50 per night for 70% of those rooms = $139,000
+
30,500 US rooms @ 70% occupancy (so 64 nights a quarter) @ AUD$2 per night = $2.7 mill

So, based on their target of 57,000 rooms by the end of the year, I'm reckoning we'll see a March 06 quarterly revenue of around $5mill – and that’s at my AUD$2 per room for 70% occupancy rate – I actually wouldn’t be at all surprised to see it come in closer to double once you factor a (likely) higher room rate, in US dollars, for the majority of the rooms.

Sheesh, time for another hot totty!