Indian Hotels Co. Ltd. · NSE:INDHOTEL
Indian Hotels — The Indian Hotels Company — Q3 FY2019-20 Earnings Presentation
48 slides from Indian Hotels's earnings presentation, Jan 31, 2020
Slide 1: Cover letter to BSE and NSE
111CI~ January 31, 2020 BSE Limited National Stock Exchange of India Limited Corporate Relationship Department Exchange Plaza 1 st Floor, New Trading Ring, Bandra Kurla Complex Rotunda Building, P. J. Towers, Bandra (E) Dalal Street, Fort, Mumbai 400 051 Mumbai - 400 001. Symbol: INDHOTEL Scrip Code
Slide 2: Global Conference Call FY 2019-20 – Q3 Results
Global Conference Call FY 2019-20 – Q3 Results 31st January, 2020
Slide 3: Financial Performance Highlights – Q3 FY 2019/20
Financial Performance Highlights – Q3 FY 2019 / 20 Revenue EBITDA EBITDA Margin PAT ₹ 1,409 cr ₹ 462 cr 32.78% ₹ 203 cr 662 5% 32% 26% bps ₹ 1,338 cr ₹ 350 cr 26.16% ₹ 162 cr *Pre-IND AS - EBITDA: ₹ 416 cr, EBITDA Margin: 29.6% (+339 bps); PAT: ₹ 214 cr 2
Slide 4: Financial Performance Highlights – 9M FY 2019/20
Financial Performance Highlights – 9M FY 2019 / 20 Revenue EBITDA EBITDA Margin PAT ₹ 3,495 cr ₹ 854 cr 24.44% ₹ 280 cr 659 5% 44% 63% bps ₹ 3,314 cr ₹ 592 cr 17.85% ₹ 172 cr *Pre-IND AS - EBITDA: ₹ 719 cr, EBITDA Margin: 20.56% (+271 bps); PAT: ₹ 310 cr 3
Slide 5: Best Q3 and 9 Months Financial Performance in a Decade
Best Q3 and 9 Months Financial Performance in a Decade Particulars – Q3 2019/20 2018/19 2017/18 2016/17 2015/16 2014/15 2013/14 2012/13 2011/12 2010/11 Revenue 1,409 1,338 1,217 1,146 1,185 1,235 1,169 1,074 1,027 838 EBITDA 462 350 300 280 274 266 247 223 225 194 EBITDA Margin (%) 32.8% 26.2% 24.7%
Slide 6: Aided by Revival of Indian Hospitality
Aided by Revival of Indian Hospitality 5
Slide 7: Green Offshoots of Recovery: Reversal in Demand vs Supply Growth Trend
Green Offshoots of Recovery: Reversal in Demand vs Supply Growth Trend Demand Growth Supply Growth 4.9% 4.7% 4.2% 4.1% 3.3% 3.3% 3.1% 3.0% 3.1% 3.0% 3.1% 2.9% 2.5% 2.5% Q1 FY 2018/19 Q2 FY 2018/19 Q3 FY 2018/19 Q4 FY 2018/19 Q1 FY 2019/20 Q2 FY 2019/20 Q3 FY 2019/20 Source: STR Global, All figures r
Slide 8: Green Offshoots of Recovery: Industry RevPAR Growth Back on Track
Green Offshoots of Recovery: Industry RevPAR Growth Back on Track 6.0% 5.5% 2.9% 2.7% 2.5% 1.8% 1.9% 0Q1 FY 2018/19 1 Q2 FY 2018/19 2 Q3 FY 2018/19 3 Q4 FY 2018/19 4 Q1 FY 2019/20 5 Q2 FY 2019/20 Q3 FY 2019/206 Source: STR Global, All figures revised as per latest data refresh by STR 7
Slide 9: Aspiration to Execution: Key Highlights
Aspiration to Execution: Key Highlights 8
Slide 10: Aspiration 2022
Aspiration 2022 15 NEW PROJECTS EVERY YEAR 8% EBITDA MARGIN EXPANSION 50-50 PORTFOLIO 9
Slide 11: All-time High Hotel Signings
GROWTH REVENUE PROFITABLIITY All-time High Hotel Signings New Hotels Signed 24 22 14 5 FY 2016/17 FY 2017/18 FY 2018/19 YTD 2019/20 #Rooms 1,174 468 3,118 2,804 10
Slide 12: Significant Growth in Portfolio – Asset Light
GROWTH REVENUE PROFITABLIITY Significant Growth in Portfolio – Asset Light #Hotels #Rooms 197 179 155 160 24,223 22,231 18,965 18,361 March 2017 March 2018 March 2019 Jan 2020 Mgmt. % 31% 32% 39% 42% *Including Pipeline 11
Slide 13: Opened One Hotel a Month in 2019, to Open More in 2020
GROWTH REVENUE PROFITABLIITY Opened One Hotel a Month in 2019, to Open More than One Hotel a Month in 2020 New Hotels Opened in 2019 Hotels Rooms Taj 5 662 9 Hotels Opened SeleQtions 1 207 in the First Vivanta 1 110 9 months of Ginger 5 428 FY 2019/20 Total 12 1,407 Total Pipeline by Brand Hotels Ro
