Hotel Royal (H12) H1 2023 earnings summary

Executive summary

• H1 2023 revenue rose 63.8% YoY to $27.541m; profit after tax was $1.956m versus a $3.859m loss in H1 2022.

• The recovery in hotel operations, led by Singapore and Thailand, drove the return to profitability; operating cash flow was $3.999m versus cash used of $2.645m a year earlier.

Financial highlights

• Revenue was $27.541m, up 63.8% YoY; gross profit increased to $13.225m from $5.938m.

• Profit before tax was $3.017m versus a $4.421m loss; profit after tax was $1.956m versus a $3.859m loss.

• Finance costs rose 78.6% to $4.230m, mainly due to higher interest rates; administrative expenses increased 47.0% to $7.818m.

• Total comprehensive loss was $7.754m, including a $10.309m foreign currency translation loss.

Outlook and guidance

• Room demand is expected to increase as travel recovery continues in Singapore, Malaysia and Thailand; a soft launch of Hotel Royal Signature is planned for H2 2023.

• Tourism recovery supports the outlook, while the Russia-Ukraine conflict, global inflation and rising interest rates could adversely affect performance and managed fund investments.

• Foreign exchange movements in the New Zealand dollar, US dollar, Malaysian ringgit and Thai baht against the Singapore dollar remain a performance exposure.