Archive for May, 2014

Aitken Spence Hotels FY13/14 net profit up 31%

The bottom line of the company was also boosted by another income of Rs.391 million, generating from insurance claims

Aitken Spence Hotel Holdings PLC, the hotel owning and management unit of the diversified Aitken Spence group saw its net profit for the year ended March 31, 2014 (FY13/14) rising 31 percent year-on-year (YoY) to Rs.2.3 billion, supported by better performance of hotels both in Sri Lanka and the South Asian region.

The bottom line of the company was also boosted by another income of Rs.391 million, generating from insurance claims on a fire that destroyed 16 water villas i n a resort operated by Aitken Spence in the Maldives.

The revenue for the year stood at Rs.12.9 billion, up from Rs.12 billion in the previous year. The operational profit for the year rose 26 percent YoY to Rs.4 billion.

The firm also recorded a net finance income of Rs.77 million against a net finance expense of Rs.18 million in the previous year.

The earnings per share for the year improved to Rs.6.92 from Rs.5.26.

The Sri Lankan resort hotels of the firm reported a revenue of Rs.3.3 billion for the year under review, against a revenue of Rs.2.8 billion in the previous year. The segment reported a pre-tax profit of Rs.1.35 billion, up from Rs.1 billion.

The firm’s South Asian hotel operations generated a revenue of Rs.9.7 billion, against a revenue of Rs.9.3 billion in the previous year. The segment’s pre-tax profit also rose to Rs.2.7 billion from Rs.2.2 billion.

Aitken Spence Hotels owns and manages six resort hotels in the Maldives. The company also manages four hotel properties in India and a couple in Oman.



Changing face of Sri Lanka tourism


There is no doubt that tourism in Sri Lanka is currently growing in leaps and bounds, with the cumulative arrivals up to April 2014 amounting to 534,132, which is an overall growth of 27 percent year-on-year (YoY). Hence, it is quite possible that the arrivals to the country will reach close upon 1.5 million arrivals or more by the end of this year.

Earnings have also kept pace with the arrival growth pattern, with 2013 achieving a record US $ 1.75 million in foreign exchange revenues. Up to April 2014, earnings have exceeded US $ 700 million already, and it would be safe to assume that by the end of the year it will reach close to the US $ 2 billion mark. The hotel sector accounts for about 65 percent of all these earnings, with the other segments being travel agencies, banks and shops registered to accept foreign currency. Fuelling and driving the dramatic changes of all these main indices are other interesting and also important emerging trends, as Sri Lanka tourism moves into becoming a mature market. Hence, it is worthwhile to analyse what some of these emerging trends in tourist arrivals are in the last two to three years.


The Sri Lanka Tourism Development Authority (SLTDA) statistics provide comprehensive data on several aspects of tourism and one of the more important indices available in these statistics is the foreign guest nights (FGN). This is the actual number of nights a foreign guest stays in a hotel (formal graded establishments) and in smaller informal hotels (supplementary establishments).

When this data is analysed, over the last four years, it shows an interesting phenomena, where up to in 2011 the number of foreign tourists who stayed in the smaller informal hotel sector grew at a phenomenal rate of 80 percent YoY, while the  formal sector grew only by 21 percent. However, in 2013, both sectors show a healthy increase of 34.8 percent YoY in the star classified hotels and 22.5 percent YoY in the smaller establishments.

Hence, it appears that after the initial spurt in the growth of the informal sector, currently both the formal and informal sectors are growing rapidly. However, it must be noted that there is a large number of small accommodation units mushrooming up, especially in the more ‘touristic’ areas of the island. These establishments are not registered with the SLTDA and therefore totally unregulated and their data and information related to foreigners’ stays are not captured in the overall statistics. It is difficult even to make a calculated guess as to the size and performance of this segment.

Accommodation/room stock

The number of rooms in the formal sector has increased from 14,714 in 2010 to 16,223 in 2013, a 10.3 percent overall increase, with 26 new hotels coming into the operation during this period. On the other hand, the number of supplementary accommodation rooms increased from 5,895 to 7,373, which is a 25 percent increase. On an overall basis, during this period, 158 new supplementary accommodation establishments have been commissioned. This of course does not take into account the other numerous unregistered accommodation units mentioned earlier. This perhaps indicates that due to rising construction cost, possible market demands and return on investments concerns, new investors seem to be focusing on building smaller establishments with lesser number of rooms.

‘Leakage factor’

It is an accepted fact that of the total arrivals recorded each year, not every person who arrives in the country stays in a hotel. There is a large visiting friends and relatives (VFR) and diaspora segment, which does not get caught up in the accommodation statistics, although they are recorded as tourist arrivals. The hotel sector considers this segment a ‘leakage factor’.

