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Tsokkos hit by swiss frank

28/08/2015 12:03
Tsokkos Hotels announced increased losses for the first half of 2015 due to exchange losses from the conversion - after many years – of the company's loans from Swiss franc to euro.

The net loss after tax amounted to € 9 mn compared to a loss of € 4,6 mn in the corresponding period of 2014. The losses occurred despite the improvements of the fundamentals of the company due to the operation of King Evelthon Beach Hotel & Resort.

The Group's results are affected by the seasonality of the tourism industry in Cyprus and therefore the results of the first half of the year have a lower yield than the second half. The group obtains the largest part of its income and profit in the second half of the year.

The net turnover of the Group for the first six months of 2015 increased by 23% or € 2,9 mn and reached € 15,7 mn compared to € 12,8 mn in the corresponding period of 2014. The increase is due to income from the operation of hotel King Evelthon in Paphos which was open throughout the six months of 2015. The hotel started its operation in April 2014 and therefore income in the first half of last year was lower.

In the first half of 2015 there was € 750 thousand worth of income from the property development sector. Last year there were no revenues from the sector of land development.

Operating profit reached € 1,7 mn against a loss of € 697,5 thousand last year.

The income of the hotels increased by 17%, while operating expenses increased by 4%.

The net exchange loss for the first half of 2015 amounted to € 6,4 mn compared to a loss of € 356,9 thousand last year. This includes a realized exchange loss of € 16,5 mn which resulted from the conversion of the company’s debt from Swiss francs to euros on 29 and 30 June 2015 and an unrealized exchange gain of € 10,1 mn due to the exchange rate of the Swiss franc against the euro.

As regards the outlook for the second half of the year, it is estimated that it will be better than the first mainly because the results from operations are expected to be positively affected by the traditionally increased tourist arrivals during the months of summer.