Recovery in Hotel Demand Driven by Go To Travel and the Shift to Domestic Travel

「Meanwhile, occupancy rates diverged between facilities and sales stagnated at some locations due to a combination of factors, including demand being dispersed among newly opened competing facilities, a partial retreat in domestic lodging demand caused by record summer heat, and a decline in inbound demand, particularly from China, in the second half.」

「The hotel business shifted to management contracts in connection with the transfer of the hotel assets on 1 July 2024. As a result, sales after the transfer date were no longer recorded by the Company, leading to a substantial decline in a simple year-on-year comparison. At each hotel, the competitive environment became increasingly challenging as development of hotels in similar price ranges progressed. Although room rates increased following price revisions, occupancy rates declined at some facilities, and sales fell below both the year-earlier period and the initial plan.」

「Hotel business sales for the six-month period under review were ¥1,029 million, down 52.8% year on year. On a sales basis that, as before, aggregates sales at each location, however, sales increased 4.4% year on year.」

「Hotel business sales for the first nine months of the fiscal year under review were ¥3,535 million, up 11.8% year on year, and operating income was ¥222 million, up 525.9% year on year. GOP was ¥1,012 million, up 25.0% year on year.」

「Hotel business sales for the first half of the fiscal year under review were ¥2,258 million, up 10.4% year on year, and operating income was ¥80 million, up 1,045.0% year on year. GOP was ¥601 million, up 15.5% year on year.」

「Hotel business sales for the first quarter of the fiscal year under review were ¥1,018 million, up 12.8% year on year, while the operating loss was ¥20 million, compared with an operating loss of ¥59 million in the year-earlier period. GOP was ¥234 million, up 27.3% year on year.」

「Hotel business sales for the fiscal year under review were ¥4,061 million, up 21.8% year on year, while the operating loss was ¥90 million, compared with an operating loss of ¥362 million in the year-earlier period. GOP was ¥942 million, up 50.4% year on year.」

「Hotel business sales for the first nine months of the fiscal year under review were ¥3,162 million, up 23.6% year on year, and operating income was ¥35 million, compared with an operating loss of ¥171 million in the year-earlier period. GOP was ¥810 million, up 40.4% year on year.」

「Hotel business sales for the first half of the fiscal year under review were ¥2,046 million, up 25.2% year on year, and operating income was ¥6 million, compared with an operating loss of ¥128 million in the year-earlier period. GOP was ¥520 million, up 40.9% year on year.」

「Hotel business sales for the first quarter of the fiscal year under review were ¥902 million, up 30.8% year on year, while the operating loss was ¥59 million, compared with an operating loss of ¥142 million in the year-earlier period. GOP was ¥183 million, compared with ¥103 million in the year-earlier period.」

「Total hotel business sales reached a record high.」

「Revenue for the nine-month consolidated cumulative period was at a record high for the hotel business as a whole, owing to the recovery of existing hotels, whose sales exceeded both the previous year and the year before, before the spread of COVID-19, as well as the contribution from the new openings of THE HIRAMATSU Kyoto and THE HIRAMATSU Karuizawa Miyota.」

「Hotel business sales for the first half of the fiscal year under review were ¥1,635 million, up 93.6% year on year, while the operating loss was ¥128 million, compared with an operating loss of ¥228 million in the year-earlier period, a ¥99 million reduction in the loss.」

「Hotel business sales for the first quarter of the fiscal year under review were ¥690 million, up 236.7% year on year, while the operating loss was ¥142 million, compared with an operating loss of ¥229 million in the year-earlier period. GOP, defined as gross operating profit after deducting rent and depreciation from selling, general and administrative expenses, was ¥103 million, up 215.9% year on year.」

「In addition to the high-value-added concept matching consumer needs during the COVID-19 pandemic and increased demand from the shift from overseas travel to domestic travel, the government’s “Go To Travel” program provided a tailwind, resulting in performance substantially above the same period of the previous year.」

「Signs of recovery emerged due to the impact of the Japanese government's tourism support program, Go To Travel, and the shift from overseas to domestic travel. From July onward, the hotels performed steadily, with each hotel's sales exceeding the year-earlier period.」