Centel sees bright year for Thai hotels, despite challenges
Central Plaza Hotel Plc will open six new hotels this year as it expects a 30 to 40% increase in revenues, following a faster-than-expected recovery last year, its CEO Thirayuth Chirathivat said on Friday.
The company, known as Centel, saw total revenue surge 57% last year to 18.21 billion baht, while its net profit jumped 123% to 398 million baht. The year before, it lost 1.73 billion baht.
Thirayuth said the return of Chinese tourists would propel growth this year, adding that the occupancy rate at Centel hotels rose to 80% after Thailand reopened to foreign tourists in July last year.
The company opened one of its Centra brand hotels this year in Ubon Ratchathani and will open another in Osaka on July 1, Thirayuth said.
Despite the optimistic outlook, Thirayuth said Centel is closely monitoring several challenges, including the cost of food, energy, wages and rising interest rates.
Flight capacity has not recovered to pre-pandemic levels yet, but is expected to do so at the end of this year or early next year, he said.
Thirayuth expects the return of Chinese tourists to be gradual because flights remain expensive.
The upcoming general election, tentatively scheduled for May 7, will stimulate consumer spending, which will have a positive impact on the company, Thirayuth added.
He called for the next government to implement clear policies to reduce business costs, and stimulate tourism and consumer spending.
"The fifth phase of Rao Tiew Duay Kan [We Travel Together] domestic tourism stimulus scheme should be launched during the country's low season," he said, referring to the rainy season.
Thirayuth reiterated Centel’s commitment to achieve its net-zero greenhouse gas emissions by 2050. He said the company plans to reduce greenhouse gas emissions by 20% by 2029 through effective management of energy, water and waste.
"Centel will reduce the use of single-use plastics by 2025," he said, adding that the company is looking at technological solutions to reduce greenhouse gas emissions further.
The company will offer incentives for guests to be more attentive to environmental protection, Thirayuth said.
Centel CFO Gun Srisompong said the company plans to mitigate rising costs by finding alternative sources for raw materials and cutting fuel costs by using more solar energy and reducing the amount of energy used.
"Business growth this year will be driven by the hotel and food businesses," Gun said.
Hotels in Thailand will continue to recover as the number of international tourists is forecast to rise, he added. Centel’s five-star properties in Bangkok and major tourist destinations will be the main drivers of its growth, Gun said.
The company’s food business is expected to continue to grow as the economy’s recovery continues, he said, estimating that same-store sales (excluding joint ventures) would see annualised growth of 7-9% this year. The number of its food store outlets, including joint ventures, will expand by 120 to 150 this year, Gun said.
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