Company generates revenue of THB 7,222 million in the first nine months of 2023, with improvements witnessed in major key markets including Thailand, UK, Fiji, and Maldives
BANGKOK, THAILAND: S Hotels and Resorts PCL (SET: SHR, or “the Company”), the global hospitality company from Singha Estate PCL (SET: S), has announced that it generated THB 7,222 million (approx. USD 203 million) in revenue in the first nine months of 2023, a significant increase of 18% from the same period last year. This achievement highlights the continued resurgence of the global tourism industry, from which the Company’s operations have greatly benefited.
The average occupancy rate of the Company’s hotels, based solely on the rooms that are open for service, was a robust 71% - an increase of 12% from the prior year. Additionally, the Average Daily Rate (ADR) has shown substantial growth in line with the burgeoning demand for travel and improving economic conditions, as well as shifts in consumer and travel behaviours. The Company’s average ADR has witnessed significant growth, reaching THB 5,560 in the first nine months of 2023, an improvement from THB 5,049 the previous year. This has led to an impressive 29% rise in Revenue Per Available Room (RevPAR), reaching THB 3,821. Alongside continuous cost control and expense management, the Company reported an Adjusted EBITDA of THB 1,749 million, a substantial increase of 35% compared to the same period last year.
Mr. Dirk De Cuyper, CEO of S Hotels & Resorts, highlighted the fact that the tourism industry has witnessed a marked recovery during the first nine months of 2023. “Since the beginning of the year, there has been a significant increase in occupancy rates, buoyed by the surge in travel demand and the price-setting ability of S Hotels & Resorts due to the advantageous locations of our hotels in leading tourist destinations.
“Coupled with our commitment to service excellence and proactive marketing strategies, these factors have enabled our hotels to increase revenue across all geographies, all of which are important tourist destinations, particularly in Thailand, where revenue has doubled due to the popularity of the location and its high-spending, loyal customer base, including Russian, German, and British tourists, leading to an impressive occupancy rate of 80% excluding rooms under renovation. The United Kingdom portfolio hotels continue to be the main revenue contributor, accounting for 42% of the total revenue from services. This reflected robust growth driven by domestic demand and government business, along with the company's strategic approach to managing RevPAR and identifying solutions for efficiency improvement, which resulted in year-on-year revenue growth of 12%. In the Maldives however, the growth of the CROSSROADS Maldives project may not appear as prominent when compared to 2022, when the Maldivian tourism industry experienced a significant recovery and outperformed other major tourist destinations. Combined with the economic slowdown in Europe, which is a major market for the Maldives, this resulted in increasing price competition within the industry. Consequently, the Company achieved a moderate 5% year-on-year increase in revenue.” Mr. De Cuyper added.
The hotel business is expected to exhibit a distinct upward trend in the final quarter of the year, continuing into 2024, fuelled by the continuous growth of the tourism sector and the resurgence of inter-regional travel, aligned with the increase in air lift. 2023 marks the first year that global tourism has fully reopened, and S Hotels & Resorts is witnessing an uptrend in new market segments across all regions it operates in. Now, the Company is preparing new products that align with the latest travel trends and capitalize on these opportunities to reach potential clients, while maintaining its high service standards. In this regard, the renovation of the Company's core hotels, including Outrigger Fiji Beach Resort, SAii Laguna Phuket, SAii Phi Phi Island Village, and select hotels in the United Kingdom, is proceeding as part of the strategic plan to enhance the efficiency and performance of the portfolio. The newly renovated rooms will be ready to welcome guests before the start of each country’s high season, with the aim of enhancing the hotels’ competitive capability and generating efficient profitability. The company has set a target that the renovated rooms will raise ADR by 15-25%.
Mr. De Cuyper provided additional insight, stating: “We continue to witness positive growth indicators in the tourism sector across all countries where we operate. This makes us confident that the Company's revenue will continue to expand steadily in 2024.”
The Company has witnessed signs of recovery, particularly during the upcoming high season of Maldives tourism, supported by macroeconomic factors such as increased flight routes and frequencies, and an uptick in employment within the tourism industry, aligning with the moderate recovery in room booking rates. Coupled with a strategic approach to managing RevPAR, including the expansion of sales channels and new customer bases. Additionally, the newly opened SO/ Maldives hotel, which started operations in November, has received a good response. This enhances the CROSSROADS Maldives project, offering a comprehensive range of product options that cater to various market segments, solidifying its position as the leading integrated leisure destination in the Maldives.
