Accordia Golf Trust Q1 net profit plunges 75.4% on Japan's Covid-19 state of emergency

ACCORDIA Golf Trust (AGT) saw its Q1 net profit plunge 75.4 per cent to 570 million yen (S$7.4 million) for the three months ended June 30, 2020, down from 2.32 billion yen a year ago.

Operating income fell 27.1 per cent to 10.65 billion yen, from 14.62 billion yen in Q1 FY19.

In a financial update released on Friday, AGT's manager said the performance of the portfolio of golf courses had shown a "significant decline" in the quarter due to the state of emergency declared in Japan in April and May to combat the spread of Covid-19.

"Many golfers stayed home during this period, resulting in high number of cancellations, and are spending less money at the golf courses," it said.

The total number of players for the quarter fell 12.3 per cent from the year-ago period to 1.42 million, with the revenue per player falling 21.6 per cent. Discounts on play fees were given to golfers to encourage higher visitor numbers, resulting in a fall in play fee of 12.4 per cent.

Earnings per unit was 0.52 yen, compared to 2.11 yen a year ago.

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The manager added that in line with the Japanese government's effort to boost domestic travel and tourism, it had in recent months rolled out discounts and outreach programmes to attract golfers from the local community.

"Signs have been encouraging as the number of golfers has gradually recovered to pre-Covid-19 levels, although play fee is expected to remain lower than last year," it added.

The manager also said that with the "high degree of uncertainty" brought about by the Covid-19 outbreak and the halting of international travel to Japan, management had forecast that the performance of the golf industry will remain muted in the coming months, as Japan's unemployment level continues to rise and its economy contracts.

Units of AGT ended Thursday at 74 Singapore cents, up 0.5 cent or 0.7 per cent.