Shangri-La Asia posts 28.1% fall in H1 net profit on higher operating costs
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Revenue rose as hotel occupancy increased year-on-year, from a low base in the first half of 2023.
ST PHOTO: KUA CHEE SIONG
Yong Jun Yuan
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SINGAPORE – Hotel group Shangri-La Asia posted a 28.1 per cent decline in net profit to US$94.5 million ($123.4 million) for the half-year ended June 30, from US$131.4 million a year ago.
This came despite revenue rising 4.3 per cent to US$1.05 billion, from US$1 billion a year earlier over the same period.
In its results released on Aug 23, the company attributed the drop in net profit to higher operating costs and a year-on-year decrease in gains of non-operating items.
It noted that earnings before interest, tax, depreciation and amortisation fell 3.8 per cent to US$381.5 million due to higher costs in the company’s hotel business.
Meanwhile, revenue rose as the company’s hotel business further recovered. Occupancy increased year on year, from a low base in the first half of 2023, it said.
By geography, the company’s best-performing market was Sri Lanka, where revenue rose 44 per cent to US$20.3 million.
France was the company’s worst-performing market as revenue from there declined 7.6 per cent to US$25.6 million.
Mainland China continued to be the largest contributor to the company’s revenue. Revenue generated from this market fell 0.5 per cent to US$326.9 million.
In the next year, the group will continue to expand its footprint, especially in mainland China, it said.
The company’s dual-brand JEN Kunming by Shangri-La was launched in April 2024. It serves as a pilot for having two brands in a single building, with Shangri-La Kunming expected to debut in 2025.
“This approach allows us to cater to diverse market segments and maximise occupancy and revenue potential,” the company said.
Meanwhile, Shangri-La Asia opened Shangri-La Nanshan, Shenzhen, in 2024 and expects to debut its dual-brand Shangri-La and Traders Hongqiao in early 2025. Shangri-La Zhengzhou is slated to open in 2026.
The company’s board has declared an interim dividend of HK$0.05 per share for the half-year, to be paid on Oct 8.
No dividend had been declared for the corresponding period a year ago.
Shares of Shangri-La Asia closed flat at HK$4.95 on Aug 23 before the results were released. THE BUSINESS TIMES
