Formosa International Hotels Corp (FIH, 晶華國際酒店集團) is positive about earnings growth this quarter and beyond as the hospitality industry gradually emerges from the COVID-19 pandemic and the government is inclined to ease disease prevention measures.
The Taipei-based company made the remarks on Monday after posting NT$109 million (US$3.63 million) in net income for last quarter, the lowest in eight quarters, or earnings per share of NT$0.69.
The results represented a 3.28 percent decline from a year earlier, as the public generally stayed home to avoid infections and the sale of pizza chain Domino’s Taiwan in June last year raised the comparison bar.
Photo: Taipei Times
The company sold all its shares in Pizzavest Co (達美樂披薩), the operator of Domino’s Taiwan, to Australia-listed fast-food operator Domino’s Pizza Enterprises Ltd for US$61.2 million.
Lingering border controls continued to constrain its capacity to serve foreign tourists, but its properties fared better than peers in the past two-and-a-half years by measure of profitability, FIH said in a statement.
Stripping out the Domino’s deal, FIH would have achieved a 51.11 percent increase year-on-year in net profit, it said.
Cumulative revenue in the first six months weakened 4.27 percent to NT$246 billion, while net income shrank 4.37 percent to NT$390 million, or earnings per share of NT$2.67, the company said.
In the absence of the one-off income linked to Domino’s, year-to-date profit would have expanded 11.5 percent, the company said.
The situation has improved this quarter as the daily number of COVID-19 cases has steadily declined and the government last month introduced a new travel subsidy to shore up domestic tourism.
FIH, which operates hotels under the Regent Taipei (台北晶華), Silks Place (晶英), Wellspring by Silks (晶泉丰旅) and Just Sleep (捷絲旅) brands, as well as independent restaurants such as Spice Market (泰市場), Just Italian (義饗食堂) and Just Grill Steakhouse, said it would focus on wooing local family tourists before Taiwan lifts border controls.
This quarter is the high season for domestic tourism due to the summer vacation, and the Mid-Autumn Festival next month should boost sales of moon cakes and other gift boxes as a whole, it said.
The next quarter is the high season for food and beverage sales on the back of corporate feasts and family gatherings, it said.
In addition, health authorities are widely expected to further ease COVID-19 controls and coexist with the virus as many countries around the world have done.
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