Monday, August 18, 2008 Pinoy hotel chain reports revenue growth as tourist arrivals increase
A STRONG influx of visitors to the country last year brought “positive” revenue growth to Waterfront Philippines Inc. (WPI).
This, as the hotel operations of WPI—a Filipino hotel chain owner and operator with properties located in key cities in Luzon, Visayas and Mindanao—posted a revenue of almost P1.89 billion or 96 percent of the company’s total income in 2007.
Of the company’s total revenues, WPI’s flagship hotel—Waterfront Cebu City Hotel and Casino—contributed the biggest with 39 percent or P732.14 million. The Manila Pavilion Hotel followed with revenues of P706.19 million.
Despite increases in the cost of energy and other operating expenses, the company managed to decrease its cost and expenses by 3.1 percent or P1.6 billion in 2007 from P1.7 billion in 2006, “through various cost-cutting measures without sacrificing the quality of service to (their) guests.”
WPI’s overall net performance, on the other hand, increased by 792 percent or P162.65 million against P18.24 million in 2006.
To sustain this growth, WPI disclosed plans to continue exploring prospects and opportunities for expansion and acquisition in the National Capital Region and other key cities in the country.
“In the immediate future, we plan to add new hotels to our portfolio in partnership with the Wellex Group,” the WPI annual report stated. The annual report was distributed during the company’s annual stockholders’ meeting last Saturday at the Waterfront Cebu City Hotel and Casino.
After the meeting, WPI chairman of the board Renato Magadia and WPI president Kenneth Gatchalian told reporters that the company is looking at Bohol as possible site of a resort.
“There is nothing concrete at this point. There are talks, but they are still in the exploratory stage. Acquisition of a property there is an option because we just have to run it, (but) there are also benefits in constructing our own since we can configure it the way we want it to,” said Gathcalian.
Marco Protacio, WPI area general manager for Visayas and Mindanao, said most tourist packages offer Cebu and Bohol together.
“It is wise to have a property in Bohol because it also augments the operations here in Cebu. Since Panglao is a prime destination in Bohol, it is ideal to have a property there,” he said.
Apart from expanding, WPI also plans to regularly improve and enhance its rooms, food and beverage (F & B) outlets and hotel structure, as well as to further promote its hotel brands “with a value-added marketing proposition.”
In 2007, consolidated room revenues grew by 8.9 percent or P710.46 million from P652.17 million in 2006 while its F & B revenues reached P673.88 million, contributing 34 percent in total revenues.
Gatchalian, during the stockholders’ meeting, said Waterfront Cebu City Hotel and Casino continues to be the leader in its class with an actual market share of 31 percent.
“Occupancy levels continue to be over 50 percent while average room rate increases annually, bringing revenue per available room (revPAR) to P1,430 in 2007. Net income of our flagship hotel increased by 45 percent, reaching P24.69 million last year over P17 million in 2006,” he said.
Meanwhile, Waterfront Airport Hotel and Casino registered an occupancy rate of 66 percent. Its actual market share was 53 percent with an average room rate at P2,322 and revPAR at P1,526. In 2007, the airport hotel’s net income grew by 2864.5 percent or P10.66 million from P359,631 in 2006.
WPI attributed the growth primarily to the increase of tourist arrivals in the country.
The company noted that that tourist arrivals, as reported by the Department of Tourism, increased by 8.7 percent last year and their spending grew by more than 40 percent or $4.885 billion compared to $2.62 billion in 2006. (NRC)
