Lemon Tree Hotels Ltd. · NSE:LEMONTREE
Lemon Tree Hotels — Q4 FY2020 Earnings Presentation
61 slides from Lemon Tree Hotels's earnings presentation, May 29, 2020
Slide 1: Outcome of the Board Meeting
May 29, 2020 National Stock Exchange of India Limited BSE Limited Exchange Plaza, C-1, Block G Phiroze Jeejeebhoy Towers Bandra Kurla Complex Dalal Street, Mumbai – 400001 Bandra (E), Mumbai – 400051 NSE Scrip Symbol: LEMONTREE BSE Scrip Code: 541233 Re: Outcome of the Board Meeting We wish to infor
Slide 2: Independent Auditor's Report on Consolidated Results
Deloitte Chartered Accountants 7th Flor, Building 10, Tower B, Haskins & Sells LLP a Gurugram - 122 002, Haryana, [nda Phone; 491 124 679 2000 Fax; +9) 124 679 2012 INDEPENDENT AUDITOR‘S REPORT ON AUDIT OF ANNUAL CONSOLIDATED FINANCIAL RESULTS AND REVIEW OF QUATERLY FINANCIAL RESULTS TO THE BOARD OF
Slide 3: Auditor's Report (continued)
Deloitte Haskins & Sells LLP (6) Conclusion on Unaudited Consolidated Financial Results for the quarter ended March 31, 2020 With respect to the Consolidated Financlal Results for the quarter ended March 31, 2020, based on our review conducted and procedures performed as stated in paragraph (b) of A
Slide 4: Management's Responsibilities for the Statement
Deloitte Haskins & SelisLLP Management's Responsibilities for the Statement This Statement, which includes the Consolidated Financial Results is the responsibility of the Parent's Board of Directors and has been approved by them for the issuance. Fhe Consolidated Financial Results for the year ended
Slide 5: Auditor's Responsibilities
Deloitte Haskins & Sells LLP As part of an audit in accordance with SAS, we exercise professional judgment and maintain professional skepticism throughout the audit. We also: Identify and assess the asks of matcrial misstatement of the Annual Cansolldated Financial Results, whether due to fraud or é
Slide 6: Auditor's Responsibilities (continued)
Deloitte Haskins & Sells LLP (b) Materiality is the magnitude of misstatements in the Annual Consolidated Financial Results that, individually or in aggregate, makes it probable that the economic decisions of a reasonably knowledgeable user of the Annual Consolidated Financial Results may be influen
Slide 7: Other Matters
Deloitte Haskins & SellsLLP Other Matters As stated in Note 2 of the Statement, the figures for the corresponding quarter ended March 31, 2019 are the balancing figures between the annual audited figures for the year then ended and the year to date figures for the 9 months period ended December 31,
Slide 8: Auditor's Report Signature
Deloitte Haskins & Sells LLP Our opinion on the Statement is not modified in respect of the above matters with respect to our reliance on the work done and the reports of the other auditors. For DELOITTE HASKINS & SELLS LLP Chartered Accountants (Firm's Registration No. 117366W/W100018) hound Vijay
Slide 9: Annexure I – Entities Included in Consolidated Results
Annexure — I TO INDEPENDENT AUDITOR'S REPORT ON AUDIT OF ANNUAL CONSOLIDATED FINANCIAL RESULTS AND REVIEW OF QUARTERLY FINANCIAL RESULTS (Referred to in paragraph a (i) under the Opinion and Conclusion section of Independent Auditor's Report on Audit of Annual Consolidated Financial Results and Revi
Slide 10: Annexure I (continued)
