Slide 1: Lemon Tree Hotels Limited Q2 FY20 Earnings Presentation
Lemon Tree Hotels Limited Q2 FY20 Earnings Presentation Nov 13, 2019
Slide 2: 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 3: Table of Contents
Table of Contents 1 Company Overview 2 Chairman & Managing Director’s Message 3 Performance Highlights 4 Financial & Operational Metrics 5 Key Developments / Business Updates 6 Annexures 3
Slide 4: Lemon Tree – Snapshot as on 1st Nov, 2019
Lemon Tree – Snapshot as on 1st Nov, 2019 Current (16% of Branded Pipeline By CY21 (20% of Branded Mid Market Hotels in India*) Mid Market Hotels in India*) 7,786 2,784 10,570 rooms; rooms; rooms; 77 hotels 28 hotels 105 hotels Brand Current Pipeline by CY21 Aurika 139 Rooms, 1 Hotel 669 Rooms, 1 Ho
Slide 5: Lemon Tree – Portfolio
Lemon Tree – Portfolio Key Statistics Q2 FY19 Q2 FY20 1st Nov FY20 Cities 31 34 45 Hotels 51 57 77 Rooms 5,090 5,828 7,786 Loyalty 835,732 1,072,977 1,091,326 Members 5
Slide 6: Portfolio Breakup as on 30th September, 2019
Portfolio Breakup as on 30th September, 2019 Operational Portfolio Owned Leased Managed Total 30.09.2019 Hotels Rooms Hotels Rooms Hotels Rooms Hotels Rooms Lemon Tree Premier 6 1300 2 161 5 539 13 2,000 Lemon Tree Hotels 13 1241 4 321 16 944 33 2,506 Red Fox Hotels 5 759 2 193 4 370 11 1,322 Total
Slide 7: Strategically positioned in key geographies with Lemon Tree share of mid-priced hotel sector
Strategically positioned in key geographies with Lemon Tree share of total mid- priced hotel sector Geographical spread across India and presence in key markets to Jaipur: FY17 – 11% Delhi NCR: FY17 – 14% cater effectively to corporate FY21E – 16% FY21E – 10% clients and business travelers Hotel
Slide 8: Chairman & Managing Director’s Message
Chairman & Managing Director’s Message Commenting on the performance for Q2 FY20, Mr. Patanjali Keswani, Chairman & Managing Director – Lemon Tree Hotels Limited said, “We have registered a healthy performance during the quarter despite a subdued macro environment. Our Revenue from operations and EB
Slide 9: Performance Highlights – Operational Metrics (Consolidated)
Performance Highlights – Operational Metrics (Consolidated) Operational Inventory Owned/Leased rooms Managed rooms Total rooms Average Daily Rate (Rs.) 5,828 4.9% 4,133 3.8% 5,411 4,070 4,999 3,939 3,919 3,975 3,278 3,570 1,721 1,841 1,853 End of Q2 FY19 FY19 Q2 FY20 Q2 FY19 FY19 Q2 FY20 Q2 FY19 FY1
Slide 10: Performance Highlights – Financial Metrics (Consolidated)
Performance Highlights – Financial Metrics (Consolidated) Revenue from Operation (Rs. Crores) EBITDA (Rs. Crores) 93 14.9% 294 31.6% 256 71 18.7% 34.5% 48 153 36 129 Q2 FY19 Q2 FY20 H1 FY19 H1 FY20 Q2 FY19 Q2 FY20 H1 FY19 H1 FY20 Cash profit (Rs. Crores) PAT (Rs. Crores) -4.9% 9 35 33 7 -11.1% 20 18
Slide 11: Profit & Loss Statement (Consolidated)
Profit & Loss Statement (Consolidated) Q2 FY20 YoY Change Q2 FY20 YoY Change Rs. Cr Q2 FY19 Before IndAS After IndAS 116 FY19 116 Impact (%) Impact (%) Revenue from operations 128.7 152.8 18.7% 152.8 18.7% 549.5 Cost of F&B consumed 11.9 13.2 11.7% 13.2 11.7% 49.8 Employee benefit expenses 29.6 36.6
Slide 12: Profit & Loss Statement (Consolidated)
Profit & Loss Statement (Consolidated) H1 FY20 YoY Change H1 FY20 YoY Change Rs. Cr H1 FY19 Before IndAS After IndAS 116 FY19 116 Impact (%) Impact (%) Revenue from operations 255.6 293.7 14.9% 293.7 14.9% 549.5 Cost of F&B consumed 23.8 25.6 7.7% 25.6 7.7% 49.8 Employee benefit expenses 58.7 70.4 1
Slide 13: Balance Sheet Snapshot (Consolidated)
Balance Sheet Snapshot (Consolidated) Rs. Cr H1 FY19 H1 FY20 FY18 FY19 Shareholder's Funds 827.1 824.7 814.8 875.0 Non-controlling interests 429.4 430.9 428.6 432.2 Total Shareholder’s equity 1,256.5 1,255.6 1,243.5 1,307.2 Total Debt 1,107.3 1,334.9 1,011.0 1,204.2 Other Non-current liabilities 38.
