Dufry’s Rossinyol ‘expects movement of sales’ following China border unlock

By Luke Barras-hill |

Xavier Rossinyol, CEO, Dufry Group.

Hainan will continue to be an important destination for travel and spending but that could dampen in the coming years as international outbound trips revive following China’s international border reopening, according to Dufry.

Earlier today, the Group revealed full-year 2022 turnover of CHF 6,878.4 million/US$7,380.5 million and core EBITDA of CHF 606.2m at a margin of 8.8% in an assured performance against a backdrop of eased travel restrictions in most global regions.

Chief Executive Officer Xavier Rossinyol and Chief Financial Officer Yves Gerster addressed the market during the global travel giant’s full-year results presentation, conference call and video webcast.

Responding to an analyst’s question about the possibility of spending being ‘cannibalised’ as people leave the Mainland to travel abroad, Rossinyol made the following observation: “Common sense says that if Chinese travellers have options outside China – versus until now where they have only been to internal China or Hainan – there should of course be some movement of sales between domestic China, Hainan and the rest of the world.

Yves Gerster, CFO, Dufry Group.

“We believe part of the flow will go outside [China]. Hainan will remain an important destination for sure, but maybe less so in the future than in the last three years.”

In China, Dufry possesses a partnership with Hainan Development Holdings in Hainan where it collaborates at the downtown Global Duty Free Plaza at Haikou’s Mova Mall.

“Our presence in Hainan is very small; as a foreign company we have a management and supply agreement and we cannot operate duty free stores in China,” reminded Rossinyol.

Turnover in Asia Pacific, where Dufry operates 67 shops over 25,000sq m, increased 67.6% (reported) in 2022 year-on-year to CHF165.9m, though China’s restrictive measures affected travel overall across the region.

In addition to its partnership in Hainan, the Swiss-headquartered firm also boasts a number of duty paid operations in China.

Passport expirations, visa backlogs, testing requirements and the unpredictable Covid situation in China might delay the return of travel, Dufry notes in a results presentation, though the unlocking of the country’s border to international travel is expected to gradually hike travel numbers in H2.

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