19. inovoa Hotels and Resorts Limited Subsidiary company 20. | lora Hotels Private Limited Subsidiary company 21. | Ophrys Hotels Private Limited Subsidiary company 22. | Bandhav Resorts (P} Limited Subsidiary company 23. | Valerian Manegement Services Private | Subsidiary company Limited 24. | Carn
Slide 11: Statement of Consolidated Financial Results
Regd Office:- Asset Ni Lemon Tree Hotels Limited Aerocity Hospitality District, New Delhi-110037 Tel: 011-46050101; Fax.: 011-46050110; E-Mail:sectdeptt@lemontreehotels.com: Website: www.lemontreehotels.com CIN: L74899DL1992PLC049022 Statement of Consolidated Financial Results for the Quarter and Ye
Slide 12: Notes to Consolidated Results
Notes: 1, The Consolidated financial results for the Quarter are not indicative of a full year's working due to the seasonal nature of the Indian Hotel Industry. 2. The Audit Committee has reviewed the above results and the Board of Directors has approved the above results at their respective meetin
Slide 13: Statement of Consolidated Assets and Liabilities
8. Statement of Consolidated Assets and Liabilities (In Lakhs) Particulars As at Asat March 31, 2020 March 31, 2019 (Audited) (Audited) Assets Non-current assets (a) Property, plant and equipment 265,180.14 158,942.55 (b) Capital work-in-progress 18,956.64 66,386.54 (c) Investment Property 236.93 24
Slide 14: Consolidated Equity and Liabilities
( @ In Lakhs) Particulars As at Asat March 31, 2020 March 31, 2019 (Audited) (Audited) Equity And Liabilities Equity (a) Share capital 79,031.44 78,929.55 (b) Other Equity 3,267.73 8,572.84 Equity attnbutable to owners of the parent 82.299.17 87,502.39 (©) Non-controlling interests 72,176.94 43,218.
Slide 15: Notes: RBI Moratorium and COVID-19
9. The RBI has issued guidelines relating to COVID-19 Regulatory Package dated March 27, 2020 and May 22. 2020 and in accordance therewith, the Company has opted for a moratorium of six months on the payment of all principal instalments and/ or interest, as applicable, falling due between March 1, 2
Slide 16: Statement of Consolidated Cash Flow
11. Statement of Consolidated Cash flow (@ In Lakhs) Particulars For the year ended | For the year ended March 31, 2020 March 31, 2019 (Audited) (Audited) Profit /(loss) before tax (217.68) 4,526.74 Operating profit before working capital changes 24,126.75 17,541.42 Net cash flow from operating acti
Slide 17: Independent Auditor's Report on Standalone Results
- Chartered Accountants 2 ol e 7th Floor, Buitéing 10, Tower B, . DLF Cyber City Complex, k & Ss i] LLP DLF City Phase - HL, as Ins e is Gurugram - 422 002, Haryana, india Phone: +91 124 679 2000 Fax: +91 124 679 2012 INDEPENDENT AUDITOR'S REPORT ON AUDIT OF ANNUAL STANDALONE FINANCIAL RESULTS AND R
Slide 18: Auditor's Report on Standalone Results (continued)
Deloitte Haskins & SellsLLP (b) Conclusion on Unaudited Standafone Financial Results for the quarter ended March 31, 2020 With respect to the Standalone Financial Results for the quarter ended March 31, 2020, based on our review conducted as stated in paragraph (b) of Auditor’s Responsibilities sect
Slide 19: Management's Responsibilities for the Statement
Deloitte Haskins & Sells LLP Management's Responsibilities for the Statement and presentation of the Standalone 31, 2020 that give a true and fair vie’ laid down in the Indian Accounting Standards prescribed under Section 133 of the Act read with relevant rules issued thereunder and other accounting
Slide 20: Auditor's Responsibilities
