KUALA LUMPUR (June 12): Berjaya Tioman Resort's management today said that the over 50-year-old resort will cease operations from June 15, hit by the Covid-19 outbreak and to make way for a redevelopment on site.

"It is with a heavy heart to announce that Berjaya Tioman Resort will cease operations with effect from June 15, 2020, due to the unprecedented Covid-19 pandemic which has adversely impacted the tourism industry.

"Throughout this closure, the management will embark on a much-needed major redevelopment to revitalise the resort, which is more than 50 years old," it said in a statement.

The resort management also said that a retrenchment exercise will be carried out, where all affected employees will be fairly compensated to the tune of over RM8 million.

"Upon completion of the redevelopment exercise, the management will consider offering new employment opportunities to all our affected employees," it said, and thanked them for their dedication in staying with the resort through thick and thin.

Berjaya Tioman Resort, part of the portfolio held by Berjaya Land Bhd, had been loss-making as recently as in the 14-month period ended June 30, 2019 with a pre-tax loss of RM7.4 million, on revenue of RM23.1 million or 6.5% of group top line of RM356.1 million.

In Malaysia, Berjaya Land also has resorts in Langkawi, the Redang island, Bukit Tinggi, as well as hotels in parts of Asia and Europe. The group owns and operates 13 hotels and resorts locally and internationally.

Berjaya Land's share price traded 0.5 sen or 2.78% lower at 17.5 sen at noon market break, valuing it at RM875.06 million. The counter has retreated by 7.89% since the start of the year.