Annual Report 2024/25

BROWNS BEACH HOTELS PLC

Annual Report 2024/25

A Visionary Legacy

In honour of the late Deshamanya D.H.S. Jayawardena, we reflect on the legacy of a pioneering entrepreneur whose leadership

has shaped the success of Browns Beach Hotels PLC. Under his leadership, the development of Heritance Negombo stands as a testament to his forward-thinking vision and commitment to excellence. This project, driven by his bold decisions and

unwavering belief in the potential of Sri Lanka’s hospitality sector, has transformed the landscape of the industry in Negombo.

Mr. Jayawardena joined the Board of Browns Beach Hotels PLC on February 08th, 1993, and became Chairman on September 03rd, 2007. Since then, his decisive leadership has guided the Company through seasons of volatility over the years.

As Chairman, Mr. Jayawardena proved instrumental in the redesign and redevelopment of Browns Beach Hotel, rebranding the property as Heritance Negombo in 2016. His hands-on-approach to management, coupled with an unwavering sense of responsibility, meant that he was personally involved in every aspect of the project, down to the minutest detail.

His insight into Sri Lanka’s unique position and untapped potential in the global tourism market, recognition of the hotel’s advantageous proximity to the Bandaranaike Airport, and

willingness to actively engage with partners, were critical in further envisioning a dynamic transformation for the property.

At Mr. Jayawardena’s direction, Browns Beach Hotels entered into a franchise partnership, in 2023, with DER TOURISTIK HOTELS

GmbH, rebranding the hotel as Sentido Heritance Negombo. Highlighting his ability to adapt to changing landscapes, the hotel is now strategically poised to attract long-haul passengers to Negombo, capitalising on Heritance’s strong local brand and SENTIDO’s global presence and market reach.

Mr. Jayawardena’s leadership went beyond strategy, sustainability or harnessing the power of technology. It was about providing meaningful careers, touching lives and empowering those

around him. Through his guidance, many members were given opportunities to grow alongside the Company. During

challenging times, he recognised the importance of supporting our associates, ensuring their well-being even inquiring about the safety of their families during natural disasters. He was a strong believer in identifying talent, providing cross-exposure and always encouraging our team to sharpen their skills and knowledge. His ability to recognise and nurture talent combined with his care for people nurtured a culture of ownership and dedication, enabling individuals to grow with the company and contribute to its longterm success.

Dynamism and bold decision-making were the essence of his leadership, and his legacy continues to have a lasting impact on the Company and inspire our journey forward. We are profoundly grateful to him for this. As we move forward, we are committed to carrying his vision with us, remaining steadfast in our pursuit of service excellence and creative innovation in the hospitality industry.

We invite you to reflect on the year gone by and look ahead to the future we’re building at Browns Beach Hotels PLC.

It has been a defining year of transformation, guided by meaningful change and a shared commitment to progress with purpose.

This report chronicles our story: one of navigating a volatile landscape and setting a clear course for sustainable growth. We pay tribute to the enduring values that continue to guide us and reflect on how they have helped us adapt to a dynamic global tourism environment.

More importantly, we highlight the milestones that shaped our performance, the partnerships that redefined our path, and the people who remain at the heart of our progress.

As we look to the future, we move ahead with clarity and confidence—committed to enriching experiences, enhancing stakeholder value, and evolving with the world around us.

