Grande Asset clips 2020 hotel revenue
As the Covid-19 virus outbreak hits the tourism sector, SET-listed Grande Asset Hotels & Property Plc expects hotel revenue to deflate this year, while MBK Plc is set to revise its outlook.
Vitavas Vibhagool, chief executive of Grande Asset Hotels & Property, said the company’s revenue from the hotel business this year is expected to drop by 12.4% to 3.3 billion baht from 3.77 billion last year.
“We downgraded our estimate this year, attributed mostly to the Covid-19 outbreak, which is affecting Chinese tour groups at Royal Orchid Sheraton Hotel, a major source market,” he said.
The 726-room hotel is situated by the banks of the Chao Phraya River opposite IconSiam mall.
While the average occupancy rate is weak, the company plans to roll out a renovation in the second half. Hotel revenue is projected to drop by 60.6% to 380 million baht in 2020 from 965 million in 2019.
Grande Asset has four other hotels. Sheraton Hua Hin Resort & Spa is estimated to see a decrease of 8.4% in revenue to 360 million baht. The decline is less severe as it benefits from a strong domestic market.
The Westin Grande Sukhumvit near Asok intersection will see a drop of revenue by 7% to 650 million baht.
Most guests are from Europe and the Middle East.
Sheraton Pranburi Villas will have flat growth with 70 million baht in revenue in 2020, but Hyatt Regency Bangkok Sukhumvit near Nana Skytrain station is projected to claim growth of 22.2% to 540 million baht as it will have a full year of operation this year, said Mr Vitavas.
Earnings from the company’s hotels in Thailand are projected to decline by more than 20% to 2 billion baht from 2.57 billion.
Chainid Adhayanasakul, chief executive of SET-listed developer Property Perfect Plc (PF), Grande Asset’s parent firm, said Chinese arrivals will return in greater numbers in the second half.
“We are confident that the outbreak will be under control and vanish within March,” said Mr Chainid. “The Tourism Authority of Thailand should have a campaign for Songkran to rebuild the tourism industry.”
Suvait Theeravachirakul, chief executive of MBK Plc, said the company was unable to estimate the impact of the outbreak on its hotel Pathumwan Princess Hotel and retail business MBK Center at the moment as the problems have not been solved yet.
“It is still unclear how and when it will end,” he said. “People around the world have stopped travelling so we cannot know which market will replace mainland travellers.”