The reorganized Seibu Group said Wednesday its Prince Hotels chain had a net loss of 37.2 billion yen in fiscal 2005, an increase from the previous year's loss of 32 billion yen.
Prince Hotels Inc. fell further into the red due to an uphill battle with rivals, particularly new hotels, and weaker earnings at leisure facilities as fewer people played on its golf courses or went to its ski resorts, Seibu said.
The transportation and resort development group reorganized itself in March under Seibu Holdings Inc. after being shaken up by the discovery that Seibu Railway Co. had falsified financial statements. The holding company now owns Seibu Railway and Prince Hotels -- established by combining the Prince Hotels chain and Kokudo Corp., the group's former core company.
Prince Hotels' business results for fiscal 2005 are the combined financial figures for the hotel chain and Kokudo.
According to fiscal 2005 earnings reports released by Seibu Holdings, Seibu Railway chalked up a pretax profit of 11.9 billion yen, up 2.2 times over the previous year, on a 6.6 percent rise in operating revenue to 434.6 billion yen on a consolidated basis.
The railway posted the favorable results thanks to an increase in passenger numbers, caused in part by the construction of condominiums along its rail lines.
Booking an extraordinary loss of 98.1 billion yen under asset-impairment accounting, however, Seibu Railway recorded a bottom-line loss of 32.6 billion yen.
For the current fiscal year, Seibu Holdings forecasts a group pretax profit of 22 billion yen on revenues of 690 billion yen.