Travel agencies

South Korean Travel Agents Expected to Make Profits Amid Rising Demand for Overseas Travel


South Korean travel agencies are expected to recover from the protracted fallout caused by the COVID19 pandemic and record a profit in 2022 due to growing demand for overseas travel, a market observer said on Monday.

Local brokerage firms forecast that industry leader HanaTour could post a consolidated operating profit of 3.9 billion won ($ 33 ​​million) in the coming year, a sharp turnaround from at an operating loss of 114.9 billion won last year, according to financial information provider FnGuide.

In the first half of this year alone, HanaTour recorded an operating loss of 65.6 billion won. The company posted operating profit of 5.9 billion won in 2019 ahead of the COVID19 outbreak, Yonhap News Agency reports.

The Mode Tour runner-up is also expected to post an operating profit of 200 million won next year, compared to an operating loss of 10.5 billion won in the first half of this year.

Yellow Balloon Tour Co. is expected to report an operating profit of 9.7 billion won next year, compared to a loss of 6.4 billion won in the first half.

The positive outlook for local travel agencies comes amid growing demand for overseas travel due to rapidly rising coronavirus vaccination rates and Seoul’s “travel bubble” pacts with others country.

Major tourist destinations around the world are reporting high vaccination rates, and South Korea has been pushing to sign travel bubble deals with several countries.

Seoul’s decision to prepare for a “living with Covid-19” program next month, in which the virus will be treated as an infectious respiratory disease, like the seasonal flu, is also responsible.

However, FnGuide said it would likely take longer for the sales and profits of these travel agencies to return to pre-pandemic levels.

Local tour operators have been hit hard by the global spread of COVID19, which has resulted in a drop in travel demand following lockdowns in major countries.

An industry source said local travel agencies were the last to rebound from the 2002 severe acute respiratory syndrome (SARS) epidemic and the Middle East respiratory syndrome (MERS) epidemic.

(With IANS entries)

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Posted on: Monday October 18, 2021 10:46 am IST


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