Sri Lanka's Serendib Hotels losses more than double in June quarter
Aug 14, 2017 14:20 PM GMT+0530 | 0 Comment(s)
ECONOMYNEXT – Sri Lanka’s Serendib Hotels group losses more than doubled to Rs72 million in the June 2017 quarter from a year ago with occupancy levels lower amid stiff competition from other hotels and informal accommodation.
Sales of the firm, part of the Hemas Holdings group, fell three percent to Rs303 million, according to interim accounts filed with the stock exchange.
The loss per share was 65 cents compared with 30 cents the year before. The Serendib Hotels share last traded at Rs24.10 Monday.
Serendib Hotels Executive Director Malinga Arsakularatne said the group had an average occupancy of 60% during the quarter under review, down 7 percent from last year.
“However, the loss in room nights was compensated by a 10% increase in the average room rates in rupee terms,” he said.
Club Hotel Dolphin achieved an occupancy of 66% and Avani Bentota achieved 59%, while Sigiriya achieved only 49%.
Arsakularatne said losses were also because of increased food and beverage costs, largely due to an increase in the all-inclusive package mix particularly in Club Hotel Dolphin.
Bad debt and other one-off provisions, higher IT-related expenses and amortization due to new systems implementations, and business development expenses also contributed to losses.
“While the industry is set to grow in terms of supply as well as demand, we expect the rest of the financial year to continue to be challenging,” Arsakularatne said.
“There seems to be an increasing trend towards the emerging traveler seeking alternative types of accommodation such as boutique hotels and villas, backpacking lodges etc, at the expense of the traditional tourist seeking mainstream hotels and resorts.”
The Serendib Hotels group comprises of Serendib Hotels and its subsidiaries, Dolphin Hotels, Hotel Sigiriya and Serendib Leisure Management Ltd.
It also manages AVANI Bentota Resort & Spa, AVANI Kalutara Resort, Club Hotel Dolphin and Hotel Sigiriya with a total of 413 rooms.
Jada Resorts & Spa (Pvt) Ltd., the owning company of Avani Kalutara, is treated as an investment and its earnings were not included in the accounts.
(COLOMBO, August 14, 2017)