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Quarterly data takes shine off financial standing of Amman’s Four Seasons Hotel

By Samir Ghawi - Jun 24,2015 - Last updated at Jun 24,2015

At the end of 2014, METICO was owned by 25 Arab and foreign shareholders who accounted for 33.2 per cent of the capital while 132 Jordanians controlled the remaining 66.8 per cent (Photo courtesy of

AMMAN —  Lower earnings and profits during the first quarter (Q1) of this year took the shine off  the rock-hard annual 2014 and 2013 financial results at Mediterranean Tourism Investment Company (METICO).

METICO, a public shareholding company that owns the Four Seasons Hotel in Amman, earned JD3.9 million during the first three months of this year, 7.1 per cent less than the JD4.2 million earned during the same period in 2014.

The 193 rooms generated JD2.3 million of total earnings, with food and beverages bringing in JD1 million and “others”  JD0.6 million.

Gross profit generated from the hotel’s operations amounted to JD1.1 million, compared to JD1.3 million.

After taking into consideration administrative and general expenses, depreciation, other income and other expenses, the net profit after-tax came at JD0.4 million during January-March 2015, down from 0.5 million in the first quarter of the previous year.

Based on the changes to the Income Tax Law effective from the start of 2015, the tax rate was adjusted to 20 per cent for the first quarter of this year from 14 per cent during the same period of last year.

The company’s income statement as of December 31, 2014, showed a JD19.3 million in overall earnings, 3.8 per cent higher than the JD18.6 million registered in 2013.

According to notes accompanying the auditor’s financial statements, the earnings from hotel operations were derived mainly from rooms and food which amounted to JD10.1 million and JD5.3 million respectively.

Income from beverages came at JD1.3 million and from renting party halls at JD0.4 million. Under “other income”, the earnings were JD2.2 million.

By comparison, the earnings in 2013, were JD9.8 million from rooms, JD5.0 million from food, JD1.2 million from beverages, JD0.4 million from rentals, and JD2.1 million from “other income”.

Last year’s gross operating profit and the net profit after tax stood at JD6.5 million and JD3 million respectively, slightly down from the previous year.

METICO Chairman Abdul Qader Al Qadi wrote in the 18th annual report that the JD6.5 million operational profit was achieved despite higher costs that resulted from increases in energy prices, staff salaries and taxes.

Qadi described the JD3 million net profit as the highest among hotel companies in Jordan.

In a foreword, the chairman indicated that the occupancy rate at the Four Seasons Hotel rose from 74.2 per cent in 2013 to 76.7 per cent in 2014, noting that the average rate at other 5-star hotels in Amman was 60.64 per cent, down from 61.53 per cent in 2013.

He said that the average room rate in 2014 was JD187.68 compared to JD188.28 in the previous year, while the average rate at 5-star hotels in Jordan was JD125.50, down from JD132.78 in 2013.

As such, the report revealed that the average room profitability was JD97 compared to JD45 at other 5-star hotels.

“The hotel was able to increase its market share in terms of room occupancy, topping all competitors, and was at the forefront in terms of earnings from food and beverages, or income from catering,” it said.

The balance sheet as of March 31, 2015, showed total assets at JD52.2 million, of which JD42.7 million was the net value of property and equipment.

Financial assets at fair value amounted to JD1 million representing investments in shares of Al Dawliyah for Hotels and Malls (JD0.6 million), and Arab Jordan Investment Bank (JD0.4 million) which are listed on Amman Bourse, and a Jordanian company for hotel and tourism education, which is not listed on the stock exchange.

Current assets totalled JD8.4 million, JD0.5 million of which were receivables and JD6.8 million was cash in hand and at AJIB, which owns a 9.6 per cent stake in METICO.

Total equity at the end of March 2015 stood at JD49.1 million comprising JD45 million capital, JD3.2 million mandatory reserve besides other reserves and profit.

Liabilities totalled JD3.1 million.

According to notes accompanying the auditor’s 2014 financial statements, METICO earned JD0.2 million in bank interest last year as “the JD5.2 million six-month term deposit at a local bank was carrying a 3-5.5 per cent annual interest rate”.

Reflecting the company’s healthy financial standing and profitability, the general assembly of shareholders agreed to disburse JD2.7 million in cash dividends at a rate of 6 per cent for the year 2014, unchanged from the previous year.

At the end of 2014, METICO was owned by 25 Arab and foreign shareholders who accounted for 33.2 per cent of the capital while 132 Jordanians controlled the remaining 66.8 per cent.

Main shareholders were Abdul Qader Al Qadi, Mahmoud Zuhdi Malhas, and Mahmoud Khalil Abulrub who respectively owned 15.7 per cent, 23.6 per cent and 11.2 per cent equity. AJIB had a 9.6 per cent stake and Sheikh Hamad Bin Jassem Bin Jaber Al Thani followed with 6.6 per cent.

Out of 403 employees who worked at the Four Seasons Hotel at the end of 2014, 12 were foreigners.

As per the agreement signed with the Canadian international luxury, five-star hotel management for 15 years from 2003 when the Amman hotel began actual operations, METICO has to pay Four Seasons Holdings Inc. management expenses at the rate of 0.25 per cent of total operational earnings, and concession fees at the rate of 0.05 per cent of total operational earnings.

METICO also has to pay 1.75 per cent of total operational earnings as consultation expenses, 9 per cent as operational expenses, 0.87 per cent as marketing fees and 0.6 per cent as promotional fees.


Last year’s financial statements of Amman’s Four Seasons Hotel show JD1.1 million as expenses related to management fees for Four Seasons Holdings Inc. and also JD1 million as payables due to the Canadian management.

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