Shilla Hotel Posts 158.8 Billion KRW in Q2 Sales... Optimism for Major Hotel Performance Amid Endemic (Comprehensive)

Sales of 158.8 Billion KRW... 2% Increase YoY
Expectations for Strong Performance from Parnas, Lotte Hotel, and Others

Shilla Hotel has shown strong performance, benefiting significantly from the influx of tourists due to the endemic (periodic outbreak of infectious diseases).

According to Hotel Shilla on the 28th, the hotel and leisure division's sales in the second quarter of this year reached 158.8 billion KRW, up 2% from 155.8 billion KRW in the same period last year. However, operating profit was 24 billion KRW, down 15% from 28.4 billion KRW in the same period last year, which appears to be a result of the base effect following last year's record-breaking performance. Compared to the previous quarter (Q1), sales and operating profit increased by 11% and 158%, respectively.

Hotel Shilla attributes the strong performance to the normalization of the tourism industry due to the endemic and the influx of both domestic and foreign tourists. Additionally, efforts to strengthen profitability through solid management since last year also contributed. By hotel, Seoul Hotel's sales rose 15% year-on-year, and Shilla Stay increased by 28% compared to the same period last year. Leisure division sales also rose 7% year-on-year. However, Jeju Hotel was the only one to show a 19% decrease compared to the same period last year.

Shilla Hotel Seoul

Not only Shilla Hotel but also major domestic hotels are openly optimistic about the endemic. According to the hotel and financial investment industries, Parnas Hotel's (estimated) operating profit and sales for the second quarter are expected to be 15 billion KRW and 108 billion KRW, respectively. Considering that operating profit and sales for the same period last year were 8.1 billion KRW and 82 billion KRW, respectively, this represents an increase of approximately 54% and 75%. Industry analysis also suggests that hotel occupancy rates will improve by more than 20 percentage points compared to the same period last year when the impact of COVID-19 was still ongoing. The business hotel operated by Parnas Hotel, Nine Tree Hotel, also saw weekday occupancy rates rise to nearly 90%.

Lotte Hotel's sales for Seoul Hotel and Jeju Hotel are also estimated to have increased by 27% and 24%, respectively. The increase in foreign tourist occupancy rates at Lotte Hotel L7, located in urban tourist areas such as Myeongdong and Hongdae, was also a significant factor.

The hotel industry expects this strong performance to continue in the second half of the year as the peak hotel season begins in summer. The steady increase in demand for MICE (Meetings, Incentives, Conventions, and Exhibitions) and weddings is also one of the reasons. An industry insider said, "Foreign tourists are quickly filling the domestic demand that was lost overseas, and with various events resuming, the industry trend is positive. However, since some places recorded record-breaking performances last year, a certain level of base burden is expected."

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