Pphe Hotel Group Limited · LSE:PPH
Pphe Hotel — H1 2019 Earnings Presentation
36 slides from Pphe Hotel's earnings presentation, August 2019
Slide 1: We Are Creators: Interim Results Six Months Ended 30 June 2019
WE ARE CREATORS I N T E R I M R E S U LT S F O R S I X MONTHS ENDED 30TH JUNE 2019 Holmes Hotel London
Slide 2: Important Notice
I M P O R TA N T N O T I C E By attending the meeting where this presentation presentation upon request. PPHE gives no undertaking Any recipient of this presentation in jurisdictions outside Matters discussed in this document may constitute is made, or by reading this document, you agree to to provi
Slide 3: Presentation Team and Contents
P R E S E N TAT I O N T E A M CONTENTS 3 INTRODUCTION 13 RECENT DEVELOPMENTS AND PIPELINE Boris Ivesha Daniel Kos Greg Hegarty Robert Henke 15 President Chief Financial Officer Chief Operating Officer Executive Vice President & Chief Executive Officer & Executive Director Commercial & Corporate Affa
Slide 4: A 30-year track record of owning, developing and operating prime hospitality real estate
A 3 0 -Y E A R T R A C K R E C O R D O F O W N I N G , D E V E L O P I N G A N D O P E R AT I N G P R I M E H O S P I TA L I T Y R E A L E S TAT E £1.7 billion £25.52 EPRA NAV per share Adjusted EPRA in prime assets as at 30 June 2019 earnings yield 8.1%1 International hospitality real estate We dev
Slide 5: Our Business Model
OUR BUSINESS MODEL T R A N S FO R M I N G H O S P I TA L I T Y R E A L E S TAT E P O T E N T I A L I N T O VA LU E A N D PR O F I T S Our purpose is to create valuable memories for our guests and value for our assets chase real estate Pur We create shareholder value through developing, owning ting v
Slide 6: A Diversified Portfolio of Operating Assets
A D I V E R S I F I E D P O R T F O L I O O F O P E R AT I N G A S S E T S Value split by geography1 Hotels and resorts by geography Hotels and resorts by ownership type (Includes franchises and excludes campsites (Includes franchises and excludes campsites) and development pipeline) Germany Croatia
Slide 7: Independent Operator with Brand Flexibility and Access to Global Distribution
I N D E P E N D E N T O P E R AT O R W I T H B R A N D F L E X I B I L I T Y A N D ACC E S S TO GLOBAL DISTRIBUTION The Park Plaza® brand is owned by The art’otel® brand, which is Radisson Hotel Group (RHG) and wholly owned by the Group, In Croatia, our subsidiary Arena operated in EMEA by the Group
Slide 8: Centrally Located in Growth Markets
C E N T R A L LY L O C AT E D I N G R O W T H M A R K E T S Europe London Amsterdam Amsterdam Sloterdijk PARK PLAZA LONDON PARK ROYAL ART’OTEL Centraal Haarlemmerweg LONDON Station HOXTON ART’OTEL O sd AMSTERDAM HOTEL HOLMES Da or PARK PL AZA LONDON pe mra rw eg VICTORIA gracht Rozen k LEEDS AMSTER
Slide 9: Selection of Properties in Prime Locations
S E L E C T I O N O F P R O P E R T I E S I N P R I M E L O C AT I O N S Well-maintained, prime assets, with close proximity to major demand generators within leading capital cities, urban markets and resort destinations Properties LONDON Park Plaza Westminster Bridge London Park Plaza London Riverb
Slide 10: Strong Balance Sheet with Diverse Approach to Funding
S TRO N G BAL AN CE SHEET W ITH DIVER SE APPROACH TO FUNDIN G Debt/Equity Accounting debt (backed by assets) £’m Park Plaza Westminster Bridge London units £152.6 (999 year leases) 127.8 100+ year leases 191.8 29.7% £523.8 Net debt £1,088.7 £697.3 Bank debt leverage Gross bank debt 690.2 Cash 166.4
Slide 11: Long-Term Bank Funding Secured at Low Average Cost
L O N G -T E R M B A N K F U N D I N G S E C U R E D AT L O W AV E R A G E C O S T Loan maturity profile at 30 June 2019 Total 1 year 2 years 3 years 4 years 5 years Thereafter £’m £’m £’m £’m £’m £’m £’m 690.2 14.7 12.9 13.0 15.0 12.6 622.0 GAV Leverage – Average cost of bank debt 3.1% – Average ma
Slide 12: Leading to Strong Earnings and Value Growth