Contents

03-24

25-59 50-99

ABOUT THE GROUP

MANAGEMENT DISCUSSION AND ANALYSIS

GOVERNANCE

06 About Our Annual Report 08 About Us

09 At a Glance

10 Our Socio-economic Impact

11 Performance Highlights

12 Group Performance Highlights

14 Our Commitment to Sustainability

16 Chairperson's Message

20 Board of Directors

25 Operating Environment

28 Managing Risk and Opportunities

33 Financial Capital

36 Manufactured Capital

39 Human Capital

44 Social Relationship Capital

50 Natural Capital

56 Intellectual Capital

60 Corporate Governance

82 Annual Report of the Board of Directors

88 Audit and Risk Committee

91 Related Party Transactions Review Committee Report

93 Remuneration Committee Report

1. Nomination and Governance Committee Report

2. Statement of Directors’ Responsibilities

3. The Board of Directors’ Statement on Internal Controls

99 Report of the Senior Independent Director

loo-l55 l57-l7l

FINANCIAL REPORTS

SUPPLEMENTARY INFORMATION

‌About Our Annual Report

Welcome to the Integrated Annual Report of Browns Beach Hotels PLC which is the primary publication to our shareholders and other interested stakeholders. In this report, we provide a concise and balanced view of our performance and impacts of the past year. The report also provides relevant information on the operating environment, corporate governance practices and risk management, while reflecting on our future outlook.

Reporting Period

The report follows an annual reporting cycle for both its financial and sustainability reporting, and covers the

financial period from 1st April 2024 to 31st March 2025.

It builds on our previous report for the financial year ending 31st March 2024, for which comparatives are presented where applicable. Material information subsequent to the reporting period and up to the Board approval date of

12th June 2025, have also been included in this report.

Scope and Boundary

The report covers the operations of Browns Beach Hotels PLC or the “Company”, including its subsidiary Negombo Beach Resorts (Pvt) Ltd, collectively referred to as the “Group”.

The financial statements presented on pages 105 to 156 and the discussion of financial aspects in the narrative report provide a consolidated view of the Group, unless otherwise stated, while the non-financial information in the narrative report is limited to Sentido Heritance Negombo. Governance and Risk Management align with the Framework published by the International Integrated Reporting Council.

There were no significant changes to the structure, supply chain, reporting boundary or material restatements of financial or sustainability information during the reporting period.

Materiality

The Report provides information on material matters that can significantly impact the Group’s ability to create value over the short, medium, and long term. These material matters have been identified after careful consideration of the operating environment, stakeholder concerns and the Group’s strategic objectives. The identified material matters have been discussed within the Capital Reports.

Assurance

The financial statements that form part of this Report have been audited by external auditors, Messrs KPMG.

Forward-looking Statements

The Report may include forward-looking statements and forecasts regarding the Group’s future performance and prospects. These statements involve an element of uncertainty, as they pertain to events, outcomes, and impacts beyond our control leading to actual results differing from the stated projections. We do not undertake to update or revise these statements publicly in the event of a change of circumstances.

Navigation of the Icons

We have used the following navigation icons to showcase the connectivity of information.

CAPITALS

Financial Capital

OTHER

Outlook and Way Forward

Manufactured Capital

Risk

Intellectual Capital

Governance

Human Capital

Page Reference

Social and Relationship Capital

Natural Capital

This Annual Report is also available online

Feedback

We continuously strive to improve the quality of our Annual Report and welcome your suggestions and comments.

Kindly direct your feedback to: gm.negombo@heritancehotels.com Group Business Development Unit-Browns Beach Hotel PLC

BOARD RESPONSIBILITY STATEMENT

The Board of Browns Beach Hotels acknowledges its responsibility for ensuring the credibility and integrity of this report. We hereby confirm that the 2024/25 Annual Report fairly represents the Group’s performance and addresses all relevant material matters that have a bearing on our ability to create value over the short, medium and long term.

The acknowledgment of the Boards’ responsibility for the Annual Report and its contents are given in the Annual Report of the Board of Directors on page 82.

‌About Us

our vision

To achieve excellence in all our activities, establish high growth businesses in Sri Lanka and across new frontiers, and become a

globally competitive market leader in the region

our values

Reliable Honest and Transparent

Warm and Friendly

Genuine Inspiring

Confidence

our presence in the value

chain

Travel Agents, Tour Operators, Online Aggregators and Direct Bookings

Airline Operators, Cruise Lines, Other Transport Providers

Hotels, Local Communities

‌At a Glance

Nestled amidst palm groves, Browns Beach Hotels is a well-known beachfront resort located in close proximity to the Bandaranaike International Airport. The hotel underwent a redesign and redevelopment in 2016, emerging as Heritance Negombo,

offering ocean-facing rooms, world-class dining options, serene spa treatments, and a relaxing tropical pool.

