"Only limited business possible during renovation"
Tal Lanka Hotels PLC has posted a loss after tax of Rs.529 million in the year ended March 31, 2014 against a profit of Rs.221 million the previous year with revenues impacted by the major renovation project undertaken in the financial year 2013/14 between April and October last year.
The company’s Chairman Mr. Raymond Bickson, said that the project involved renovation of guest rooms in the fourth, sixth and seventh floors, lobby, arrival area and bar at a cost of US$ 15.27 million.
This is the first loss posted by the company since 2009/10 when a loss of Rs.36.4 million was incurred.
"Due to the project only limited business operations were possible during the renovation period and this impacted the company’s revenue and profitability," Bickson explained.
The gross earnings during the year had fallen to Rs.1.29 billion from the previous year’s Rs.1.94 billion and the company incurred a gross loss of Rs.143 million against a gross profit of Rs.556 million the previous year due to this renovation.
Bickson said that the country was on course to develop into a major tourist destination with arrivals crossing the one million mark during the year.
"The company is now well poised to exploit this opportunity by positioning the hotel as one of the leading hotels in Sri Lanka. The company is also well placed to compete against international hotel brands that are expected to launch in Sri Lanka," he said.
Leading industry consultants continued to forecast a demand–supply gap in hotel room inventory, a situation that will be beneficial for existing hotels, Bickson said.
"However challenges exist in development of the industry, such as the need for more trained staff, improving service standards and to better promotional efforts particularly in non-traditional markets," he added.
The government had accorded priority to the tourism sector both to push economic growth and earn foreign exchange. The ongoing mega projects in the hotel sector were expected to raise the capacity in the industry to meet requirements of the targeted tourist arrivals, he said. Hence the timely completion of these projects is vital.
"The tourism development strategy continues to support the President’s vision of attracting 2.5 million visitors by 2016 with additional objectives of attracting US$3 million of FDI and increasing tourism related employment to 500,000 by the year 2016," Bickson concluded.
The company announced that as it intends to undertake extensive refurbishment of banqueting facilities in the coming year, due to operational requirements they were constrained to suspend the traditional annual shareholder lunch until further notice.
"We thank you for your support and understanding in this regard," the management said, in the annual report.
Net assets per share were down to Rs.12.81 from Rs.16.69 the previous year but the share closed at Rs.39 against the previous year’s Rs.25.
The directors of the company are: Messrs. R.N.E. Bickson (Chairman), A.P. Goel, U.L. Kadurugamuwa, B.K. Chaudhary, R.K. Chaudhary, T. de Zoysa, V.V. Singh, Ms. D.M.. Harris, Dr. G. Sundaram, V. Govindasamy, S. Joshi and C. Subramanian (Alternate to R.K. Chaudhary).
www.island.lk
Tal Lanka Hotels PLC has posted a loss after tax of Rs.529 million in the year ended March 31, 2014 against a profit of Rs.221 million the previous year with revenues impacted by the major renovation project undertaken in the financial year 2013/14 between April and October last year.
The company’s Chairman Mr. Raymond Bickson, said that the project involved renovation of guest rooms in the fourth, sixth and seventh floors, lobby, arrival area and bar at a cost of US$ 15.27 million.
This is the first loss posted by the company since 2009/10 when a loss of Rs.36.4 million was incurred.
"Due to the project only limited business operations were possible during the renovation period and this impacted the company’s revenue and profitability," Bickson explained.
The gross earnings during the year had fallen to Rs.1.29 billion from the previous year’s Rs.1.94 billion and the company incurred a gross loss of Rs.143 million against a gross profit of Rs.556 million the previous year due to this renovation.
Bickson said that the country was on course to develop into a major tourist destination with arrivals crossing the one million mark during the year.
"The company is now well poised to exploit this opportunity by positioning the hotel as one of the leading hotels in Sri Lanka. The company is also well placed to compete against international hotel brands that are expected to launch in Sri Lanka," he said.
Leading industry consultants continued to forecast a demand–supply gap in hotel room inventory, a situation that will be beneficial for existing hotels, Bickson said.
"However challenges exist in development of the industry, such as the need for more trained staff, improving service standards and to better promotional efforts particularly in non-traditional markets," he added.
The government had accorded priority to the tourism sector both to push economic growth and earn foreign exchange. The ongoing mega projects in the hotel sector were expected to raise the capacity in the industry to meet requirements of the targeted tourist arrivals, he said. Hence the timely completion of these projects is vital.
"The tourism development strategy continues to support the President’s vision of attracting 2.5 million visitors by 2016 with additional objectives of attracting US$3 million of FDI and increasing tourism related employment to 500,000 by the year 2016," Bickson concluded.
The company announced that as it intends to undertake extensive refurbishment of banqueting facilities in the coming year, due to operational requirements they were constrained to suspend the traditional annual shareholder lunch until further notice.
"We thank you for your support and understanding in this regard," the management said, in the annual report.
Net assets per share were down to Rs.12.81 from Rs.16.69 the previous year but the share closed at Rs.39 against the previous year’s Rs.25.
The directors of the company are: Messrs. R.N.E. Bickson (Chairman), A.P. Goel, U.L. Kadurugamuwa, B.K. Chaudhary, R.K. Chaudhary, T. de Zoysa, V.V. Singh, Ms. D.M.. Harris, Dr. G. Sundaram, V. Govindasamy, S. Joshi and C. Subramanian (Alternate to R.K. Chaudhary).
www.island.lk
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