Resort operator hurt by political situation in Thailand, H1N1 outbreak
BANYAN Tree Holdings has reported a loss attributable to shareholders of $4.2 million for the second quarter ended June 30 – down from a $3.5 million profit a year back – as the unstable political situation in Thailand was compounded by the H1N1 flu outbreak and economic weakness.
But the resort operator expects a better performance for the second half-year.
Second-quarter revenue fell 44 per cent to $59.8 million on lower contributions from some business segments.
Revenue from hotel investment dropped 15 per cent to $32.4 million year on year, as resorts in Thailand and the Maldives reported lower revenue. However, this was partly offset by the stronger performance of Banyan Tree’s China resorts.
Sales of hotel residences and other property contributed a total of $11 million, down 78 per cent year on year. And this segment is expected to recover more slowly than others.
Revenue from hotel management increased $1.7 million year on year to $5.7 million. But seven new hotels opening in the next 12 months will bolster this segment.
Spa revenue rose 3 per cent to $6.2 million for the second quarter, while revenue from design fees and the ‘others’ segment fell 38 per cent to $3.3 million.
Gallery sales dropped 69 per cent to $1.2 million.
Banyan Tree chief executive Ho Kwon Ping said: ‘We are hopeful that our business segments will further pick up in the second half, with the continuing stabilisation of the global economy and the Thai political situation. This is supported by the encouraging recovery trend we see in our hotels’ forward bookings.’
Forward bookings for the third quarter are now 8 per cent below the level for Q3 last year, as opposed to 19 per cent for Q1 2009 and 12 per cent for Q2.
The resort operator has saved $25 million through cost-cutting measures.
In the stock market yesterday, the Banyan Tree counter finished eight cents higher at 78 cents.
Source : Business Times – 14 Aug 2009
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