Regent Asia Group Ltd is anticipating a strong increase in duty free revenue over the next few years and expects to double sales by 2018. With the company’s number of luxury duty free brand boutique outlets due to grow quickly over the next 12 months, Regent Asia is targeting a double-digit increase in duty free revenue this year following a Q4 2015 upturn.
Last year’s duty free revenue growth follows a flat year in 2014 due to the first quarter impact on the Philippines tourist industry of super Typhoon Haiyan Yolanda that struck the central Visayas region on 8 November, 2013.
After reaching an estimated US$45m in 2015, duty free sales are expected to rise this year as new airport and downtown arrival duty free stores begin trading.Regent reported total travel retail revenue of about US$60m in 2014 by its subsidiary Landmark companies, of which two thirds was generated by duty free sales and one third from duty paid travel retail operations.
“I predict we will double our duty free sales by the end of 2018,” Regent Asia Group Ltd Managing Director, Jose Maria ‘Chim’ Esteban told TRBusiness.
“Currently we are 60% perfume and cosmetics and 40% fashion but probably fashion growth will be stronger as we will have more brands with our luxury downtown store opening; the T3 landside downtown store will include aspirational fashion brands.”
Regent Asia departure stores at Manila Airport’s T1.
The duty free market in the Philippines appears to be on the cusp of a very productive period, with new projects initiating all over the Southeast Asian country. These include airside and landside duty free shops and boutiques at Manila’s Ninoy Aquino International Airport and the planned opening of the capital’s first luxury downtown duty free store in early 2017.
“Currently we are 60% perfume and cosmetics and 40% fashion but probably fashion growth will be stronger as we will have more brands with our luxury downtown store opening; the T3 landside downtown store will include aspirational fashion brands,” says Chim Esteban.
New facilities scheduled to open in Manila Airport this year include a parade of luxury boutiques in Terminal 3 and the first phase of Duty Free Philippines’ new T3 landside downtown duty free arrival store.
Close to the airport, work continues on upgrading facilities at Duty Free Philippines’ Fiesta Mall downtown duty free arrival shop, as reported in the January issue of TRBusiness. Elsewhere outside the capital a number of new duty free and tax paid travel retail outlets are preparing to open in some of the Philippines’ smaller provincial international airports.