Since, the average stay per guest is known, it is quite easy to establish the actual number of foreign guests who stay in hotels, by dividing foreign guest nights by the average stay. The number of foreigners, who actually stay in hotels and supplementary establishments, can then be compared with the overall arrival statistics of the country and the ‘leakage factor’ can be assessed. It is interesting to note that this leakage factor has increased from about 18-15 percent in 2010/11 to around 24-26 percent in the last two years. Hence, possibly, there is a larger number of visitors coming to Sri Lanka, who are Sri Lankan expatriate returnees.

Over and above this, there may be a sizable number of tourists who are staying in the many smaller unregistered accommodation units in the island whose data is  not reflected in the SLTDA statistics by virtue of the fact that they are unregistered and could be a part of this ‘leakage factor’.

Other revenue from tourism

Many of the country’s natural and other attractions draw a large number of tourists and consequently there is revenue earned by these sectors as well. The main locations are the wildlife parks, zoo, cultural sites, botanical gardens and museums from which the state earned around US $ 20 million in 2012. It is noteworthy that all of these sites show healthy increases in earnings from tourists over the past few years, with wildlife parks leading the growth with over 300 percent growth over the past four years. This indicates that Sri Lanka has the potential to further develop wildlife tourism greatly, while at the same time other attractions also must be further developed and enhanced to give a better visitor experience.

Hence, it is important that tourism professionals and in particular, hotel operators and developers look at these emerging trends in a more analytical manner, so that Sri Lanka’s future product and service offerings can be geared to suit the market demands.


Hat-trick in Trip Advisor Certificate of Excellence for Maalu Maalu Resort and Spa, Pasikudah

Maalu Maalu Resort and Spa in Pasikudah has been awarded the Trip Advisor Certificate of Excellence for the third time. Remarkably, the 40 room beach resort has been in operation for only that many number of years, since it was inaugurated in May 2011.

This award does more than recognise the resort and its drive towards excellent standards of service. It has really been an accomplishment for the close-knit team, as many of the staff, around 70% of them are from the surrounding area, and have undergone many hardships in obtaining education and even in learning the English language. “We are more than grateful for the recognition afforded to us by our guests, as the staff do their best to make this place a little piece of paradise, in their naturally warm and sincere way. Excellent service can be trained, but genuine kindness and attention can only come from a sincere desire to please,” said Chandra Wickramasinghe, a veteran hotelier and Chairman of the resort. The Trip Advisor Certificate of Excellence is awarded annually, based on guest reviews and ratings of hotels and resorts in relation to excellence of service, across the globe.


Aitken Spence – RIU Hotels of Spain tie-up to build 500-room luxury resort


During the period, 2013/2014 Aitken Spence Hotel Holdings PLC, the Aitken Spence Group’s hotel owning strategic business unit, entered into a shareholders’ agreement with RIU Hotels of Spain to build a 500-room luxury resort in Ahungalla, costing approximately USD 100 million. The construction of the hotel is expected to commence during the second half of the financial year 2014/15, a press release said.

It adds: ‘Annual revenue for the Maritime Cargo Logistics sector increased 15.3% to Rs. 7.3 billion whilst profits before tax for the sector increase by 26% to Rs. 709 million. Entry into a strategic partnership in Fiji for port management services through the acquisition of a 51% shareholding in Ports Terminal Ltd – the first- ever public-private partnership overseas by a Sri Lankan company recorded to date, was a highlight for the year.

‘Blue chip conglomerate Aitken Spence PLC reported its annual unaudited financial results 2013/14 to the Colombo Stock Exchange on Monday, reporting profit attributable to shareholders of Rs 3.7 billion, an increase of 11.7% over the previous year’s profit of Rs 3.3 billion. Profit before tax was Rs 5.4 billion and profit after tax was Rs.4.5, recording growth of 7.6% and 5.5% respectively. The diversified Group’s annual revenue declined marginally to Rs. 36.6 billion whilst earnings per share improved by 11.7% to Rs. 9.04 for the financial year.

The Group’s bottom line was driven primarily by the Tourism sector. Sri Lanka welcomed over 1.27 million tourists during the year 2013, with a target of 1.5 million set for 2014.The boom in the tourism industry was reflected in the Group’s performance with the revenue of the Tourism sector for the financial year growing by 9.4 % to Rs. 16.9 billion and profit before tax surging by 26.3 % to Rs. 4.4 billion.

Services sector reported a revenue of Rs. 819.6 million for the financial year under consideration which was a growth of 11.5 %, and a profit before tax of Rs 180.5 million, a growth of 10.2% compared to the previous year. Strategic Investments sector reported a year on year decrease of 16.1% in revenue to Rs. 15.3 billion, while the profit before tax dropped by 81.1% to Rs. 159.8 million for the financial year primarily due to the Aitken Spence power plants in Matara and Horana not being operational during the reporting period consequent to the cessation of the Power Purchase Agreements. Further, a provision for impairment of approximately Rs. 400 million was made in respect of the remaining assets of these two companies, which dragged down the profits of the sector.

