Impact of Timf... Hana Tour's Q3 Operating Profit Down 9% YoY (Comprehensive)

Consolidated Basis 1.2 Billion
Sales 159.4 Billion...25.81%↑
Increase in Package Broadcast Customers in Q4
Expectations for Effect of China Visa-Free Policy

Hana Tour faced somewhat sluggish performance in the third quarter of this year due to the large-scale unsettled payment issues involving Qoo10-affiliated TMON and WEMAKEPRICE (Timep).

Hana Tour Headquarters, Jongno, Seoul. Photo by Jo Yong-jun

Hana Tour announced on the 5th that its consolidated operating profit for the third quarter of this year was preliminarily estimated at 12 billion KRW, down 8.99% compared to the same period last year. Sales increased by 25.81% to 159.4 billion KRW, but net profit decreased by 15.3% to 13.6 billion KRW.

The company explained that the decline in operating profit was due to the unsettled payment issues with TMON and WEMAKEPRICE and a temporary demand contraction caused by natural disasters in Japan, which intensified price competition and lowered profitability.

However, the cumulative operating profit for the first to third quarters of this year reached a record high of 37.3 billion KRW. As the travel industry began to recover after COVID-19 and travel demand from China rebounded, the number of package tour customers dispatched in the third quarter reached about 500,000, a 38% increase from 360,000 in the same period last year.

Expectations for the fourth quarter have also grown. Thanks to the effect of the bridge holidays last month, the number of package tour customers dispatched increased by 13% compared to the previous month and by 29% compared to the same month last year. Additionally, since the beginning of the fourth quarter, package tour customers to nearby travel destinations such as Japan, Southeast Asia, and China have been steadily increasing. In Japan, the number of dispatched customers increased by 31% compared to the previous month, indicating a recovery in demand that had been suppressed by natural disasters.

A Hana Tour official stated, "October bookings exceeded those of the peak season in July and August, and due to factors such as the implementation of visa-free travel for China, we expect bookings in the fourth quarter to be even better."