International Hotel Investments plc - Updated Financial Analysis Summary

On 30 June 2019, International Hotel Investments plc published an updated Financial Analysis Summary (“FAS”) providing an overview of the 2018 financial results, a comparison of the 2018 actual results with the revised forecasts of 2018 as published in the previous FAS dated 4 March 2019, as well as the revised forecasts for the current financial year ending 31 December 2019.

The main highlights of the expected financial performance of the Group in 2019 are:

• Revenues are expected to climb by 6.8% to €273.8 million mostly reflecting increased business at the Corinthia hotels located in London (+GBP5.4 million), Budapest (+€1.75 million) and Lisbon (+€1.39 million). On the other hand, the Group’s three hotels located within the St George’s Bay peninsula are expected to register a decline in revenues whilst the performance of the Corinthia Hotel St Petersburg is anticipated to return to more normal levels following the exceptional year in 2018 reflecting the organisation of the FIFA World Cup football tournament in Russia.
• EBITDA is now anticipated to improve by 6.5% to €70.7 million which is however lower than the earlier projection of an EBITDA of €73.6 million, largely reflecting downward revisions in the expected contributions from the Corinthia hotels located in Tripoli (on much lower than expected occupancy levels) and London (on an expected lower average room rate). On the other hand, IHI is now expecting significantly improved results from its food retailing and contract catering businesses which also include the operations of the Costa Coffee franchise in Malta and the east coast of Spain.
• Results from operating activities are expected to decline by 10% to €34.4 million when compared to the 2018 financial year. On the other hand, however, the financial performance of IHI in 2019 is expected to be positively impacted by favourable foreign exchange movements which, in turn, are anticipated to boost the Group’s net profitability to €13.9 million compared to a net profit of €8.46 million in 2018.

Meanwhile, the forecasted Statement of Financial Position as at 31 December 2019 shows that IHI is expecting to close the year with total borrowings of €585.6 million and a net debt position of €518.2 million. These are higher than the corresponding figures as at the end of 2018 which show that IHI had total borrowings of €565.1 million and a net debt of €502.6 million. Conversely, the net asset value per share is expected to increase to €1.131 from €1.110 as at the end of 2018 reflecting the net profits that are expected to be generated in the 2019 financial year.

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International Hotel Investments plc – Financial Analysis Summary dated 28 June 2019.