Spanning 6.5 acres of beachfront property, the hotel draws inspiration from the rich Sri Lankan heritage, blending modern amenities with warm Sri Lankan hospitality. With 139 well-appointed rooms adorned with vibrant colours, the hotel reflects the lively surroundings. Heritance Negombo provides a perfect setting for unforgettable

seaside memories, whether you are looking for a romantic escape, a family retreat or a beachfront celebration.

The hotel was re-branded as Sentido Heritance Negombo in 2023, having entered into a partnership with Sentido. The partnership positions the hotel to become a beacon of distinguished hospitality in the region, through the combination of the exceptional service standards of Heritance and Sentido’s global recognition.

CREATING VALUE FOR STAKEHOLDERS

SHAREHOLDERS

Delivering consistent growth

Net Assets value per share: (5.78)

CUSTOMERS

Providing an authentic

experience to our guests

93.4% Customer Satisfaction rate

EMPLOYEES

A conducive work place free from discrimination

96% retention rate

SUPPLIERS & BUSINESS PARTNERS

Partnerships that create mutual value

A pool of over 675

suppliers

53 channel partners

COMMUNITY

Initiatives for community development and empowerment of beach cleanups

‌Our Socio-Economic Impact

The tourism industry plays a vital role in shaping the future trajectory of the country’s economy. As part of the Aitken Spence Group which is recognised as a pioneer in sustainable tourism in Sri Lanka, we are cognisant of our socio-economic responsibilities and actively engage in efforts to improve the well-being of our stakeholders.

A brief overview of the socio-economic impact of our hotel operations and activities and the value-added economic statement for the year is presented below:

Contributing to Government Tax Revenue

The Group supports fiscal policy and national development by paying taxes in compliance with

relevant regulations. LKR 245 Mn

paid as taxes to the Government.

Uplifting Livelihoods

Our operations create direct and indirect employment opportunities for people, thereby supporting local communities and uplifting their livelihoods

• 15% direct employment opportunities

• 52% employees from the local community

• Rs 2.5 Mn in training investments

• Rs 242 Mn as Salaries and benefits

• Creating opportunities for local artisans to showcase their talent

Promoting Environmental

Sustainability

We encourage both employees and guests to be responsible in the consumption of natural resources, in line with the Integrated Sustainability Framework of the Parent entity.

Developing Local Suppliers

We maintain relationships with the local community, procuring locally whenever possible thereby supporting the SMEs and local suppliers in the vicinity.

Rs 529 Mn was made as payments to local suppliers

98% local procurement

Economic Value-added Statement

24/25 23/24

Total Economic Value Addition

Rs. 733 Mn Rs. 497 Mn

Contribution for foreign reserve

US$. 2.4 Mn US$. 1.9 Mn

Employees Salaries & other benefits

Rs. 242 Mn Rs. 210 Mn

Strengthening the

Market capitalisation

Rs. 2,435 Mn Rs. 1,585 Mn

Lenders of capital Interest

Rs. 329 Mn Rs. 455 Mn

Value added per share

Rs. 5.55 Rs. 3.84

External Sector

The Group contributes towards the strengthening of the external sector of the country by generating US$ 2.4 Mn worth of foreign exchange through tourist arrivals.

‌Group Performance Highlights

Financial Highlights

For the year ended 31st March Unit 2025 2024 Change

‌Group Performance Highlights

L

C

A

P

I

T

A

L

NON-FINANCIAL HIGHLIGHTS

Rs 1,520 Mn

(2023/24: 1,317 Mn)

Revenue

Rs 243 Mn

(2023/24: 48 Mn)

Operating Profit

Rs 53 Mn

(2023/24: 11.3 Mn)

Capital expenditure

A

P

I

T

A

L

F

I

N

A

N

C

I

A

N

S

H

I

P

C

Average occupancy rate

E

L

A

T

I

O

55%

187

Employees

(2023/24: 152)

