PPHE Hotel Group Ltd on Thursday posted weaker profit in the first half of 2024 but reported a robust revenue performance, with the company targeting further growth from its development pipeline.
The Amsterdam-based international hospitality real estate company is a developer, owner, and operator of hotels and resorts.
PPHE Hotel swung to a £1.3 million pretax loss in the six months that ended June 30 from a £2.0 million pretax profit last year.
Earnings before interest, tax, depreciation, and amortisation however increased 6.7% to £48.3 million from £45.2 million.
Revenue was up 6.1% to £191.0 million from £180.0 million, with operating expenses increasing 6.0% to £141.5 million from £133.5 million.
The company raised its interim dividend by 6.3% to 17 pence per share from 16p previously.
Co-Chief Executive Officer Greg Hegarty said: ‘We are pleased to report a solid like-for-like hotel portfolio performance for the group, with record revenues following significant increases last year, and good momentum across the portfolio against a more measured travel market backdrop.’
During the half-year, like-for-like occupancy rates rose to 72% compared with 69% in the same period in 2023, but average room rates softened by 4.4% on a like-for-like basis to £152.8 from £159.6.
‘Positive like-for-like growth was achieved against a persistently challenging macroeconomic backdrop. While demand for leisure travel remained the most dominant business theme, as anticipated, the rate growth normalised in the first half of 2024, as leisure room rates moderated, and other market segments continued to increase,’ PPHE Hotel commented.
‘Corporate travel globally remained somewhat subdued but showed signs of building back towards pre-2019 levels. Nevertheless, forward booking momentum across all segments and geographies continued to be encouraging, with meetings and events performing particularly well, supporting longer-term forecasting.’
PPHE Hotel boasts a £300 million development pipeline which is near completion and expected to deliver at least £25 million of incremental Ebitda to the business.
In April the company completed the soft opening of art’otel London Hoxton, and work on the art’otel Rome Piazza Sallustio is almost finished in time for opening this winter.
A new 186-bedroom mixed use development in London’s South Bank area also secured planning approval earlier in August.
To tackle the current share price discount, a £4.0 million buyback programme launched in July and has thus far resulted in the repurchasing of 97,869 shares for £1.3 million.
PPHE Hotel shares were down 0.8% at 1,354.00 pence each in London on Thursday morning.
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