EIH, which owns the Oberoi chain of hotels, has attributed its drop in revenue and profit in the first quarter of the current year to a general slowing of business activity, decline in air travel and reduction in the airline catering business.
The quarter resulted in a loss before tax of Rs 11.25 crore, compared to a profit of Rs 16 crore in the same period a year before. Loss after tax was Rs 7 crore, as against a profit in the comparative period of Rs 10.2 crore. Operating earnings were Rs 34.9 crore, down from Rs 56.8 crore; total revenue was Rs 303 crore vis-a-vis Rs 343.5 crore.
Executive Chairman P R S Oberoi told shareholders at the company’s annual general meeting on Wednesday that revenue and profit in the next three quarters would be better. He was not present, his speech being read out by Vikram Oberoi, managing director and chief executive. The meeting was chaired by S S Mukherji, executive vice-chairman.
Last year, EIH made a one-off provision of Rs 84.75 crore on account of cash-strapped Jet Airways. The company’s annual report mentioned, but for the one-off provision its profit before tax would have been higher than the previous year by 42.9 per cent.
Responding to shareholder queries, Vikram Oberoi said the company had been working with Jet from the beginning. “Over the years, we have done business of Rs 1,000 crore,” he said.
At least two properties would be coming up in the near term, at Marrakech (Morocco) and Bandhavgarh. The former is in the final phase of completion and scheduled to open in the last quarter of 2019.
The Oberoi Wildlife Resort at Bandhavgarh is located on a 22-acre site, 5 km from Bandhavgarh National Park in Madhya Pradesh. Construction is on and it is scheduled to open in the third quarter of 2020.
The Oberoi Grand in Kolkata is adding 50 rooms for an investment of around Rs 100 crore. This will be completed in around 15 months.