Banyan Tree expects net loss for H1 due to Covid-19 pandemic

Singapore

RESORT group Banyan Tree Holdings said in a regulatory filing on Tuesday that its hotel business continues to be negatively impacted on the back of border controls and travel restrictions imposed as a result of the Covid-19 pandemic.

Its hotel investment segment, which comprises owned hotels in Thailand and the Maldives, recorded "significantly lower" occupancies in April and May than in the corresponding months last year.

For the five months ended May 31, occupancy stood at 36 per cent, down 39 percentage points while revenue per available room was S$106, some 42 per cent lower than the same period last year.

In the Maldives, occupancy was at 36 per cent, down 31 percentage points; revenue per available room was S$215, which was 42 per cent lower against the previous corresponding period.

Overall occupancy for its hotels investment segment dropped to 34 per cent for the five months ended May 31, from 69 per cent in the same period last year. Revenue per available room fell from S$187 to S$108.

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With the extension of Thailand's ban on international flights till the end of June and the lack of indication of the health and safety protocols that will be in place even as the authorities in Maldives say it has plans to reopen borders in July, the group expects operating performance for the first half year ending June 30 to be adversely affected.

The group said that it expects to report a net loss in its half-year results; its unaudited financial results are expected to be announced around Aug 12.

"Until there is clarity on the duration, severity and consequences of the Covid-19 pandemic, the group will continue to pursue steps to reduce costs, conserve cash and diversify our sources of funding to strengthen our balance sheet," it said in its business update.

It is reviewing all aspects of operations, including its sales and marketing programmes, to ensure that they can meet demand once air travel returns to normal.

The group also announced that the board has voluntarily committed to a 15 per cent reduction in the cash fee component of their directors' fees for the financial year ended Dec 31, 2019 as a show of solidarity.

Banyan Tree shares closed at S$0.26 on Tuesday, up 2 per cent.