Slide 14: Higher Q3 RevPAR growth compared to industry
GROWTH REVENUE PROFITABLIITY Higher Q3 RevPAR growth compared to industry – 18/19 & 19/20 Industry IHCL Network 5.6% 5.5% 3.6% 1.8% Q3 2018/19 Q3 2019/20 *IHCL RevPAR growth on same store basis 13
Slide 15: Q3 RevPAR Growth in Key Cities
GROWTH REVENUE PROFITABLIITY Q3 RevPAR Growth in Key Cities +8% +7% +10% +9% +10% Mumbai New Delhi Chennai Hyderabad Bangalore *Network Same Store 14
Slide 16: Creating Alternate Revenue Streams
GROWTH REVENUE PROFITABLIITY Creating Alternate Revenue Streams S. M. A. R. T. Asset SMART Growth Strategy 200+ Additions, ₹ 30 Cr Incr. Revenue 9M Management fees ₹ 163 Cr (+7%) Focus on F&B – Scale & Synergy Launched and Scaling Up Launching Soon in Bengaluru 13 Bungalows operational 15
Slide 17: Ginger Achieves a Key Milestone
GROWTH REVENUE PROFITABLIITY Ginger Achieves a Key Milestone 50 Hotels ~4,500 Keys 35 Locations Across India 16
Slide 18: Lean Luxe Delivering Results for Ginger
GROWTH REVENUE PROFITABLIITY Lean Luxe Delivering Results for Ginger 20% Lean Luxe Today 26% 7.4% 4.27 Growth in Q3 ARR for RevPAR Growth Highest Trip Advisor Lean Luxe Portfolio in 9M FY 19/20 Score 50% Lean Luxe by Mar ‘21 17
Slide 19: Continuous Improvement in Operating Cost Base
GROWTH REVENUE PROFITABLIITY Continuous Improvement in Operating Cost Base Raw Material Cost Payroll Cost 23.6% 34.9% 23.3% 22.5% 34.2% 33.4% 21.6% 33.1% 9M 2016/17 9M 2017/18 9M 2018/19 9M 2019/20 9M 2016/17 9M 2017/18 9M 2018/19 9M 2019/20 Fuel, Power and Light Other Expenditure 6.6% 6.6% 29.2% 28
Slide 20: Continuing our Journey of EBITDA Margin Expansion
GROWTH REVENUE PROFITABLIITY Continuing our Journey of EBITDA Margin Expansion EBITDA Margin Expansion 728 Launch of Aspiration 2022 662 585 458 405 230 183 148 Q4 2017/18 Q1 2018/19 Q2 2018/19 Q3 2018/19 Q4 2018/19 Q1 2019/20 Q2 2019/20 Q3 2019/20 Margin Expansion in Basis Points *EBITDA Margin Exp
Slide 21: Summary: Strong performance exhibited across parameters
Summary: Strong performance exhibited across parameters • Highest number of Hotels signed in any Financial Year ever • Significant Growth in Portfolio – Asset Light • Opened One Hotel a Month in 2019, to Open More than One Hotel a Month in 2020 • Higher Q3 RevPAR growth compared to industry – 18/19
Slide 22: Financial Update
FINANCIAL UPDATE Giridhar Sanjeevi, Chief Financial Officer 21
Slide 23: Consolidated – Reported P&L Statement – Q3 2019/20
Consolidated – Reported P&L Statement (Post Ind AS) – Q3 2019/20 ₹ /crores Q3 Particulars 2019/20 2018/19 Growth Vs PY Revenue from Operations 1,373 1,323 4% Non Operating Revenue 36 15 149% Total Revenue 1,409 1,338 5% Total Expenditure 947 988 -4% EBITDA 462 350 32% EBITDA Margin 32.78% 26.16% 662
Slide 24: Consolidated Exceptional Items - Q3 2019/20
Consolidated Exceptional Items - Q3 2019/20 ₹ /crores Particulars 2019/20 2018/19 Var. Change in fair value of derivative contracts (1) 41 (42) Total (1) 41 (42) Gain on Sale of Flats included in Non Operating Revenue 30 - 30 23
Slide 25: Consolidated – Reported P&L Statement – 9M 2019/20
Consolidated – Reported P&L Statement (Post Ind AS) – 9M 2019/20 ₹ /crores 9M Particulars 2019/20 2018/19 Growth Vs PY Revenue from Operations 3,400 3,268 4% Non Operating Revenue 94 46 104% Total Revenue 3,495 3,314 5% Total Expenditure 2,641 2,722 -3% EBITDA 854 592 44% EBITDA Margin 24.44% 17.85%