L E A D I N G T O S T R O N G E A R N I N G S A N D VA L U E G R O W T H Total revenue EBITDA Normalised PBT EPRA NAV per share Adjusted EPRA EPS Dividend per share £’m £’m £’m £ Pence Pence 25.52 113.2 37.7 35 120 341.5 341.1 107.3 24.57 115 325.1 104 94.1 32.1 31.7 97 96 272.5 29.8 91 80.1 26.4 24
Slide 13: ...and Solid Returns on Investment
...AND SOLID RETURNS ON INVESTMENT At market value Development asset and Operational assets excess cash Total 30 June 2019 £’m £’m £’m Net assets employed 1,682.6 82.5 1,765.1 Development (non-yielding) assets and excess cash represent Net bank debt (639.6) 115.8 (523.8) 15% of EPRA Net Asset Value
Slide 14: Creating Value with Recent and Current Development and Repositioning Projects
C R E AT I N G VA L U E W I T H R E C E N T A N D C U R R E N T D E V E L O P M E N T AND REPOSITIONING PROJECTS HOLMES HOTEL LONDON PA R K P L A Z A L O N D O N W AT E R L O O PA R K P L A Z A L O N D O N R I V E R B A N K –P PHE Hotel Group‘s first premium boutique hotel – Site acquired in 2013 an
Slide 15: ...and Continuing to Do So with Our Strong Pipeline
... AND CONTINUING TO DO SO WITH OUR STRONG PIPELINE Repositioning, renovation and development projects 2 019 2020 2022 CONTR AC TED TO ACQUIRE 88 ROOMS HOTEL IN BELGR ADE VERUDEL A BEACH RESORT PUL A HOTEL BRIONI PULA New hotel projects OWNED (EXPECTED OPENING 2022/2023) MANAGED (EXPEC TED OPENING
Slide 16: 2019 H1 Highlights: Financial Results
F I N A N C I A L R E S U LT S 2 0 19 H 1 HIGHLIGHTS ART‘OTEL LONDON BATTERSEA POWER STATION PPHE Hotel Group Interim Results six months ended 30th June 2019 15
Slide 17: Arena Kažela Campsite Medulin Park Plaza Vondelpark, Amsterdam Park Plaza Vondelpark, Amsterdam
Arena Kažela Campsite Medulin Park Plaza Vondelpark, Amsterdam Holmes Hotel London Park Plaza Vondelpark, Amsterdam Arena One 99 Glamping Holmes Hotel London PPHE Hotel Group Interim Results six months ended 30th June 2019 16
Slide 18: Highlights
HIGHLIGHTS Inclusion in the FTSE 250 Index London Repositioning Croatia Repositioning Joined both FTSE 250 and FTSE Full opening of Holmes Hotel London after Arena Kažela Campsite unveiled luxury new look including All Share Indices 24 June 2019 £9 million repositioning programme swimming pool compl
Slide 19: Financial Highlights
FINANCIAL HIGHLIGHTS HY 2019 HY 2018 Change HY 2019 HY 2018 Change Total revenue £155.3m £148.8m +4.3% Normalised EPS 16p 15p +8.9% Like-for-like revenue1 £155.2m £146.0m +6.3% Reported EPS 16p 42p (62.5)% EBITDA £45.7m £40.6m +12.5% Ordinary dividend 17p 16p +6.3% Like-for-like EBITDA1 £43.1m £40.8
Slide 20: United Kingdom
UNITED KINGDOM Reported in GBP Like-for-like in GBP (£) (£)1 Park Plaza London Park Royal 6 months ended 6 months ended 6 months ended 6 months ended 30 June 2019 30 June 2018 Change 30 June 2019 30 June 2018 Change Total revenue £95.7 million £89.6 million +6.8% £95.7 million £89.6 million +6.8% EB
Slide 21: The Netherlands
THE NETHERLANDS Reported in local currency Euros Like-for-like in local currency Euros (€) (€)1 Park Plaza Utrecht 6 months ended 6 months ended 6 months ended 6 months ended 30 June 2019 30 June 2018 Change 30 June 2019 30 June 2018 Change Total revenue €29.6 million €28.2 million +5.0% €29.6 milli
Slide 22: Germany and Hungary
GERMANY AND HUNGARY Reported in local currency Euros Like-for-like in local currency Euros (€) (€)1 Park Plaza Nuremberg 6 months ended 6 months ended 6 months ended 6 months ended 30 June 2019 30 June 2018 Change 30 June 2019 30 June 2018 Change Total revenue €16.2 million €18.0 million (10.3)% €16
Slide 23: Croatia
C R O AT I A Reported in HRK Arena One 99 Glamping 6 months ended 6 months ended 30 June 2019 30 June 2018 Change Total revenue HRK 142.7 million HRK 137.3 million +3.9% EBITDAR HRK 0.4 million HRK 5.5 million (93.6)% EBITDA HRK (4.7) million HRK 0.8 million (678.7)% Occupancy 52.7% 51.0% +170bps Av
Slide 24: Supplementary Information
S U P P L E M E N TA R Y I N F O R M AT I O N PARK PLAZA VICTORIA, AMSTERDAM ART‘OTEL AMSTERDAM PPHE Hotel Group Interim Results six months ended 30th June 2019 23
Slide 25: Consolidated Statement of Financial Position (Assets)
