Message from the President
To our shareholders:
We would like to thank you for your support and patronage. Let me report on the status of our business in the second quarter of FY2018.
A look back at the first half of FY 2018
According to the Japan National Tourism Organization (JNTO), the number of international visitors to Japan in the first half of 2018 reached a record high of 15.89 million, an increase of 15.6% year over year comparing the same period. At our properties, the total number of international guests has increased steadily by 11.8% to about 920,000 people, with our targeted group of Foreign Individual Travelers (FIT) accounting for 80% of that number. On the other hand, new hotel openings are accelerating not just from industry competitors, but also from companies in other industries entering the market leading to a labor shortage. Given the intensifying competitive environment, we recognize that differentiation strategies and lack of personnel are issues to address.
In terms of business results for the first half of FY 2018, Hakone Kowakien Tenyu, which opened in April 2017, and Hotel Gracery Kyoto Sanjo South, which opened in May 2017, have now been in operation for a full year. On the other hand, due to Hakone Hotel Kowakien ending operations on January 10 of this year, and our management contract for Hotel Azur Takeshiba concluding on March 2017, sales declined by 220 million yen year over year comparing the same period. However, owing to an increase in room prices mainly in the WHG part of our accommodation business, operating income increased by 130 million yen, and ordinary income increased by 170 million yen, exceeding initial expectations.
In addition to our existing businesses, we have launched glamping (*) business as a new initiative to respond to the diversifying needs of our customers. On April 27, we opened Fujino Kirameki Fuji Gotemba in Gotemba City, Shizuoka Prefecture. In addition, in April, we opened Opera Domaine Kouraibashi in Osaka City as part of our efforts to strengthen our wedding business.
(*) A portmanteau of "glamour" and "camping," which describes a style of camping and recreation in nature with hotel-style amenities and services.
A look at plans for the second half of the year
In the WHG business, on August 31, we opened Hotel Gracery Seoul, our first directly-managed, overseas property, and on October 4, we plan to open Hotel Gracery Asakusa. Also, in anticipation of new brand hotels opening from 2019, we will be introducing new productivity enhancing services such as an automatic check-in / check-out system and an AI concierge.
In our Resort business, in order to improve customer satisfaction and increase the number of repeat customers at Hakone Kowakien Tenyu, we are providing high value added products at the restaurants Kihinkan and Geihinkan known for their historic buildings, and also various experiential activity programs. As for Hakone Kowakien Yunessun, we are working to enhance the appeal of the facilities by improving the onsite dining, shopping, and activity options, as well as build relationships with neighboring facilities and continue attracting FIT customers.
In our Luxury and Banquet business, we will utilize the garden shrine constructed in November 2017 as well as the large banquet hall refurbished in August 2017 at Hotel Chinzanso Tokyo to meet demand for Japanese style weddings and further developing MICE (meetings, incentives, conventions, exhibitions) business. As for Taiko-en, we will also continue to meet the demand for Japanese style weddings, and along with the newly added historical European-style Opera Domaine Kouraibashi, will work to improve the total number of new visits and clients.
As for other projects, on July 25, we opened Origami Asakusa, an authentic Japanese restaurant serving Halal food to meet the needs of the increasing number of Muslim travelers visiting Japan. In addition to our first glamping facility, Fujino Kirameki Fuji Gotemba, on September 27, we will open Nordisk Village Goto Islands, a glamping facility equipped with luxury tents, in the Goto Islands in Nagasaki that is a collaboration with the Danish outdoor goods company Nordisk. Through these business activities, we will work to achieve synergies with our existing businesses and continue growing our customer base.
We will continue to provide high value-added products and services tailored to each and every customer in Japan and overseas. I would like to once again thank our shareholders for their support and patronage, and ask for their continued support in the future.
Fujita Kanko Inc.
- IR Library