75%

Rate of retention

(2023/24: 97%)

Promotions

15

(2023/24: 14)

S

O

C

I

A

L

A

N

D

R

C

A

P

I

T

A

L

(2023/24: 55%)

Guest Satisfaction rate

93.4%

(2023/24: 91.3%)

H

U

M

A

N

C

A

P

I

T

A

L

20,557

Energy Consumption

L

N

A

T

U

R

A

L

A

L

C

A

P

I

T

A

GJ (2023/24: 17,855 GJ)

Carbon Footprint

3,130

tCO2e (2023/24: 2,255 tCO2e)

21%

Reduction in Paper Consumption

(2023/24: 17%)

Awards and

Accolades

Digital infrastructure

2

(2023/24: 3)

Rs 59 Mn

(2023/24: 48 Mn)

Property, Plant and

E

4.5 Bn

quipment

Room inventory

(2023/24: 4.5 Bn)

139

(2023/24: 139)

L

M

I

N

A

T

N

E

U

L

F

L

A

E

C

C

T

T

U

U

R

E

D

C

A

P

I

T

A

Revenue Guest Nights

58,275

(2023/24: 49,547)

33,347

(2023/24: 28,545)

Revenue Room Nights

53

Over

Payments to local suppliers

Investment in CSR

beneficiaries

Channel partners

(2023/24: 51)

Rs 529 Mn

(2023/24: 434 Mn)

Rs 2.4 Mn

(2023/24: 1.8 Mn)

40

10:1

Male: Female Ratio (2023/24: 10:1)

Investment in Training Rs Mn

2.5

(2023/24: Rs 1.4 Mn)

Payments to Employees

242

Rs Mn

(2023/24: Rs 210 Mn)

1.32 kg. per GN (2023/24: 1.33 kg. per GN)

Waste to landfill

57,001 m3

Water Consumption

Water Intensity

(2023/24: 55,455 m3)

1,101 per GN (2023/24: 1,084 per GN)

45k

(2023/24: 57k)

13k (2023/24: 12k)

‌Our Commitment to Sustainability

In the face of rising implications of climate change and socio-economic vulnerabilities, global interest in environmental, social, and governance (ESG) issues has risen sharply. The tourism sector has been widely acknowledged for its contribution

to addressing global sustainability issues and achieving UN’s Sustainable Development Goals.

INTEGRATED SUSTAINABILITY POLICY

The policy provides guidance for securing the business’s long-term viability, profitability and integrity through the adoption of a proactive approach to corporate sustainability.

As part of the Aitken Spence Group, a leader in sustainable tourism in Sri Lanka, we have fully embraced sustainability principles, embedding social and environmental awareness into our corporate strategy, operations, and processes. Our approach is aligned with the Integrated Sustainability Framework of our parent entity, a summary of which is presented below:

Underlying Policy Framework

BUSINESS ETHICS

Conducting business in an ethical manner, promoting the adherence to the UNWTO Global Code of Ethics for Tourism while also encouraging our partners to do the same.

ENVIRONMENTAL MANAGEMENT

Following environmental management systems to carry out organisational operations and activities and commit to prevent pollution.

SUPPLY CHAIN & COMMUNITY DEVELOPMENT

Encouraging supply chains to implement sustainable strategies while engaging in community development activities.

HUMAN RESOURCES

Nurturing a strong and competitive team of employees who are equipped with the right skills to maintain operations efficiently while ensuring guest satisfaction.

Sustainability Pillars

ENERGY POLICY

This serves as the framework for continually improving energy efficiency and is designed in line with ISO 50001:2011- Certified Energy Management Systems.

