Hongkong and Shanghai Hotels, the profit-challenged owner of the luxurious Peninsula hotels, has higher hopes for the second half as the peak season for tourism and mooncakes looms.
The hotelier, controlled by the Kadoorie family, saw underlying profit slide 62 per cent to HK$182 million in the first six months after corporates reined in travel budgets and swine flu dampened tourist arrivals.
The industry woes were expected to linger after denting occupancy and room rates across Peninsula hotels in Hong Kong, New York, Chicago, Beverly Hills, Tokyo, Bangkok, Beijing and Manila and the Quail Lodge golf resort in California.
'The immediate outlook of our hotel business will remain soft across our main markets, even though we have recently seen some moderate pick-up in business at the Peninsula Hong Kong,' chief executive Clement Kwok King-man said yesterday. 'The pick-up is short-term and quite last-minute.'
The company's net profit slumped 71 per cent to HK$462 million, or 32 HK cents per share, after including various exceptional items such as the revaluation surplus of its investment properties.
Turnover shrank 18 per cent to HK$1.96 billion as revenue per available room, a measure of profitability for hotels, slipped 31 per cent in both Hong Kong and the United States and fell 32 per cent in the rest of Asia.
In Hong Kong, the landmark Peninsula hotel saw its average rate shrink 3.52 per cent to HK$3,915 per room per night as occupancy fell 21 percentage points to 52 per cent in the first half because of the combined effects of the downturn and swine flu.