In the UK, the Company is continuing its asset rotation strategy by focusing on higher-quality investments and meticulously selecting assets with the potential to enhance returns. Along with elevating the brand and bolstering operational efficiency, this approach is aimed at strengthening the portfolio's resilience and positioning it to fully capitalize on the growth of the domestic leisure industry.
The Company’s portfolio of hotels in Thailand exhibited remarkable growth in 2023, with a strategic focus on enhancing the competitiveness of core assets to sustainably meet the increasing demand in Phuket and Phi Phi. The comprehensive plan for hotel renovations and room upgrades is scheduled between 2023 and 2025, with construction activities planned only during the off-peak seasons each year. This schedule is designed to ensure that the newly renovated rooms will be available to accommodate tourists during the peak of the high season each year, maximizing the pricing potential.
Furthermore, S Hotels & Resorts anticipates that Q1 2024 will witness the peak performance period for its portfolio in Thailand, due to the full availability of room capacity and the increased room rates resulting from the introduction of new products.
The Outrigger hotel portfolio is anticipated to be a key driver for financial performance in 2024, bolstered by three main factors. (1) The Fijian market is anticipated to continue its expansion, buoyed not only by increased demand from travellers from Australia and New Zealand, its primary markets, but also through rising popularity among tourists from North America, Europe, and Asia. This is expected to result in a strong occupancy rate for both hotels in Fiji, while driving up ADR. (2) The completion of a major renovation in Fiji, including guest room and public area enhancements which will be 100% completed by December this year. S Hotels & Resorts is optimistic that its new products will deliver an enhanced experience for tourists and significantly and sustainably boost its ability to increase ADR. (3) Outrigger Mauritius Beach Resort, which has been welcoming guests since November 2023, after a major water management system upgrade, coincides with the country's high tourism season, will now embark on its first full year of operations.
Dirk De Cuyper, CEO of S Hotels & Resorts, concludes: “S Hotels & Resorts has operated in accordance with the previously announced plans, pushing forward its financial performance to meet the outlined objectives despite the prevailing economic uncertainty in certain markets, adverse factors, and unforeseeable events. However, I, together with the management team and all staff members, have dedicated our collective efforts and resources to fulfilling the commitments made to our shareholders and stakeholders. Moreover, in October, we succeeded in issuing bonds, raising THB 1.3 billion to establish a robust and sustainable business foundation, such as accommodating the plan to upgrade and enhance the efficiency of our portfolio, as well as pursuing even greater investment in the future.”
About S Hotels and Resorts Public Company Limited
S Hotels and Resort PLC or SHR, a subsidiary of Singha Estate PLC, is a fast-growing holding company that engages in the management of hotels and resorts. In 2023, its performance has been outstanding with its portfolio featuring world-class hotels and resorts in not just Thailand but also beyond. An expert in the upscale hotel and resort management and investments in the most desirable global tourism destinations, SHR develops several lifestyle hotel brands organically and collaborates with some leading hotel/resort brands that have had strong distribution channels. As of 2023, SHR has 38 hotels in its portfolio. Together, these hotels have had 4,552 rooms. Each of them is located in a key tourist destination that attracts tourists from all over the world. Guided by its parent company Singha Estate, SHR enjoys management strengths and pursues Sustainable Diversity Strategy. It thus has a diverse yet balanced investment portfolio, with sustainable growth as the ultimate goal of is operations. Thanks to its environmental focus, five resorts in Thailand and the Maldives and The Marina @ CROSSROADS have won Green Globe certifications that effectively provide assurances to both investors and guests. To learn more, please visit www.shotelsresorts.com or follow us on Facebook, Instagram, Youtube, or LinkedIn.
For more information and high-resolution images, contact:
Lalita Somboonsuk (Ta)
Senior Manager - Corporate Marketing Communications
S Hotels & Resorts | Singha Estate PCL
Tel: +66 (0) 2058-9888 ext. 320
Delivering Asia Communications
Tel: +66 (0)91 723 1648