Mauritius Sun Resorts Q1 profits down 8.9%

Mauritius-based luxury hotel group Sun Resorts posted an 8.9 percent fall in pretax profit for the three months to March 31 on Monday due to a decline in the number of tourists from Europe.

The global economic downturn has hit the island's tourist industry and hurt growth in one of Africa's traditionally most stable and prosperous economies.

Tourism typically generates about 10 percent of the Indian Ocean island's gross domestic product and European tourists account for some two-thirds of arrivals.

"Although tourist arrivals in the quarter were 5.1 percent up on same quarter last year, all our main European markets showed a decrease, with the exception of France," the company said in a statement.

"Therefore, trading in the quarter has been difficult. It must also be noted that the Easter period fell in April this year as compared with March in the prior year," it said

Sun Resorts said pretax profit fell to 163.6 million Mauritius rupees from 179.6 million in the same period last year.

Sun Resorts said revenues fell to 969.8 million rupees in the first quarter from 988.9 a year ago and that earnings per share drop to 1.63 rupees from 1.76 rupees.

"The second quarter results will benefit from the Easter period but the low season, beginning in May, is expected to remain very competitive in all market segments," it said.

Sun Resorts said Long Beach, which replaced the former Coco Beach, opened for business in April 18 and the new resort should contribute to better second-quarter results.

The company also said it had signed an agreement with Armand Apavou & Company Ltd to lease the Ambre Resort and Spa, a 298-room, four star hotel.

"The board of Sun Resorts Limited (SRL) is of the opinion that this transaction, if completed, will create value for the shareholders of SRL and will allow the company to capture new market segments," Sun Resorts said