China Travel looks to Taiwan after profit soars

PUBLISHED : Saturday, 28 August, 2010, 12:00am
UPDATED : Saturday, 28 August, 2010, 12:00am

China Travel International Investment Hong Kong hopes closer cross-strait ties will further boost the company's bottom line after reporting net profit surged 386.9 per cent in the first half.

General manager Xu Muhan said the tourism sector on both sides of the Taiwan Strait expected the mainland government to allow individual tourism. But he added that the central government had yet to make an official announcement 'although China Travel has prepared well [to exploit the opportunity]'.

The company yesterday reported net profit for the first six months of the year rose to HK$65.34 million from HK$13.42 million a year earlier. Revenue swelled to HK$2.33 billion from HK$1.89 billion. No interim dividend was recommended.

'Despite a steady recovery [in] the tourism industry, the industry sees fierce competition and the [rapid] change of market conditions [in the second half],' chairman Zhang Xuewu said in a statement.

The company planned to boost business through increasing operations in new areas, including Taiwan.

Some mainland reports said earlier the central government had approved Beijing, Shanghai, Tianjin, Chongqing and Nanjing as trial cities for individual visits to Taiwan.

Shao Qiwei, the president of the Cross-Strait Tourism Exchange Association, told Xinhua last week the mainland government was positive about allowing individual mainland tourists to travel to Taiwan, but a lot of preparatory work must be done in advance. 'The two sides would have to amend the travel agreement signed in June 2008 as it only covered package tours,' Shao said.

In May, Taiwan opened a tourism office in Beijing and the mainland's Cross-Straits Tourism Exchange Association is due to open its offices in Taiwan.

The absence of official ties means any travel problems and tourist disputes have to be handled informally by the two offices.

According to industry website Global Travel Industry News, Taiwan began allowing mainlanders to visit in group tours since July 2008. Since then, Taiwan has received about one million mainland visitors. The mainland now records about four million Taiwanese visitors annually.

Taking off

China Travel's net rose 386.9 per cent amid a recovery in the industry

The amount of earnings the travel company booked for the first six months of the year, in HK$: $65m