John Keells Hotels PLC, which operates the John Keells group’s non-city resort hotels in Sri Lanka and the Maldives, saw its net profit for the quarter ended September 30, 2017 (2Q18) falling 71 percent year-on-year (YoY) to Rs.100.6 million, amid a top line slowdown due to lower room inventory.
The earnings per share fell to 7 cents from 24 cents.
The company closed its four-star, 133-key Bentota Beach Hotel for redevelopment in July and once it is completed in about two-and-a-half years, it will become a five-star establishment with 150 rooms.
According to Bartleet Religare Research, the Maldivian resort segment also operated with 25 percent less room capacity during the quarter due to refurbishment activities.
As a result, the performance of both the Sri Lankan and Maldivian segments declined during the quarter under review, compared to the previous year.
The Sri Lankan resort segment recorded an after-tax profit of Rs.186.7 million, down from Rs.205.3 million YoY and the Maldivian segment posted an after-tax loss of Rs.82.8 million, against an after-tax profit of Rs.144 million.
Revenue of the Sri Lankan resort segment fell to Rs.1.4 billion from Rs.1.5 billion YoY, while for the Maldivian segment, revenue fell to Rs.1.2 billion from Rs.1.4 billion.
The total revenue for the quarter fell 15 percent YoY to Rs.2.5 billion.
For the six months ended September 30, 2017, John Keells Hotels recorded a net loss of Rs.130.2 million, against a net profit of Rs.432.7 million. The loss per share was 9 cents.
John Keells Holdings PLC holds a 80.32 percent stake in the company, while the state-run private sector pension fund, the Employees’ Provident Fund, holds 5.39 percent as the second largest shareholder.