Slide 26: Consolidated Exceptional Items – 9M 2019/20
Consolidated Exceptional Items – 9M 2019/20 ₹ /crores Particulars 2019/20 2018/19 Var. Change in fair value of derivative contracts (1) (56) 55 Profit on sale of TMFK shares 2 - 2 Boston Lease Modification Income 0 48 (48) Total 1 (8) 9 Gain on Sale of Flats included in Non Operating Revenue 62 - 62
Slide 27: IHCL Network Revenue – Q3 2019/20
IHCL Network Revenue – Q3 2019/20 Domestic (₹ / Crores) International ($ Ml) Particulars Growth over PY Growth over PY CY PY CY PY % % F & B Revenue 664 619 7.1% 28 32 -10.4% Room Revenue 733 659 11.3% 39 41 -4.9% RevPAR* ₹ 7,224 ₹ 6,841 5.6% $ 231 $ 241 -4.2% *RevPAR is for Same Store No of Hotels:
Slide 28: IHCL Network Revenue – 9M 2019/20
IHCL Network Revenue – 9M 2019/20 Domestic (₹ / Crores) International ($ Ml) Particulars Growth over PY Growth over PY CY PY CY PY % % F & B Revenue 1,602 1,534 4.4% 72 76 -4.9% Room Revenue 1,703 1,570 8.5% 107 108 -0.3% RevPAR* ₹ 5,635 ₹ 5,458 3.3% $ 212 $ 211 0.3% *RevPAR is for Same Store No of
Slide 29: Standalone Financial Highlights – Q3 FY 2019/20
Standalone Financial Highlights – Q3 FY 2019 / 20 Revenue EBITDA EBITDA Margin PAT ₹ 890 cr ₹ 353 cr 39.61% ₹ 168 cr 602 9% 29% 22% bps ₹ 816 cr ₹ 274 cr 33.59% ₹ 138 cr 28
Slide 30: Standalone – Reported P&L Statement – Q3 2019/20
Standalone – Reported P&L Statement (Post Ind AS) – Q3 2019/20 ₹ /crores Q3 Particulars 2019/20 2018/19 Growth Vs PY Revenue from Operations 855 803 6% Non Operating Revenue 36 13 164% Total Revenue 890 816 9% Total Operating Expenditure 538 542 -1% EBITDA 353 274 29% EBITDA Margin 39.61% 33.59% 602
Slide 31: Standalone Exceptional Items – Q3 2019/20
Standalone Exceptional Items – Q3 2019/20 ₹ /crores Particulars 2019/20 2018/19 Var. Change in fair value of derivative contracts (1) 41 (42) Total (1) 41 (42) Gain on Sale of Flats included in Non Operating Revenue 30 - 30 30
Slide 32: Standalone Financial Highlights – 9M FY 2019/20
Standalone Financial Highlights – 9M FY 2019 / 20 Revenue EBITDA EBITDA Margin PAT ₹ 2,124 cr ₹ 646 cr 30.43% ₹ 309 cr 569 6% 31% 213% bps ₹ 1,996 cr ₹ 494 cr 24.73% ₹ 99 cr 31
Slide 33: Standalone – Reported P&L Statement – 9M 2019/20
Standalone – Reported P&L Statement (Post Ind AS) – 9M 2019/20 ₹ /crores 9M Particulars 2019/20 2018/19 Growth Vs PY Revenue from Operations 2025 1937 5% Non Operating Revenue 99 59 67% Total Revenue 2124 1996 6% Total Operating Expenditure 1478 1503 -2% EBITDA 646 494 31% EBITDA Margin 30.43% 24.73
Slide 34: Standalone Exceptional Items – 9M 2019/20
Standalone Exceptional Items – 9M 2019/20 ₹ /crores Particulars 2019/20 2018/19 Var. Change in fair value of derivative contracts (1) (55) 54 Profit on sale of TMFK shares 21 - 21 Provision for impairment of investment in Pierre that incurred cash (27) (32) 5 losses Total (7) (87) 80 Gain on Sale of
Slide 35: Cost Optimization – 9M 2019/20
Cost Optimization – 9M 2019/20 Corporate Overheads as a % of Revenue Raw Mat. Costs as a % of F&B Revenue 7.7% 2018/19 22.5% 2018/19 6.8% 2019/20 21.6% 2019/20 HLP Costs as a % of Revenue Payroll Costs as a % of Revenue 6.4% 2018/19 33.4% 2018/19 6.2% 2019/20 33.1% 2019/20 *All Percentages of Consol
Slide 36: Unlocking value through Simplification and Monetization
