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Earnings of Waterfront hotels shrink

Saturday, June 13, 2009 | MANILA, PHILIPPINES [ BusinessWorld Online ]


Profits of hotels owned by businessman William T. Gatchalian declined during the first three months of the year amid fewer bookings.

Waterfront Philippines, Inc. reported that net income went down by more than half to P27 million, while profits of sister Acesite Hotel Corp., which operates Manila Pavilion Hotel on UN Avenue, declined slightly to P7.14 million from January to March compared with the P7.27 million in the same quarter last year.

Both hotels pointed to lower room occupancy rates and higher costs. The occupancy rate in Waterfront for instance was only at 55% last quarter compared with 61% in first quarter 2008.

Meanwhile, the occupancy rate at the Manila Pavilion went down to 48.94% from January to March compared with 66.72% in the same quarter last year. "Hotel operations continue to be the main driver of growth. Total revenue was at P476 million, a 4% decrease from last year’s first quarter because of the increase in costs and expenses," Waterfront Corporate Secretary Arsenio A. Alfiler, Jr. said.

Despite the drop in the profits, Mr. Alfiler said the company would continue to look for opportunities amid a slow recovery in the tourism sector.

"We started the year with resolve to face the challenges brought on by unrelenting international crises that contributed to the slow pace of recovery of the tourism and tourism-related services sectors," he said.

But based on the Department of Tourism’s first-quarter report, tourist arrivals in the country reached 1.3 million from January to March this year, compared with the 858,244 tourists in the first quarter of 2008.

Cebu attracted the biggest volume of visitors with a share of 32%, followed by Boracay, Davao City, and Camarines Sur.

The tourism department also said the volume of domestic tourists visiting key destinations grew faster at 13%. The number of foreign tourists went up by only 4%.

Shares in Waterfront rose by 3.22% or a centavo to P0.32 apiece on Thursday, while shares of Acesite did not move at P8.50. — K.J.R. Liu

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