Taiwan High Speed Rail Corp (THSRC, 台灣高鐵) is expected to recover quickly from the effects of COVID-19, as life returns to normal and thanks to the government’s domestic travel incentives, Yuanta Securities Investment Consulting Co (元大投顧) said in a note on Friday.
THSRC’s business might have bottomed out after revenue fell 49.83 percent year-on-year to NT$2.03 billion (US$67.59 million) in April, the lowest in nearly 10 years, while combined revenue in the first four months dropped 26.44 percent to NT$11.63 billion, as the COVID-19 outbreak reduced ridership, the investment consultancy said.
“The worst should be over in April as domestic tourism has started to resume in May after a half month without local coronavirus cases and THSRC carried out a promotion plan for students from May 27 and will provide more plans for all types of groups such as commuters,” Yuanta analyst Elle Yang (楊郁容) said in the note.
Photo: Wu Cheng-fung, Taipei Times
THSRC on Friday said that it is to provide six extra services per week from today and add 33 extra services during weekends from Friday next week to meet increased demand due to the government’s incentive programs for domestic tourism as the coronavirus situation stabilizes, the company’s Web site says.
“The ‘disease prevention tourism’ policy to be launched by the government by providing subsidies for tourism accommodation on July 1 should stimulate the domestic tourism industry and also increase demand for THSRC,” Yang said.
As people reduced their use of public transportation for tourist and business trips amid the COVID-19 outbreak, THSRC’s daily average ridership fell 17.2 percent year-on-year to 151,000 people in the first quarter, while its passenger load factor dropped to 53.7 percent, compared with 67.5 percent a year earlier, a company document released after an investors’ conference on Thursday showed.
As a result, the high-speed railway operator reported that net income decreased 50.63 percent year-on-year to NT$1.13 billion in the first quarter, with earnings per share of NT$0.2, the lowest in three years, company data showed.
Yang said that the company’s ridership and load factor recovered gradually last month.
Its sales are expected to decline year-on-year this month and the next, narrowing notably in July after promotion plans are offered, she said.
While border restrictions might continue, they would have little effect on operations, as foreign tourists constitute less than 10 percent of THSRC’s ridership, she added.
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