IHI report improved performance
Also on August 30, the board of directors of International Hotel Investments plc approved for publication the half-yearly financial statements as at June 30, 2007.During the first six months of 2007, total revenue generated by the IHI Group amounted to...
Also on August 30, the board of directors of International Hotel Investments plc approved for publication the half-yearly financial statements as at June 30, 2007.
During the first six months of 2007, total revenue generated by the IHI Group amounted to €38.8 million, representing a 39 per cent increase over the same period last year. This increase resulted from improved turnover levels across all the group's hotels with the Corinthia San Gorg Hotel in Malta and the Corinthia Lisboa Hotel in Portugal registering the strongest growth rates of 45 per cent and 14 per cent respectively. The inclusion of CHI Ltd as a group subsidiary as from October 2006 also helped to increase IHI's revenue compared to last year. Moreover, as from June 1, 2007, IHI acquired the Corinthia Bab Africa Hotel and Commercial Centre in Libya and the Corinthia Towers Hotel in the Czech Republic which also contributed to the group's turnover.
Although direct costs increased by 40 per cent to €25.3 million, the IHI Group's gross profit climbed by 36.8 per cent to €13.5 million in the first half of the year. Operating costs rose by 6.2 per cent during the period under review to €9.3 million resulting in a group operating profit of €4.2 million compared to only €1.1 million in the first half of 2006.
Earnings before interest, tax, depreciation and amortisation (EBITDA) of €10.1 million in the first six months of 2007 represents a 75 per cent increase from same period last year with the EBITDA margin improving to 26.1 per cent (June 2006: 20.7 per cent).
Net financing costs increased to €5.9 million following a hike in interest rates as well as the additional debt from the acquisition of the two hotels in Libya and the Czech Republic.
The IHI Group incurred a loss before tax of €1.6 million compared to the loss of €3.3 million during the comparative period. After accounting for taxation and the profit attributable to minority interests, the group's loss for the first half of 2007 amounted to €2.2 million. The minority interest refers to Wyndham's 30 per cent equity stake in CHI Ltd, with the balance of 70 per cent held by IHI. In the half-yearly report the directors stated that had the recently acquired properties been included in the group's financial statements as from January 1, 2007, IHI would have generated a profit of €1.3 million during the first half of the year.
Total assets of the IHI Group climbed to €886.9 million as at June 30, 2007 following the acquisition of the hotels in Libya and Czech Republic. Shareholders' funds increased to €478.5 million reflecting the issue of 192 million shares to Corinthia Palace Hotel Co. Ltd as part consideration for the acquisition of the new hotels and the issue of 105 million shares to Istithmar hotels FZE of Dubai. A further 73 million shares were to be allotted to Istithmar by the end of August 2007 in terms of the Share Subscription Agreement. This will increase the group's shareholders' funds by another €73 million to €551.5 million with a similar increase in the issued share capital to 537,099,977 shares. The net asset value per share will amount to €1.03.
Following the cash injection of €178 million by Istithmar, IHI will be increasing its borrowings in order to purchase up to an additional five hotels, thus bringing the group's total hotel portfolio to 11 properties. The company is reportedly currently reviewing a number of properties mainly in Central and Eastern Europe.
During a stockbrokers' meeting with the Company held on May 14, 2007 IHI's executives explained that discussions are being held with a number of property owners in Russia, Poland, Ukraine and Kazakhstan. IHI is also seeking to invest in a developed market such as London or Paris in order to balance the overall risk profile of its hotel portfolio and improve CHI's brand image following its agreement with Wyndham Hotel Group.
The directors noted in the half-yearly report that the addition of the Corinthia Bab Africa Hotel and Commercial Centre in Libya and the Corinthia Towers Hotel in the Czech Republic should have a significant positive impact on the group's results during the second half of the year. Moreover the other four hotels are also expected to register an improvement over 2006 notwithstanding the current extension of the Nevskij Palace Hotel and the refurbishment of 248 rooms of the Corinthia Lisboa Hotel in Portugal. In the recent shareholder circular it was revealed that the directors estimate a group pre-tax profit of €3.1 million in 2007 compared to a pre-tax loss of €10.7 million incurred in 2006.
