Positive operating trend continues at NH with revenue increasing to €407 million

Madrid, 8 May 2023 – Revenue at NH Hotel Group, part of Minor Hotels, climbed to €407 million in 1Q23, up 74.2% from 1Q22, which was affected by restrictions related with the Omicron variant, and 15.4% higher than in 1Q19.

Sustained revenue growth, coupled with disciplined control over operating expenses, which the company has incorporated to its business model, are key to offset persistent inflationary pressure. First-quarter EBITDA came in at €59 million, compared to €9 million in 1Q22 and €83 million in 1Q19. Business seasonality makes the first quarter the weakest of the year, implying a recurring net loss of €36 million in 1Q23, which represents an improvement of 40.9 million euros compared to the same quarter of the previous year.

During the quarter, the recovery continued in both leisure and business segments. Revenues from the B2B segment were slightly higher than in 2019. NH Hotel Group expects its operating momentum to continue in the coming months, underpinned by strong existing demand for the first part of the year and the good outlook for the business.

Group liquidity is higher than €480 million, following last January’s voluntary repayment of the remaining €50 million of the €250 million ICO loan received in the pandemic. Net debt stood at €340 million, which represents an increase of €33 million, due to the seasonality of the quarter and €23 million of CapEx invested during the first quarter of the year.

Revenue increased by €173 million compared to 1Q22, which was affected by omicron. These additional comparable revenues are distributed as follows: €36 million in the Spanish business unit (which includes Portugal and France), €33 million in Italy, €41 million in Benelux, €39 million in Central Europe and €23 million in Latin America. New hotels – nhow Frankfurt, NH Collection Milano CityLife, Anantara Plaza Nice and NH Collection Copenhagen – contributed €9 million of incremental revenue.

Revenue growth was particularly positive in Southern European countries. Like-for Like revenue growth in Spain was 32% compared to 1Q19, thanks mainly to strong performances across main and secondary city destinations. Like-for-like growth in Italy amounted to 28% compared to 2019, underpinned by recovery in Rome and Venice, as well as in this market’s secondary cities. In the Benelux countries, said growth was 5% and Central Europe was slightly lower due to a weak month of January, even though the other two months of the quarter were higher than 2019. In Latin America, revenue was 23% above 1Q19 levels, with the performances in Argentina and Mexico standing out.

On the other hand, the average daily rate (ADR) increased from €90 in 1Q22 to €115 in 1Q23. This metric gathered momentum month after month, with ADR increasing from €105 in January to €115 in February and €122 in March. That traction continued in April, when the ADR reached c.€140.

Occupancy also improved, to 59.7% in 1Q23, still 5pp below the occupancy level in 1Q19. In March it reached 67% and was higher than 70% in April. This level of activity was greater in southern Europe, where it is close to 2019 levels.

Occupancy in Spain averaged 68% in 1Q23, the highest of the Group, and ADR was €113. In Italy and Benelux, average occupancy stood at 58% and 53%, respectively, with both units reporting an ADR of €135. In Central Europe, occupancy was 56% and ADR, €105. In Latin America, occupancy averaged 65%, with ADR reaching €80.

Lastly, revenue per available room (RevPar) amounted to €68, compared to €36 in 1Q22 and €61 in 1Q19. On a like-for-like basis, first-quarter RevPar was 9% above 1Q19 levels.