ROH’s 2Q Profit Declines 54% from a Decrease in Services and Post-Employment Benefits

Royal Orchid Hotel (Thailand) Public Company Limited (ROH)  has reported its 2Q19 consolidated financial statement through the Stock Exchange of Thailand as follows:

ROH’s consolidated and separate financial statements presented a decrease in profit of THB 9.3 million and THB 8.9 million, or equivalent to 54% and 42% respectively, compared to the year 2018.
The operating income for the year 2019 compared with the year 2018 in ROH’s consolidated financial statements decreased by THB 3.6 million or equivalent to 2% and decreased by THB 3.2 million or 1% compared to the year 2018 in separate financial statements market are very soft and the demand decrease of the meeting, incentive conferences and exhibitions business (MICE business) from the last year.

ROH focuses on cost and expenses management to utilize resources to maximize the benefits. Compared to year 2018, cost of services, selling and administrative expenses for the year 2019 in ROH’s consolidated and separate financial statements increased due to the additional legal severance pay rates for employees who have worked for an uninterrupted period of twenty years or more, with such employees entitled to receive not less than 400 days’ compensation at the latest wage rate. The change is considered a post-employment benefits plan amendment and ROH and its subsidiary have additional long-term employee benefit liabilities of THB 13.9 million (ROH only: THB 13.9 million) as a result. ROH and its subsidiary already reflected the effect of the change by recognizing past service costs as expenses in the income statement of the period in which the law is effective, which is the second quarter of 2019.