NH Hotel Group posts a frofit for the first time since 2011

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After two years investing in repositioning and reinforcement of its organizational, management and communication capabilities, NH Hotel Group heads into year three of its business plan having met the

After two years investing in repositioning and reinforcement of its organizational, management and communication capabilities, NH Hotel Group heads into year three of its business plan having met the market’s growth expectations. Moreover, it expects to top guidance going forward with a larger revenue base, better-positioned hotel portfolio and a significant improvement in perceived quality.

Reported revenue rose 10.3% to โ‚ฌ1.395 million, while EBITDA before onerous provision reversal climbed 35.8% higher to โ‚ฌ149.5 million; net profit came in at โ‚ฌ0.9 million, compared to the โ‚ฌ9.6 million loss reported in 2014.

Business and earnings momentum gained traction as the year unfolded driven by the pricing strategy rolled out: Revenues per available room (RevPAR) rose by 11% last year.

The healthy performances posted by the Spanish and Italian business units last year stand out; these markets have benefitted from the execution of the asset repositioning strategy in the initial years of the business plan. Management expects the Benelux and Central Europe business units to perform better in 2016, as the repositioning works began in these markets during the second quarter of 2015.

Implementation of the Group’s five-year business plan is tracking ahead of schedule and the scope for outperformance of the initial guidance has increased. At year-end 2015, hotels representing 64% of Group EBITDA were in perfect shape. Once the โ‚ฌ237 million repositioning plan has been fully implemented, this figure will rise to 81%.

Assuming moderate economic growth, the outlook for 2016 is very upbeat: thanks to its current strength, the Group is targeting topline growth of 8%, EBITDA of c.โ‚ฌ200 million in comparable terms with the previous year, and a leverage ratio of 4.0x (down from 5.6x).

Among the milestones planned for 2016, it is worth highlighting the fact that NH Hotel Group will unveil its growth plans for the Chinese market in March.

About the author

Avatar of Juergen T Steinmetz

Juergen T Steinmetz

Juergen Thomas Steinmetz has continuously worked in the travel and tourism industry since he was a teenager in Germany (1977).
He founded eTurboNews in 1999 as the first online newsletter for the global travel tourism industry.

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