International Hotel Investments p l c : Half-Yearly Report for 2023

International Hotel Investments p.l.c.

Interim Financial Statements (Unaudited)

For the six-month period

1 January 2023 to 30 June 2023

International Hotel Investments p.l.c.

Interim Financial Statements

For the period from 1 January 2023 to 30 June 2023

Contents

Half-yearly Directors' Report pursuant to Capital Markets Rule 5.75.2	1 - 3
Interim Income Statement		4
Interim Statement of Comprehensive Income		5
Interim Statement of Financial Position	6	- 7
Interim Statement of Changes in Equity		8
Interim Statement of Cash Flows		9
Notes to the Financial Statements	10	- 12
Statement pursuant to Capital Markets Rule 5.75.3		13

International Hotel Investments p.l.c.

Interim Financial Statements

For the period from 1 January 2023 to 30 June 2023

Directors' Report

Six-month period ended 30 June 2023

Basis of Preparation

The published figures for the reporting period have been extracted from the unaudited consolidated financial statements of International Hotel Investments p.l.c. ("the Group") for the six months ended 30 June 2023 and the comparative period in 2022. Comparative balance sheet information as at 31 December 2022 has been extracted from the audited financial statements of the Group for the year ended on that date. This report is being published in terms of Capital Markets Rule 5.74 issued by the Listing Authority and has been prepared in accordance with the applicable Capital Markets Rules and International Accounting Standard 34, 'Interim Financial Reporting'. In terms of Capital Markets Rule 5.75.5, the Directors are stating that this Half-Yearly Financial Report has not been audited or reviewed by the Group's independent auditors.

Principal Activities

International Hotel Investments p.l.c. carries on the business of an investment company in connection with the ownership, development and operation of hotels, leisure facilities, and other activities related to the tourism industry and commercial centres. The Company has a number of subsidiary companies and investments in associate companies through which it promotes the business of the Group.

Review of Performance

The Group registered total revenues of €124.8 million compared to €95.8 million in the corresponding period last year, an increase of 30%. The 2023 interim report is the first report not influenced by direct curbs on performance due to Covid, noting that the first months of 2022 were impacted by the Omicron variant. Total revenues in the first half of 2023 are now at 95% of pre-pandemic levels registered in the same period for 2019. Revenue in most operations is on par with 2019 levels, with London leading - -with an increase of €6 million on 2019. Hotels dependent on conference business are registering a slower recovery as expected given the long lead time typical of bookings for this market segment.

The Group registered an EBITDA of €18.78 million in the first half the year compared to €17.3 million in the corresponding period last year. EBITDA conversion at 15% is impacted by inflationary pressures on payroll and other costs such as energy, the latter especially in Budapest, as well as exchange rate movements when converting actual performance from local currencies such as the Rouble and Sterling into Euro. The Group's operating subsidiary Corinthia Hotels Limited is also incurring pre-opening costs and taking on new, senior personnel as this company ramps up its activity, expertise and resources in advance of the opening of several new, luxury Corinthia hotels in 2024 and 2025, which will drive revenues to the Group only once such hotels are operating. EBITDA conversion in the corresponding period last year was positively impacted by wage subsidies. Notwithstanding, the Group's focus on cost controls is ongoing with a particular focus on manning levels, which remain lower than 2019 levels on a like-for-like basis, benefitting to some degree from efficiencies which had arisen in the pandemic. Furthermore, given seasonality factors, the Group expects conversion levels to stabilise at past years' levels by the end of this year.

In reviewing the financial results for the first six months of 2023, one should also note the following:

Interest income and expense has been impacted by the increase in base rates as Central bankers battle inflationary pressures. Interest cost increased by €4.5 million from €12.8million in the corresponding period to €17.3 million on account of these base rate increases and net increases in debt.

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International Hotel Investments p.l.c.

Interim Financial Statements

For the period from 1 January 2023 to 30 June 2023

Directors' Report - continued

Period ended 30 June 2023

Last year, in advance of imminent sanctions, and acting on expert advice, the group fully repaid an outstanding loan in St Petersburg then owing to a bank which eventually was indeed placed on a list of sanctioned entities by the European Union. Net foreign exchange translation difference gains of €10.5 million reported in our financial statements last year represent realised exchange movements arising from this repayment, which were one-off in nature. This payment removed exchange volatility from debt denominated in a currency different from the function currency of the operation.

All of the above results in a loss after tax of €11.7 million being reported compared to a profit of €0.8 million in the same period last year

The net loss, net of tax, of €6.2 million in the Statement of Comprehensive Income principally reflects the currency translation difference on the Group's non-Euro denominated investments in London and in St Petersburg. The Sterling strengthened whilst the Rouble weakened against the reporting currency of the Group which is the Euro.

State of Affairs and Outlook

Our hotel in London is exceeding expectations and is already recording revenues at 118% of 2019. Except conference hotels, our other hotels are performing at 2019 levels or better. In all our hotels and businesses, management remains entirely focused on maintaining tight discipline on all operating costs. As in the corresponding period, in all countries where the company operates, its most imminent challenges are related to labour shortages as the industry generally struggles to attract workers as demand increases combined with inflationary pressures on costs and energy. The Company's targets for year-end and financial planning are based on revenue expectations that are in line with our original forecasts.

All CAPEX remains tightly controlled. In terms of cash and bank balances, as at end of June 2023, the Group had available resources of €58.5 million.

The Company through its operating entity Corinthia Hotels Limited remains focused on a growth strategy through management agreements. Works are now well underway on projects on sites in Doha, Rome, New York, Riyadh, Maldives and Bucharest, where Group subsidiary companies are 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 of 2024.

Furthermore, growth is also being achieved through capital investment in owned hotel projects. The redevelopment of the Grand Hotel Astoria in Brussels is ongoing with a target date of Q2 2024 set for opening. The Company has a 50% share in this project.

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.

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International Hotel Investments p.l.c.

Interim Financial Statements

For the period from 1 January 2023 to 30 June 2023

Directors' Report - continued

Period ended 30 June 2023

Directors

At the date of this report, the Directors of the Group are as follows:

Mr Alfred Pisani (Chairman)

Mr Frank Xerri de Caro

Mr Moussa Atiq Ali

Mr Hamad Buamim

Mr Douraid Zaghouani

Mr Joseph Pisani

Mr Richard Cachia Caruana

Mr Mohamed Mahmoud Alzarouq Shawsh

Mr Alfred Camilleri

In accordance with the Group's Articles of Association, the present Directors remain in office.

On behalf of the Board,

Alfred Pisani	Richard Cachia Caruana
Chairman	Director

Registered Office:

22 Europa Centre,

Floriana FRN1400,

Malta

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