Malaysia Airports Holdings Berhad 98 >> Our Performance Ma n a g e m e n t D i s c u s s i o n a n d A n a ly s i s Non-Airport Operations Malaysia Airports’ non-airport operations comprises three business divisions – Hotel, Project and Repair Maintenance Operations, and Agriculture and Horticulture. In 2020, revenues for non-airport operations as a whole fell 35.9% YoY to RM183.8 million. Hotel Deepening domestic business To attract guests in the domestic market, we introduced the Airport Staycation, ‘work from hotel’ packages and the ‘Passport’ loyalty programme. Malaysia Airports operates hotels in both Malaysia and Turkey. In Malaysia, the hotels are operated by Malaysia Airports’ wholly owned subsidiary, KL Airport Hotel Sdn Bhd, under the brand ‘Sama-Sama Hotel’. There are three Sama-Sama Hotels – the five-star Sama-Sama Hotel KL International Airport (Sama-Sama Hotel KLIA) and two airside transit hotels – SamaSama Express KLIA and Sama-Sama Express klia2. In Turkey, the hotel is known as ‘Airport Hotel’ and is located landside at SAW. KL Airport Hotel Sdn Bhd also operates the Airport Fast Track service at KLIA1, a premium kerbside-to-gate service that offers guests fast track lanes for check-in, customs and immigration, transportation services and buggy and concierge services. The performance of the hotel segment is dependent on several factors. Traditionally, passenger traffic at KUL and airline routes are key drivers of occupancy rates as transit passengers and airline crew layovers are key customer segments. In addition, the demand for meeting and event facilities is another key factor. As such, the fall in passenger numbers as well as public health restrictions on large meetings, conferences, events and gatherings have impacted the hotel business. In addition, on-going renovations of the ballroom, meeting rooms and food and beverage outlets at the flagship SamaSama Hotel KLIA have also affected the hotel’s ability to maximise revenue. The renovations which began in December 2019 were delayed by work restrictions during the Movement Control Order period. While the ballroom and meeting rooms on Level 1 were operational and generating revenue from Q3 2020 onwards, the rest of the renovations are scheduled for completion in Q2 2021, a delay from Q4 2020. In 2020, revenues from the hotel segment fell 51.3% YoY to RM47.8 million. The average occupancy rate dropped from 80% in 2019 to 53% in 2020. The average daily rate for 2020 was also 23.8% lower at RM282 compared to RM370 in 2019. Among the reasons for the lower average daily rate was the government-gazetted rate of RM150 per night for quarantined travellers which accounted for a substantial portion of the hotel revenues. The revenues were derived from the compulsory quarantine measures imposed on travellers entering Malaysia from overseas. Through the allocation of persons-undersurveillance by the Ministry of Health, and self-paid premium packages for those seeking higher quality accommodation for their quarantine, Sama-Sama Hotel KLIA sold 39,045 room nights with revenues of RM6.0 million. In addition, domestic leisure packages accounted for 1,501 room nights, meeting and residential packages generated 918 room nights. We also offered special packages for the airport community and for ‘work from hotel’ guests. We also launched a loyalty programme ‘Passport’ for guest retention. Malaysia Airports’ first Airport Staycation, a unique experience at Sama-Sama Hotel KLIA, was introduced to coincide with the KLIA Crazy Sale. The highlight of the Airport Staycation is a tour for guests of the airport fire station where they can experience riding a fire engine, learn to use firefighting equipment and escape a simulated burning building. The Airport Staycation package generated 60 room nights. While it was a challenging year, we implemented strict management of cash flow and cost optimisation measures to reduce costs by RM9.9 million (25.0% YoY), enabling us to retain all Malaysian staff and maintain an occupancy rate which was higher than industry average. Sama-Sama Hotel KLIA also achieved a high guest satisfaction rate of 93.2%. In addition, our hotels also won several travel industry awards, as well as an award for occupational safety and health.
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