London hotel values were reduced by pounds 31m and pounds 152m was erased from the worth of other UK properties. The remainder was split pounds 88m in the US and pounds 141m in the rest of the world.
Mark Finnie, analyst at NatWest Markets, said: 'The extent of the property write-down caused surprise, since Forte told us that it (valuation) was all done conservatively last year.' The reduction in values in 1992/3 was pounds 344m.
However, Rocco Forte, chairman of Forte, said a total value of pounds 3.4bn for property and fixed assets did not represent the real worth of the portfolio as a whole, the underlying value of the business or the longer- term economic value of properties.
Some pounds 88m of the write-down was charged to the profit and loss account, but was more than offset by pounds 122m of gains from disposals. Pre-tax profits, excluding exceptional items, improved from pounds 71m to pounds 87m - in line with stock market expectations.
The final dividend is 4.75p, holding the total at 7.5p. Earnings per share, excluding the exceptional credit, were 6.8p.
While the company is keen to expand overseas, Mr Forte said: 'Our concentration is sweating what we've got. In terms of recovering to previous profit levels and beyond, we don't need to do anything else.
'We want to develop internationally. If anything comes on to the market we will look at it.' Forte, recently beaten by Sheraton in its attempt to take over Ciga in Italy, has bid for Air France's Meridien chain.
Forte's operating profits in 1993/4 improved 12 per cent to pounds 162m. Virtually all the gain was attributable to the UK, which lifted its contribution by pounds 20m to pounds 149m.
Profits in Europe fell pounds 4m to pounds 14m and the US lost pounds 1m, having broken even the year before. The rest of the world broke even, after losing pounds 2m previously.
Forte, which refuses to disclose occupancy levels and room rates, said underlying sales growth in hotels worldwide was 3 per cent and underlying profits growth 14 per cent.
Underlying profits from London hotels, which include the upmarket Browns, the Hyde Park and the Grosvenor House, climbed 31 per cent to pounds 47m. Provincial hotels also made pounds 47m, up from pounds 42m.
Half the business for London hotels is from overseas. 'We saw some growth from the American market last year,' Mr Forte said.
European trading remains depressed, and sales also dipped in the US.
Forte's restaurant businesses, which include Little Chef and Harvester, made pounds 63m with the aid of pounds 8m from acquisitions. The result compared with pounds 51m the year before.
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