COMPANIES are moving to keep their businesses afloat as the impact of the novel coronavirus pandemic starts to bite on their operations.
Publicly listed firms have disclosed the state of their operations amid the escalating economic impact from the public health crisis.
Metro Retail Stores Group, which operates supermarket and department stores, expects a drop in foot traffic at its stores as community quarantine measures take effect but also assures shoppers its logistics and distribution operations will continue to function.
“We will strive to provide our customers on a best effort basis under the prevailing circumstances, and depending on supplier availability, with ample supply of basic commodities,” the Cebu-based retailer said, noting the risk of not being able to replenish its merchandise on time.
Waterfront Philippines Inc. (WPI), which operates two Waterfront hotels in Cebu, said room occupancy went down 55 percent on average.
“This pandemic is causing a harsh economic downturn and is continuously taking a toll on the tourism industry and its allied services especially with the imposition of travel bans and community quarantines,” WPI said, noting the booking cancellations and sales slowdown are causing “revenue strain.”
WPI said it is “implementing cost-saving measures which included a flexible work arrangement as per the labor department guidelines, closing of hotel outlets and keeping outlet operations to the minimum, postponement of non-essential marketing expenses, as well as adjustment of room rates to encourage local bookings.”
Ayala-led Cebu Holdings Inc., on the other hand, said foot traffic in its malls in the city and residential sales were expected to drop.
“With Covid-19, malls, offices and hotels have been experiencing lower foot traffic and bookings, respectively, as a result of the community quarantine, travel ban and curfew. We also expect some impact on residential sales as property buyers may prioritize personal health and safety given the current environment,” the firm said.
Following Cebu City’s declaration of community quarantine and curfew on Sunday, March 15, 2020, mall hours have been adjusted from 11 a.m. to 7 p.m.
Seda Hotel Ayala Center Cebu said it reviews the travel history of guests upon check-in, with options for rebooking and cancellations in place. Restaurants and common area facilities have been rearranged for social distancing and food preparers and handlers are requested to observe strict protocols.
PH Resorts Group Holdings said there might be some delays in the construction of its Emerald Bay Resort and Casino in Lapu-Lapu City “on account of availability of construction workers, construction supplies and other circumstances” beyond its control.
Nevertheless, the company said “the construction and development of the Emerald Bay in Mactan, Cebu will keep moving forward. If there are significant unexpected changes in the construction timeline, we will apprise the public immediately as an update to this disclosure.”
The operations of the Donatela Hotel in Bohol though may be significantly affected in furtherance of a “community quarantine.”
“In any event, the management is keeping the expenses at minimum and is executing general cleaning and small in-house renovations while occupants are expected to be low at this time.”
Airline, fastfood
Meanwhile, the airline industry continues to suffer from the economic fallout.
Budget carrier Cebu Pacific said it expects to free up 90 percent of its seat capacity due to the 30-day community quarantine imposed in Metro Manila, as it sees a significant revenue impact from the public health crisis.
The airline said it “will continue with flights to and from Cebu and other hubs” to maintain overall air connectivity “where operationally feasible.” The carrier also expects to cut its operating expenses with the suspension of several flights.
“This includes lower fuel consumption, landing, take off and air navigation fees and flight-based repair and maintenance expenses,” Cebu Air Inc. said.
While lower fuel price adds a cost benefit with lower fuel consumption, the airline also faces increase in refund and re-booking requests.
Fast food giant Jollibee Foods Corp. (JFC) said it has ensured its stores in the Philippines will have adequate supply.
About 80 percent of the raw materials consumed by its stores in the country are sourced locally mainly agricultural goods such as chicken, vegetables, eggs and rice.
“The restriction of movement within a country (lockdown) can also create shortage of raw materials or products in some areas and excess in other areas, an imbalance of supply within a country, potentially resulting in lost sales and inventory obsolescence,” JFC said.
As a proactive measure, JFC had spread its inventories in different parts of the country in different warehouses and depots.
JFC also has 15 commissaries located in different parts of the country, some in Luzon while others in the Visayas and Mindanao to support its 3,300 outlets which are dispersed in many towns and cities across the country.