Deloitte Haskins & SellsLLP As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also: * Identify and assess the risks of material misstatement of the Annuat Standalone Financial Results, whether due to fraud or e
Slide 21: Review of Standalone Quarterly Results
Deloitte Haskins & Sells LLP (b) Review of the Standalone Financial Results for the quarter ended March 31, 2020 We conducted our review of the Standalone Financial Results for the quarter ended March 31, 2020 in accordance with the Standard on Review Engagements (“SRE“) 2410 ‘Review of Interim Fina
Slide 22: Auditor's Report Signature
Deloitte Haskins & Sells LLP Our opinion on the Statement is not modified In respect of this matter. For DELOITTE HASKINS & SELLS LLP Chartered Accountants (Firm’s Registration No, 117366W/WkO0018) § yh Vijay Agarwal Partner Membership No, 094468 UDIN: 20094468AAAACLES03 Place: New Delhi, Date: tay
Slide 23: Annexure I – Standalone Entities
Annexure - I TO INDEPENDENT AUDITOR’S REPORT ON AUDIT OF ANNUAL STANDALONE FINANCIAL RESULTS AND REVIEW OF QUARTERLY FINANCIAL RESULTS (Referred to in paragraph a {i} under the Opinion and Conclusion section of ladependent Auditor's Report on Audit of Annual Standalone Financial Results and Review o
Slide 24: Statement of Standalone Financial Results
Lemon Tree Hotels Limited Regd Office:- Asset No. 6, Aerocity Hospitality District, New Dethi-110037 Tel.: 011-46050101; Fax.: 011-46050110; E-Mail:sectdeptt@lemontreehotels.com: Website: www.lemontreehotels.com CIN: L74899DL1992PLC049022 Statement of Standalone Financial Results for the Quarter and
Slide 25: Notes to Standalone Results
Notes: 1. The results for the Quarter are not indicative ofa full year's working due to the seasonal nature of the Indian Hotel Industry. 2. The Audit Committee has reviewed the above results and the Board of Directors has approved the above results at their respective meetings held on May 29, 2020.
Slide 26: Statement of Standalone Assets and Liabilities
7. Statement of Standalone Assets and Liabilties ( % In Lakhs) As at March | As at March Particulars 31, 2020 31, 2019 (Audited) (Audited) Assets Non-current assets a) Property, plant and equipment 42,190.28 43,243.28 perty. p quip: (b) Capital work-in-progress 1,449.78 1,170.49 c) Investment Proper
Slide 27: Standalone Equity and Liabilities
(& In Lakhs) As at March | As at March Particulars 31, 2020 31, 2019 (Audited) (Audited) Equity And Liabilities Equity (a) Share capital 79,031.44 78,929.55 (b) Other Equity 25,345.89 24,205.35 Total Equity 104,377.33 103,134.90 Liabilities Non-current liabilities (a) Financial liabilities (i) Borro
Slide 28: Notes: RBI Moratorium and COVID-19
8. The RBI has issued guidelines relating to COVID-19 Regulatory Package dated March 27, 2020 and May 22, 2020 and in accordance therewith, the Company has opted for a moratorium of six months on the payment of all principal instalments and/ or interest, as applicable, falling due between March 1, 2
Slide 29: Statement of Standalone Cash Flow
10. Statement of Standalone Cash flow ( @ In Lakhs) For the year For the year pacdeuies ended March | ended March 31, 2020 31, 2019 (Audited) (Audited) Profit before tax 4,064.77 4.844.90 Operating profit before working capital changes 10.988.04 9,565.90 Net cash flow from operating activities (A) 6
Slide 30: Lemon Tree Hotels Limited Q4 FY20
Lemon Tree Hotels Limited Q4 FY20 Earnings Presentation 29th May, 2020
Slide 31: Disclaimer
