Asian Hotels dividend up despite marginal dip in revenue and profits

Partial closure of Cinnamon Lakeside for seven months affects performance

June 25, 2016, 8:03 pm 

Cinnamon Grand Lobby

Mr. Susantha Ratnayake, Chairman

Asian Hotels and Properties PLC, the JKH subsidiary owning the Cinnamon Grand and Cinnamon Lakeside Hotels as well as the Crescat Boulevard has seen a slight dip in both revenue and profitability in the year ended March 31, 2016, primarily due to the partial closure of Cinnamon Lakeside for essential enhancements and upgrades during the first seven months of the year under review.

The Company’s Chairman, Mr. Susantha Ratnayake, has told shareholders in the annual report that the Group is looking at a future "that will undoubtedly be competitive, but one which also promises to be exciting."

"With tourism continuing to retain its title as the fastest growing industry in the world, Sri Lanka continues to retain its status as an emerging hot spot for the global traveler," he said in the company’s recently released annual report.

Sri Lanka Tourism has targeted 2.2. million visitors this year with an annual growth of 22% and an increase in average daily expenditure of a tourist to USD 200 which is expected to drive total tourism revenue to USD 2.75 billion.

The year under review saw Asian Hotels post total revenue of Rs. 8.07 billion, down 2 % from a year earlier, with profit after tax at Rs. 2.2 billion, down 3% from the previous year. However, the Company has pushed up its dividend payment for the year to Rs. 5.50 per share from Rs. 4 per share the previous year.

Ratnayake said that both the Cinnamon Grand and Cinnamon Lakeside Hotels had continued to maintain their pre-eminent position among the city hotels with their signature restaurants and banquet spaces.

Reporting 1.79 million tourist arrivals in the calendar year 2015, up 17.8 % from the previous calendar year, he said that Western Europe was the largest regional contributor of traffic with arrivals up 15.3 % year-on-year to 552, 442. India continues to be the largest single-source market with 316, 247 arrivals.

"The Chinese market continued to be a key thrust market, with initiatives being rolled out at a national policy level," Ratnayake said. "These efforts and continuing increase in flight connectivity resulted in the aforesaid increase in arrivals from China, which accounted for 12% of total arrivals to Sri Lanka in 2015."

Asian Hotels with a stated capital of Rs. 3.34 billion has total assets of Rs. 29.1 billion and total liabilities of Rs.2.56 billion.

JKH with 78.56% of Asian Hotels is the controlling shareholder followed by the EPF (9.84%), Sri Lanka Insurance Corporation Life Fund (2.27%) and the Ceybank Unit Trust with 2.19 % with Dr. S. Yaddihage who owns 0.77% .

The Directors of the Company are Messrs Susantha Ratnayake, Chairman, Ajit Gunewardene, MD, Ronnie Peiris, Rohan Karunarajah, Suresh Rajendran, Sanjiva Senanayake, Shirani Jayasekera, C.J.L. Pinto and Krishan Balendra.

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