The Hindu Business Line : IHCL net rises 31.32%

IHCL reported a 31.32 per cent rise in profit after tax for the second quarter ended September 30, 2003 to Rs 3.48 crore, from the previous corresponding Rs 2.65 crore. Including sales and other operating income of Rs 136.55 crore (Rs 115.86 crore for the year ago period), total income touched Rs 144.21 crore (Rs 126.40 crore).

Profit before exceptional items and tax was higher by 104.13 per cent at Rs 8.41 crore (Rs 4.12 crore). Exceptional items accounted for Rs 2.91 crore, largely VRS outflow, its impact partly offset by reduced interest of Rs 6.06 crore (Rs 9.28 crore). Occupancy level averaged 63 per cent (53 per cent), while room revenues gained by 19 per cent. ARRs, post-June '03, exceeded year ago levels and closed the quarter higher by 9 per cent.

In terms of revenue share, rooms fetched 46 per cent (45 per cent) and F&B, 44 per cent (44 per cent). From a SBU perspective, the revenue share of luxury division grew to 80 per cent (72 per cent), business contributed 8 per cent (13 per cent), leisure 7 per cent (6 per cent) and corporate, 7 per cent (4 per cent). Domestic leisure traffic was strong in the first half and going ahead, international leisure traffic is projected to pick up significantly.

For the second half, IHCL expects growth rates to continue with a combination of occupancy and ARR increases. However, other expenses and pay roll costs will be higher, the latter ascribed to induction of people with international experience. Mr Zubin Dubash, Executive Director, IHCL, said at a press briefing, the company is implementing a 7-10 per cent rate increase across properties.

Direct sales agents are being appointed to increase coverage at no fixed costs, there will be focus on increasing the proportion of negotiated accounts and a sales campaign is planned targeting over 200 corporates in South East Asia.

According to him, IHCL did submit a bid for a suitable property in the US, but success appears almost ruled out given reports of a stronger bid in the fray. No official word to that effect has been received yet, from the seller. Some time back, the company had informed the BSE of its board approving the submission of a non-binding bid for a US property.

For the first half, its profit after tax amounted to Rs 7.24 crore (Rs 3.67 crore) on total income of Rs 281.87 crore (Rs 244.17 crore).

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