C O N S O L I D AT E D S TAT E M E N T O F F I N A N C I A L P O S I T I O N As at As at 30 June 31 December 2019 2018 Unaudited Audited £’000 £’000 Assets Non-current assets: Intangible assets 20,247 21,463 Property, plant and equipment 1,116,135 1,270,785 Right-of-use assets 222,204 – Investment i
Slide 26: Consolidated Statement of Financial Position (Equity and Liabilities)
C O N S O L I D AT E D S TAT E M E N T O F F I N A N C I A L P O S I T I O N As at As at 30 June 31 December 2019 2018 Unaudited Audited £’000 £’000 Equity and liabilities Equity: Issued capital – – Share premium 130,161 130,061 Treasury shares (3,636) (3,636) Foreign currency translation reserve 24
Slide 27: Consolidated Income Statement
C O N S O L I D AT E D I N C O M E S TAT E M E N T As at As at 30 June 30 June 2019 2018 Unaudited Unaudited £’000 £’000 Revenues 155,273 148,809 Operating expenses (108,767) (104,079) EBITDAR 46,506 44,730 Rental expenses (851) (4,149) EBITDA 45,655 40,581 Depreciation and amortisation (21,016) (17
Slide 28: High Quality Portfolio Independently Valued at £1.7 Billion
H I G H Q U A L I T Y P O R T F O L I O I N D E P E N D E N T LY VA L U E D AT £ 1 . 7 B I L L I O N 30 June 2019 Book value EPRA value1 Valuation yield United Kingdom properties in operation (gross) 737.1 Finance lease liabilities (191.8) Units in Park Plaza Westminster Bridge London owned by third
Slide 29: EPRA Performance Measures: Net Asset Value
EPR A PERFORMANCE MEASURES EPRA net asset value The main adjustment to the published figures included in the Group’s financial statements is the inclusion of the Group’s properties at their open market value as operational hotel assets. On this basis, all of the Group’s properties have been independ
Slide 30: EPRA Performance Measures: Earnings
EPR A PERFORMANCE MEASURES EPRA earnings The main adjustment to the published figures included in the Group’s financial statements is adding back the IFRS depreciation charge which is based on assets at historical cost and replacing it with a charge calculated as 4% of the Group’s total revenues, re
Slide 31: Re-development and Positioning Our Portfolio
RE-DEVELOPMENT AND POSITIONING OUR PORTFOLIO D E V E L O P M E N T/ R E P O S I T I O N I N G R A M P - U P T O M AT U R I T Y M AT U R E P E R F O R M A N C E O P E R AT I O N A L O P T I M I S AT I O N PA R K P L A Z A LONDON RIVERBANK PA R K P L A Z A (O C TO B ER 2 018) VICTORIA, AMSTERDAM ( J U
Slide 32: Why Istria?
Guest House Riviera Amphitheatre Boat to Venice Our Our Our Landmarks Transport Airports Hotels Resorts Campsites Marina Lighting Giants Pula International Airport Fresh food market PULA Arena Stoja Splendid Resort Campsite Horizont Resort WHY ISTRIA? Hotel Brioni Marina Park Plaza Arena Pula Park P
Slide 33: Board of Directors
B OAR D OF DIREC TOR S Eli Papouchado Boris Ivesha Daniel Kos Kevin McAuliffe Nigel Jones Dawn Morgan Kenneth Bradley Non-Executive Chairman President & Chief Financial Officer Non-Executive Deputy Non-Executive Director & Non-Executive Director Non-Executive Director Chief Executive Officer & Execu
Slide 34: Leadership Team
LEADERSHIP TEAM PPHE HOTEL GROUP A R E N A H O S P I TA L I T Y G R O U P Greg Hegarty Jaklien van Sterkenburg Robert Henke Inbar Zilberman Daniel Pedreschi Michelle Wells Reuel (“Reli”) Slonim Devansh Bakshi Arnoud Duin Chief Operating Officer Executive Vice President Executive Vice President Gener
Slide 35: Largest Shareholders
LARGEST SHAREHOLDERS NUMBER OF ISSUED SHARES (EXCLUDING TREASURY ) 42,398,188 Percentage of issued share capital Largest shareholders as at 30 June 2019 Number of shares (excluding treasury) Eli Papouchado1 13,760,260 32.45% Boris Ivesha2 4,636,974 10.94% Bank Leumi Le Israel 3,047,039 7.19% First I
Slide 36: Correspondence
CORRESPONDENCE ROBERT HENKE Executive Vice President Commercial & Corporate Affairs County Hall – Riverside Building 2nd Floor, Belvedere Road London SE1 7GP United Kingdom T. +31 (0)20 717 8603 E. info@pphe.com pphe.com PPHE Hotel Group Interim Results six months ended 30th June 2019 35