Thai mall operator profits up 47 percent on tourism boom
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Thai retail property developer Central Pattana Pcl (CPN) reported net profit of 13.6 billion baht ($432.3 million) for its 2017 fiscal year on Wednesday, up 47 percent from a year earlier.
CPN beat estimates of 12.1 billion baht based on a survey of 11 analysts.
CPN, which operates 32 shopping malls in Thailand, has been one of the main beneficiaries of the country’s tourism boom, led by Chinese arrivals.
More direct flights from China, a visa fee discount and waiver incentives led to strong inbound tourism, CPN said in a statement.
Thailand received 35 million tourists in 2017 and expects 37.55 million arrivals this year.
Revenue from rent and services were up 3.2 percent from the year earlier, reaching 26 billion baht.
Average occupancy rates in its retail properties stood at 92 percent, lower than 94 percent a year earlier due to major renovations.
CPN, part of Central Group, owned by the billionaire Chirativat family, plans a compound annual growth rate of at least 13 percent until 2022 focusing on mixed-use and residential developments, increasing rental rates and new malls in Southeast Asia.
Hotel revenue grew 10 percent to 1.1 billion baht, with an average occupancy rate of 93 percent, up from 83 percent a year ago, due to a higher number of tourists, it said.
CPN expects its new mall on the tourist island of Phuket to open by mid-year and another mall in Malaysia to open by year-end.
Questions & Answers
Q.What contributed to CPN's strong financial performance in 2017?
What contributed to CPN's strong financial performance in 2017?
CPN directly benefited from Thailand's tourism boom, particularly the increase in Chinese visitors. More direct flights, a visa fee discount, and waiver incentives also drove strong inbound tourism figures for the country.
Q.Why did CPN's average retail property occupancy rates decline in 2017?
Why did CPN's average retail property occupancy rates decline in 2017?
The average occupancy rates for CPN's retail properties fell to 92 percent from 94 percent a year earlier. This decrease was attributed to major renovations taking place across their portfolio.
Q.What are CPN's future growth strategies beyond new mall developments?
What are CPN's future growth strategies beyond new mall developments?
CPN plans to achieve a compound annual growth rate of at least 13 percent until 2022. This will involve focusing on mixed-use and residential developments, alongside increasing rental rates in their properties.
Q.What was the growth in hotel revenue for CPN, and what caused it?
What was the growth in hotel revenue for CPN, and what caused it?
Hotel revenue for CPN increased by 10 percent, reaching 1.1 billion baht. This growth was driven by a higher number of tourists, which also raised the average hotel occupancy rate to 93 percent from 83 percent.
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