SHANGRI-LA GROUP RELEASES 2022 FULL YEAR RESULTS (China)
Shangri-La Group’s Chairman Hui Kuok said “I am very proud of our colleagues’ commitment to delivering our signature Asian hospitality to our guests and the communities during the past three years” |
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SHANGRI-LA GROUP RELEASES 2022 FULL YEAR RESULTS (China)
Shangri-La Group’s Chairman Hui Kuok said “I am very proud of our colleagues’ commitment to delivering our signature Asian hospitality to our guests and the communities during the past three years” |
Category: Asia Pacific - China - Industry economy
- Figures / Studies
This is a press release selected by our editorial committee and published online for free on 2023-03-28
Shangri-La Asia Limited (HKEX stock code: 00069) today reported the financial results of the Company and its subsidiaries (“Group”), and associates for the year ended 31 December 2022.
Highlights included:
- Group Operating Cashflow of USD33.4 million and Operating Profit After Tax from operating properties (“PATMI”) of USD6.1 million both turned positive for the first time since the COVID outbreak
- Group Consolidated Revenue increased by 17.8% to USD1,462.1 million, driven by hotel recovery in non-China regions
- Group effective share of Earnings Before Interest, Tax, Depreciation and Amortisation (“EBITDA”) increased by 5.6% to USD441.6 million
- Maintained strong financial position, cash and cash equivalent of USD766.0 million and committed undrawn facilities of USD973.1 million, available funds totalling about USD1.7 billion
- No final dividend proposed
The 2022 results saw significant business improvement for the Group as travel and pandemic restrictions in most regions gradually loosened.
The Group increased its owned hotels’ Revenue Per Available Room (“RevPAR”) by 25% from USD51 to USD64, despite lingering challenges in its operations in the Chinese mainland and Hong Kong, a result of sporadic restrictions related to local COVID-19 outbreaks throughout 2022.
The hotels’ RevPAR outside of the Chinese mainland greatly improved by about 130% to USD100 from USD44. The Group also applied effective cost-management strategies to improve profitability.
The Group’s hotels in Europe and ASEAN continued to see growth momentum from the resumption of travel post-COVID and strong domestic demands. In London and Paris, the hotels’ RevPARs reached record highs, while Singapore also saw strong growth. Overall, the average daily room rate grew about 20% YoY from USD130 to USD155.
The Group’s Operating Cashflow and Operating PATMI both turned positive for the first time since the COVID outbreak.
Commenting on the annual results, Shangri-La Group’s Chief Financial Officer and Chief Investment Officer, Chua Chee Wui, said, “China’s accelerated reopening is likely to be a significant tailwind to the Group, given that the Chinese mainland and Hong Kong have traditionally contributed about 65% of our hotels’ effective share of EBITDA. We are cautiously optimistic about the recovery of our business and turnaround of profitability, barring unforeseen circumstances and assuming the current positive momentum continues. We shall stay vigilant of our costs control efforts to ensure that the prospects of a brighter outlook translate into stronger bottom lines and, more importantly, cash generation.”
Shangri-La Group’s Chairman Hui Kuok said, “I am very proud of our colleagues’ commitment to delivering our signature Asian hospitality to our guests and the communities during the past three years, arguably the most challenging period of Shangri-La’s 52-year history. While navigating these challenging conditions, we took the opportunity to reassess our priorities, restructure and streamline our operations, capitalise on business opportunities, and prepare for the future as we further expand into the leisure segment to complement our strong base in serving corporate customers. Our loyalty programme, Shangri-La Circle, and our in-house developed personalised booking features, both launched in 2022, are seeing positive results. Going forward, we will roll out more content and personalised recommendations and further enhance our customer experience offerings.”
“Today, travel, leisure and business activities have resumed in all the markets in which we operate. Our management team will remain vigilant and closely monitor the market situation. I have every confidence that the worst is behind us and better days are ahead. I would also like to take this opportunity to thank all our guests, business partners, and shareholders for their support and trust throughout the year,” she added.
While Shangri-La Group grappled with the COVID challenges, it did not lose sight of the future. It continued to work on long-term strategic initiatives to position the Group to be the best-loved hospitality group as part of its 2030 vision.
The Group has developed a multi-year roadmap to capitalise on diverse business opportunities and meet future customers’ needs, based on its understanding that the creation of great products must be complemented by services that matter and resonate with customers.
The Group continues to revamp its existing properties to better serve the needs of its customers, especially in the leisure segment, a fast-growing one whose prominence was much amplified during and after the pandemic.
At Island Shangri-La, Hong Kong, guest rooms and function spaces are being upgraded in line with the brand’s enhanced design concept to better serve leisure customers.
By the end of 2023, the hotel is expected to launch its new wellness offerings and family floors, which will serve as a blueprint for other properties of the Group.
The opening of Phase 2 of the Group’s project in Fuzhou, which features a new shopping mall and office tower, will bring together a range of experiences to create synergies among its elements and set new benchmarks for retail, leisure, and office operations in the city. Meanwhile, the Group will also roll out imaginative and fun-filled family programmes and packages across its properties.
Sustainability is a core pillar of Shangri-La’s commitment to be the best-loved hospitality group, aligning with the values of its customers and creating long-term shareholders’ value.
Among its various sustainability initiatives, the Group’s hotels began phasing out the use of single-use plastic bottles in rooms, meetings and events as part of its aim to reduce by 50% the hotels’ use of single-use plastics per occupied room by 2026, using the 2019 level as a baseline.
The Group achieved an encouraging 13% reduction per room night in 2022.
On the community front, Shangri-La Group also delivered groceries, hot meals and care packages directly to vulnerable families during the COVID pandemic, benefitting around 200,000 people worldwide. The Group will continue to do more for communities to make lasting positive impact.
The financial position of the Group continues to be strong. As at 31 December 2022, the Group had cash and cash equivalent of USD766.0 million and committed undrawn facilities of USD973.1 million.
As of today, the Group has already completed refinancing arrangement for 67% of its 2023 refinancing needs and will continue to sustain cash conservation efforts. The Board has proposed no final dividend for 2022.
For more details, please refer to the final results announcement:
https://www1.hkexnews.hk/listedco/listconews/sehk/2023/0324/2023032400540.pdf
About Shangri-La Group
Shangri-La Group is one of the world’s premier developers, owners and managers of hotel and investment properties which comprises office buildings, commercial real estate and serviced apartments/residences. The Group’s other principal activities include hotel management services as well as property development for sale. It currently owns and/or manages over 100 hotels globally in 78 destinations under the Shangri-La, Kerry, JEN and Traders brands. Prominently positioned in Asia, the Group has a substantial pipeline of upcoming hotel and mixed-use development projects in Australia, the Chinese mainland, Cambodia, and Japan.
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