CPHCL Finance plc - Updated Financial Analysis Summary

On 31 August 2020, Corinthia Finance plc published an updated Financial Analysis Summary (“FAS”) providing an overview of the company’s and the guarantor’s, namely Corinthia Palace Hotel Company Limited (“CPHCL”), financial results in 2019, a comparison of the 2019 actual results with the forecasts published in the previous FAS dated 30 August 2019, as well as the forecasts for the current financial year ending 31 December 2020.

The following are the main highlights of the expected financial performance and financial position of CPHCL in 2020:

• Revenues are anticipated to drop by 65.4% to €107.2 million reflecting the significant disruptions to the hotel business brought about by the ‘COVID-19’ pandemic.
• Although operating expenses are expected to drop by just over half to €117.2 million, CPHCL is anticipating a negative EBITDA for the year of just under €10 million compared to a positive EBITDA of €68 million in the 2019 financial year.
• Overall, CPHCL is forecasting a net loss of €64.4 million (compared to a net profit of €53.3 million in 2019) and also to end the 2020 financial year with a cash balance of €79.6 million compared to €125.7 million as at 31 December 2019.
• Total borrowings are expected to increase by 1.4% to €711.2 million (including lease liabilities amounting to €14.6 million) whilst net debt is anticipated to rise to €626.1 million (31 December 2019: €572 million) reflecting the considerable forecasted drop in cash reserves as well as the €11.4 million increase in borrowings.
• The gearing ratio (calculated as total debt divided by total debt plus equity) is anticipated to increase to 45.7% (31 December 2019: 42.2%). Furthermore, given the expected sharp drop in EBITDA to a negative €10 million, CPHCL is not expecting to generate enough earnings to cover its net finance costs amounting to €27.6 million.

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Corinthia Finance plc – Financial Analysis Summary dated 31 August 2020.