NH Cuts Its Losses By 59% To €17.9M In H1 2015

29 July 2015 – El Economista

The NH Hotel Group cut its losses by 59.2% during the first half of 2015 with respect to the same period in 2014, to €17.4 million, after recording positive results in the second quarter, according to its report to Spain’s National Securities Market Commission (CNMV) yesterday.

The hotel chain highlighted that its strong performance last year accelerated further during the second quarter, to generate a net profit of €11.8 million, compared with losses of €4.2 million one year ago.

These positive figures were achieved thanks to an improvement in the volume of activity and the initial results of the initiatives launched as part of the group’s five-year strategic plan. Since launching the plan, the group has completed the renovation of 27 hotels.

This situation allowed NH to generate income of €665.3 million in Q2, i.e. 8.3% more than in Q2 2014, including the sales of Grupo Royal, whose results have been consolidated with NH’s since 4 March 2015 (€643.9 million excluding them).

The company highlights the strong performance of its turnover in Spain and Italy, with increases of 7.6% and 10.3%, respectively, during the first half of the year. Similarly, it has retained control over its costs, which have grown by much less than revenues. As such EBITDA increased by 25.2% to €57.2 million, whilst recurring profits rose by 36.7% to €62.5 million (€60.3 million excluding Hoteles Royal). (…).

The company’s net consolidated debt amounted to €814.9 million at 30 June…having increased by €40.5 million with respect to the end of Q1. This increase is due mainly to investments in the repositioning and maintenance of its hotels, and a payment to the minority shareholders of Hoteles Royal.

Echenique’s departure

In addition to these results, the NH Hotel Group also announced that its non-executive President, Rodrigo Echenique, will step down within the next few months to focus on his new role at Banco Santander where he was appointed Chairmain for Spain on 30 June, and also serves as the entity’s fourth Vice-President. The change will take place once NH has found the right person to take over from him. (…).

Echenique’s departure comes despite the fact that his continuation in office was ratified very recently, specifically after the entity led by Ana Botín sold its stake in the hotel chain on 20 May. Echenique has served as the President of NH since November 2012, when he took over from Mariano Pérez Claver.

Original story: El Economista

Translation: Carmel Drake