NH Hotel Group reported revenue of EUR154 million in the second quarter of the year, compared to EUR62 million in the first quarter, driven by the lifting of mobility restrictions in southern Europe. The gradual recovery since May together with cost control, enabled the Company to reduce its recurring loss in the second quarter by EUR93 million to -EUR50.8 million. Including the net capital gain from asset rotations, these losses were reduced by EUR140 million, or 87%, to just -EUR21.3 million.
In the first half of the year, the Company reported revenue of EUR215.9 million and reduced its net loss by EUR73 million or 33.5% to -EUR145.4 million. The cash drain decreased from a monthly average of EUR29 million in the first quarter to just EUR15 million between April and June, excluding net proceeds from asset rotations.
NH Hotel Group has had nine out of every 10 hotels open since May 2021. Average occupancy continues to improve month after month, reaching 40-45% in July, being the pace of recovery in southern Europe more notable.
Ramon Aragones, NH Hotel Group's CEO, has highlighted as a success the fact that the Company is approaching the inflexion point in exiting the crisis with a sound financial structure, which he attributed to the measures taken in the first half, including the EUR400 million senior secured notes issuance, a EUR100-million equity investment by Minor International and the sale & leaseback of the NH Collection Barcelona Gran Hotel Calderon for EUR125.5 million. 'We have a solid financial foundation, with no relevant debt maturities until 2026, to face the imminent sector recovery from the best financial and capital structure position. This, coupled with the efficiency measures rolled out, will allow us to recover sooner and with greater strength', he said.
'We are leaving behind the harshest tourism sector crisis in recent history. Getting this far has required a huge effort. We have reinforced our capital structure so that we are in a position to take advantage of the opportunities that are bound to come along. We are convinced that the sacrifices and hard work of the last year and a half will bear fruit over the course of the next 18 months', said Aragones.
Improvement month after month
Since May, the Group's revenues have been improving month by month, with a first positive effect in the second quarter of the year, where EUR154 million of the EUR216 million completed in the first half of the year were achieved. Based on current bookings and short and medium-term visibility, the Company expects the pace to continue to improve in the coming quarters, as occupancy has continued on a clearly upward trend in July.
Cost control remained a priority for the Company in the first half of the year, with reductions on fixed leases amounting to EUR32 million. Operating expenses decreased by EUR106 million in the first half, outpacing the EUR93 million decline in revenue during the same period. As a result, the recurring EBITDA improved by EUR12 million to -EUR136.7 million, compared to the -EUR149,0 million in the first half of 2020, excluding gains from asset rotations and the accounting impact of IFRS 16.
On 30 June 2021, NH Hotel Group announced the sale & leaseback of the NH Collection Barcelona Gran Hotel Calderon for EUR125.5 million with an associated lease for 20 years and the option of two additional renewals of 20 years each, for a total lease term of up to 60 years. The transaction generated a net capital gain of EUR46.7 million and an estimated net cash after tax of EUR113 million, which will be used to reduce debt.
Between January and June, investment in Capex was limited to EUR24 million, in line with the trend established for the rest of the year. As of the end of June, NH Hotel Group's liquidity stood at EUR478 million, while net debt amounted to EUR703 million. Moreover, the Group has proactively reinforced its capital structure with a EUR100 million equity investment, structured through a subordinated loan by its main shareholder, Minor International, last May. This loan will be capitalised through a rights issue for all shareholders which was approved at the last Annual General Meeting.
In addition, in June the hotel chain completed a successful placement of EUR400 million senior secured notes due July 2026 and with a 4% coupon. The proceeds were used to redeem the existing senior notes due in 2023 in the amount of EUR357 million. Also in June, the Company agreed the extension of its EUR242 million revolving credit facility (RCF) from March 2023 to March 2026, allowing it to face no relevant debt maturities until 2026.
By business unit, following the lifting of restrictions in May, the recovery in revenue has been particularly strong in southern Europe. Between April and June, revenue in Spain totalled EUR48 million and in Italy, EUR21 million, while revenue in Benelux and Central Europe, excluding the subsidies received, neared EUR16 million each. In general, the secondary cities outperformed the main city destinations. In Latin America, first-half revenue decreased by 19% in local currency in Mexico, by 52.4% in constant currency terms in Argentina and by 26% in local currency in Colombia and Chile.
NH HOTEL GROUP, S.A. 
