Interim Results Q1-2012 Wednesday, April 25, 2012 Kurt Ritter, President & CEO Puneet Chhatwal, Executive Vice President & CDO Knut Kleiven, Deputy President & CFO Radisson Blu Hotel Istanbul Asia, Turkey
Q1-2012 highlights • L/L RevPAR grew by 6%, highest growth since Q1 2011 and well above market • RevPAR strongest in Eastern Europe followed by the Middle East and Africa • Revenue up 7%, supported by RevPAR growth and strong meetings and events business • EBITDA margin up 2 pp; due to revenue growth and a good flow-through in the Nordics 2 / Interim Results Q1-2011 / April 22, 2012
Q1-2012 highlights • Launch of “Carlson Rezidor Hotel Group” • Strategy “Route 2015” • Reinforced and streamlined organisation • Ranked World’s Most Ethical Hotel Company in 2012 by Ethisphere Institute • Introduction of “Think Planet”: 25% energy reduction representing cost saving of MEUR 6 by 2016 3 / Interim Results Q1-2011 / April 22, 2012
Lack of profitability in Rest of Western Europe EBITDA margin on lease contracts in the Nordics and ROWE 20% 16% 16% 15% 12% 11% 10% 10% Nordics 5% 3% 1% ROWE 0% -2% -5% -4% -10% -8% 2007 2008 2009 2010 2011 • Lower brand awareness and RevPAR in ROWE than in the Nordics • High rent percentages (mainly fixed) • Three non strategic and unprofitable leases terminated in 2010 and 2011 4 / Interim Results Q1-2012 / April 25, 2012 4
“Route 2015” – tangible initiatives to improve the EBITDA margin 3-4% Revenue Generation 6-8% 6-8% 0.5-1% Cost savings projects uplift in uplift in EBITDA EBITDA margin by margin by 2015* 2015* 2015* 2015* Cap utilization Cap utilization 0.5% 0.5% 2-2.5% 2-2.5% Fee based growth Fee based growth Asset Management * Assuming market RevPAR growth covers inflation 5 / Interim Results Q1-2012 / April 25, 2012
BUSINESS DEVELOPMENT Puneet Chhatwal, Executive Vice President & CDO Park Inn by Radisson Rosa Khutor, Sochi, Russia
Development Outlook • Investors looking for prime assets with secure income streams • Debt financing still constrained, limiting new build development • Focus on debt restructuring and conversion opportunities • Growth in emerging markets, delays in openings Rezidor Update • Pipeline to be maintained at 20,000+ rooms (excluding conversions) • Focus on Asset and Contract Management • Openings delayed due to emerging markets and business model • Positive contribution from new openings support strategy 7 / Interim Results Q1-2012 / April 25, 2012
Fee-based signings in emerging markets SIGNINGS Q1-2012 Q1-2011 Hotels 6 11 Rooms 1,400 2,200 • Q1 2012 highlights: – 100% managed, 100% emerging markets Radisson Blu Conakry, Guinea – 75% conversions – 75% conversions • 9 th consecutive quarter of 100% fee-based signings • Entering new markets: Gabon and Guinea Radisson Blu Resort Tsinandali, Georgia 8 / Interim Results Q1-2012 / April 25, 2012
Openings in strategic locations OPENINGS Q1-2012 Q1-2011 Hotels 4 6 Rooms 1,000 1,400 • Q1 2012 highlights: – 100% fee-based openings Park Inn by Radisson Rosa Khutor, Russia Russia – 2 hotel conversions – 2 hotel conversions • Key locations: Istanbul, Sochi, Libreville (Gabon) • 2 hotels went offline (143 rooms) Radisson Blu Mersin, Turkey 9 / Interim Results Q1-2012 / April 25, 2012
Selected Openings 2012 Mature Markets Rooms Emerging Markets Rooms Park Inn Donetsk, Ukraine 175 Radisson Blu Uppsala, Sweden 176 Radisson Blu Resort Gran Canaria, Park Inn Tete, Mozambique 116 231 Spain Park Inn Budapest, Hungary 136 Radisson Blu Resort & Spa Corsica, 170 Radisson Blu Doha, Qatar 583 France Radisson Blu Maputo, Mozambique 152 Radisson Blu Nantes, France 142 Radisson Blu Lusaka, Zambia 142 Park Inn Lille Grand Stade, France 127 Park Inn Wembley, UK 235 Radisson Blu Bukovel, Ukraine 252 • Balanced growth across the markets 10 / Interim Results Q1-2012 / April 25, 2012
Understanding the Pipeline Rooms Under Development 8,000 • 21,700 rooms under development 7,000 • 60% under construction / site 6,000 clearance 5,000 4,000 4,000 • Estimated wash-out 15% • Estimated wash-out 15% 3,000 • Delays in openings likely for 2,000 another 15% of pipeline 1,000 • Further openings through 0 conversions 2012 2013 2014 2015 Conceptual stage/pre-planning Under Construction/site clearance 11 / Interim Results Q1-2012 / April 25, 2012
