International Hotel Investments plc - Interim Results

On 24 August 2023, International Hotel Investments plc published its interim financial statements covering the six-month period ended 30 June 2023.

Revenues increased by 30.3% to €124.8 million compared to €95.8 million in H1 2022. While the reported figure represents a new record figure, the company noted that the amount of income recorded in the first half of 2023 represents 95% of the record revenue generated in H1 2019 when comparing on a like-with-like basis after excluding the consolidated contribution of the Golden Sands Resort from the Group’s revenue figure. IHI noted that in most operations, income is on par with 2019 levels, with London exceeding 2019 levels by €6 million, while other hotels dependent on conference business are still registering a slower recovery.

On the expenditure side, operating costs (net of exchange gains/losses) surged by 32.7% to €121.1 million driven by higher direct costs and administrative expenses, thus resulting in an operating profit of €3.72 million compared to €4.57 million posted in the corresponding period in 2022. Excluding depreciation and amortisation charges of €14 million, IHI’s EBITDA for the period amounted to €18.7 million (H1 2022: €17.3 million) which translates into an EBITDA margin of 15.0% (H1 2022: 18.1%). In this respect, IHI remarked that the increase in operating costs also included pre-opening costs related to the anticipated opening of several new hotels in 2024 and 2025.

Meanwhile, the financial performance of the Group was positively impacted by a minimal gain in the fair value of financial assets of €0.18 million in contrast to a drop in fair value of €1.63 million in the same period last year. However, interest expenses increased markedly to €17.3 million compared to €12.8 million in the previous year. Furthermore, IHI registered negative net exchange differences on borrowings amounting to €1.6 million, in contrast to the positive impact from currency exchange differences of €10.5 million in the first half of 2022.

After accounting for a tax credit of €3 million and losses attributable to non-controlling interests of €1.5 million, the net loss for the period attributable to IHI’s shareholders amounted to €10.3 million, in contrast to the net profit of €1.15 million posted in the first half of 2022.

The Statement of Financial Position as at 30 June 2023, when compared to the corresponding figures as at 31 December 2022 shows that total assets increased by 1.3% (or €21 million) to €1.68 billion, which include a cash balance of €70.4 million. Total liabilities increased by 4.6% (or €39 million) to €883.2 million, which include total borrowings of €643.4 million and lease liabilities of €13.7 million. Shareholders’ funds contracted by 3.9% (or €23.5 million) to €583.4 million, which translates into a net asset value per share of €0.948.


In their commentary, the Directors explained that management remains entirely focused on maintaining tight discipline on all operating costs. In all countries where the company operates, IHI is facing challenges related to labour shortages combined with inflationary pressures. Nonetheless, the targets for the year remain in line with original forecasts.

With respect to the growth strategy through management agreements, works are underway on projects in Doha, Rome, New York, Riyadh, Maldives and Bucharest, where IHI is involved as development partners, technical services providers and hotel operators, with practically all of the capital funding for these projects being provided by third parties. These hotels are expected to open in phases as from 2024.

Further growth is also anticipated through the capital investment in the redevelopment of the Grand Hotel Astoria in Brussels (50% owned) with an opening target date of Q2 2024. In Malta, the Group is awaiting planning decisions after it has submitted plans for the building of a low lying, highly landscaped resort for the owned site formerly known as Hal Ferh.