Minor Hotels Europe & Americas S A : Occupancy, ADR and Revenue Continued to Grow at Minor Hotels Europe & Americas in Q1 2024

14 May 2024

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• First-quarter EBITDA increased by 17% to €69 million
• RevPAR registered growth of 9.2%, driven by price growth (ADR: +5.3%) and a two-point improvement in occupancy

Madrid, 13 May 2024. Minor Hotels Europe & Americas reported total revenue of €460 million in the first three months of the year, a growth of 13% from the €407 million reported in 1Q23. First-quarter recurring EBITDA amounted to €69 million, year-on-year growth of 17%. Excluding rent, first-quarter EBITDAR, rises to €117 million, a growth of 12% from 1Q23.

Business momentum at Minor Hotels Europe & Americas continues to improve thanks to strong demand in the leisure and business travel segments, with occupancy considerably stronger in Benelux and Central Europe, while price growth was higher in Spain and Italy.

During its earnings presentation, Minor Hotels Europe & Americas told the market that demand was proving strong so far this year and that the favourable business dynamics foreshadowed another set of record earnings this year.

In the first three months of the year, the company reported an average daily rate (ADR) of €121, six euros up from the 1Q23 equivalent. That increase translated into a growth of 9.2% in revenue per available room (RevPAR), which went from €68 in 1Q23 to €75 in the first quarter of this year.

Like-for-like revenue increased by €33 million, or 11.3%, with hotels undergoing refurbishment accounting for €10 million and newly-opened hotels contributing another €10 million to the growth in revenue this quarter.

The company's net debt increased by €22 million from year-end 2023, shaped by business seasonality and €34 million of CapEx during the quarter. Minor Hotels Europe & Americas plans to gradually step up its CapEx over the coming quarters.

Elsewhere, liquidity remained strong, at €494 million at 31 March 2024, made up of €190 million cash and €304 million of undrawn credit facilities. In April 2024, the credit rating agency, Fitch, upgraded Minor Hotels Europe & Americas' corporate rating to BB- from B, with a stable outlook, an improvement of two notches that evidences the company's healthy performance in 2023, marked by significant deleveraging and improved cash generation.

The seasonal nature of the hotel business throughout Europe means the first quarter is traditionally weak: as a result, the company reported a net loss of €22 million, which is 38.5% narrower than the loss reported in the first quarter of 2023 (€36 million).

All regions strong

By region, occupancy averaged 68% in Spain in the first quarter (+0.3pp), while the ADR averaged €122, a growth of 8%. Like-for-like revenue increased by 14%, underpinned by solid performances in Madrid and Barcelona, as well as in the secondary cities.

In Italy, occupancy decreased by one percentage point to 58%, shaped by refurbishments and new openings, but the ADR increased by 9% year-on-year to €147. Like-for-like revenue in Italy grew by 8%, with Venice, Milan and the secondary cities particularly strong.

Occupancy in Benelux increased by five percentage points, to 58%, while the ADR decreased slightly by 1%, to €134, due to some refurbishment work. Faster growth at the hotels in convention centres was behind the growth of 14% in like-for-like revenue in 1Q24, with Brussels and the secondary cities the best performers.

In Central Europe, occupancy increased by four percentage points to 60%, and the ADR climbed 3% higher year-on-year to €108. Like-for-like revenue growth came in at 6%, with Frankfurt, Munich and Hamburg particularly strong, accompanied by a solid performance across the secondary cities.

In Latin America, occupancy was flat at 65%, while the ADR increased by 8% to €86. At real exchange rates, like-for-like revenue grew by 13%. Mexico and Colombia outperformed the other markets in the region.

The Spanish-listed company, which operates hotels in Europe and the Americas, is 95.9%-owned by the international hotel operator and investor, Minor Hotels.