"Hotel Shilla Faces First Ever Annual Loss Due to COVID-19 Impact (Comprehensive)"

Hotel Shilla exterior view

[Asia Economy Reporter Kim Yuri] Hotel Shilla recorded its first-ever annual loss last year due to the impact of COVID-19.

On the 29th, Hotel Shilla announced that its operating loss for the fourth quarter of last year was 35.2 billion KRW, turning to a deficit compared to the same period last year. During the same period, sales amounted to 841.9 billion KRW, a decrease of 45.5%.

Accordingly, the operating loss for last year was 185.3 billion KRW, turning to a deficit compared to the previous year's operating profit of 295.9 billion KRW. This is the first-ever annual loss. Last year's sales recorded 3.1881 trillion KRW, a 44.2% decrease compared to the previous year.

Due to the impact of COVID-19, both the duty-free and hotel & leisure sectors faced difficulties in the fourth quarter of last year. Sales in the 4th quarter TR (duty-free) sector were 742.3 billion KRW, down 47% year-on-year. Operating loss also turned to a deficit of 16.7 billion KRW compared to the same period last year. Domestic downtown and airport store sales declined by 27% and 88% respectively compared to the same period last year, struggling to recover.

Due to the elevated 'social distancing' measures in the 4th quarter, occupancy rates fell, and the hotel & leisure sector's deficit widened. Sales in this sector for the 4th quarter were 99.6 billion KRW, down 25% year-on-year, and operating loss was 18.5 billion KRW, more than tripling compared to the previous quarter.

The company plans to actively respond to internal and external environmental changes in the first quarter of this year to overcome the impact of COVID-19 and improve profitability. A Hotel Shilla official emphasized, "Effective multifaceted support is urgently needed until the tourism industry normalizes."

This content was produced with the assistance of AI translation services.