The Effect of COVID–19 Pandemic Crisis on Financial Risk of Hotels and Resorts in Thailand

Main Article Content

Pimonwan Tripattanasit
Yodsawinkan Kobkanjanapued
Wanrudee Suksanguan
Phatnatcha Chotkunakitti

Abstract

The COVID-19 situation is a severe pandemic crisis that has affected a wide area of the world. Especially hotel and resort businesses had a lot of revenue decline due to the state of emergency and the government's lockdown measures, causing the hotel and resort business to be disrupted, lack of working capital for management, which may cause financial risks of the business in the future. Then, this research is aimed at studying the impact of the COVID-19 pandemic crisis on the debt to total assets ratio, interest coverage ratio, and working capital to total assets ratio of hotels and resorts in Thailand, totaling 171 firms business from the list published on the website of the Association for Domestic Travel (ADT). After selecting the sample group by a specific method according to the specified characteristics, the sample group totaled 115 firms after collecting data for the period 2018–2020. The statistics used in the analysis included 1) descriptive statistics, 2) correlation analysis, and 3) multiple regression analysis.


The research results showed that the COVID-19 pandemic crisis happening in Thailand during 2020 caused a decrease in the interest coverage ratio compared with the years of 2019 and 2018, the year before the COVID-19 pandemic. In other words, firms have increased financial risk. Whereas the debts to assets and working capital to total assets ratios were not affected by the COVID-19 pandemic.

Article Details

How to Cite
Tripattanasit, P., Kobkanjanapued, Y., Suksanguan, W., & Chotkunakitti, P. (2022). The Effect of COVID–19 Pandemic Crisis on Financial Risk of Hotels and Resorts in Thailand. Journal of Arts Management, 6(4), 2186–2207. Retrieved from https://so02.tci-thaijo.org/index.php/jam/article/view/258649
Section
Research Articles

References

Amir, M., Farooq, M., Abbas, Z., Ahmad, I., & Akram, M. (2022). The Impact of COVID-19 Pandemic on the Financial Performance of Firms Listed on the Pakistan Stock Exchange (PSX). Competitive Social Science Research Journal, 3(1), 606-620.

Anguera-Torrell, O., Aznar-Alarcón, J. P., & Vives-Perez, J. (2021). COVID-19: Hotel industry response to the pandemic evolution and to the public sector economic measures. Tourism Recreation Research, 46(2), 148-157.

DDC. (2020). COVID-19 situation report. Ministry of Public Health, Department of Disease Control (DDC). https://ddc.moph.go.th/viralpneumonia/situation.php

Devi, S., Warasniasih, N. M. S., Masdiantini, P. R., & Musmini, L. S. (2020). The impact of COVID-19 pandemic on the financial performance of firms on the Indonesia stock exchange. Journal of Economics, Business, & Accountancy Ventura, 23(2), 226-242.

Kamolsiriwat, S. & Povatong, B. (2021). Adaptation Strategies to COVID-19 on the SHA Standard Hotels of Entrepreneurs in Bangkok Metropolitan Area in 2020. Sarasatr Academic Journal, 4(3), 650-663.

Kobkanjanapued, Y., & Chotkunakitti, P. (2021). Value Relevance of Book Value, Accounting Earnings and Operating Cash Flows in Explaining Security Prices of Thai Listed Companies During the COVID-19. Rajapark Journal, 15(40), 79-96.

Kohpaiboon, A. (2021). Impact of COVID-19 on Hotel Industry. https://www.icrc-econtu.com/wp-content/uploads/2020/12/Summary_Hotel-1.pdf.

Kornlert, P., & Sincharoonsak, T. (2016). The Relationship between Financial Leverage Ratios and Earning Management: A Case study of Listed Company in Consumption Industrial Groups in Stock Exchange of Thailand. Payap University Journal, 26(2), 165-183.

Lu, R., Zhao, X., Li, J., Niu, P., Yang, B., Wu, H., ... & Tan, W. (2020). Genomic characterisation and epidemiology of 2019 novel coronavirus: implications for virus origins and receptor binding. The lancet, 395(10224), 565-574.

Mališ, S. S., & Sačer, I. M. (2021). The Impact of COVID-19 on the Business Performance and Financial Position in Hotel Industry: The Case of Croatia. In Handbook of Research on the Impacts and Implications of COVID-19 on the Tourism Industry (pp. 1-22). IGI Global.

NGUYEN, H. T. X. (2022). The Effect of COVID-19 Pandemic on Financial Performance of Firms: Empirical Evidence from Vietnamese Logistics Enterprises. The Journal of Asian Finance, Economics and Business, 9(2), 177-183.

PHOENIX Property Development and Consultancy. (2021, February). Occupancy and occupancy rates in 2019 and 2020. https://www.phoenixproperty.co.th/blogs/research/4955

Rabbit Care. (2021, February). Asking for a loan during Covid-19, is it difficult or easy to borrow?. https://rabbitcare.com/blog/read-all-loan/is-it-difficult-or-easy-to-get-a-covid-19-loan#

Rodpan, C., & Buasook, S. (2021). The impact of the COVID-19 outbreaks on the bankruptcy of listed companies on the Stock Exchange of Thailand. National Academic Conference: NPSO (PP. 53-65). Faculty of Business Administration Economics and Communication Naresuan University.

Royal Thai Government. (2020, March 17). The prime minister announced measures to prevent the spread of COVID-19 on each side. Royal Thai Government. https://www.thaigov.go.th/news/contents/details/27430

Temelkov, Z. (2022). Financial performance of selected hotel groups and resorts during COVID-19 pandemic: 2019/2020 comparison.

Hotel and Tourism Management, 10(1), 41-51.

Tesprasit, K. (2022). The Development of Small Hotel in Chantaburi Province for Wellness Business Guidelines in Covid-19 Crisis. Sarasatr Academic Journal, 5(1), 77-90.

Wiboonrangsan, N. (2004). The Impact of Economic Crisis in 1997 on Financial Ratios[Master’s Thesis, Chulalongkorn University].

Workpointnews. (2020). Confirm the number of infected COVID-19. Workpointnews. https://covid19.workpointnews.com/