2017 Interim Results ISE: DHG LSE: DAL
Disclaimer The presentation contains forward looking statements. These statements have been made by the Directors in good faith based on the information available to them up to the time of their approval of this presentation. Due to inherent uncertainties, including both economic and business risk factors underlying such forward looking information, actual results may differ materially from those expressed or implied by these forward looking statements. The Directors undertake no obligation to update any forward looking statements contained in this presentation, whether as a result of new information, future events or otherwise. 2017 H1 Results Page 2
H1 2017 | Contents Key Value Drivers H1 2017 Financial Performance Business Review Driving Portfolio Growth Outlook Appendices 2017 H1 Results Page 3
H1 2017 | Key Value Drivers Dublin and Regional Ireland markets continue to show strong RevPAR growth. UK markets enjoying strong RevPAR growth in 2017 Leveraging scale and decentralised operating model across Ireland and into the UK • Outperformed market RevPAR growth in all cities with exception of Cork • Converted additional revenue strongly to the bottom line – Segments EBITDAR margin up from 38.7% to 41.0% Pipeline of additional 1,280 rooms on track to open in 2018 – on time and within budget. Significant earnings boost for 2019 and 2020 Continuing to deliver on growth strategy • 3 hotels bought in Ireland at combined initial yield of 7.7%, hotel sold in UK at initial yield of 4.85% • Exciting pipeline of acquisitions, refurbishments and development opportunities • Announcing today a new Clayton hotel in Manchester to open in 2020 • Controlled and disciplined growth strategy with low gearing levels Modern well invested, well located properties delivering strong free cashflows 2017 H1 Results Page 4
H1 2017 Financial Performance ISE: DHG LSE: DAL
Dalata | Driving Sustained Strong Performance in H1 2017 Adj djusted Dil Diluted EP EPS 2 RevPAR Adj djusted EB EBITDA 1 Revenue € m € m € € 100 200 60 0.20 +10% +27% +41% +24% 180 50 90 0.15 160 40 80 0.10 140 30 70 0.05 120 20 60 100 10 0.00 2016 2017 2016 2017 2016 2017 2016 2017 1. Excludes the effects of depreciation, revaluation movements and items considered by management to be non-recurring or unusual in nature. Acquisition costs have been excluded given the scale of acquisitions in 2016 2. Excludes the tax adjusted effects of revaluation movements and items considered by management to be non-recurring or unusual in nature. Acquisition costs have been excluded given the scale of acquisitions in 2016 2017 H1 Results Page 6
Dalata | 3 Core Business Segments Dublin 57% Group Revenue 60% Segment EBITDA 48% 14 Hotels 3,699 Rooms H1 2017 RevPAR: € 96.36(+8%) EBITDAR Margin Regional Ireland 21% Group Revenue 15% Segment EBITDA 24% 12 Hotels 1,643 Rooms H1 2017 RevPAR: € 60.93(+9%) EBITDAR Margin UK * 21% Group Revenue 23% Segment EBITDA 38% 7 Hotels 1,557 Rooms H1 2017 RevPAR: £63.72(+15%) EBITDAR Margin * Excludes Croydon Park Hotel Information as at period end 2017 H1 Results Page 7
Dalata | Doing what we promise 6 Months 6 Months Key Financials €’000 8.3% increase in ARR drives 9.8% RevPAR growth Ending Ending 30 th June 30 th June Strong conversion of incremental sales leads to 2017 2016 segments EBITDAR margin increasing from 38.7% to Revenue 161,801 130,050 41.0% Segments EBITDAR 66,310 50,350 Rent up due to Clayton Hotel Burlington Road, full period impact of the Gibson Hotel and performance Rent (16,342) (11,704) rents, partially offset by ownership of Clayton Hotel Segments EBITDA 49,968 38,646 Cardiff for most of period and purchase of Maldron Central overheads (5,561) (3,835) Hotel Cork freehold in September 2016 Continued investment in central team and systems Other income / costs 1,113 (3,819) reflected in central overheads EBITDA 45,520 30,992 See note on depreciation in appendices (page 32) Depreciation (7,631) (7,165) Net finance costs are net of € 663k of interest Net finance costs (5,182) (5,661) capitalised to property, plant and equipment Profit before tax 32,707 18,166 Profit after tax 28,347 15,525 KPIs 6 Months Ending 6 Months Ending 30/6/2017 30/6/2016 EPS ( € ) 0.15 0.08 Occupancy 80.2% 79.0% Adjusted EBITDA 44,891 35,348 Average Room Rate ( € ) 102.63 94.78 Adjusted diluted EPS ( € ) 0.15 0.11 RevPAR ( € ) 82.27 74.90 2017 H1 Results Page 8
