POLITICAL UNCERTAINTY in the United Kingdom (UK) and fears surrounding the Zika virus are challenging the performance of Barbados largest hotel operating, Elegant Hotels Group plc.
The company, which is listed on the London Stock Exchange, raised these concerns while reporting on its financial outcome for the six months ended March 31.
Elegant achieved an adjusted operating profit of $15.1 per cent (up 2.6 per cent), increased overall revenue, revenue per revenue per available room, earnings, and interim dividend.
But last week management said “over the last few months the group has experienced a variety of challenges”.
“In common with the rest of the luxury hotel market in Barbados, the group has seen an impact on customer demand as a result of wider issues that are largely beyond its control,” it said.
“The current political uncertainty in the UK has led to a reduction in consumer appetite for luxury holidays, and publicity around the Zika virus has resulted in room cancellations and in substantial competitor discounting, despite the relatively small number of reported cases in Barbados (with none in the group’s hotels).”
Elegant said “while such factors are clearly unpredictable, the group is hopeful that their negative impact will be relatively short-term in nature”.
Commenting on the performance, Elegant chief executive officer Sunil Chatrani called the reporting period one of “solid progress for Elegant Hotels and we were particularly pleased to complete our first acquisition since becoming a public company, in the form of Waves Hotel & Spa”.
“The group now owns around 29 per cent of the quality leisure tourist room stock in Barbados and our objective remains to continue extending this position while also expanding further into the Caribbean region,” he said.
“Whilst there are currently a number of challenges that are impacting the trading performance of both Elegant Hotels and the wider luxury hotel market in Barbados, we continue to be confident in the group’s long-term growth prospects.” (SC)