The firm, a unit of John Keells Holdings, reported earnings of 61 cents per share for the quarter.
Revenues also fell 5 percent to 612.8 million rupees while cost of sales rose 4 percent to 246 million rupees, shrinking gross profits 10 percent to 366 million rupees.
The firm earned finance income of 19.1 million rupees up 60 percent from a year earlier.
Colombo city hotels had enjoyed relatively better occupancy, compared to some resorts from the December 2012 quarter as more properties came up around the country.
Top hotel groups have called for intensive promotion to attract higher spending tourists, amid claims that they were also overpriced compared to competition.
But Sri Lanka's pricing has started to ease especially in resort areas, helping boost arrivals.