Slide 14: Discussion on Consolidated Financial & Operational Performance – Q2 FY20
Discussion on Consolidated Financial & Operational Performance – Q2 FY20 As of 1st November 2019, operational portfolio comprised of 77 hotels and 7,786 rooms : 3,646 owned, 1,546 leased and 2,594 Operational managed rooms; Pipeline includes of 656 owned/leased and 2,056 managed rooms Rooms & Pr
Slide 15: Impact of Ind AS 116 on Consolidated Q2FY20 Results
Impact of Ind AS 116 on Consolidated Q2FY20 Results Profit and Loss Statement Impact (In Rs. Crores) Before Ind AS 116 Ind AS 116 Impact After Ind AS 116 Lease Rent 8.9 (6.8) 2.1 Other Expenses 37.5 (1.2) 36.3 EBITDA 40.4 8.0 48.4 Interest Expense 26.3 9.0 35.3 Depreciation 16.1 3.4 19.6 Profit Befo
Slide 16: Impact of Ind AS on LHTL Q2FY20 Results as Waterfall
Impact of Ind AS 116 on LHTL Q2FY20 Results as Waterfall EBITDA Waterfall Lease Waterfall 60.0 10.0 9.0 50.0 8.0 1.4 8.0 40.0 7.0 EBITDA Rs Crs EBITDA Rs Crs 7.0 6.0 30.0 6.8 5.0 48.4 4.0 7.5 20.0 7.3 36.0 33.4 3.0 10.0 2.0 1.0 2.1 0.0 0.0 Q2FY19 Q2 FY20 Same New Hotels Lease Total Q2FY20 Store (DN,
Slide 17: Operational Performance by Brands & Region – Q2FY20 vs. Q2FY19
Operational Performance by Brands & Region – Q2FY20 vs. Q2FY19 Q2 FY20 vs. Q2 FY19 Hotel level EBITDAR/room (Rs. Parameters Occupancy Rate (%) Average Daily Rate (Rs.) Hotel level EBITDAR Margin Lacs) Change Change Change By Brand Q2 FY19 Q2 FY20 (bps) Q2 FY19 Q2 FY20 (%) Q2 FY19 Q2 FY20 Change (%)
Slide 18: 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 Apr-21 100.00% Lemon Tree Vembanad Lake Resort, Alleppey, Owned 10 Oct-21 100.00% Kerela1 Aurika, Intl. Airport, Mumbai2 Owned 669 Nov-21 57.
Slide 19: Expansion Plans – Pipeline of Management Contracts
Expansion Plans – Pipeline of Management Contracts (as of 1st November , 2019) Management Contracts Pipeline Rooms Expected Opening date Tenure (years) Red Fox Hotel, Vijaywada 90 Dec-19 10 Lemon Tree Premier, Rishikesh 66 Jan-20 12 Lemon Tree Hotel, Dubai 114 Jan-20 10 Lemon Tree Hotel, Thimpu 27 J
Slide 20: Annexures
kena ANNEXURES
Slide 21: Strong operating performance
TBA Strong operating performance Rooms are being added… …and occupancy levels increasing… Owned Leased Hotels Managed Hotels FY15 FY16 FY17 FY18 FY19 19% 5,411 4,870 1841 3,249 3,698 1593 78% 78% 77% 79% 78% 2,708 3,001 77% 77% 274 461 843 573 75% 74% 75% 73% 74% 171 481 1,920 283 283 317 283 283 2,
Slide 22: 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 20% 5,495 31.9% 27.9% 29.7% 29.3% 4,843 4,121 3,680 2,904 17.8% 2,217 11.0% 246 519 1,033 1,247 1,440 1,787 FY
Slide 23: 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 24: Indian hotel industry is at an inflection point
Indian hotel industry is at an inflection point Slowing supply and rising demand is expected to increase occupancy No. of rooms in ‘000s Occupancy (%) Rooms demand per day ('000) Rooms supply per day ('000) Occupancy 200 85% Demand Demand 10.8% 15.1% Demand 14.1% Demand 11.6% Supply 14.9%
Slide 25: Increasing occupancy leading to increase in room rates
Increasing occupancy leading to increase in room rates Average Daily Rate (ADR) is increasing with increase in occupancy rates ADR (INR) Occupancy % 9,000 71% 69% 68% 67% 8,000 67% 66% 65% 7,543 63% 7,000 63% 60% 59% 59% 59% 5,768 5,973 6,000 59% 58% 58% 57% 5,000 55% FY07 FY08 FY09 FY10 FY11 FY12 F
Slide 26: Mid-priced hotel sector expected to have higher demand supply gap
Mid-priced hotel sector expected to have higher demand supply gap resulting in higher growth in occupancy Mid-priced hotel sector expected to continue having higher demand-supply gap leading to… Demand Growth Supply Growth Demand Supply Gap FY12-17 FY17-21 19% 19% 16% 16% 15% 12% 12% 12% 13% 11% 8%
Slide 27: Conference Call Details
Conference Call Details Lemon Tree Hotels Limited (LTH) Q2 FY20 Earnings Conference Call Time • 5:00 PM IST on Wednesday, November 13, 2019 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) Internat
Slide 28: 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