Kingdom Hotel Investments - Preliminary results announcement for Financial Year 2009

Published March 15th, 2010 - 09:20 GMT

Kingdom Hotel Investments (“KHI”), the leading emerging markets hotel investment company, today reports results for the 12 months ended 31st December 2009.

Summary financial results

 

For the 12 months period ended:

In US$ million

31 Dec

2009

31 Dec

2008

 

Growth (% vs. PY)

Revenues

$246.4m

$278.7m

(12%)

KHI EBITDA

    KHI EBITDA including Real Estate Sales

$50.3m

$51.3m

(2%)

KHI Adjusted EBITDA1

    KHI Adjusted EBITDA including Real Estate Sales

$71.4m

$94.1m

(24%)

KHI Adjusted EBITDA1

    KHI Adjusted EBITDA excluding Real Estate Sales

$61.6m

$71.1m

(13%)

Net Profit (excl. non-recurring items)

$17.3m

$36.6m

(53%)

Net Profit (reported)

$21.8m

$17.3m

27%

Net debt

$177.1m

$149.1m

19%

 

Summary

§         Group revenues decreased 12% to $246.4m in a continued tough trading environment

§         Hotel System RevPAR fell 11% (ex-forex -9%); Consolidated RevPAR fell 7% (ex-forex -6%)

§         Geographic diversification and resilience of Company’s portfolio continue to deliver benefits

§         Stringent asset management underpinned retention rates and reduced profit margin erosion

§         Defensive actions resulted in G&A savings of $6.8m resulting in G&A 30% below 2008 level

§         Balance sheet remains conservatively leveraged, with net-debt-to-equity ratio of 15%

 

Strategic & Operational Highlights

§         Company remains profitable and cash generative

§         <?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" />Sale of four assets generated $87m in value and $37m gains

§         Monetised associate investments through dividends received of $42.4m

§         Physical real estate sales of $15m; development projects proceeding to plan

§         KHI spent $181m in 2009 advancing its development projects

 

 

 

Commenting on the results, Chief Executive Officer Sarmad Zok said:

"The trading environment in 2009 remained challenging. RevPAR declines slowed in the second half of the year as the overall portfolio proved resilient and the company benefited from the diversity of our properties by both geography and market segment.  During the year we were able to realise substantial value from the sale of four assets and through the monetisation from our associate investments. 

 

Our focus on prudent asset management and cost control has enabled KHI to actively manage the business during the downturn.  We are well positioned to execute our plans for the strategic development of the portfolio during the current year and into the medium term.”

 

Outlook

  • KHI development pipeline is on track – three projects in Seychelles, Marrakesh and Accra expected to reach post construction/pre completion stage in 2010
  • KHI expects to register mid single digit growth in RevPAR during 2010, underpinned by good growth in Asia
  • The Group will selectively consider strategic acquisitions within its targets markets
  • In 2010 KHI will continue to manage the business tightly in the expectation that the current recovery in market conditions will remain slow and fragile

 

 

 


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