easyHotel PLC – Final Results

easyHotel PLC – Final Results

easyHotel plc (AIM: EZH) the owner, developer and operator of super budget branded hotels, today announces its final results for the financial year ended 30 September 2018. 

Financial highlights

Year ended 30 September (£m)

2018

2017

Total system sales

37.3

29.7

+25.8 %

Revenue

11.3

8.4

+33.7 %

Adjusted EBITDA

2.96

2.30

+28.6 %

Profit before tax

0.87

0.86

+1.4 %

Basic earnings per share (pence)

0.5

0.7

(21.4)%

Total dividend per share (pence)

0.22

0.33

(33.3) %

(cash distribution maintained on an enlarged share basis)

  • Adjusted EBITDA growth of 28.6% reflects strength of proposition and continued market outperformance.
  • Adjusted EBITDAR margin increased by 2.1%pts to 29.6% (2017: 27.5%).
  • Profit before tax of £0.87m unchanged (2017: £0.86m), impacted by disruption at easyHotel Old Street (loss of 70 rooms) and closure of Franchise Hotel at Earl’s Court (109 rooms).
  • Cash generated from operations increased to £2.65m (2017: £2.22m).
  • Significant headroom for further investment with net cash and cash equivalents of £41.4m (2017: £33.3m), and an extended loan facility.
  • Asset backed balance sheet strengthened further with net assets rising to £120m (2017: £70m).
  • Proposed final dividend of 0.15 pence (total 0.22 pence) reflecting a maintained cash distribution on an enlarged issued share capital basis.

Business highlights

  • Owned hotels Revpar was up 11.4% with the Group’s owned hotels continuing to deliver market outperformance for the third consecutive year.
  • Like-for-like revenue for franchised hotels increased by 12.1%.
  • Nine new hotels opened during the year, totalling 907 rooms, which are trading well; supporting improvement in combined occupancy of 82.4% (2017: 79.8%) and ADR of £51.3 (2017: £47.8).
  • First owned hotel in Continental Europe opened in September – our flagship easyHotel Barcelona (204 rooms).
  • A further franchised hotel in Lisbon has opened since the year-end bringing the total portfolio to 34 hotels and 3,169 rooms across 28 cities.

Significantly accelerated development pipeline with growing European focus

  • Six new owned hotel sites in Milton Keynes, Cardiff, Chester, Cambridge, Dublin and Blackpool secured during the year.
  • 686 owned rooms and 474 franchised rooms added to the development pipeline.
  • Increased resource to accelerate growth in Europe where we see significant opportunity, with initial focus on France, Spain and Germany.
  • A further site in Bristol has been acquired since the year-end, bringing the total development pipeline to 1,100 owned rooms and 1,874 franchised rooms.

Commenting, Guy Parsons, Chief Executive Officer of easyHotel plc said:

“This has been a transformational year for the Group. We have increased our portfolio of rooms by 42%, in 27 cities across the UK, Continental Europe and the Middle East, making excellent progress towards our target of being the market leader in “super budget” hotels.

“Despite the wider macro-economic uncertainty that continues to impact consumer confidence, particularly in the UK, we have grown market share for the third consecutive year. The continued outperformance of our hotels reflects the growing strength of the easyHotel brand.  Our simple, stylish but highly affordable offer resonates exceptionally well with today’s cost-conscious traveller, giving us confidence to continue developing owned hotels.

“The successful placing completed in March 2018 has allowed us to accelerate our growth plans further, in line with our strict investment criteria. We see a number of exciting opportunities for the brand, not only in the UK but increasingly in Europe where we have recently opened our first owned European hotel in Barcelona. We have added a further 1,160 rooms to our development pipeline over the course of the year and invested behind our team to expand our presence in Europe, where we believe there is significant opportunity for the brand, particularly in Spain, France and Germany.

“With funds available for future hotel development, we believe easyHotel is well positioned for long-term growth, and will continue to outperform its competitors.

“I would like to take this opportunity to thank the entire team for their hard work and commitment over what has been an incredibly busy year and look forward to building on this progress in 2019.”

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