Disclaimer Certain statements in this communication may be ‘forward looking statements’ within the meaning of applicable laws and regulations. These forward-looking statements involve a number of risks, uncertainties and other factors that could cause actual results to differ materially from those s
Slide 32: Table of Contents
Table of Contents 1 Company Overview 2 Chairman & Managing Director’s Message 3 COVID – 19 Update 4 Performance Highlights 5 Financial & Operational Metrics 6 Key Developments / Business Updates 7 Annexures 3
Slide 33: Lemon Tree – Snapshot as on 15th May, 2020
Lemon Tree – Snapshot as on 15th May, 2020 Current (17% of Branded Pipeline By CY22 (20% of Branded Mid Market Hotels in India*) Mid Market Hotels in India*) 8,006 2,697 10,703 rooms; rooms; rooms; 80 hotels 28 hotels 108 hotels Brand Current Pipeline by CY22 Aurika 139 Rooms, 1 Hotel 669 Rooms, 1 H
Slide 34: Lemon Tree – Portfolio
Lemon Tree – Portfolio Key Statistics Q4 FY19 Q4 FY20 YoY Var (%) Cities 32 48 50% Hotels 54 80 48% Rooms 5,411 8,006 48% Loyalty 947,776 1,168,939 23% Members 5
Slide 35: Portfolio Breakup as on 15th May 2020 - Operational
Portfolio Breakup as on 15th May 2020 - Operational Operational Owned Leased Managed/Franchised Total Portfolio 15.05.2020 Hotels Rooms Hotels Rooms Hotels Rooms Hotels Rooms Aurika 1 139 0 0 0 0 1 139 Lemon Tree Premier 7 1,442 2 161 6 604 15 2,207 Lemon Tree Hotels 13 1,241 4 321 18 1,084 35 2,646
Slide 36: Portfolio Breakup as on 15th May 2020 - Pipeline
Portfolio Breakup as on 15th May 2020 - Pipeline In Pipeline Owned Leased Managed/Franchised Total 15.05.2020 Hotels Rooms Hotels Rooms Hotels Rooms Hotels Rooms Aurika 1 669 0 0 0 0 1 669 Lemon Tree Premier 0 0 0 0 5 417 5 417 Lemon Tree Hotels 1 79 0 0 19 1,412 20 1,491 Red Fox Hotels 0 0 0 0 1 80
Slide 37: Strategically positioned in key geographies
Strategically positioned in key geographies with Lemon Tree share of total branded hotel sector Jaipur: FY20 – 5.2% Delhi NCR: FY20 – 6.8% FY24E – 3.5% FY24E – 7.1% Ahmedabad:FY20 – 5.4% FY24E – 3.3% Mumbai: FY20 – 3.2% Kolkata: FY20 – 3.8% FY24E – 6.4% FY24E – 2.6% Pune: FY20 – 9.4% FY24E – 8.4% Hy
Slide 38: Chairman & Managing Director's Message
Chairman & Managing Director’s Message Commenting on the performance for Q4 FY20, Mr. Patanjali Keswani, Chairman & Managing Director – Lemon Tree Hotels Limited said, “We began Q4 FY20 on a robust note, witnessing healthy occupancy and increase in ADRs across all segments in the months of January a
Slide 39: CoVID-19 – Impact
CoVID-19 – Impact Commenting on the performance for Q3 FY20, Mr. Patanjali Keswani,Financial Operational Impact Chairman & Managing Director – Lemon Impact Tree Hotels Limited said, Almost 66% of our owned/leased rooms were operational Revenue from operations in April 2020 was down by 76% in Apr
Slide 40: CoVID-19 – Response
CoVID-19 – Response Commenting on the performance for Q3 FY20, Mr. Patanjali Keswani, Cost Control Chairman Enhanced Hygiene &and Managing Safety Director – Lemon Tree Hotels Limited said, Hiring freeze. Significant salary cuts taken at leadership Regular sanitization of all our hotels levels (m
Slide 41: CoVID-19 – Performance Summary (Owned/Leased Rooms)
CoVID-19 – Performance Summary (Owned/Leased Rooms) In Rs (Cr) April 2020 YoY Change % May 2020 YoY Change % MoM Change % Total Inventory# 5,183 41.1% 5,183 41.1% 0.0% Operational Inventory 3,397 -4.8% 4,048 13.7% 19.2% Occupancy (on operational Inventory) 33.4% (4,385)bps 39.6% (3,813)bps 611bps AR