Largest upscale hotel brand in Europe Number of Hotels Number of Hotels Number of Rooms Number of Rooms 200 183 45,000 42,400 180 40,000 37,500 160 146 35,000 140 30,000 120 25,000 21,800 93 100 20,000 17,200 75 75 80 80 15,000 15,000 15,000 52 60 10,000 7,300 40 4,800 24 20 5,000 20 0 0 Crowne Plaza InterContinental Hilton Marriott Sheraton Sofitel InterContinental Hilton Marriott Crowne Plaza Sheraton Sofitel SOURCE I MKG Hospitality Database I December 2011 (In Operation) 12 / Interim Results Q1-2012 / April 25, 2012
FINANCIAL UPDATE Knut Kleiven, Deputy President & CFO Radisson Blu Hotel , Mersin, Turkey
Q1 is always the weakest quarter EBITDA, MEUR 35 25 15 5 -5 -5 -15 03 04 05 06 07 08 09 10 11 12 03 04 05 06 07 08 09 10 11 03 04 05 06 07 08 09 10 11 03 04 05 06 07 08 09 10 11 • RevPAR is expected to benefit from low growth in room supply but macroeconomic uncertainties remain 14 / Interim Results Q1-2011 / April 22, 2012
L/L RevPAR growth 5.6%; driven by occupancy Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 15 / Interim Results Q1-2011 / April 22, 2012
RevPAR growth continued, led by Eastern Europe NO: Softer development in the Nordics. Denmark was the best performer. NO Q1 L/L RevPAR: 1.7% EE: Continued strong growth, led by Russia, Occupancy: 1.2% ARR: 0.5% Poland and the Baltics. ROWE: Good improvements in Belgium, Germany and Ireland. Noteworthy decline in EE Q1 L/L RevPAR: 12.2% Switzerland. Occupancy: 10.0% ARR: ARR: 2.0% 2.0% MEAO: First positive quarter since Q4 2010. ROWE Q1 Strong growth in South Africa, L/L RevPAR: 3.1% Saudi Arabia, UAE and Egypt. Occupancy: 3.0% ARR: 0.1% L/L RevPAR growth Q/Q 8% 6% 4% 6.9% 5.6% 5.4% MEAO Q1 2% L/L RevPAR: 10.8% 0% Occupancy: 11.7% ARR: -0.8% 16 / Interim Results Q1-2011 / April 22, 2012
Good improvement in profitability IN MEUR Q1 2012 Q1 2011 • 7% revenue growth – driven by RevPAR growth, RGI gain and strong meetings Revenue 207 193 and events business EBITDAR 58 53 • EBITDA margin up 2 pp supported by: % EBITDAR Margin 28% 27% • Good revenue flow-through 62% 65% EBITDA EBITDA -5 -5 -9 -9 • Additional high-margin fee revenue • Additional high-margin fee revenue 53% • No pre-opening expenses % EBITDA Margin -2% -4% • Higher marketing costs (timing effect) EBIT -13 -17 • EBIT margin also supported by lower % EBIT Margin -6% -9% depreciation rate Net results -14 -17 17 / Interim Results Q1-2012 / April 25, 2012
Good flow-through Q1 2012 vs Reported Hotel New Pre- FX L/L Q1 2011 Change Exits Hotels opening Revenue 14.2 2.9 -1.1 1.6 10.8 EBITDAR 5.7 1.0 -0.1 1.1 1.1 2.6 EBITDA 3.4 0.1 0.1 1.1 1.1 1.1 EBIT 4.0 0.0 0.1 1.1 1.1 1.7 • Negative impact due to timing differences of marketing spend of MEUR 2 18 / Interim Results Q1-2011 / April 22, 2012
Leased business: improved EBIT margin in the Nordics Leased Revenue 181 170 200 Revenue: 150 MEUR 92 89 84 86 • Nordics: strong meeting and events 100 business 50 0 • ROWE: modest RevPAR growth Leased EBIT EBIT: 20 4.4 10 • Nordics: good flow-through, no pre- 0.9 MEUR 0 opening expenses -10 -6.8 -11.2 -11.4 -20 -12.3 • ROWE: higher travel agent commissions, increased costs for energy and F&B and timing differences in marketing spend Q1 2012 Q1 2011 19 / Interim Results Q1-2011 / April 22, 2012
Strong growth in fee business Fee Revenue 22.0 25 19.0 MEUR Revenue: 15 7.5 6.1 6.0 2.5 6.9 5.0 4.6 2.4 5 • EE and MEAO: strong RevPAR -5 increase and new hotels Fee EBIT EBIT: 14 MEUR 7.3 • EE: in line with revenue 9 6.9 2.8 3.2 3.2 1.6 2.3 4 0.2 1.1 • MEAO: EBIT impacted by higher -1 -0.2 marketing costs (timing effect) Q1 2012 Q1 2011 20 / Interim Results Q1-2011 / April 22, 2012
Liquidity position MEUR 2012 2011 Cash Flow from Operations -15.5 -12.4 Change in Working Capital 3.1 -9.3 Investments -8.0 -6.8 CapEx -7.4 -8.0 Other Other -0.6 -0.6 1.2 1.2 Free Cash Flow -20.4 -28.5 • Settlement of higher current tax liabilities • Ongoing focus on Working Capital and positive effect of settlements in H1-2011 • Available overdrafts and cash MEUR 86 21 / Interim Results Q1-2011 / April 22, 2012
Margin expansion in Q1 reflects Route 2015 initiatives OUR FINANCIAL TARGETS FOCUS AREAS EBITDA MARGIN UPLIFT Profitability EBITDA margin of • Revenue initiatives Target 12% over a business Rezidor’s Initiatives cycle 6-8% • Cost savings Balance Small positive Sheet average net cash position position • Fee based room growth Dividend Approximately one + Asset Management Policy third of annual after- tax income to be • Asset management / distributed to deleveraging shareholders + Market Recovery over and above inflation * Assuming market RevPAR growth covers inflation 22 / Interim Results Q1-2012 / April 25, 2012
Recommend
More recommend
