South Shore Holdings Limited has reported a 16 per cent year-on-year rise in revenues for the year ended 31 March 2020 to HK$10.8 billion (US$1.3 billion), with net losses reduced by 80 per cent year-on-year to HK$1 billion.
South Shore Holdings Limited is a hospitality, entertainment and construction group responsible for The 13 Hotel in Cotai but with most of its business linked to Hong Kong developing group Paul Y. Engineering Group Limited.
The large decrease in reported losses was attributed mainly to decrease of rent, consultancy fees, legal & professional fees in addition to the impairment loss on hotel assets of approximately HK$4.6 billion million recorded in the prior year.
Still, according to its most recent unaudited financial report, South Shore indicated that its hotel segment recorded total liabilities of approximately HK$5.2 billion include liability portion of convertible bonds issued for financing the hotel development and bank and other borrowings for the hotel development.
The 13 Hotel temporarily suspended operations in February due to the pandemic and has remained closed since according to the Macao Government Tourism Office (MGTO).
In November last year, South Shore announced it had reached an agreement to dispose of a 50 per cent share in The 13 Hotel held by an indirectly owned subsidiary for HK$750 million to three companies, Fine Intellect (20 per cent); All Fame (20 per cent) and Ease Link (10 per cent).
The proceeds of the sale would be used to re-pay bank loans amounting to almost HK$2.9 billion.
‘Looking ahead, the hotel market in Macau continues to grow steadily but the overall external economic environment is still posing uncertainty including the COVID-19 pandemic, US-China trade tension is expected to continue and raise uncertainty on the political and financial risks in short-term, but it still looks remain optimistic in long-term business,’ the company noted.
The company’s revenue from hotel rooms and food & beverage was approximately HK$17 million and HK$12 million, respectively, for the period under review, with an average occupancy rate for The 13 at 37.3 per cent, with average daily room rate of HK$1,829.
South Shore’s hotel segment reported HK$994 million in losses for the year
ended March 31 and depreciation charges of some HK$353 million.
Finance costs on bank and other borrowings also amounted to approximately HK$343 million, with finance costs on convertible bonds almost HK$152 million.
The company also recently announced the appointment of Tse Cho Tseung as Executive Director effective from June 17 of this year.
South Shore’s management contracting division through the PYE group remained the core business and the major contributor of revenue this year, with revenuerising 17 per cent year-on-year to HK$10.9 billion.