Financial Performance - Total revenue for 2020 was $40.784 million, a decrease of 58.7% from $98.699 million in 2019[22]. - The company reported an operating loss of $12.194 million for 2020, compared to an operating profit of $10.580 million in 2019[22]. - Loss attributable to owners of the company was $9.320 million, representing a loss margin of -22.9%[22]. - Basic loss per share for 2020 was 2.6 cents, down from earnings of 3.1 cents per share in 2019[22]. - The company recorded revenue of $40.8 million, a decrease of $57.9 million or 58.7% compared to last year's revenue of $98.7 million[42]. - The operating loss for the year was approximately $12.2 million, a decrease of about $22.8 million from last year's operating profit of $10.6 million[42]. - The hotel and resort segment accounted for approximately 73.8% of total revenue, while the high-end travel retail segment and destination services segment accounted for 24.8% and 1.4%, respectively[45]. - Revenue from the hotel and resort segment was approximately $30.1 million, a decrease of $34.6 million or 53.5% compared to the previous year[46]. - The high-end travel retail segment generated revenue of $10.1 million, down 66.7% from $30.3 million last year[52]. - The destination services segment recorded revenue of $0.6 million, a decrease of $3.1 million compared to the previous year[53]. Impact of COVID-19 - The company temporarily closed several hotels and high-end retail stores to mitigate the financial impact of COVID-19[27]. - Cost-cutting measures were implemented across all business units to effectively reduce operational costs[27]. - The company experienced a significant decline in tourist arrivals due to COVID-19, impacting operations in Saipan and Guam[27]. - As of the report date, over 128 million COVID-19 cases were confirmed globally, with approximately 2.8 million deaths[27]. - Saipan reported a total of 159 confirmed COVID-19 cases with 2 deaths, while Guam reported 8,773 confirmed cases with 135 deaths, indicating effective measures taken by local governments to control the virus spread[30]. - As of the report date, 49.4% of CNMI's population and 51.7% of Guam's population have been vaccinated against COVID-19, with expectations for herd immunity by July 2021[30]. - Despite challenges from the pandemic, the company resumed some operations in the last quarter of 2020, including restaurants at Saipan's hotels and select retail stores[40]. - Kanoa Resort remained operational to provide services for individuals undergoing mandatory quarantine, demonstrating adaptability during the pandemic[40]. - Cost-cutting measures will continue to mitigate the financial impact of the COVID-19 pandemic[66]. Future Outlook and Strategies - The company maintains a cautiously optimistic outlook for the leisure travel market's gradual recovery by the end of 2021, driven by vaccination rollouts and travel bubbles[34]. - The company plans to leverage the strong rebound potential in leisure travel, particularly from tourists from mainland China, Japan, and South Korea, who recognize the Crowne Plaza brand[34]. - The company will continue to monitor global travel sentiment and market behavior closely, adjusting business plans and strategies to seize market opportunities for sustainable growth[34]. - The company is focusing on asset optimization plans, including renovations and upgrades of hotels during the pandemic, with the Crowne Plaza Resort Guam expected to reopen in the second half of 2021[31]. - The company plans to rebrand the Saipan Resort to "Crowne Plaza Resort Saipan" in the second half of 2021, aiming to attract high-end tourists[48]. - The Guam Resort is undergoing renovations, with an increase in room supply from 318 to 321 rooms, targeting the high-end market[51]. - The group is accelerating renovation and upgrade projects for the Guam Hyatt Hotel and Saipan Hyatt Resort, expected to be completed in the second half of 2021, with rebranding to "Crowne Plaza Resort Guam" and "Crowne Plaza Resort Saipan" respectively[62]. - Kanoa Resort will undergo renovations after the emergency contract ends, with plans to rebrand as "voco Resort Saipan"[63]. - The management believes that the travel market will rebound strongly post-COVID-19, particularly in Saipan and Guam, which are seen as "safe" destinations[61]. Shareholder and Financial Management - The company did not declare any dividends for the year 2020[10]. - The group confirmed a right-of-use asset of approximately $3.9 million related to the lease agreement for the Saipan Hyatt Resort, effective from July 1, 2021, for a term of 40 years with a possible extension of up to 15 years[55]. - The group's total cash and bank deposits as of December 31, 2020, amounted to approximately $38.2 million, a decrease of about $18.4 million compared to December 31, 2019[72]. - The total employee cost for the year was $13.6 million, down from $25 million in 2019, reflecting significant staff reductions due to cost-saving measures during hotel and resort closures[75]. - The group had no interest-bearing bank borrowings as of December 31, 2020, resulting in a capital debt ratio that is not applicable[72]. - The group's bank financing remained unchanged at $11 million as of December 31 for both 2020 and 2019, with all financing not utilized[73]. - The company has allocated $2,032,000 for general working capital, with a total of $3,945,000 available for distribution to shareholders as of December 31, 2020[140]. - The company made charitable contributions of approximately $505,000 in the current year, compared to $128,000 in 2019[145]. Management and Governance - Zhao Mingjie has been an executive director since November 2018, with over 30 years of experience in managing various business operations in the Asia-Pacific region[80]. - Su Chen Shiting has been an executive director and executive vice president since November 2018, with a solid background in the hotel and hospitality industry[82]. - Jeffrey William Schweizer has been an executive director since April 2019 and oversees hotel operations, bringing over 30 years of experience in the hospitality sector[83]. - Chen Weili has been a non-executive director since November 2018, with extensive experience in business management and tourism[84]. - Professor Chen Baihuan has served as an independent non-executive director since April 2019, with over 30 years of experience in the hotel and resort industry[85]. - Ma Zhaoxiang has been an independent non-executive director since April 2019, with over 40 years of experience in accounting and finance[88]. - Chen Liangcai has been an independent non-executive director since April 2019, with over 40 years of experience in the financial sector, previously serving as the head of commercial banking at HSBC[89]. - The group is committed to maintaining communication with shareholders and investors through various channels, including meetings and press releases[68]. - The company continues to purchase directors' and officers' liability insurance to indemnify its directors and senior officers[193]. Related Party Transactions - The company has disclosed related party transactions in its consolidated financial statements, which are subject to compliance with the Listing Rules[172]. - Several transactions conducted by the group during the year are classified as non-exempt continuing connected transactions, requiring adherence to the Listing Rules for announcements and approvals[173]. - The total value of transactions with Quanzhou Century Travel for selected holiday package trading reached $624,000, with an annual cap of $11,793,000[176]. - The agreement with TakeCare Insurance Company for medical insurance covers $1,282,000, with an annual cap of $2,196,000[180]. - The company has a long-term cooperative model with Quanzhou Century Travel, which stabilizes sales and enhances hotel revenue, mitigating risks from seasonal declines in the Saipan leisure tourism market[177]. - The company has established a long-term relationship with TakeCare, which is beneficial for both the group and its shareholders[180]. - The terms of the selected holiday package trading with Quanzhou Century Travel are based on fair commercial negotiations and are deemed reasonable and in the overall interest of the group and its shareholders[177]. Compliance and Risk Management - The group faces various risks and uncertainties that may impact its business operations and financial performance[105]. - The group has allocated sufficient resources to ensure compliance with relevant laws and regulations[104]. - Independent non-executive directors confirmed that the related transactions were conducted in the ordinary course of business and on terms no less favorable than those offered to independent third parties[189]. - The auditor confirmed that the related transactions were approved by the board and complied with the company's pricing policy, without exceeding the relevant limits set in the agreements[189].
海天地悦旅(01832) - 2020 - 年度财报