Sri Lanka’s Serendib Hotels loss widens in Sept quarter
ECONOMYNEXT – Losses at Sri Lanka’s Serendib Hotels group widened to 70 million rupees in the September 2019 quarter from a year ago as occupancy levels remained low after April’s bombings, interim accounts showed.
Group sales fell 35 percent in the quarter with the loss per share rising to 63 cents. The share last traded at 19.20 rupees.
In the six months to September 2019, the loss per share was 1.37 rupees with net losses up slightly to 152 million rupees while sales fell 32 percent to 535 million rupees.
Malinga Arsakularatne, Executive Director of Serendib Hotels, said rates across all properties were dropped during the period to boost occupancy which plunged after April’s bombings of three hotels and three churches.
The attacks killed over 250 people, including 44 foreigners.
Serendib Group hotels recorded an average occupancy of 56 percent across its hotels during the quarter, twenty-one percentage points below the occupancy achieved in the same quarter last year.
“The tourism industry showed signs of recovery during the period of July to September, with the gap in arrivals against the corresponding months last year gradually decreasing over each month,” Arsakularatne said.
“However, a longer time period is expected for selling rates in the market to revert to previous levels.
Consequently, while volumes have begun to gradually pick up at our hotels, selling rates continue to be challenged, causing a downward trend in overall revenue.”
Arsakularatne said his outlook for the rest of the year remains conservative.
“Our hotels will however continue its promotional offerings in the next few months to push volumes, while scaling back expenditure; and will seek to capitalize on the upcoming winter season.”
Serendib Hotels, part of Hemas group, owns and manages four properties in different parts of the island – Avani Bentota Resort & Spa, Club Hotel Dolphin Waikkal, Hotel Sigiriya, and Lantern Beach Collection Mirissa.
Serendib Leisure Management Limited, a fully owned subsidiary of Serendib Hotels, manages Villa 700 Induruwa and took over the management of Tri Lanka Koggala on 1st May 2019, as well as the provision of marketing services for Stafford Bungalow Nuwara Eliya.
It ceased its management of Avani Kalutara Resort with effect from 31st May 2019.
Following these changes, Serendib Leisure Management Limited currently provides management and marketing services to a total inventory of 346 rooms, a note to the accounts said.
(COLOMBO, 05 November 2019)