• Provide information and resources required to effectively implement the energy management plan

• Purchase of energy efficient products and services

UN GLOBAL CODE

FOR ETHICAL TOURISM

A comprehensive set of principles designed to guide tourism sector players including governments, the travel industry, communities and tourists. A few key principles include:

• Mutual understanding and respect between people and societies

• Tourism as a user of cultural heritage

• Obligations of stakeholders in tourism development

• Rights of workers and entrepreneurs

  TRAVELIFE CERTIFICATION

  The certification contains 163 criteria classified into the following categories:

  • Business policies and strategies

  • Compliance to legislation and standard

  • Reporting and communication on progress

  • Environmental management including energy, water, waste

  • Harmful substances and biodiversity

  • Labour and human rights including employee welfare and Child protection

  • Community integration

  • Supply chain and guests

‌Chairperson's Message

In Memory of

our Late Chairman

As we reflect on the year, we do so with deep respect and

admiration for our late Chairman, Deshamanya D.H.S. Jayawardena, whose passing marked the end

of an era. His visionary leadership was instrumental in shaping the trajectory of our Company, and in influencing the broader hospitality sector in Sri Lanka.

A true champion of sustainability, he was an early advocate of embedding environmental and social responsibility into our core business practices, well ahead

of his time. His contributions extended far beyond our Group, playing a pivotal role in shaping Sri Lanka’s private sector and fostering national economic development. The values he instilled and the vision he shared remain deeply embedded in our culture and will continue to inspire and guide us for generations to come.

Transition with Commitment

I step into this role with a profound respect for the heritage and enduring values that have shaped our Company. I am humbled and honoured by the trust placed in me

by the Nominations and Governance Committee, the Shareholders and the Board of Directors, to be appointed as Chairperson of Browns Beach Hotels PLC (BBH PLC). I step into this role with a clear purpose, armed with the many nuggets of wisdom imparted over the

years by the late Chairman and the Group Leadership of Aitken Spence. I have every confidence in the exceptional capabilities of our multi-generational, multicultural team of Spensonians and Heritonians, ably guided by the Board and the Management Team. My career with Aitken Spence Group, which began as an intern, led to

my decade long tenure as an Executive Director, Joint Deputy Chairperson and Joint Managing Director, which has afforded me invaluable insights into the industry and prepared me for my current position as Chairperson of this company.

I remain firmly committed to upholding our principles of strong governance, strategic clarity, and integrity. Together, we will continue to chart a course for sustainable,

long-term growth, service excellence, whilst ensuring lasting value for all our stakeholders.

Financial Performance

The Group recorded steady growth over the past three years, underpinned by the recovery of the tourism sector and a focus on operational excellence. Occupancy rates rose significantly, from 23% in 2022/23 to 66% by 2024/25, driven by the resurgence in international arrivals and sustained support from domestic tourism.

Consolidated revenue increased by 15.3% to Rs. 1.52 Bn, reflecting higher demand across markets. Despite rising input costs, including utilities, labour, and supplies, our disciplined cost management strategies, competitive procurement and price monitoring, helped to curtail overheads and report an operating profit of

Rs. 243.2 Mn.

Net finance expenses decreased by 27.6% to Rs. 314.2 Mn due to negotiations with banks on rates, supported by revisions in policy rates by the Central Bank of

Sri Lanka.

While macroeconomic stabilisation provided a supportive backdrop, challenges related to taxation, political uncertainty, and regional competition exerted pressure on margins.

Nevertheless, the Group’s performance improved, with the loss narrowing to

Rs. 153.9 Mn, compared to Rs. 466.9 Mn in the previous year.

As of 31st March 2025, our total assets of Rs. 5.13 Bn are fully funded by liabilities, with the share capital of Rs. 2.38 Bn and reserves of Rs. 1.12 Bn effectively eroded due to prolonged industry disruptions.

Shareholders should refer to page 101 of the Audit Report for the Group's going concern assessment. The principal shareholders have pledged ongoing support for Browns Beach Hotels PLC, highlighting confidence in the Group’s long-term stability and growth potential.