Dalata | Adjusted EBITDA Bridge € m 60 4.2 1.0 1.7 50 44.9 0.1 2.3 1.4 4.5 35.3 40 30 20 10 0 EBITDAR margin increases from 38.7% to 41.0% due to strong conversion of additional revenue to EBITDAR 2017 H1 Results Page 9
Dalata | Continuing to Outperform Market RevPAR growth 22.9% 22.6% 19.1% 17.0% 13.6% 13.1% 11.5% 11.2% 10.9% 10.3% 9.7% 8.8% 8.6% 8.2% 7.2% 6.5% 1.8% -1.1% Dublin Galway Limerick Cork Belfast Leeds Manchester Cardiff London (excl Clayton Hotel Burlington Road 1 ) Dalata Market Source: Market data – STR; Trending.ie Very strong performance versus market in Dublin, London and Regional UK cities Behind market in Cork due to of impact of refurbishment works in Q1 and rebranding at Clayton Hotel Cork City Very strong six months in London driven by exceptional performance at Clayton Hotel Chiswick 1. Clayton Hotel Burlington Road is excluded from the ‘like for like’ analysis because its performance in the transitional period since its November 2016 acquisition has a disproportionate impact as a result of its size 2017 H1 Results Page 10
Dublin | Half Year Performance Dublin market continues to perform strongly (+7.2%) 6 Months Ending 6 Months Ending All figures €’000 30/6/2017 30/6/2016 due to the combination of strong demand and limited Revenue new supply. STR now forecasting 7% increase in RevPAR for 2017 Rooms 64,529 48,229 Food and beverage 22,012 15,704 Dalata outperformed market with RevPAR up 11.2% Other 6,172 4,371 excluding Clayton Hotel Burlington Road 1 Total revenue 92,713 68,304 Food and beverage revenue up 3.1% for the year on a EBITDAR 44,256 31,519 ‘like for like’ basis. Clayton Hotel Burlington Road Rent (14,212) (8,590) added € 4.9m to food and beverage revenue EBITDA 30,044 22,929 Rent up as a result of addition of Clayton Hotel EBITDAR % 47.7% 46.1% Burlington Road, full year impact of Gibson Hotel and 6 Months Ending 6 Months Ending KPIs Inc Burlington Rd increased performance rents at Ballsbridge Hotel and 30/6/2017 30/6/2016 Maldron Hotel Dublin Airport Occupancy 83.1% 82.4% Average Room Rate ( € ) 116.02 108.38 EBITDAR margin up to 47.7% due to 74% conversion RevPAR ( € ) 96.36 89.30 of additional sales to EBITDAR on a ‘like for like’ basis 6 Months Ending 6 Months Ending KPIs Exc Burlington Rd 30/6/2017 30/6/2016 Occupancy 84.4% 82.8% Average Room Rate ( € ) 112.52 103.07 1. Clayton Hotel Burlington Road is excluded from the ‘like for like’ analysis because its performance in the transitional period since its November 2016 acquisition has a disproportionate impact as a result of its size RevPAR ( € ) 94.91 85.34 KPIs include full six month performance of other Dublin acquisitions regardless of when acquired 2017 H1 Results Page 11
Regional Ireland | Half Year Performance 6 Months 6 Months All figures €’000 Ending 30 th Ending 30 th Cork, Limerick and Galway markets continue to June 2017 June 2016 perform well on the back of strong demand from Revenue domestic consumers and FDI companies. Outlook remains positive through combination of limited Rooms 18,094 14,548 supply pipeline and strong demand Food and beverage 11,987 10,940 RevPAR increased by 9.2%. Number of hotels Other 3,971 3,251 benefitting from impact of refurbishment in previous Total revenue 34,052 28,739 years such as Clayton Hotel Silver Springs, Maldron EBITDAR 8,048 6,209 Hotel Cork and Clayton Hotel Limerick Rent (672) (1,119) Significant increase in EBITDAR margin to 23.6% due EBITDA 7,376 5,090 to 86.3% conversion of incremental revenue on ‘like for like’ basis EBITDAR % 23.6% 21.6% KPIs 6 Months 6 Months Ending 30 th Ending 30 th June 2017 June 2016 Occupancy 71.5% 69.3% Average Room Rate ( € ) 85.17 80.46 RevPAR ( € ) 60.93 55.79 KPIs include full six month performance of all Regional Ireland hotels regardless of when acquired 2017 H1 Results Page 12
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