Prof. M.T.A. Furkhan, the head of the Confifi group which is a major player in the beach resort segment of Sri Lanka’s tourist industry has said that it was high time that the country stopped fooling itself in the way it counted tourist arrivals.

Furkhan has made this comment in the annual report for 2007/08 of Eden Hotel Lanka PLC where he said: "Last year, in my report I referred to the unreliability of the official tourist arrival statistics and referred to the urgent need to stop fooling ourselves and do the right thing by introducing credible statistical analysis of foreigners at entry level to the country. Nothing seems to have been done so far."

He said that in the context of the official figures, arrivals last year were down to 494,008 from the previous year’s 559,603. Pointing out that "numbers can be deceiving," Furkhan said that it was possible to seriously raise the question whether all arrivals classified as tourists are strictly tourists.

"Or do they include Sri Lankans holding foreign passports and returning home for a holiday or family visits? Similarly are all Indian arrivals strictly tourists?" he asked.

Discussing the economic indicators including GDP growth and per capita income, Furkhan said: "Whilst all this is well and good, and we are all expected to feel better on account of Sri Lanka’s development which is impressive on paper, when we look around we see that despite all this growth we still appear to be poor in every sense of the word.

"What we see today is high inflation, high interest rates, the stock market and new investments on a downward spiral, tourist inflow down, continuing brain drain, no visible improvement in infrastructure and hardship everywhere."

In this context he asked whether GDP growth is due to increases of goods and services or due to government spending which has increased almost 30%. "One wonders where exactly the growth is!" he declared.

Reporting that travel advisories issued by regular tourist originating countries like the UK, Germany, France, Italy etc ``have and are currently severely restricting the tourist inflow to the country,’’ he noted that there were severe criticism of the government on account of human rights violations. This was hitting the tourism industry.

The year ended March 31, 2008 had seen occupancy at Eden Hotel increasing marginally to 53% from 52% the previous year with turnover growing 13% to Rs.376 million.

But the company had done better where the net profit was concerned, posting an after-tax earning of Rs.40.4 million, 80% up from the previous year’s Rs.22.5 million despite steep increases in energy costs and wages.

The Eden directors have declared no dividend on ordinary shares but, in accordance with the terms of the issue, paid the accumulated dividends on the redeemable 11% preference shares held by the DFCC Bank.

The company which has a stated capital of Rs.528 million and preference share capital was Rs.66.7 million was carrying accumulated losses of Rs.76.7 million in its books as at March 31, 2008.

A third of the 10 million preference shares held by the DFCC Bank had been redeemed in April 2006 but due to lack of funds the rest of these shares were not redeemed requiring the guarantors to redeem them.

During the end of the year under review the DFCC Bank held slightly over 3.3 million shares with Confifi Beach Hotels, Confifi Hotels Holdings and Riverina Hotels each holding slightly over 1.1 million of these shares. A total of 6.7 million of these preference shares are outstanding.

Net assets per share had grown to Rs.17.52 from Rs.16.71 the previous year and the company’s share traded at a high of Rs.17 and a low of Rs.9 during the year. This compared to a trading range of Rs.18.25 to Rs.10 the previous year.

Riverina Hotels with 24.39% followed by Confifi Hotel Holdings (21.82%), Confifi Management Services Ltd ( 20.71%), Mr. K.D.D. Perera ( 3.11%), Confifi Beach Hotels (Pvt) Ltd. (1.73%) and Mercantile Investments Ltd (1.70%) are the major shareholders of the company.