Mauritius-based luxury hotel group Sun Resorts saw its profit before tax for the quarter ended March 31, 2014 declining to Rs 24.5 million against Rs 138.5 million in the corresponding period of 2013. The consolidated statement showed that the group revenue for the quarter ended March 31, 2014 dipped 11.3% to Rs 1.1 billion against Rs 1.2 billion achieved in the corresponding period of 2013, following a drop in occupancy to 59% in this quarter from 62% in the same period last year.
Additionally, this resulted in the operating profit decreasing to Rs 106 million in thequarter ended March 31, despite savings achieved in direct and other operating costs, whereas in the corresponding period of last year, it was estimated to be Rs 232 million.
The group profit after tax for the quarter amounted to Rs 22.2 million from Rs 120.3 million in the 2013 quarter, representing a decline of 81.6%.
On segmental revenue, the hotel did not perform well as its external sales stopped short at Rs 927.5 million in the quarter ended March 31, 2014 while in the corresponding period of 2013, it amounted to Rs 1.03 billion. Its inter-segment sales were estimated at Rs 117.6 million from Rs 139.9 million in the quarter March 31, 2013.
In the first quarter, no improvement was seen in trading conditions either, with tourist arrivals to Mauritius experiencing a 0.8% decrease.
The company secretary noted in the financial comments that the local industry was engaged in a major price war and aggressive promotions from competitors in all markets heavily impacted Sun Resort’s performance as they tried to protect their rates.
Additionally, the Easter period fell in the second quarter this year, whilst it overlapped March and April in 2013.
The transactions in respect of the partnership and participation of 26% by Shangri-La in Le Touessrok and the proposed acquisition of 50% of Anahita Hotel Ltd (Four Seasons Resort Mauritius at Anahita) are progressing well. Also, the proposed Rights Issue is targeted to take place in September 2014.
Eventually, the Board expects reduced losses when compared to same quarter of last year although market conditions will remain challenging in the second quarter with low season rates and discounting.
Image (Sun Resorts): The financial statement noted that the local industry was engaged in a major price war and aggressive promotions from competitors in all markets heavily impacted Sun Resort’s performance as they tried to protect their rates.
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