{"id":884,"date":"2024-08-28T09:39:25","date_gmt":"2024-08-28T01:39:25","guid":{"rendered":"https:\/\/www.ftpol.com\/en\/?p=884"},"modified":"2024-08-28T09:39:25","modified_gmt":"2024-08-28T01:39:25","slug":"soft-duty-free-spending-dampens-hainan-meilan-international-airport-h1-results","status":"publish","type":"post","link":"https:\/\/www.ftpol.com\/en\/soft-duty-free-spending-dampens-hainan-meilan-international-airport-h1-results.html","title":{"rendered":"Soft duty-free spending dampens Hainan Meilan International Airport H1 results"},"content":{"rendered":"

Hainan Meilan International Airport Company posted a -27.03% fall in franchise income (see table below) to RMB237.4 million (US$33.4 million) for its first half ended 30 June. The airport company said the decrease was driven by a fall (unspecified) in duty-free sales and advertising revenue.<\/p>\n

The franchise income decline led to a -4.5% year-on-year decrease in first-half non-aeronautical revenue to RMB545.6 million (US$76.6 million).<\/p>\n

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Source: Hainan Meilan Airport Company<\/strong><\/figcaption><\/figure>\n

Passenger numbers increased +20% year-on-year to almost 14.5 million with domestic traffic (key to the offshore duty-free business) up +17%. International passenger volume recovered to 85% of 2019 levels.<\/p>\n

Total revenues rose +7.8% to RMB1,149,277,255 (US$161.4 million). The group reported a net loss of RMB248.05 million (US$34.08 million)<\/p>\n

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(Above and below) Images of China Duty Free Group\u2019s expansive shopping offer at Haikou Meilan International Airport Terminal 1, a predominantly domestic terminal that enjoys offshore duty-free status. Note the red signs in each shop warning against daigou activity. {Photos: Martin Moodie, April 2024}<\/strong><\/figcaption><\/figure>\n

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In a note, Goldman Sachs Investment Research commented: \u201cAlthough the company did not disclose its DFS sales figures, if assuming similar trends in duty-free and duty-on [duty-paid] businesses, this implies duty-free sales per passenger declined by -39% year-on-year to only RMB71 (US$9.97 = 33% of 2021 FY average) similar to the weak DFS spending seen recently in Shanghai International Airport.\u201d<\/p>\n

Hainan Meilan Airport Company said that in H1 Hainan offshore duty-free sales in total fell -29.9% year-on-year to approximately RMB18.46 billion (US$2.6 billion), on a -10% fall in shopper numbers to 3.36 million and a -35.9% slump in the number of transactions to 19.8 million.<\/p>\n

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Goldman Sachs Investment Research analyses the results. Note the deteriorating per-passenger duty-free spend.<\/strong><\/figcaption><\/figure>\n

The airport company attributed the declines to an increase in Chinese outbound travel to Southeast Asia and other countries. This resulted in \u201cserious\u201d dilution of island shopping, it said, adding: \u201cAt the same time, changes in tourist consumption habits resulted in a significant decrease in offshore duty-free sales of the whole island.\u201d<\/p>\n

First-half visitor numbers to the province rose +10.9% to 51,087,800 while total tourism revenue surged +19.8% to RMB109.739 billion (US$15.4 billion).<\/p>\n

Those positive numbers underline the challenges faced by the island\u2019s duty-free industry amid a seemingly sustained consumer trend to non-shopping-related holiday spending.<\/p>\n","protected":false},"excerpt":{"rendered":"

Hainan Meilan Internation<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[6],"tags":[],"_links":{"self":[{"href":"https:\/\/www.ftpol.com\/en\/wp-json\/wp\/v2\/posts\/884"}],"collection":[{"href":"https:\/\/www.ftpol.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.ftpol.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.ftpol.com\/en\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.ftpol.com\/en\/wp-json\/wp\/v2\/comments?post=884"}],"version-history":[{"count":1,"href":"https:\/\/www.ftpol.com\/en\/wp-json\/wp\/v2\/posts\/884\/revisions"}],"predecessor-version":[{"id":885,"href":"https:\/\/www.ftpol.com\/en\/wp-json\/wp\/v2\/posts\/884\/revisions\/885"}],"wp:attachment":[{"href":"https:\/\/www.ftpol.com\/en\/wp-json\/wp\/v2\/media?parent=884"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.ftpol.com\/en\/wp-json\/wp\/v2\/categories?post=884"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.ftpol.com\/en\/wp-json\/wp\/v2\/tags?post=884"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}