International Hotel Investments plc - Updated Financial Analysis Summary

On 28 June 2024, International Hotel Investments plc published an updated Financial Analysis Summary. The following are the main highlights of the expected financial performance and position of IHI in 2024:

• Revenues are expected to increase by 6.7% to a record of €307 million (FY2023: €288 million) reflecting the forecasted higher level of income across a number of its owned hotels, the inauguration of Corinthia Brussels in the final quarter of the year, and the opening of Corinthia hotels in Bucharest and New York through which IHI will generate a management fee.
• Despite the higher level of business, EBITDA is projected to fall by 2.4% to €58.9 million compared to €60.3 million in 2023, since expenses are expected to increase at a faster pace than income. In this respect, IHI explained that Group’s performance is being impacted by hotel pre-opening costs in Brussels and Rome.
• IHI expects net finance costs to increase by 15.2% to €43.2 million compared to €37.5 million in 2023. As a result, the interest cover is projected to weaken to 1.4 times compared to 1.6 times last year.
• Total debt is projected to increase by 7.8% (or €56 million) to €776 million. As a result, the gearing ratio (calculated as total debt divided by total debt plus equity) is anticipated to increase to 48.2% compared to 46.3% as at the end of 2023.
• After accounting for the expected cash balances of €43 million as at the end of 2024, IHI’s net debt is forecasted at €733 million, which translates into a net debt-to-EBITDA multiple of 12.4 times compared to 10.5 times as at the end of 2023.