Taj renovation results in Rs.530 m loss in FY 2013/14
View(s):Taj Hotels has reported a loss of Rs.530 million for the year ending March 31, 2014 compared to profits amounting to Rs.221 million last year, unaudited accounts released by the hotel management stated in a stock exchange filing.
It was noted that the operating loss was at Rs.433.7 million compared to the profits of Rs.286.2 million made in 2013. The hotel had increased its marketing expenses by 26 per cent to Rs.75.4 million for 2013/14. But revenues for the year fell by 33 per cent to Rs.1.2 billion, the hotel stated.
The statement said the company, TAL Lanka Hotels PLC, had invested US$20 million for the renovation of Taj Samudra Hotel from April 2013 to renovate the lobby, bar guest rooms and public areas of the property. As a result of this only limited inventory of about 70 rooms were operational and available for sale between April and October 2013.
This led to lower revenues and also an operating loss in the period with the first phase of the project for US$15.5 million completed and all 300 rooms available for sale since November 1, 2013, the report stated.
In terms of turnover it was pointed out that this had totalled Rs.1.3 billion, down from the previous year’s Rs.1.9 billion and accommodation at Rs.649.2 million and food and beverage at Rs.565 million falling considerably as against the year 2012/13.
While share prices had sustained at levels similar to the previous year at a maximum of Rs.32 and a low of Rs.27.60 for 2013-14, the Employees Provident Fund was listed as the third highest shareholder among the company’s top 20 shareholders as at March 31 having accrued 5.14 per cent of the total shares but considerably lower than its previous two with Indian Hotels Company Ltd owning 24.62 per cent and TAL Hotels and Resorts Ltd holding onto 58.14 per cent of shares in the organisation.