The company disposed of the Horana power plant during the financial year, while the 100 MW power plant at Embilipitiya remained operational, albeit with lower generation due to excessive rainfall during the first nine months of the financial year. During the period under review the Group inaugurated a land mark project by investing in a luxury retirement homes complex that will comprise of 140 villas and associated high-end facilities located at a 30 acre site in Negombo. The project aims to attract Sri Lankans living overseas who wish to return to their homeland as well as foreign nationals who wish to retire and live in Sri Lanka.


Aitken Spence Hotels unveils app for iPads

Aitken Spence Hotels broke new ground recently with the launch of its first digital application for iPads. The application was designed to provide a comprehensive snapshot of the Aitken Spence Hotels portfolio spread across four diverse destinations; and covers the fundamental facets used by guests to decide on their preferred hotel or resort. A holistic integration of the information of 21 hotels is presented in an interactive seamless platform enabling ease of navigation for the user. The app provides a brief description of each hotel affording guests a glimpse to the roots of the property. The types of accommodation that can be enjoyed by guests are also listed with pictorial representations of the room and its amenities.

Information on hotel facilities, dining options, event spaces and excursions can be accessed at the tip of a finger. The information is complimented by an extensive gallery complimenting the sensory journey one engages with when browsing the app. It also provides a unified platform for feedback and reservation inquiries creating easy interaction between Aitken Spence Hotels and potential guests. “The digital revolution has created a fundamental need for businesses to evolve their practices.  The launch of an iPad app for Aitken Spence Hotels is one of the many initiatives lined up to evolve our practices to offer our guests an engaging and seamless experience The app is the perfect tool to create brand awareness amongst tour operators, destination management companies and tourists from around the world. We plan to evolve the services that can be offered through the app creating ease of access to the modern traveler,” says Aitken Spence Hotels Vice President, Sales and Marketing
Althaf Mohamed Ali. Aitken Spence is Sri Lanka’s largest resort operator and the largest international hotel operator in the Maldives. The Group also manages a portfolio of hotels in India and Oman. The company’s premier resorts operate under the brand Heritance.


Sri Lanka’s highest rooftop bar and lounge ON14 now open at OZO Colombo


Colombo’s most exciting rooftop bar and lounge, ON14, is set to become the city’s hottest new venue. Located on the 14th floor of the newly opened hotel, OZO Colombo on Marine Drive, the venue offers the capital’s glitterati a sophisticated night out. From its contemporary design and eclectic choice of live entertainment, to its sharp and savvy service and global cuisine, ON14 is the epitome of cool in this cosmopolitan city.

With striking views overlooking the Indian Ocean and casual lounge style seating beside the infinity swimming pool, the innovative bar and lounge concept focuses on the art of crafting distinctive cocktails and serving premium drinks by a team of internationally trained mixologists as well as showcasing cuisines of the world through a scrumptious menu of gastronomic treats from Swiss-born Executive Chef, Stefan Beutler. For those looking for ultimate exclusivity, ON14 also encompasses a private terrace for up to 30 guests at the highest point on the 15th floor, providing the perfect backdrop for those looking to impress, host private parties or simply chill out in swanky surroundings. ON14 is open daily from 11 a.m. till late.


Other Corner Habarana awarded‘2014 Winner’ TripAdvisor Certificate of Excellence


‘The Other Corner’,, an eco-friendly nature resort, announced that it has received a 2014 Winner’ TripAdvisor Certificate of Excellence award. The accolade, which honours hospitality excellence, is given only to establishments that consistently achieve outstanding traveller reviews on TripAdvisor and is extended to qualifying businesses worldwide. Establishments awarded the Certificate of Excellence are located all over the world and represent the upper echelon of businesses listed on the website.

When selecting Certificate of Excellence winners, TripAdvisor uses a proprietary algorithm to determine the honourees that take into account reviews ratings. Businesses must maintain an overall TripAdvisor bubble rating of at least four out of five, volume and recency of reviews. Additional criteria include a business’ tenure and popularity ranking on the site.

“Winning the TripAdvisor Certificate of Excellence is a true source of pride for the entire team at The Other Corner, Habarana and we’d like to thank all of our past guests who took the time to complete a review on TripAdvisor,” said The Other Corner Resident Manager Eric Van Dort.

“There is no greater seal of approval than being recognised by one’s customers. With the TripAdvisor Certificate of Excellence based on customer reviews, the accolade is a remarkable vote of confidence to our business and our continued commitment to excellence.”

“TripAdvisor is pleased to honour exceptional hospitality businesses for consistent excellence,” said TripAdvisor for Business President Marc Charron.

“The Certificate of Excellence award gives top performing establishments around the world the recognition they deserve based on feedback from those who matter most – their customers. From Australia to Zimbabwe, we want to applaud exceptional hospitality businesses for offering TripAdvisor travellers a great customer experience.”