Performance Review

Hospitality Sector

SEDCO Holding has invested in world-class Saudi hospitality companies such as Elaf, which operates a network of hotels, offers Hajj and Umrah services, and operates tour and travel agencies.

Elaf Group

Elaf Group is a wholly owned SEDCO subsidiary and a market leader in the Saudi Arabian tourism, travel and hotel sectors. The company is a General Sales Agent for major airlines and operates a network of three, four and five-star hotels. As a premier name in religious tourism, Elaf also offers inbound and outbound tour packages, partnering with several Hajj and Umrah operators around the world.

Adel Ezzat
Chief Executive Officer

“WE ARE REVISITING OUR STRATEGY TO ALIGN IT WITH VISION 2030, PARTICULARLY IN THE DOMAIN OF HAJJ AND UMRAH AND TOURISM.”

The hotel business continued to experience headwinds in 2021 due to Covid-19 related travel restrictions. Bookings by domestic tourists grew year-on-year, however, and our Jeddah hotels enjoyed a successful last quarter with major events taking place in the city – the inaugural Saudi Arabian Grand Prix, the Red Sea Film Festival, and the Dakar rally – generating significant revenues.

We rolled out emergency contingency plans early in the year, closing some properties, reducing our head count and imposing strict payroll management in the Holy Cities’ hotels. By anticipating the impact of the pandemic and acting decisively, we were able to close the year on budget.

While the global tourism market recovery is expected to start in 2024, our short-term focus is on local, GCC and tourist visa markets to create demand from those countries and to capitalize on the resumption of visas for 49 countries.

The religious tourism business was clearly affected by events but, with the lifting of restrictions on flights from the key Umrah markets of India, Indonesia, Pakistan and Egypt from the beginning of 2022, and ongoing efforts by the Saudi authorities to mitigate the worst of the impact, we are optimistic that we can quickly recover the ground lost in 2020 and 2021.

Meanwhile, Elaf Umrah OTA acquired more than 250 external agent and Umrah operator registrations following an extensive awareness campaign and we also signed Umrah contracts with most of our agents in North Africa, Jordan and Pakistan. A new contract with Tunas Travel in Indonesia is important because it will give us access to 350 travel agents.

We also started the process of revisiting our strategy to align it with Vision 2030, particularly in the domain of Hajj and Umrah and tourism.

As a committed advocate of sustainability and CSR, Elaf was proud to use its hotels for training college students and to host several events for not-for-profit training centers and an art gallery for Saudi Young Painters during the year. Our active involvement in the community is important to us and will be the subject of renewed focus going forward.

There is much ground to be made up in the year ahead, but we believe that a controlled and consistent approach to recovery and growth will be key to improving our hospitality performance in the short and mid-term. We are excited at the prospect of entering the Riyadh market with a new property and to re-open our hotels in Makkah. We plan to roll out new branding for our hotels.

As Umrah resumes, we will focus on consolidating our leadership position in religious tourism domestically and abroad, and to target 10% market share of the Umrah OTA market.