4Q Exchange Rate Decline, Increase in Duty-Free Cost Ratio
Hotel and Leisure Performance Hits Annual Record High
Hotel Shilla announced on the 27th that its consolidated operating profit last year was 78.3 billion KRW, a decrease of 34.1% compared to the previous year. During the same period, sales increased by 30.2% year-on-year to 4.922 trillion KRW. The net loss turned to a deficit of 50.2 billion KRW.
Operating loss in the fourth quarter of last year was 6.7 billion KRW, turning to a deficit compared to an operating profit of 25 billion KRW in the same period of the previous year. Sales and net loss were 1.2999 trillion KRW and 81 billion KRW, respectively.
By business segment in the fourth quarter, sales in the duty-free sector increased by 13% year-on-year to 1.14 trillion KRW. Operating loss turned to 19.6 billion KRW compared to the previous year. Domestic downtown duty-free sales increased by 3%, and airport duty-free sales rose by 122%. Sales in the hotel and leisure sector increased by 31% year-on-year to 159.9 billion KRW, and operating profit increased by 579% to 12.9 billion KRW compared to the previous year.
A representative from Hotel Shilla stated, "The reason for the deficit turnaround in the fourth quarter was that the exchange rate fell from the 1,400 KRW range to the 1,200 KRW range, increasing the duty-free cost ratio of duty-free sales," adding, "From this year, the exchange rate is expected to stabilize, so the impact on the cost ratio will be minimal." They further explained, "The hotel and leisure sector also achieved significant growth compared to the previous year in the fourth quarter and recorded the highest-ever annual performance."
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