GL's core net profit dwindles 30% to $10.8m

Weaker hotel segment marred earnings.

The weakened hospitality sector has led to Singapore-listed investment holding GL Limited posting a 30% decline in its net profit to US$7.9 million ($10.8 million).

According to CIMB Research, even with the 6% increase in the group's net profit, lower contributions from the hotel segment.

Hotel core earnings before interest & tax (EBIT) declined 31% YoY to US$11.7m from US$16.9m last year.

CIMB said this is due to both adverse foreign exchange translation from the weakened British Pound and weaker tourism sentiment from the several terror attacks in Europe over the financial year.

"While the weakened GBP could potentially boost leisure travel to the UK, we think it may take 3-6 months for the impact to really kick in. Also, we believe that the potential positive impact from higher leisure travel is unlikely to neutralise the negative impact from adverse FX translation and the potential decrease in business travel,” the report said.

More so, the report noted that although its oil and gas royalty profit spiked this year, it is still lower compared to earnings the segment used to yield two years ago.