Slide 42: CoVID-19 – Expectations ahead
CoVID-19 – Expectations ahead A cure should be found within 6-9 months and a vaccine in 18-24 months and it should take another 6-12 months for the entire population to be vaccinated Currently (during lockdown) business is at ~25% - 30% of normal levels (y-o-y) Once a cure is found, business w
Slide 43: CoVID-19 – Plan to Survive and Thrive (1/2) – Solving for Liquidity
CoVID-19 – Plan to Survive and Thrive (1/2) – Solving for Liquidity Commenting on the performance for Q3 FY20, Mr. Patanjali Keswani, Chairman & Managing Director – Lemon Board of Directors Tree Hotels Limitedhassaid, given approval to raise upto Rs 150 Cr as an abundant precaution to provide an a
Slide 44: CoVID-19 – Plan to Survive and Thrive (2/2) – Operational Efficiency
CoVID-19 – Plan to Survive and Thrive (2/2) – Operational Efficiency Commenting on the performance for Q3 FY20, Mr. Patanjali Keswani, Chairman & Managing Director – Lemon We feel we can Tree significantly improvesaid, Hotels Limited our operational efficiencies in future Staff per room ratio ca
Slide 45: Q4 FY20 Performance Highlights – Operational Metrics
Q4 FY20 Performance Highlights – Operational Metrics (Consolidated) Operational Inventory Owned/Leased rooms Managed rooms Total rooms Average Daily Rate (Rs.) 47.9% 8,006 4.5% 2.8% 45.4% 52.8% 4,604 4,530 5,192 5,411 4,405 3,570 2,814 1,841 End of Q4 FY19 Q4 FY20 Q4 FY19 Q4 FY20 Q4 FY19 Q4 FY20 Q4
Slide 46: Q4 FY20 Performance Highlights – Financial Metrics
Q4 FY20 Performance Highlights – Financial Metrics (Consolidated) Revenue from Operation (Rs. Cr) EBITDA (Rs. Cr) 41.2% 21.8% 669 238 550 17.0% 30.7% 169 151 176 49 64 Q4 FY19 Q4 FY20 FY19 FY20 Q4 FY19 Q4 FY20 FY19 FY20 EBITDA Margin (%) Cash profit (PAT + Depreciation) 381 bps (Rs. Cr) 489 bps 110.
Slide 47: Consolidated Profit & Loss Statement – Q4 FY20
Consolidated Profit & Loss Statement – Q4 FY20 Q4 FY20 Q4 FY20 YoY Change IndAS 116 YoY Change Rs. Cr Q4 FY19 Before IndAS 116 After IndAS 116 (%) Impact (%) Impact Impact Revenue from operations 150.5 176.1 17.0% 176.1 17.0% Total expenses 101.6 121.1 19.2% -8.9 112.2 10.4% EBITDA 48.9 55.0 12.4% 8
Slide 48: Consolidated Profit & Loss Statement Breakup – Q4 FY20
Consolidated Profit & Loss Statement Breakup – Q4 FY20 New Same Hotels Total without Keys Hotels Keys Hotels Total Hotels1 Rs. Cr YoY YoY YoY Q4FY19 Q4FY20 Q4FY20 Q4FY19 Q4FY20 Q4FY20 Q4FY19 Q4FY20 Change Change Change Inventory 3,570 3,570 0.0% 686 3,570 4,256 19.2% 936 3,570 5,192 45.4% ARR 4,405
Slide 49: Operational Performance by Brands & Region
Operational Performance by Brands & Region – Q4 FY19 vs. Q4 FY20 Hotel level EBITDAR/room (Rs. Parameters Occupancy Rate (%) Average Daily Rate (Rs.) Hotel level EBITDAR Margin Lacs) Change Change Change By Brand (#Rooms) Q4 FY19 Q4 FY20 (bps) Q4 FY19 Q4 FY20 (%) Q4 FY19 Q4 FY20 Change (%) Q4 FY19 Q
Slide 50: Discussion on Consolidated Financial & Operational Performance
Discussion on Consolidated Financial & Operational Performance – Q4 FY20 Operational As of 15th May 2020, operational portfolio comprised of 80 hotels and 8,006 rooms : 4,214 owned, 978 leased and 2,814 managed Rooms & rooms; Pipeline includes of 748 owned/leased and 1,949 managed rooms Pipeline
Slide 51: Consolidated Profit & Loss Statement – FY20
