MANAMA: Gulf Hotels Group (GHG) has reported an increase of 17.59 per cent in net profit at BD8.679 million for the nine months ended September when compared with BD7.381m achieved in the same period in 2016.
A statement yesterday said for the same period the group achieved a total gross operating revenue of BD27.546m compared with BD26.055m in 2016, an increase of 5.72pc.
For the third quarter this year, the group achieved a net profit of BD2.809m, a decrease of 2.91pc from BD2.894m achieved in the same quarter last year.
However, profit for the third quarter last year included a one-time gain of BD6.126m associated with the acquisition of Bahrain Tourism Company.
For the third quarter, the group achieved a gross operating revenue of BD9.16m, a decrease of 5.3pc when compared with BD9.672m for the same period last year.
Highlighting the challenges facing the hospitality industry, chairman Farouk Almoayyed said falling occupancies and room rates over the past four years have resulted in a 21.3pc drop in revenues since 2014 for Gulf Hotel.
The drop, coupled with increases in duties, employment costs, overheads, utilities, and so on, is crippling the industry, said Mr Almoayyed, adding that many hotels might be forced out of business if the government did not act to support the industry and stimulate business.
The group expects to continue expanding within Bahrain with projects such as a multi-restaurant facility in Block 338 and the Gulf Executive Residence Juffair, however, given the challenging Bahrain market conditions, it will concentrate on external expansion in order to diversify its portfolio, with the UAE and Saudi Arabia as key target markets for both the hotel and restaurant segments, said Mr Almoayyed.
Echoing the chairman, chief executive Garfield Jones said, “Our current growth results from our acquisition of Bahrain Tourism Company in 2016 however the underlying trend in the industry is negative.”
Refurbishment of rooms at the BTC’s Crowne Plaza Hotel is progressing well with completion expected by first quarter of next year.
The 109 unit Gulf Executive Residence Juffair is now in the fit-out phase and is expected to open for business in the second half of 2018, said Mr Jones.
A full refurbishment of the Gulf Convention Centre will be done next year along with upgrades to the Gulf Hotel’s Al Waha Restaurant and Sherlock Holmes outlet.