Hotel Shilla said on the 18th that it decided to return the business rights for Incheon Airport duty-free DF1 zone (cosmetics and perfumes).
According to the Financial Supervisory Service's electronic disclosure system, Hotel Shilla decided to suspend operations in the Incheon Airport duty-free DF1 zone, judging that excessive losses are expected and that its going-concern value is lower than its liquidation value.
The suspension date is Mar. 17 next year. Hotel Shilla plans to pursue overall growth measures for the business along with risk management going forward.
This appears to be a decision made after requesting a rent adjustment from Incheon International Airport Corp. due to deteriorating duty-free industry profitability, among other reasons, but the corporation did not accept the request.
A Hotel Shilla official said, "The losses are too great to continue operating at Incheon Airport, and the company, judging that it needs to improve its financial structure and enhance corporate and shareholder value, inevitably decided to return the business rights for the Incheon Airport duty-free DF1 zone." The official added, "Although difficulties in the duty-free business continue, we will do our best to improve profitability."