Corporate Governance

The passing of our visionary Chairman showcased the strength of our governance framework, set in place to ensure succession planning and the smooth transition of leadership, along with the delegation of authority. Mr. M.R. Mihular, formerly Independent Non-Executive Director since September 2024, was appointed as Senior Independent Director upon my appointment as Chairperson of the company. We welcome to the Board Dr. Ravi Fernando and Mr. Peter Englisch as Independent Non-Executive Directors. At the point of writing this report, we also welcome Mr. C.M.S. Jayawickrama as an Executive Director and Mr J. M. S. Brito

as a Non-Independent Non-Executive

Director. The diversity and depth of expertise of our Board, with their wealth of multi-industry exposure and experience in international finance and capital markets, affirms our compliance with Listing Rule 9 of the Colombo Stock Exchange. BBH PLC updated our Board composition, relevant committee structures, Terms of Reference, and related governance policies. We

have strengthened our risk oversight mechanisms to promote a risk-aware culture to better navigate market volatility.

Strategic partnerships

Two years ago, the Board of Directors proactively envisioned a transformative development for the hotel by entering a strategic partnership with DER TOURISTIK HOTELS and RESORTS GmbH. As part

of this alliance, our hotel in Negombo was rebranded under DER TOURISTIK’s premium SENTIDO collection, an internationally recognised brand known for quality and distinct guest experiences. This partnership aims to attract long-haul travellers to Negombo, countering the trend of shorter stays driven by transient travel patterns. By aligning Heritance’s strong local brand with SENTIDO’s global presence and market reach, we are well-positioned to enhance competitiveness against multinational hotel groups currently developing properties in the

Negombo area. The synergy of Heritance’s

local heritage and SENTIDO’s international standards and distribution channels, is expected to drive higher volumes and encourage greater market penetration, ensuring sustainable growth in visitor arrivals and length of stay.

Operating Environment Global tourism landscape

In 2024, international tourism continued its strong post-pandemic recovery. According to the UN World Tourism Barometer, global tourist arrivals reached approximately

1.4 Bn, representing 99% of pre-pandemic levels. This was an 11% increase over 2023. This growth was driven by several key factors such as the residual release of pent-up demand, enhanced global air connectivity, and the dynamic resurgence of Asian travel markets. Major source markets around the world reported solid performances, while destinations across Asia and the Pacific demonstrated a growing momentum in their recovery trajectories.

Sri Lankan economic and tourism context

Sri Lanka experienced a stronger-than-expected economic rebound in 2024, building upon strengthened macroeconomic fundamentals and decisive policy reforms.

The country recorded real GDP growth of 5.4%, primarily led by the industrial and tourism sectors. These gains reflect the success of structural adjustments and a commitment to fiscal discipline.

Inflationary pressures eased significantly, with the country entering a phase of deflation from September 2024. By February 2025, inflation had declined

to 4.2%, moderating slightly to 2.6% in March 2025. Interest rates remained low throughout the year, responding to accommodative monetary policies.

Meanwhile, Sri Lanka’s external sector showcased resilience, buoyed by a rise in exports, tourism earnings, and worker remittances. These inflows strengthened official reserves and supported a 10.5% appreciation of the Sri Lankan Rupee during the calender year, despite a minor depreciation of around 1.1% in the first three months of 2025, due to temporary market fluctuations.

Tourism sector revival

Following years of disruption, from the 2019 terror attacks to the COVID-19 pandemic, and through the subsequent economic crisis, 2024/25 marked a turning point for Sri Lanka’s tourism industry. A stable socio-economic environment, combined with a surge in traveller confidence, fuelled a significant resurgence in arrivals.

Tourist arrivals reached 2.1 Mn in the 2024 calender year, representing a 38.1% increase over 2023, and aligning closely with targets set by the Sri Lanka Tourism Development Authority (SLTDA). While arrivals remained about 11.7% below

pre-pandemic levels, current momentum clearly signals a renewed global interest in Sri Lanka as a preferred destination.

India retained its position as our top source market, contributing over 400,000 arrivals, a 37.7% year-on-year increase and accounting for 20.3% of total traffic. Russia followed with approximately 200,000 visitors (9.8%), while the United

Chairperson's Message

Kingdom and Germany also recorded notable gains, underscoring the widening appeal of Sri Lanka’s tourism offering across continents.

