NH’s first quarter revenues up 74% thanks to higher occupancy rates
NH Hotel Group’s total revenue in the first quarter of 2023 was €407 million, 74.2% higher than in the same quarter of 2022, affected by the restrictions due to Omicron, and also 15.4% higher than in the same period of 2019.
Sustained revenue growth and disciplined operating cost control, which the company has built into its business model, are priorities to offset persistent inflationary pressure. EBITDA was €59 million, compared to €9 million in the same quarter last year and €83 million in the first three months of 2019.
The seasonal nature of the business made the first quarter of the year the weakest and, as a result, the company’s net profit was a loss of 36 million euros, an improvement of 40.9 million euros compared to the same quarter of the previous year.
During the quarter, the upturn continued in both leisure and business customers. NH’s revenue in the B2B segment was slightly higher than in 2019. NH Hotel Group expects the trend to continue in the coming months, based on strong demand for the first part of the year and good operating forecasts.
The Group’s liquidity is more than EUR 480 million, following the voluntary repayment last January of the remaining EUR 50 million of the EUR 250 million ICO loan received in the pandemic. Net financial debt amounted to EUR 340 million, an increase of EUR 33 million, due to the seasonal nature of the period and the EUR 23 million CapEx investments made in the first quarter.
Revenues in the first quarter of the year were an improvement of €173 million compared to the same period of 2022, which was impacted by Omicron. These additional comparable revenues are split between EUR 36 million more in the Spanish business unit (which includes Portugal and France), EUR 33 million more in Italy, EUR 41 million more in the Benelux countries, EUR 39 million more in the Central European countries and EUR 23 million more in the Latin American countries. Nine million euros corresponded to new hotel additions: nhow Frankfurt, NH Collection Milano CityLife, Anantara Plaza Nice and NH Collection Copenhagen.
Revenue development was particularly positive in the Southern European countries. Spain increased its comparable revenue by 32% compared to 2019, on the back of strong performance in the main and secondary cities. In Italy, comparable growth compared to 2019 was 28%, with a strong recovery in both Rome and Venice and secondary cities. In the Benelux countries, growth was 5% and in Central Europe was slightly lower due to a weak January and despite the other two months of the quarter being higher than 2019. In Latin America, revenues increased by 23% compared to the same quarter of 2019, with a particularly favourable performance in Argentina and Mexico.
Improved pricing and occupancy
On the other hand, the average daily rate (ADR) rose from €90 in the first quarter of 2022 to €115 in the same quarter of this year. The evolution was upwards month by month, from 105 euros per night in January to 115 euros per night in February and 122 euros per night in March. The progression continued in April, which closed with an ADR close to 140 euros.
The occupancy trend was also positive reaching 59.7% in the first quarter of this year, but still five percentage points lower than the first quarter of 2019. In the month of March it reached 67% and was above 70% in the month of April. This level of activity was higher in southern Europe, where it is close to 2019 levels.
Spain had an average occupancy rate of 68% in the quarter, the highest of the entire group, with an ADR of 113 euros per night. In Italy and the Benelux countries, average occupancy was 58% and 53% respectively, with the same ADR of 135 euros in both cases. In Central Europe occupancy was 56% and the ADR was EUR 105. In the Latin American countries, occupancy was 65% and the average daily rate was 80 euros.
Finally, the average revenue per available room per night (RevPar) stood at €68, compared to €36 in the same quarter a year ago, and €61 in the first quarter of 2019. On a comparable basis, between January and March this year, RevPar grew by 9% compared to the same period in 2019.
