Elegant Hotels Group Plc (LON:EHG) CEO Sunil Chatrani talks to DirectorsTalk after the release of its unaudited results for the six months ended 31 March 2018. With increases in revenue, RevPAR average daily rate and occupancy Sunil explains what has driven the positive results, talks us through the latest dynamics of the operating environment in Barbados, the recent acquisition of Treasure Beach, the validity of its strategy of ‘refurbish, reposition, reprice’, the outlook for the remainder of this year and strategic priorities.
Unaudited Financial Highlights
· Revenue up 8% to $38.8m (H1 2017: $35.8m)
· RevPAR (revenue per available room) up 5% to $292 (H1 2017: $279)
· ADR (average daily rates) up 2% to $433 (H1 2017: $425)
· Adjusted EBITDA* up 1% to $15.4m (H1 2017: $15.3m)
· Adjusted profit before tax down 7% to $11.4m (H1 2017: $12.2m)
· Adjusted EPS (cents per share) of 10.5c (H1 2017: 11.0c)
· Implied Net Asset Value (NAV) of 199 cents per share (143 pence per share **)
· Interim dividend declared at 1.33 pence per share (H1 2017: 3.5 pence per share)
· Opened Treasure Beach hotel, a 35 suite hotel, in December 2017 resulting in a 6% increase in room count to 588 (H1 2017: 553)
· Established a centralised warehouse in order to increase operational efficiencies and take advantage of direct importation of food and beverage
· Construction of Hodges Bay Resort in Antigua, the Group’s first management contract and its first hotel outside Barbados, nearing completion
· Occupancy increased to 67% (H1 2017: 66%)
* The Group uses adjusted EBITDA as a measure of performance as it better represents underlying performance. Adjusted EBITDA is earnings before interest, tax, depreciation, amortisation and one-off items that are outside the ordinary course of business. Adjusted profit and adjusted EPS reflect the adjusted EBITDA figure.
Please note that due to rounding, numbers presented throughout this document may not add up precisely to the totals provided. Percentage changes are calculated on unrounded figures.
** based on an exchange rate of £1 : $1.40
Commenting on the results, Sunil Chatrani, CEO of Elegant Hotels Group, said: “We are pleased to have delivered a solid financial and operational performance in the first half of the financial year. The high end hotel market in Barbados appears to be stabilising after several challenging years, and we have a strong pipeline of bookings for the remainder of the financial year. As a result, we remain comfortable with the FY18 outlook versus market expectations and confident in the Group’s longer term prospects.”