SHR (S Hotel and Resort) has reported sales and service revenue of 7.22 billion baht for the first nine months of 2023, representing an 18% growth compared to the same period last year. This growth is attributed to the ongoing recovery of the global tourism industry, with the company's average hotel occupancy rate reaching 71%, a 12% increase from the previous year. Additionally, the average daily rate (ADR) has risen in line with increased travel demand and rising travel costs due to economic conditions, as well as changing consumer and travel behaviors. The average ADR for the first nine months of this year was 5,560 baht, up from 5,049 baht in the same period last year, resulting in a 29% increase in revenue per available room (RevPAR) to 3,821 baht. Coupled with ongoing cost and expense control, the company reported an Adjusted EBITDA of 1.749 billion baht, a 35% increase from the same period last year.

Dirk Andreline Derkuiper, CEO of the company, stated, "During the first nine months of 2023, the tourism industry has shown a clear recovery compared to the same period last year. Since the beginning of the year, we have recorded significantly higher occupancy rates due to increased travel demand and pricing strategies supported by the strong locations of our hotels in top tourist destinations, along with our commitment to excellent service standards and proactive marketing strategies. As a result, our hotels across all geographical locations have been able to generate increased revenue, particularly in key tourist areas that are popular with travelers worldwide. Specifically, (1) in Thailand, our hotel group has doubled its revenue due to being located in popular tourist areas and capturing a high-spending customer base, including Russians, Germans, and UK nationals. Our hotels in Thailand have shown very strong performance following the full reopening of the country, with occupancy rates reaching 80% (excluding rooms under renovation). (2) Our hotels in the UK continue to be a major revenue base, contributing 42% of total service revenue, reflecting strong growth from domestic tourism and the expansion of inter-regional travel, along with our strategy to manage RevPAR and find ways to enhance revenue growth, resulting in a 12% increase from the previous year. (3) For our hotels in the CROSSROADS Maldives project, while growth may not be as remarkable compared to 2022 when the Maldives tourism industry rebounded significantly compared to other major tourist destinations, the economic slowdown in Europe, a key market for the Maldives, has led to intense price competition, resulting in a 5% revenue growth from 2022.

However, the company is confident that the hotel business will continue to expand clearly in the fourth quarter of the year and into 2024, driven by the ongoing growth of the tourism sector and signs of recovery in inter-regional travel, which aligns with the increase in flight routes and frequencies. This year marks the first year of full global tourism reopening, and we are seeing trends of increasing new market customers in all regions where we operate. We are eager to seize opportunities to reach these potential customers and prepare to offer new product formats that meet the current travel trends, along with maintaining our high service standards. Furthermore, the renovation of our key hotels, including Outrigger Fiji Beach Resort, Sai Laguna Phuket, Sai Phi Phi Island Village, and some hotels in the UK, is progressing as part of our portfolio enhancement plan. The newly renovated rooms will be ready for guests before the high season in each country to enhance competitiveness and generate efficient profits. The company aims for the renovated rooms to achieve an average ADR increase of 15% - 25%.

Mr. Dirk added, "We continue to see positive growth signals in the tourism sector across all countries where we operate, giving us confidence that the company's revenue in 2024 will continue to grow steadily."

The company has started to see signs of recovery in Maldives tourism during the high season, supported by macro factors such as increased flight routes and frequencies, as well as job growth in the tourism industry, which aligns with the recovery outlook for room bookings and the company's strategy to manage RevPAR by expanding sales channels and finding new customer bases. Additionally, the company's new hotel under the SO Maldives brand, which opened in November, has received excellent feedback, complementing and fulfilling the needs of various market segments as a comprehensive leisure destination in the Maldives.

Regarding the hotels in the UK, the company continues to implement its asset rotation strategy by screening assets and reallocating investments towards higher quality and potential assets to enhance returns, while also upgrading brands and repositioning products to strengthen the operational efficiency of this portfolio and fully capitalize on the growth of the tourism industry.

For the hotels in Thailand, the company focuses on enhancing the competitiveness of core assets to sustainably meet the increasing demand for tourism. The renovation and upgrade plans for hotels will take place between 2023 and 2025, with construction scheduled only during the off-peak tourism season of each year, aiming to have new rooms ready to accommodate tourists during the high season each year to maximize pricing potential.

The company anticipates that in the first quarter of 2024, the hotel portfolio in Thailand will perform exceptionally well, supported not only by market growth during the tourism season but also by the full reopening of room availability and an increase in room rates due to the introduction of new products.

The final group is the Outrigger hotel portfolio, which will be a significant driver of performance in 2024 due to three supporting factors: (1) The tourism market in Fiji continues to expand, with strong support from increased travel demand from travelers from Australia and New Zealand, which have traditionally been the main markets. Fiji is also becoming increasingly popular among tourists from North America, Europe, and Asia, resulting in strong average occupancy rates throughout the year for both hotels in Fiji, pushing ADR to grow according to market mechanisms. (2) The completion of major renovations of hotel rooms and common areas, which will be fully completed by December this year, gives us confidence that the new products we offer will create an even better experience for tourists and significantly enhance our ability to adjust ADR. (3) The full-year reopening of Outrigger Mauritius, which has welcomed tourists since November 2023 after a temporary closure for water management system upgrades, just in time for the country's tourism season.

“SHR has operated according to the plans previously announced and has driven performance to meet targets amidst economic volatility in some countries and negative factors, as well as events beyond the company's control. However, I, along with the management and all employees of SHR, have dedicated our efforts and resources to fulfill our commitments to shareholders and all stakeholders. Additionally, in October, we successfully issued bonds, raising 1.3 billion baht to establish a strong and sustainable business foundation, such as supporting the renovation and enhancement of our portfolio, as well as expanding future investments,” Mr. Dirk concluded.