Unlocking value through Simplification and Monetization Sale of Land Sale of Residential Apartments Simplification Land in Pune - ₹ 63 crore 18 Apartments Sale proceeds – ₹ 29.8 crore ₹ 73.2 crore sale proceeds 35
Slide 37: Continuous Improvement in Net Debt / EBITDA and Net Debt / Equity
Continuous Improvement in Net Debt / EBITDA and Net Debt / Equity 1.65 1.25 6.47 0.45 0.37 0.34 4.74 2.58 2.11 1.76 Mar 2016 Mar 2017 Mar 2018 Mar 2019 Dec 2019 Net Debt to EBITDA Net Debt to Equity *Trailing Twelve Months Basis **Net Debt, EBITDA on Pre IND AS basis 36
Slide 38: Debt Position
Debt Position ₹ /crores Standalone Consolidated Particulars December December March 31, December December March 31, 31, 2019 31, 2019 2019 31, 2019 31, 2019 2019 (Post Ind AS) (Pre Ind AS) (Post Ind AS) (Pre Ind AS) Gross Debt 1,708 1,708 1,784 2,269 2,269 2,326 Liquidity -269 -269 -282 -434 -434 -4
Slide 39: Q&A
Q&A 38
Slide 40: Disclaimer
Disclaimer These presentations may contain forward-looking statements within the meaning of applicable securities laws. Similarly, statements that describe our business strategy, outlook, objectives, plans, intentions or goals also are forward-looking statements. Forward-looking statements are not g
Slide 41: Annexure
40 Annexure INCL
Slide 42: Consolidated P&L – Q3 2019/20
Consolidated P&L – Q3 2019/20 ₹ /crores 2019/20 2019/20 2018/19 Growth % Particulars Post Ind AS Pre Ind AS (Pre Ind AS) Revenue 1,409 1,409 1,338 5% Operating Expenses 947 992 988 0% EBITDA 462 416 350 19% EBITDA Margin 32.78% 29.56% 26.16% 339 bps Depreciation 101 83 83 0% Interest 85 45 49 -9% Pr
Slide 43: Consolidated P&L – 9M 2019/20
Consolidated P&L – 9M 2019/20 ₹ /crores 2019/20 2019/20 2018/19 Growth % Particulars Post Ind AS Pre Ind AS (Pre Ind AS) Revenue 3,495 3,495 3,314 5% Operating Expenses 2,641 2,776 2,722 2% EBITDA 854 719 592 21% EBITDA Margin 24.44% 20.56% 17.85% 271 bps Depreciation 301 250 243 3% Interest 256 137
Slide 44: Standalone P&L – Q3 2019/20
Standalone P&L – Q3 2019/20 ₹ /crores 2019/20 2019/20 2018/19 Growth % Particulars Post Ind AS Pre Ind AS (Pre Ind AS) Revenue 890 890 816 9% Operating Expenses 538 559 542 3% EBITDA 353 331 274 21% EBITDA Margin 39.61% 37.20% 33.59% 361 bps Depreciation 51 43 43 0% Interest 59 39 40 -2% Profit Befo
Slide 45: Standalone P&L – 9M 2019/20
Standalone P&L – 9M 2019/20 ₹ /crores 2019/20 2019/20 2018/19 Growth % Particulars Post Ind AS Pre Ind AS (Pre Ind AS) Revenue 2124 2124 1996 6% Operating Expenses 1478 1542 1503 3% EBITDA 646 582 494 18% EBITDA Margin 30.43% 27.39% 24.73% 266 bps Depreciation 152 130 125 4% Interest 178 120 119 1%
Slide 46: Our Operational Portfolio
Our Operational Portfolio Inventory by Geography Inventory by Contract Type Intl, 2654 Management Contracts, 5538 Group Companies, 8635 Dom, 15942 Holding Company, 4423 Group Companies Holding Company Dom Intl Management Contracts As of 31st January 2020, IHCL has 157 hotels with 18,596 Rooms 45
Slide 47: Group Major Companies
Group Major Companies Effective Effective Company Name Company Name Holding % Holding % Subsidiaries Joint Ventures Piem Hotels Ltd 51.57 Taj SATS Air Catering Ltd 51.00 Benares Hotels Ltd 51.68 Taj GVK Hotels & Resorts Ltd 25.52 United Hotels Ltd 55.00 Taj Kerala Hotels & Resorts Ltd 28.30 Roots Co
Slide 48: Awards and Accolades continue to reinforce our direction
Awards and Accolades continue to reinforce our direction 47
The Indian Hotels Company — Q3 FY2019-20 Earnings Presentation on 6ix