During the first six months of 2007, total revenue generated by the IHI Group amounted to €38.8 million, representing a 39 per cent increase over the same period last year. This increase resulted from improved turnover levels across all the group's hotels with the Corinthia San Gorg Hotel in Malta and the Corinthia Lisboa Hotel in Portugal registering the strongest growth rates of 45 per cent and 14 per cent respectively. The inclusion of CHI Ltd as a group subsidiary as from October 2006 also helped to increase IHI's revenue compared to last year. Moreover, as from June 1, 2007, IHI acquired the Corinthia Bab Africa Hotel and Commercial Centre in Libya and the Corinthia Towers Hotel in the Czech Republic which also contributed to the group's turnover.
Although direct costs increased by 40 per cent to €25.3 million, the IHI Group's gross profit climbed by 36.8 per cent to €13.5 million in the first half of the year. Operating costs rose by 6.2 per cent during the period under review to €9.3 million resulting in a group operating profit of €4.2 million compared to only €1.1 million in the first half of 2006.
Earnings before interest, tax, depreciation and amortisation (EBITDA) of €10.1 million in the first six months of 2007 represents a 75 per cent increase from same period last year with the EBITDA margin improving to 26.1 per cent (June 2006: 20.7 per cent).
Net financing costs increased to €5.9 million following a hike in interest rates as well as the additional debt from the acquisition of the two hotels in Libya and the Czech Republic.
The IHI Group incurred a loss before tax of €1.6 million compared to the loss of €3.3 million during the comparative period. After accounting for taxation and the profit attributable to minority interests, the group's loss for the first half of 2007 amounted to €2.2 million. The minority interest refers to Wyndham's 30 per cent equity stake in CHI Ltd, with the balance of 70 per cent held by IHI. In the half-yearly report the directors stated that had the recently acquired properties been included in the group's financial statements as from January 1, 2007, IHI would have generated a profit of €1.3 million during the first half of the year.
Total assets of the IHI Group climbed to €886.9 million as at June 30, 2007 following the acquisition of the hotels in Libya and Czech Republic. Shareholders' funds increased to €478.5 million reflecting the issue of 192 million shares to Corinthia Palace Hotel Co. Ltd as part consideration for the acquisition of the new hotels and the issue of 105 million shares to Istithmar hotels FZE of Dubai. A further 73 million shares were to be allotted to Istithmar by the end of August 2007 in terms of the Share Subscription Agreement. This will increase the group's shareholders' funds by another €73 million to €551.5 million with a similar increase in the issued share capital to 537,099,977 shares. The net asset value per share will amount to €1.03.
Following the cash injection of €178 million by Istithmar, IHI will be increasing its borrowings in order to purchase up to an additional five hotels, thus bringing the group's total hotel portfolio to 11 properties. The company is reportedly currently reviewing a number of properties mainly in Central and Eastern Europe.
During a stockbrokers' meeting with the Company held on May 14, 2007 IHI's executives explained that discussions are being held with a number of property owners in Russia, Poland, Ukraine and Kazakhstan. IHI is also seeking to invest in a developed market such as London or Paris in order to balance the overall risk profile of its hotel portfolio and improve CHI's brand image following its agreement with Wyndham Hotel Group.
The directors noted in the half-yearly report that the addition of the Corinthia Bab Africa Hotel and Commercial Centre in Libya and the Corinthia Towers Hotel in the Czech Republic should have a significant positive impact on the group's results during the second half of the year. Moreover the other four hotels are also expected to register an improvement over 2006 notwithstanding the current extension of the Nevskij Palace Hotel and the refurbishment of 248 rooms of the Corinthia Lisboa Hotel in Portugal. In the recent shareholder circular it was revealed that the directors estimate a group pre-tax profit of €3.1 million in 2007 compared to a pre-tax loss of €10.7 million incurred in 2006.