Consolidated Profit & Loss Statement – FY20 FY20 FY20 YoY Change IndAS 116 YoY Change Rs. Cr FY19 Before IndAS 116 After IndAS 116 (%) Impact (%) Impact Impact Revenue from operations 549.5 669.4 21.8% 669.4 21.8% Total expenses 380.7 464.3 21.9% -33.2 431.1 13.2% EBITDA 168.8 205.1 21.6% 33.2 238.3
Slide 52: Consolidated Balance Sheet Snapshot – FY20
Consolidated Balance Sheet Snapshot – FY20 Rs. Cr FY19 H1 FY20 FY20 Shareholder's Funds 875.0 824.7 823.0 Non-controlling interests 432.2 430.9 721.8 Total Shareholder’s equity 1,307.2 1,255.6 1,544.8 Total Debt 1,204.2 1,334.9 1,577.5 Other Non-current liabilities 38.0 381.4 464.2 Other Current lia
Slide 53: Operational Performance by Ageing – FY19 vs. FY20
Operational Performance by Ageing – FY19 vs. FY20 Adult Hotels Toddler Hotels Infant Hotels Under-development Parameters Financial year (Stable - older than 3 (Stabilizing - between (New - less than 1 hotels years) 1-3 years old) year old) FY20 24 6 11 Hotels1 2 FY19 21 7 2 Operating Rooms FY20 2,85
Slide 54: Expansion Plans – Hotels under Development
Expansion Plans – Hotels under Development Expected Opening Under-development hotels Type Rooms Ownership (%) date Lemon Tree Mountain Resort, Shimla Owned 69 TBD 100.00% Lemon Tree Vembanad Lake Resort, Alleppey, Owned 10 TBD 100.00% Kerela1 Aurika, Intl. Airport, Mumbai2 Owned 669 End of CY22 57.9
Slide 55: Expansion Plans – Pipeline of Management Contracts
Expansion Plans – Pipeline of Management Contracts (as of 15th May, 2020)* Management Contracts Pipeline Rooms Expected Opening date Tenure (years) Lemon Tree Hotel, Baga, Goa 44 Aug-20 15 Lemon Tree Hotel, BKC, Mumbai 70 Sep-20 15 Lemon Tree Premier, Dwarka 108 Sep-20 12 Lemon Tree Premier, Bhubane
Slide 56: Annexures
lena ANNEXURES hus SIAN
Slide 57: Strong operating performance
Strong operating performance Rooms are being added… …and occupancy levels increasing… Owned Leased Hotels Managed Hotels FY16 FY17 FY18 FY19 FY20 25% 8,006 2814 79% 4,870 5,411 78% 78% 77% 77% 77%78% 3,698 1841 675 3,249 1593 75% 75% 843 74%74% 461 481 573 73% 74% 283 317 4,517 71% 72% 2,505 2,538 2
Slide 58: Strong Growth and improving margins
Strong Growth and improving margins Revenue has increased at 20% over the last 5 years… …coupled with increasing EBITDA margins Revenue from operations (Rs. million) EBITDA & EBITDA margins 16% 36.2% 6,694 31.9% 27.9% 29.7% 29.3% 5,495 4,843 4,121 3,680 1,033 1,247 1,440 1,787 2,441 FY16 FY17 FY18 F
Slide 59: The hotel business cycle
The hotel business cycle Occupancy 70% Illustrative: 15 Room Hotel with 65% Investment = 300 60% Cycle Top (2) Middle (3) Bottom (2) Occupancy 70% or more 63-68% 60% or less Rooms Sold 12 10 8 Average Daily Rate 13 10 7 Revenue 156 100 56 3:2:1 Expenses 60 50 40 EBITDA 96 50 16 Hotel RoCE 32% 17% 5%
Slide 60: Conference Call Details
Conference Call Details Lemon Tree Hotels Limited (LTH) Q4 FY20 Earnings Conference Call Time • 4:00 PM IST on Monday, June 1, 2020 Conference dial-in Primary number • Primary number: +91 22 6280 1141 / +91 22 7115 8042 Local access number • +91 70456 71221(Available all over India) International To
Slide 61: About Us
About Us Lemon Tree Hotels (LTH) is the largest mid-priced hotel sector chain, and the third largest overall, on the basis of controlling interest in owned and leased rooms, as of June 30, 2017, according to the Horwath Report. LTH operates in the mid market sector, consisting of the upscale, upper