Accordia Golf Trust reports fiscal 4Q net loss widened on impairment losses

Novelty Japan pens at DaisoNovelty Japan pens at Daiso

Accordia Golf Trust reported Tuesday its fiscal fourth quarter net loss widened to 18.5 billion yen (S$232.82 million or US$169 million), from a loss of 2.88 billion yen in the year-ago period, on impairment losses at certain golf courses.

Revenue for the quarter ended 31 March was 10.12 billion yen, up 7.5 percent on-year, the trust said in a filing to SGX after the market close Tuesday.

The increase was on efforts to improve the golf courses’ utilization rates and improvements in the weather conditions generally throughout the full year, Accordia Golf Trust said, adding that was offset by lower membership renewals due to an aging population.

Operating expenses surged in the quarter, up 133.4 percent on-year to 29.13 billion yen, the filing said.

That was partly due to an impairment loss on plant, property and equipment of 4.82 billion yen, widening from a year-earlier 1.72 billion impairment loss, on expectations certain golf courses will underperform and on a government flood-prevention infrastructure project which will impact earnings from the Northern Country Club Nishikigahara Golf Course, the trust said.

In addition, other operating expenses rose 42.5 percent on-year in the quarter to 815 million yen on more extensive damage to infrastructure from natural disasters at golf courses, the filing said.

Stripping out the impairment loss, the operating loss would have been 1.09 billion yen for the fiscal fourth quarter, with a full year operating profit of 6.74 billion yen, the filing said.

For the full fiscal year, Accordia Golf Trust reported a net loss of 12.55 billion yen, swinging from a year-ago net profit of 4.10 billion yen. Revenue for the full year was 50.73 billion yen, down 0.2 percent on-year, the trust said.

For the fiscal second half, the trust declared a distribution of 2.13 Singapore cents, down from 2.20 Singapore cents in the year-ago period.

Accordia Golf Trust issued an optimistic outlook.

“Japan has done well in its tourism industry. The number of visitor arrivals hit a record high of more than 30 million in 2018, on track to reach its target of 40 million by 2020. We continue to remain optimistic in the current and future state of Japan’s economy,” the trust said.

“The golf industry is expected to remain resilient in the face of economic slowdown, underpinned by its healthy fundamentals and steady demand from senior golfers,” it added.

The trust said it has also seen more mergers and acquisitions in the industry, with the number of golf courses in the country at 2,238 by end-March, down by 44 on-year.

“The trend is deemed beneficial as there are more reputable golf course operators with stronger balance sheets to face future headwinds. We view this as an opportunity,” Accordia Golf Trust said.

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