Asian Hotels and Properties PLC (AHPL), the Colombo-centric hotel operating and property development arm of the country’s largest conglomerate John Keells Holdings PLC (JKH), saw its September quarter profit (2Q18) falling 25 percent year-on-year (YOY) to Rs. 410.7 million.
AHPL’s profit contraction was due to lower business at its two 5-star city hotels Cinnamon Grand and Cinnamon Lakeside during a challenging quarter (2Q17) for the entire tourism industry, when tourism arrivals to the country fell by 0.5 percent YoY.
Earnings per share of AHPL for 2Q17 fell to Rs. 0.93 from Rs. 1.23 YoY.
AHPL’s revenue during 2Q17 fell 3 percent YoY to Rs. 2.29 billion, while the cost of sales increased 9 percent YoY to Rs.992.6 million. This resulted in gross profits falling 11 percent YoY to Rs. 1.3 billion.
The asset base of AHPL fell marginally to Rs.39 billion while the net assets per share fell to Rs.74 from Rs.75 at the start of the financial year. For the first half of the current financial year, AHPL’s net profits fell 22 percent YoY to Rs. 690.8 million with earnings per share deteriorating to Rs. 1.5 from Rs. 2 YoY.
Revenue for the period fell 2 percent YoY to Rs. 4.2 billion, while cost of sales increased 7 percent YoY to Rs. 1.8 billion.
The hotel segment revenue recorded a 2 percent decline to Rs.4 billion, while revenue from the property development segment increased 0.5 percent YoY to Rs. 205.7 million.
Net profits from the hotels fell 25 percent YoY to Rs. 677.92 million, while net profits from property development increased 9 percent YoY to Rs.138 million.
AHPL’s property development includes a number of residential and commercial properties.
The firm’s top shareholder John Keells Holdings PLC owns 78.56 percent of total shares of AHPL, while the government owns approximately 16.62 percent shares in the company through various state-owned enterprises and public retirement funds.