Tourism revenue sinks as pandemic hammers demand

A street in Hanoi capital during the social distancing period (Photo: VNA)

Hanoi - Tourism companies witnessed revenues dwindling in the second quarter due to border closures and international flight bans amid the COVID-19 pandemic.

The number of international visitors to Vietnam has significantly reduced since March, nearly two months after the first confirmed cases of COVID-19 appeared in Vietnam. The number slumped by 99.3 percent in June compared to the same period last year.

Many tourism companies on the stock market recorded second-quarter revenues falling 70-80 percent year-on-year, resulting in a sharp decline in profits or huge losses such as Sheraton Danang, Vietravel and Dam Sen Water Park Corporation.

The Dam Sen Water Park (DSN) reported a loss of 4.3 billion VND in the second quarter. It enjoyed a profit of 42 billion VND in the same quarter last year.

In the first six months of this year, the company recorded a profit of a mere 100 million VND.

Vietravel (VTR) reported revenue of 206 billion VND and a loss of 38 billion VND in Q2. In the first half, the company earned 996 billion VND in revenue, down 72 percent year-on-year and suffered a loss of more than 76 billion VND.

The company is among the largest travel companies in the country with revenue coming mainly from international tours.

This year, the company forecast revenue to fall nearly 60 percent compared to the previous year. It expects a loss of about 22 billion VND, after consecutive years enjoying profits.

BenThanh Tourist Service Corporation (BTV) also suffered a loss of more than 7 billion VND in Q2.

It recorded a 60 percent decrease in revenue and a loss of more than 15 billion VND in the first six months.

Hoi An Tourist Service Joint Stock Company (HOT) reported a loss of 8.4 billion VND in the second quarter. The Board of Directors forecasts the company may suffer a loss of more than 6 billion VND in the third quarter.

As the tourism market has not yet recovered, the company temporarily approved a third-quarter earning plan with total revenue of 8.7 billion VND and a loss of nearly 6.2 billion VND.

In the last three months, COVID-19 had been effectively contained in the country, bringing hopes for the tourism industry. Many businesses have launched promotion packages to stimulate domestic customers.

However, the resurgence of the virus in Da Nang two weeks ago and its complicated developments are expected to continue putting pressure on the industry in the future.