The global economic outlook remains clouded by uncertainty, driven in part by reciprocal tariffs introduced by President Trump’s administration, announced in early April 2025. The U.S. Federal Reserve has highlighted concerns over inflationary pressures stemming from these trade tensions, contributing to increased geopolitical turbulence and polarisation. As we navigate 2025, these dynamics are expected to create volatility across global markets, presenting challenges to security and trade that will impact multiple sectors, including those in which we operate.

Despite these headwinds, the tourism sector has demonstrated resilience, with continued growth in arrivals from key regions such as Asia Pacific, the Middle East, and Europe. This positive

momentum signals a meaningful recovery from the pandemic’s disruptions. Notably,

Sri Lanka’s recognition as the world’s pre-eminent family-friendly destination for 2025 underscores the country’s strengthened appeal and competitive positioning on the global stage.

Tapping into global travel trends The resurgence of global tourism in 2024 has been shaped by a decisive

shift in traveller expectations—marked by a rising preference for immersive,

wellness-oriented, and culturally grounded experiences. As travellers seek journeys that are both personally meaningful and socially conscious, Sri Lanka’s positioning as a destination offering authenticity, biodiversity, and coastal charm places it at the heart of this evolving demand. Sentido Heritance Negombo is uniquely poised

to capture this momentum. Located just minutes from the island’s international gateway and nestled along a vibrant

stretch of beach, the property offers the ideal blend of access, local culture, and experiential richness. Its rooftop Coco Spa, curated wellness journeys, and proximity to artisan markets and historic sites cater to guests’ sense of place. As Sri Lanka continues to attract high-value travellers from India, the UK, and Europe—drawn by its reputation as the world’s leading family-friendly destination—Sentido Heritance Negombo stands ready to deliver meaningful, locally inspired, and globally relevant experiences.

Our people

In the hospitality industry, our people are at the heart of everything we do. Recognising this, we have continued to invest in learning and development to

upskill and reskill our teams, ensuring they remain agile and future ready. We have also deepened employee engagement, nurturing a workplace culture that values inclusivity, collaboration, and mutual respect.

Despite the broader challenges posed by labour migration trends nationally, and growing competition from new developments in the area, our efforts to attract, retain, and develop skilled talent have yielded positive results. We remain

committed to empowering our people and strengthening partnerships that enhance service excellence and drive long-term value across our operations.

Way forward

Tourism is poised to play a critical role in sustaining Sri Lanka’s economic recovery, improving the balance of

payments, and supporting debt servicing. To unlock this potential, the country must focus on strategic destination positioning and branding, targeted global promotion, and safeguarding its unique selling propositions through regulated, sustainable tourism development.

Infrastructure upgrades are vital. Fast-tracking airport expansion, enhancing digital platforms, and improving internal connectivity, particularly in rail and domestic air travel, will enhance mobility and enrich guest experience. A streamlined, investor-friendly “one-stop shop” for tourism investments will also attract much-needed capital.

The Sri Lanka Tourism Development Authority (SLTDA) projects further growth in 2025, supported by increased

international flight frequencies and charter operations. Based on current trends, the SLTDA conservatively forecasts 2.7 Mn tourist arrivals, rising to 3.0 Mn arrivals in an optimistic outlook.

With the right policy support and infrastructure in place, tourism can become a key pillar of Sri Lanka’s longterm economic resilience and growth.

The company is set to implement a future-focused strategy to seize competitive advantages in an evolving landscape.

Our commitment to the principles of sustainability is at the heart of this vision, as we seek to not only capture an

increasingly eco-conscious market, but as a non-negotiable imperative to preserve the country’s natural resources. Our sustainability agenda continues to evolve through data-driven decision making, aimed at minimalising our environmental impact. In conjunction, the company will move to further adapt to the evolution

of digital platforms, streamlining guest experiences and enhancing revenue management. Hospitality is a people-centric industry, and our strongest asset remains our human resource. Empowering staff through tailored training programmes is a key enabler of our future growth and will ensure the continuation and elevation of the exceptional service delivery Heritance Hotels and Resorts are known for.