Hotel Lotte, Chosun Hotel, and Hotel Shilla See Improved Profitability in Q3
Record-Breaking Inbound Tourist Numbers Expected This Year
Strong Demand from Both Domestic and Foreign Guests
Premium Cake Competition Heats Up for the Year-End Peak Se
Major hotels in South Korea have successfully maintained profitability in the third quarter of this year, driven by increased occupancy rates amid a surge in tourists. The high season, which includes summer vacations and holidays that attract strong domestic demand, coincided with a steady rise in inbound foreign tourists, who are on track to reach record numbers.
According to industry sources on November 15, Hotel Lotte reported a consolidated operating profit of 117 billion won in the third quarter of this year, marking a 384.2% increase compared to the same period last year. However, sales during the same period decreased by 4.9% to 1.2218 trillion won. Within this, the hotel division's sales rose by 3.7% year-on-year to 386.8 billion won, and operating profit jumped by 74.1% to 67.1 billion won.
The company explained that hotel performance improved as the influx of foreign tourists continued. In the third quarter, the number of foreign guests increased by 8.9% year-on-year, while hotel room revenue rose by 4.6%. Overseas hotels also saw a sales increase of 11.3% compared to the same period last year, thanks to the ongoing recovery in the global tourism market. Revenues in the Americas, where many chain hotels are located, grew by 9.5%, and in Vietnam by 6.5%.
According to the Korea Tourism Organization, the cumulative number of inbound foreign tourists from January to September this year reached 14.08 million, a 16% increase compared to the same period last year. Previously, the Hyundai Research Institute projected that the number of foreign tourists visiting South Korea by the end of this year would reach 20.09 million, surpassing the pre-pandemic record of 17.5 million in 2019 and setting a new all-time high.
Other major hotels have also benefited from this robust inbound demand. At Hotel Shilla, although the duty-free division continued to post an operating loss of 10.4 billion won in the third quarter, the hotel and leisure division saw sales rise by 2.7% year-on-year to 176.1 billion won. Operating profit remained steady at 21.8 billion won, similar to the previous year. Notably, sales at the Seoul Hotel and Shilla Stay increased by 12.4% and 4.7%, respectively, compared to the same period last year, highlighting the effectiveness of customer acquisition efforts. During this period, the occupancy rate was 74% at the Seoul Hotel and 81% at Shilla Stay.
Chosun Hotels & Resorts also reported a 12.7% increase in third-quarter sales to 210.8 billion won, and a 13.4% rise in operating profit to 22 billion won, driven by higher occupancy rates and improved average spending per guest. An industry insider commented, "With growing demand from both domestic and foreign tourists, major hotel properties are maintaining consistently high occupancy rates regardless of whether it is peak or off-peak season. During weekends or holiday seasons, reservations are often filled early and the average spending per guest remains high."
The hotel industry expects this trend to continue into the fourth quarter, with increased arrivals and special demand during the Christmas and year-end holiday season following the Chuseok holiday. In addition to competing for room bookings, hotels plan to attract guests by offering premium cakes.
Walkerhill's '2025 Lumiere Blanche Cake' released as a limited edition for the Christmas season. Provided by Walkerhill
For example, Walkerhill Hotels & Resorts has launched the 'Lumiere Blanche' cake for the Christmas season. The name, which means 'light of a white winter' in French, is priced at 380,000 won. It will be available for purchase by advance reservation via phone from December 1 to 21. Grand InterContinental Seoul Parnas is also set to release its signature cake for this year, the 'Merry-Go-Round,' priced at 350,000 won and limited to 50 pieces.
In addition, Lotte Hotel, Shilla Hotel, and Chosun Hotel all plan to launch their own Christmas cakes later this month.
© The Asia Business Daily(www.asiae.co.kr). All rights reserved.
